Castillo v. Atlanta Cas. Co.

• Decision Date: 12 June 1997
• Docket Number: No. 960532-CA,960532-CA
• Citation: 939 P.2d 1204
• Parties: 319 Utah Adv. Rep. 13 John CASTILLO and Maria Castillo, Plaintiffs and Appellants, v. ATLANTA CASUALTY COMPANY, Defendant and Appellee.
• Court: Utah Court of Appeals

Page 1204

939 P.2d 1204

319 Utah Adv. Rep. 13

John CASTILLO and Maria Castillo, Plaintiffs and Appellants, v. ATLANTA CASUALTY COMPANY, Defendant and Appellee.

No. 960532-CA.

Court of Appeals of Utah.

June 12, 1997.

Daniel L. Wilson, Ogden, for Plaintiffs and Appellants.

Robert Neeley, Ogden, for Defendant and Appellee.

Before Judges DAVIS, P.J., WILKINS, Associate P.J., and ORME, J.

OPINION

ORME, Judge:

Plaintiffs John and Maria Castillo appeal the bench trial judgment denying them consequential damages for the loss of use of their vehicle that resulted from a breach of their insurance contract with defendant insurance company. In addition, they challenge the trial court's valuation of their destroyed vehicle. With minor adjustment, we affirm.

FACTS

"[W]e consider the evidence in a light most favorable to the trial court's findings," Butler Crockett v. Pinecrest Pipeline, 909 P.2d 225, 228 (Utah 1995), and recite the facts accordingly.

Sometime in 1991, Mr. and Mrs. Castillo purchased a 1979 Toyota Celica for approximately $450. Although the vehicle was not in running condition, plaintiffs felt the vehicle was worth more than what they had paid for it.

A few years later, after getting the vehicle repaired for safe operation, plaintiffs purchased from defendant Atlanta Casualty Company a policy of liability insurance, which included coverage for uninsured motorist property damage (UMPD), in the amount of $3,500. On October 30, 1994, while Mrs. Castillo was driving her daughter to a friend's house, an uninsured motorist ran a red light and collided with plaintiffs' vehicle. The collision caused total destruction of plaintiffs' car, as well as physical injuries to Mrs. Castillo.

Approximately one week after the collision, Mrs. Castillo, pursuant to the requirements of the insurance policy, notified the insurer of the loss. It was during this notification process that the insurer misinformed plaintiffs that their policy did not include UMPD coverage, and that, as a result, the insurer would not provide compensation for the destroyed vehicle. The trial court ruled, as a matter of law, that the insurer breached the insurance contract when it erroneously denied plaintiffs' UMPD claim. This ruling is not challenged on appeal.

After being denied coverage by the insurer, plaintiffs sought the advice of an attorney who, upon investigation, determined that their policy did in fact include UMPD coverage. After the attorney's intervention, the insurer ultimately acknowledged its liability. Over the course of the next several months, plaintiffs' counsel and the insurer negotiated in an effort to settle plaintiffs' claim. No agreement concerning the value of the destroyed vehicle was ever reached, and this lawsuit resulted.

Two primary issues were before the trial court: (1) the value of the destroyed vehicle and (2) whether plaintiffs were entitled to attorney fees and loss of use damages as a consequence of the insurer's breach.

Several witnesses were called to testify regarding both issues. Mrs. Castillo testified that she primarily drove the vehicle, and that, prior to the accident, she drove the vehicle "a lot" and the car "r[a]n great." She also testified that, after the accident, she and her husband were not able to afford a replacement vehicle; that if they had had the money, they would have obtained a replacement; that because of their vehicle's loss, she had to borrow vehicles from family members and reimburse them, presumably for fuel; and that she was without transportation for the year preceding trial because a replacement was not obtained.

Mr. Castillo testified that, in his opinion, the car was worth $2,000 prior to the collision; that the car had been driven somewhere between 90,000 and 92,000 miles prior to the collision; that it was inconvenient not having their vehicle; and that he performed numerous repairs on the vehicle after its purchase, including replacing the tires and installing new brakes. Mr. Castillo also testified that, based on his inquiries of four local agencies, it would have cost at least $23 per day to rent a replacement for their destroyed car.

Plaintiffs also called Jerry Shepard, a dealer in used cars, who testified that plaintiffs' car was worth at least $1,900 and perhaps as much as $2,300 prior to the accident. He also testified that the vehicle's odometer read approximately 90,000 miles, which, in his opinion, was less than half the average mileage for a 1979 Toyota Celica still in operation in 1994.

