Dean v. Insurance Co. of North America

• Decision Date: 21 September 1983
• Docket Number: No. 4-382A53,4-382A53
• Citation: 453 N.E.2d 1187
• Parties: Franklin C. DEAN and Edna C. Dean, Appellants (Plaintiffs Below), v. INSURANCE COMPANY OF NORTH AMERICA, Appellee (Defendant Below).
• Court: Indiana Appellate Court

Page 1187

453 N.E.2d 1187

Franklin C. DEAN and Edna C. Dean, Appellants (Plaintiffs Below), v. INSURANCE COMPANY OF NORTH AMERICA, Appellee (Defendant Below).

No. 4-382A53.

Court of Appeals of Indiana,

Fourth District.

Sept. 21, 1983.

Frank E. Spencer, Indianapolis, for appellants.

Keith C. Reese, Robert C. Wolf, Rocap, Rocap, Reese & Young, Indianapolis, for appellee.

MILLER, Judge.

Plaintiffs-appellants Franklin C. and Edna C. Dean sued to recover the proceeds of a fire insurance policy issued by defendant-appellee Insurance Company of North America (INA) and punitive damages for INA's refusal to pay. The policy in question covered the Deans' northside Indianapolis home, which was substantially damaged by fire January 2, 1977. The jury, apparently accepting INA's defense of arson, found in its favor and against the Deans. The Deans now raise several issues for our consideration and, for the reasons stated below, we affirm.

ISSUES

The Deans claim the trial court erred during the course of trial:

(1) in refusing to allow the Deans to bring forth evidence regarding criminal charges (alleging the Deans filed a false proof of loss with INA) which were later dismissed;

(2) in removing the issue of punitive damages from the jury;

(3) in admitting into evidence a report prepared by an investigator from the Washington Township Fire Department which report contained derogatory information, revealed by Dean's ex-wife, regarding a fire at Franklin Dean's former home.

The Deans further claim the jury's verdict was contrary to law, insisting INA failed to sustain its burden of proof on the arson issue.

FACTS

The events leading to the Deans' discovery of the fire were related by Franklin Dean at trial. According to Dean, he, his wife and son attended an auto show at the Indiana State Fairgrounds with friends on the evening of January 1, 1977. After leaving the auto show, the group went to the friends' home, located several blocks from the Deans', where they played cards until 4 A.M. Shortly thereafter, the Deans departed, leaving their son to spend the night with their friends' son. After leaving their friends' home, the couple went to a restaurant some two to three miles distant, and stayed there about 20 to 30 minutes eating breakfast. They then left for home. However, their return was somewhat delayed because, as they followed the route homeward, Mrs. Dean saw a pair of hitchhikers and, noting the temperature was near zero, asked Dean to stop and give them a lift. According to Dean, the hitchhikers told him they were headed for Noblesville and he undertook to drive them there, with the round trip to and from Noblesville taking about one hour. Dean testified he and his wife arrived home between 6:30 and 7:00 A.M., at which time they saw smoke rising from the eaves of the house. They immediately awoke neighbors and used their phone to call the fire department, which arrived some three to four minutes later.

After the firemen had left the scene, Dean called Mrs. Joyce Bilbee Griffith, from whom the Deans were buying the home on contract. Mrs. Griffith notified her insurance agent of the fire, ¹ and the agent then contacted the Deans, telling them to get a motel room for the night and informing them an INA adjuster would visit the following day. After speaking with the adjuster, the Deans filed proofs of loss estimating damage to the structure in the amount of $33,995.65 and loss of contents at $18,078.50.

INA refused payment for the loss however, after investigators from the State Fire Marshal's office determined arson to be the cause of the blaze. Gasoline residue was discovered in two of three samples taken from debris in the home and burn patterns established the fire had been induced by accelerants. After INA refused to pay, the Deans brought the instant suit to recover the policy proceeds, asking for an additional $100,000 as a punitive award.

At trial, Dean testified he had locked the front door before leaving for the auto show and had placed a chair in front of the back door. After the fire, the chair was still in place blocking the back door and neither Dean nor the fire investigators observed any sign of forcible entry into the Deans' home. Testimony disclosed there had been several previous fires of suspicious origin in the Ravenswood area where the Deans' home was located and that a number of persons who had experienced fires were acquaintances or friends of Dean. The evidence also revealed the Deans had been trying unsuccessfully to sell their home for some time, and had experienced problems with a broken sewer pipe which had caused sewage to back up under the residence. Dean testified he had the faulty pipe replaced and said he did not know of any sewage under the home. He also testified he had purposefully removed his house from the market after a realtor brought a black family to look at the house, as he feared a black buyer would face reprisals from neighbors.

