Carr v. American Insurance Company, Civ. A. No. 1130.

• Decision Date: 12 March 1957
• Docket Number: Civ. A. No. 1130.
• Parties: Mrs. Ann Cass CARR v. The AMERICAN INSURANCE COMPANY, the Pacific National Fire Insurance Company, Boston Insurance Company, General Adjustment Bureau, Inc.
• Court: U.S. District Court — Eastern District of Tennessee

152 F. Supp. 700

Mrs. Ann Cass CARR v. The AMERICAN INSURANCE COMPANY, the Pacific National Fire Insurance Company, Boston Insurance Company, General Adjustment Bureau, Inc.

Civ. A. No. 1130.

United States District Court E. D. Tennessee, Northeastern Division.

March 12, 1957.

Chase & Neel, Johnson City, Tenn., for plaintiff.

Thos. E. Mitchell, Johnson City, Tenn., H. Dennis Erwin, Erwin, Tenn., for defendants.

ROBERT L. TAYLOR, District Judge.

This is an action to recover an arbitration award made on account of a fire loss, which loss was covered by fire insurance policies issued by the three insurance companies listed as defendants above. Plaintiff alleges that the three policies, each in the amount of $5,000, contained a standard arbitration provision; that after the loss the determination of the amount of loss was submitted to two arbitrators, one selected by the plaintiff, the other by defendants; that the two arbitrators submitted widely divergent estimates; that the umpire appointed by a court was then called upon to settle the disagreement between the two arbitrators; that the umpire found the damage to be $8,001.51; that the arbitrator selected by the insured placed the loss at $7,983.91; that the insured waived the excess above that sum in order to conform the estimate of the umpire with that of the insured's arbitrator; that after such waiver the insured demanded payment of the insurers, which demand was rejected.

For answer defendants admit the issuance of the policies; that they covered a certain building of the insured; that a fire loss occurred about January 17, 1956.

Defendants do not deny liability for the loss but say this action is premature.

Defendants aver that the appraisers did not state separately the "actual cash value and loss to each item," as required by the arbitration provision, but submitted separately lump sum estimates of the loss.

Defendants say they have refused to make payment for the reason that the arbitration is not complete.

Plaintiff seeks an alternative relief, namely, that a decree be entered against the defendants "in such amount as the Court may find that complainant may be entitled to in the facts presented."

As to this alternative action, defendants say it is not maintainable because the controversy has been submitted to arbitration.

Defendants have filed a motion for summary judgment based upon the pleadings. The defendants say that this Court is without right to render a valid judgment on the merits because the parties agreed in writing to submit their differences to arbitration and that the arbitrators have failed to make a valid award and the suit is premature.

The basis of this contention is that the parties agreed by written contract to submit their differences to arbitration; that in accordance with the agreement the differences were submitted to arbitrators but the arbitrators have failed to make their award in accordance with the terms of the submission. One of the terms was that the appraisers should appraise the loss, stating separately the "actual cash value and loss to each item." Another, "an award, in writing so itemized, of any two when filed with this company shall determine the amount of actual cash value and loss."

The record shows that the arbitrators have failed to submit an award in writing signed by two of them and have failed to state separately the actual cash value and loss of each item.

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