In support of a somewhat lower value figure, the insurer called its own expert, James Gettings, an independent property damage appraiser. In relying on the National Automobile Dealers Association guidebook (NADA), Mr. Gettings testified that the car would have had a fair market value of $1,150 at most. While admitting that low mileage can be an important factor in determining a car's value, Mr. Gettings testified under cross-examination that he thought the low mileage of plaintiffs' car would not affect its value under NADA, reasoning that older cars such as plaintiffs' 1979 Toyota Celica, unlike newer cars, do not benefit in value from low mileage.

The trial court accepted Mr. Gettings's valuation, stating that his demeanor, experience, and method of valuation were more credible than that of Mr. Shepard and Mr. Castillo. Therefore, the court awarded plaintiffs $1,150, minus a $250 policy deductible, for a total of $900 for their destroyed vehicle. The trial court ruled in favor of plaintiffs on the issue of attorney fees as an element of consequential damages, but denied their request for loss of use damages. On this latter point, the trial court ruled that loss of use damages were not available, as a matter of law, because plaintiffs, albeit due to their lack of funds, did not actually rent a replacement vehicle and thus had incurred no out-of-pocket expense. Therefore, in its judgment entered on December 29, 1995, the trial court awarded plaintiffs $900 as the net value of their destroyed vehicle, $300 for attorney fees, and $280.20 for court costs, for a total judgment of $1,480.20.

ISSUES ON APPEAL

Plaintiffs raise two issues on appeal: (1) whether the trial court erred in valuing the destroyed vehicle at $1,150 and (2) whether the trial court erred in ruling, as a matter of law, that plaintiffs were not entitled to consequential damages for the loss of use of their vehicle because they did not incur any out-of-pocket expense in obtaining a replacement vehicle or in otherwise dealing with the insurer's breach.

VALUATION OF PLAINTIFFS' VEHICLE

We first decide whether the trial court erred in valuing the destroyed vehicle at $1,150. Initially, we note that our review of this issue is limited. We defer to the trial court's finding, reversing only if it is clearly erroneous. See Alta Indus. Ltd. v. Hurst, 846 P.2d 1282, 1286 (Utah 1993); Housing Auth. of Salt Lake City v. Delgado, 914 P.2d 1163, 1165 (Utah.Ct.App.1996). To succeed in their challenge to the valuation finding, plaintiffs must " 'marshal all the evidence supporting the finding and then demonstrate that the evidence is legally insufficient to support the finding[ ] even in viewing it in the light most favorable to the court below.' " Alta, 846 P.2d at 1286 (quoting Reid v. Mutual of Omaha Ins., 776 P.2d 896, 899 (Utah 1989)).

Plaintiffs contend two factors point to clear error. First, plaintiffs contend that NADA, relied upon by the insurer's expert to arrive at his valuation figure, expressly provided for an increase in value for vehicles with lower mileage, including plaintiffs' 1979 Toyota Celica, and that the insurer's expert failed to take this into consideration. Second, plaintiffs point to the trial court's Finding Number 28, which states that "it is just as reasonable that the car had [been driven] 192,000 miles" given the age of the car. Plaintiffs argue that because the evidence only supported a finding that the car had been driven 92,000 miles, the trial court was clearly in error in its valuation of the vehicle.

The only record evidence regarding the effect of low mileage on a vehicle's value under NADA was presented by the insurer's expert, Mr. Gettings. Mr. Gettings agreed that NADA treats low mileage as an important factor in determining the value of a used car, but he did not know whether an upward adjustment of fifty percent in value is required on all vehicles with low mileage. Plaintiffs' counsel then asked whether Mr. Gettings had an opinion on the effect of mileage vis-a-vis the value of a vehicle. Mr. Gettings acknowledged that low mileage had a great effect on the value of a newer vehicle, but reiterated his opinion that it had no significant effect on older model vehicles.

Plaintiffs contend on appeal, as they apparently did at trial during cross-examination of Mr. Gettings, that NADA provides for an absolute across-the-board increase in value of a car with low mileage. However, the record before us wholly fails to bear out plaintiffs' position. As stated, the only evidence on this issue was provided by Mr. Gettings, who opined that the low mileage provision in NADA applies only to vehicles of more recent vintage. Significantly, no copy of NADA or any part thereof is in the record. Indeed, even if NADA called for an across-the-board increase in value for low mileage, as plaintiffs contend, it would not foreclose Mr. Gettings from testifying that, in his professional opinion, the low mileage adjustment was properly applied only to newer vehicles. The trial court exercised its discretion in judging the credibility of Mr. Gettings and making its valuation determination accordingly. See D'Aston v. Aston, 844 P.2d 345, 355 (Utah.Ct.App.1992) ("Credibility determinations are within the sound discretion of the trial court."). See also Utah R. Civ. P. 52(a) ("[D]ue regard shall be given to the opportunity of the trial court to judge the credibility of the witnesses.").

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