Casey v. Highlands Ins. Co.

• Decision Date: 04 October 1979
• Docket Number: No. 12752,12752
• Citation: 100 Idaho 505,600 P.2d 1387
• Parties: J. A. CASEY and Harold J. Jacobs dba Modern Way Thrift, Inc., J. A. Casey and Harold J. Jacobs and Modern Way Thrift, Inc., Plaintiffs- Respondents, v. HIGHLANDS INSURANCE COMPANY, Defendant-Appellant.
• Court: Idaho Supreme Court

Page 1387

600 P.2d 1387

100 Idaho 505

J. A. CASEY and Harold J. Jacobs dba Modern Way Thrift, Inc., J. A. Casey and Harold J. Jacobs and Modern Way Thrift, Inc., Plaintiffs- Respondents, v. HIGHLANDS INSURANCE COMPANY, Defendant-Appellant.

No. 12752.

Supreme Court of Idaho.

Oct. 4, 1979.

Samuel Eismann, Coeur d'Alene, for defendant-appellant.

Winfred B. Moorer, Moscow, for plaintiffs-respondents.

DONALDSON, Chief Justice.

J. A. Casey and Harold J. Jacobs, dba Modern Way Thrift, Inc., and J. A. Casey and Harold J. Jacobs and Modern Way Thrift, Inc. (Modern Way Thrift) originally brought this action in the district court in July, 1976 to recover insurance proceeds allegedly due from defendant-appellant, Highlands Insurance Company (Highlands), under a policy issued by Highlands covering losses occurring as a result of a "safe burglary." This appeal stems from a district court order granting Modern Way Thrift's motion for summary judgment and awarding plaintiffs damages in the amount of $8,500, interest in the amount of $2,550 and costs.

In December of 1971, Modern Way Thrift obtained the comprehensive business policy of insurance in issue here from Highlands through one Phil Guilfoy of Guilfoy Insurance of Moscow, Idaho. The policy contained the following coverage relating to safe burglaries:

"Coverage C Safe Burglary:

To pay for loss of money, securities and other property from within the vault or safe by safe burglary or attempt thereat. To pay for damage to property other than money and securities, and to the premises by such safe burglary or attempt thereat, provided with respect to damage to the premises the insured is the owner thereof or is liable for such damage."

The policy went on to define "safe burglary" to mean:

". . . (1) the felonious abstraction of insured property from within a vault or safe described in the declarations and located within the premises by a person making felonious entry into such vault or such safe and any vault containing the safe, when all doors thereof are duly closed and locked by all combination locks thereon, provided such entry shall be made by actual force and violence, of which force and violence there are visible marks made by tools, explosives, electricity or chemicals upon the exterior of (a) all of said doors of such vault or such safe and any vault containing the safe, if entry is made through such doors, or (b) the top, bottom or walls of such vault or such safe and any vault containing the safe through which entry is made, if not made through such doors, or (2) the felonious abstraction of such safe from within the premises."

This same policy was in effect when the theft of $8,500 occurred from the safe in the Modern Way Thrift Store on or about July 13, 1973. The thieves apparently gained entry into the store by breaking the lock on the front door of the store. Modern Way Thrift speculates that the thieves then manipulated the safe's combination to open it and remove the money. At the time of the theft the safe was completely locked. The safe bore no visible marks made by tools, electricity, explosives or chemicals or anything else which would indicate that it was forcibly opened.

Modern Way Thrift timely filed a claim with Highlands. Highlands denied the claim as not being within the "safe burglary" provision in the policy. Modern Way Thrift then filed an action in district court which led to this appeal.

Following the filing of its answer in district court, Highlands moved for summary judgment based upon the pleadings, Modern Way Thrift's answers to requests for admissions and the affidavit of Phil Guilfoy. Modern Way Thrift filed the affidavit of Harold J. Jacobs, one of the plaintiffs, in opposition to the motion. The district judge heard arguments on the motion on June 9, 1977. Three weeks later, Modern Way Thrift moved for summary judgment. On July 13, 1977 the court issued its decision to grant Modern Way Thrift's motion, filing its findings of fact and conclusions of law a week later.

The district court concluded, apparently on the basis of the Jacobs' affidavit, that the plaintiffs believed that they were insured against losses through burglary. He concluded further that the insurance policy was ambiguous in that the words "attempt thereat" were not defined. Construing this ambiguity most strongly against Highlands, he found for the plaintiff.

The issue presented is whether the district court erred in denying Highlands' motion for summary judgment and in granting that of Modern Way Thrift, thus finding insurance coverage for safe burglary and awarding Modern Way Thrift $8,500 plus interest of $2,550.