For the defense, Terry Davis, a Washington Township fire fighter, testified he observed a broken pipe with a garbage bag wrapped around it under the Deans' home and saw a large amount of sewage in the crawl space. Barker Davie, a forensic chemist hired by the State Fire Marshal's Office, testified he found leaded gasoline residue in his analysis of samples of debris taken from the Deans' home. James Skaggs, chief of the State Fire Marshal's Investigation Division, said he concluded the fire was incendiary after examining burn patterns which showed accelerants had been spread on the floor. Skaggs also testified regarding the sewage in the crawl space and stated that after his investigation, the arson suspect he could not eliminate was Dean, as there were no signs of burglary, Dean was the last person to leave the home, and he stood the most to profit from the fire. Dewitt Keeler, a consulting engineer, testified his examination of the Deans' furnace revealed that it had not been the cause of the fire, as suggested by Dean during his testimony.

Issue One--Evidence of Criminal Charges

The Deans assert they were denied a fair trial when the trial judge refused to allow them to present evidence regarding criminal charges filed against them in connection with the fire. Upon the recommendation of the State Fire Marshal, the Deans were arrested and charged with perjury for filing a false proof of loss (excessive damages) with INA, which charges were later dismissed. Deans' counsel attempted to refer to the criminal matter during his opening statement and attempted to question Franklin Dean in this regard, arguing at the time, and now on appeal, it was relevant to the issue of punitive damages as it showed oppressive conduct on the part of INA. INA objected, asserting the State Fire Marshal, not INA, was responsible for the filing of the criminal charges. It also argued the injection of the criminal matter into the trial would only serve to confuse the jury. The trial court excluded discussion of the charges in the opening statement and refused to allow Dean to testify regarding the criminal matter.

After examining the record, we conclude the Deans waived this issue by failing to make a formal offer to prove establishing relevancy, a procedure which has been established by our case law as a prerequisite, in situations such as this, to appealing the rejection of evidence. First, we note that the disputed refusal occurred when Dean revealed that, after the fire, he had been called to a firehouse for a hearing during which an INA insurance investigator asked most of the questions. He was then asked, "Okay, and what happened after that?" (R. 424) whereupon the objection was made that the information being solicited (the perjury arrests) was outside the issues. When the objection was sustained, Deans' counsel made no formal offer of proof as to what Dean's answer would have been, if permitted. Thus, the issue is clouded by the lack of an offer to prove which, pursuant to Ind.Rules of Procedure, Trial Rule 43(C), would have given the substance of the disputed testimony and, properly, a revelation of other testimony and evidence counsel was prepared to submit, all of which would have established the relevancy of this line of questioning. By failing to make such an offer, the Deans waived any alleged error in the refusal of Dean's testimony. Chuck Callahan Ford, Inc. v. Watson, (1982) Ind.App., 443 N.E.2d 79; Elliott v. Roach, (1980) Ind.App., 409 N.E.2d 661; Carroll v. Ely, (1980) Ind.App ., 398 N.E.2d 1364.

The record does disclose however, that an informal discussion was held at that time outside the presence of the jury during which the court was informed of the Deans' meeting with fire officials and an INA investigator. During the meeting, the INA investigator asked most of the questions (whether the questions dealt with the cause of the fire or with the amount of the Deans' claim or both was not disclosed to the court). It was also revealed that the Deans were later charged with perjury and these charges were dismissed. Even giving the Deans every benefit of the doubt by considering the foregoing disclosures as an offer to prove, we are convinced that this bare evidence, standing alone, did not establish relevancy as there was no other evidence presented indicating that INA had any influence on the initiation of the criminal proceedings. Thus, without more, it would have been purely conjecture on the trier of fact's part to determine what role, if any, INA played in the arrest. ²

Additionally, we note the Deans have the burden to show they were harmed by any alleged error in the exclusion of the testimony. I. Duffey & Son Co. v. Kemmer, (1941) 110 Ind.App. 116, 37 N.E.2d 274. In light of the fact that no harm from the exclusion of evidence relating to punitive damages, which require a prerequisite of actual damage. See Hahn v. Ford Motor Co., (1982) Ind.App., 434 N.E.2d 943; Large v. Gregory, (1981) Ind.App., 417 N.E.2d 1160.

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