Butler v. Ætna Ins. Co. of Hartford, Conn.

• Decision Date: 18 August 1934
• Docket Number: No. 6237.,6237.
• Parties: BUTLER v. ÆTNA INS. CO. OF HARTFORD, CONN.
• Court: North Dakota Supreme Court

64 N.D. 764

256 N.W. 214

BUTLER

v.ÆTNA INS. CO. OF HARTFORD, CONN.

No. 6237.

Supreme Court of North Dakota.

Aug. 18, 1934.

Syllabus by the Court.

1. While the question of value in estimating the loss under a fire insurance policy is more or less a matter for expert opinion, and testimony in that behalf may not be arbitrarily rejected or disregarded, but is to be considered in the same manner as other evidence, nevertheless the question is one of fact, and, in determining it, the jury may give such testimony weight according as it appeals to their intelligent and impartial minds, in view of all the facts and circumstances developed upon the trial and the common knowledge and experience of mankind.

2. Whether a new trial shall be granted on the ground of the insufficiency of the evidence to sustain the verdict is a matter resting largely in the discretion of the trial court, and the exercise of that discretion will not be disturbed except in case of an abuse thereof. Held, for reasons stated in the opinion, that there was no abuse of discretion in the instant case.

3. The provision in the standard form of fire insurance policy that the insurer “shall not be liable beyond the actual cash value of the property at the time any loss or damage occurs and the loss or damage shall be ascertained or estimated according to such actual cash value, with proper deduction for depreciation however caused, and shall in no event exceed what it would then cost the insured to repair or replace the same with material of like kind and quality,” is a limitation upon the insurer's liability and for his benefit. Accordingly, where the court in his instructions, and as a part thereof, read the foregoing provision, omitting, however, the clause “with proper deduction for depreciation however caused, and shall in no event exceed what it would then cost the insured to repair or replace the same with material of like kind and quality,” there was no prejudicial error.

4. A contract of fire insurance is one of indemnity whereby the insurer undertakes to make the insured whole as against such loss of the insured property as he may suffer on account of fire in an amount not exceeding that stipulated in the policy.

5. “Actual cash value,” within the meaning of that term in the standard form of fire insurance policy, is the market price of the insured property at the time of the fire, and where there is no established market the market price must be estimated at such amount as in all probability would have been arrived at by fair negotiations between an owner willing to sell and a purchaser desiring to buy, taking into account all considerations that fairly might be brought forward and reasonably given substantial weight in such bargaining.

Appeal from District Court, Sargent County; Geo. M. McKenna, Judge.

Action by Leo T. Butler against the Ætna Insurance Company of Hartford, Connecticut, to recover on account of loss under a fire insurance policy. Verdict for plaintiff. From an order denying his motion for a new trial, plaintiff appeals.

Affirmed.

A. Leslie, of Forman, Kvello & Adams, of Lisbon, and Otto L. Kaas, of Britton, S. D., for appellant.

Nilles, Oehlert & Nilles, of Fargo, for respondent.

NUESSLE, Judge.

This is an appeal from an order of the district court of Sargent county denying plaintiff's motion for a new trial.

The action was brought by the plaintiff to recover on several policies of fire insurance. The essential facts are as follows: On February 10, 1933, the plaintiff, a farmer living in Sargent county, bought a grain elevator. This elevator was situated on the railroad right of way in the little village of Straubville. It was the only elevator there. It was built in 1922 at a cost of $16,000. It was of 40,000-bushel capacity, contained 16 hopper bins, was fully equipped, and in good condition. Adjacent to it and as a part of the elevator plant was a coal shed. Plaintiff bought the elevator, together with the coal shed, equipment, and furniture therein, for $5,600. He paid $1,000 cash and gave his notes for the remainder, securing the same by chattel mortgage on the elevator. He bought from one Mrs. Lewis, who had obtained title to the elevator through foreclosure of a mortgage which she had held as security for an indebtedness of $8,000. The elevator had been but little used since 1931, as apparently not much grain was marketed in that community during that period. At the time the plaintiff bought the elevator there was outstanding a fire insurance policy covering it with loss payable to Mrs. Lewis. After the purchase this policy was reduced in amount to $5,500 and was transferred to the plaintiff. Plaintiff also at once took out additional insurance in the amount of $6,100 in four policies, one of which was directly in question in this action. On the night of April 10, the elevator proper together with its entire contents was destroyed by fire. The coal shed was not burned. The fire had an unaccountable origin. Though plaintiff had been using the office of the elevator, he had had no fire there for some time. The elevator had not been used for grain storage purposes, excepting that a small quantity of seed grain was stored therein, and none had been bought. No train had passed for many hours before the fire. A few days before the fire plaintiff removed a large safe from the office. The coal shed at the time of the fire contained some coal. The shed was valued at around $700.