In deciding whether the district court erred in granting Modern Way Thrift's motion for summary judgment, we decide this case on the following question of law: when a genuine issue of material fact presents itself through the pleadings, depositions admissions and affidavits of the parties involved, it is error, as a matter of law, to grant summary judgment to the moving party. Because we find that such a genuine issue of material fact existed on the matter of the alleged representations made by Highlands' agent, Guilfoy, to Modern Way Thrift, it was error to grant summary judgment to either party. We reverse the decision of the district court and remand this case for further proceedings.

Under I.R.C.P. 56(c) summary judgment should be granted only if there is no genuine issue as to any material fact after the pleadings, depositions, admissions, and affidavits have been construed in a light most favorable to the party opposing summary judgment. Salmon Rivers Sportsman Camps, Inc. v. Cessna Aircraft Co., 97 Idaho 348, 544 P.2d 306 (1975); Farmer's Ins. Co. of Idaho v. Brown, 97 Idaho 380, 544 P.2d 1150 (1976). Furthermore, summary judgment under I.R.C.P. 56(c) should be granted whenever on the basis of evidence before the court a directed verdict would be warranted or whenever reasonable men could not disagree as to the facts. Petricevich v. Salmon River Canal Company, 92 Idaho 865, 452 P.2d 362 (1969).

On appeal from an order granting summary judgment, the Supreme Court must construe the record liberally in favor of the party opposing the order and accord him the benefit of all inferences which might be reasonably drawn. Straley v. Idaho Nuclear Corp., 94 Idaho 917, 500 P.2d 218 (1972). The fact that both sides moved for summary judgment does not in itself establish that there is no genuine issue of fact. Farmers Ins. Co. of Idaho v. Brown, supra. Applying these propositions to the record in the instant case, it is clear that summary judgment for Modern Way Thrift cannot be upheld.

The district court, in its memorandum opinion, applied the "doctrine of reasonable expectations" (Corgatelli v. Globe Life & Accident Ins. Co., 96 Idaho 616, 533 P.2d 737 (1975)) to Modern Way Thrift's insurance policy and extended coverage to include the loss in dispute. It also adopted Modern Way Thrift's assertion that defendant's agent, Phil Guilfoy, caused the insured to believe that the policy in question covered Modern Way Thrift against losses sustained as a result of burglary. The court relied upon the affidavit of Harold Jacobs in reaching this conclusion.

In granting summary judgment for plaintiffs, however, the lower court overlooked the genuine factual issue of whether Highlands' agent, in fact, made any material representations to Modern Way Thrift, and if so, the nature of those representations. Since the basis of Modern Way Thrift's case is that the alleged representations of Highlands' agent created coverage under the policy, this question of fact as to the representations precludes a finding of summary judgment as a matter of law.

Plaintiff pled in paragraph V of its complaint that Phil Guilfoy acted as agent for defendant Highlands and all representations made regarding insurance coverage were made within the scope of his employment. Highlands admitted Guilfoy's status as agent but denied all other allegations in its answer. ¹ Also, at hearings on Highlands' motion for summary judgment, counsel for Highlands raised the fact that Modern Way Thrift's pleadings failed to state the precise nature of the alleged representations made by Guilfoy. The lower court mentioned this deficiency in the pleadings to Modern Way Thrift's counsel and he admitted such deficiency. The effect of this admission and of the pleadings themselves is that a genuine issue of material fact remains.

Modern Way Thrift also attempts to use the affidavit of Harold Jacobs as a means of establishing its reliance on representations allegedly made by Guilfoy, thus creating an unconscionable restriction on coverage in the policy which defeated plaintiff's reasonable expectations. However, the affidavit of Jacobs fails to allege what representations, in fact, were made. I.R.C.P. 56(e) requires that supporting affidavits for motion for summary judgment "be made on personal knowledge" and "set forth such Facts as would be admissible in evidence . . . ." (emphasis added)

In the instant case, the affidavit of Jacobs merely states "that affiant relied upon the advice and recommendations of Phil Guilfoy, the authorized agent of defendant, that affiant would be insured, by the above mentioned policy, against losses sustained as a result of burglary." The affidavit fails to specify factually what representations were made or when such statements were made and merely states a conclusion that affiant relied upon the advice of the agent. Where an affidavit merely states conclusions and does not set out facts, such supporting affidavit is inadmissible to show the absence of a genuine issue of material fact. Matthews v. New York Life Ins. Co., 92 Idaho 372, 443 P.2d 456 (1968). Accord, Openshaw v. Allstate Ins. Co., 94 Idaho 192, 484 P.2d 1032 (1971). Construing the pleadings, affidavits and admissions in a light most favorable to the defendant, there remains a material...