The instant case was tried to a jury. The jury returned a verdict for the plaintiff and found the cash value of the elevator at the time of the fire to be $3,000. Suit had been instituted upon all of the four policies aggregating $6,100. By stipulation the three other actions were consolidated with and to abide the final result in the instant action. Under the terms of the several policies the total recovery that might be had on them was limited to the cash value of the elevator. Thus the total recovery was limited to the value found by the jury. Plaintiff moved for a new trial, urging as grounds therefor that the verdict of the jury fixing the value of the elevator at $3,000 was contrary to the evidence, and that the court erred in his instructions with respect to the method of determining the value thereof. The motion for new trial was denied. Whereupon the plaintiff perfected the instant appeal.

The plaintiff's contentions on his motion for a new trial and now on this appeal were, and are, that under the evidence in the case the jury's verdict fixing the cash value of the elevator at $3,000 was inadequate; that the uncontradicted evidence in the case shows the value was $12,000; that the defendant insurance companies had issued policies of insurance aggregating $6,100; that therefore the verdict should have been for at least that amount.

The only direct affirmative testimony as to the value of the elevator was that of the plaintiff, who testified it was worth $12,000 at the time of the fire. The plaintiff had had no experience in the elevator business and predicated his testimony as to value largely on the information he had obtained from lumbermen with respect to the cost of materials that would be required to build the elevator. In addition to the policies of insurance here involved aggregating $6,100, there was also outstanding and in effect the policy of insurance which was in effect at the time of the purchase in the reduced amount of $5,500, so that the whole amount of the outstanding policies aggregated $11,600. There is some dispute in the record as to how it came to pass that the insurance companies issued policies for this amount of coverage. The agent who issued the policies for $6,100 testified he did so pursuant to the plaintiff's statement that he had paid $12,000 for the property, and on account of other misinformation respecting the facts in the case. On the other hand, plaintiff testified that the agent was fully apprised of the amount he had agreed to pay for the elevator and that he had full information as to all the other essential facts at the time the policies were issued. But, in any event, the jury, to whom the question of value was left, found it to be $3,000.

[1][2][3] The question of value is always more or less a matter for expert opinion. In such cases the jury are not confined in their consideration of the question to testimony respecting values given by witnesses. They may take into consideration the character, age, condition of the property, its location, and the use to which it is put and the demand for such use, the profit likely to accrue therefrom, the property's salability, and all the one hundred and one other things that go to fix the value of any property. Here there was no testimony, excepting that of the plaintiff, as to the value of the property at the time of the fire, and the plaintiff's contention is largely that in such case and under such conditions, there being only the testimony of the plaintiff as to the value of the property, the jury were in effect bound by this testimony. We do not think this is so. The jury are presumed to have been men and women of reasonable intelligence and business experience. They have the right to consider, together with the plaintiff's testimony, all of the other facts and circumstances as the same appeared to them, including the apparent declining value of the elevator as shown by the fact it was erected in 1922 at a cost of $16,000, that it was permitted to be sold at mortgage foreclosure sale to satisfy a debt of $8,000, that the mortgagee thereafter sold it for $5,600, part time, part cash, and then, applying the common knowledge and experience which the jury possessed, to say what the value was. See Shuman v. Ruud, 35 N. D. 384, 160 N. W. 507;Remington v. Savage, 148 Minn. 405, 182 N. W. 524;Stovern v. Town of Calmar, 204 Iowa, 983, 216 N. W. 112;McAnarney v. Newark Fire Insurance Co., 247 N. Y. 176, 159 N. E. 902, 56 A. L. R. 1149; 22 C. J....