Dubuque Fire and Marine Insurance Co. v. Caylor
| Decision Date | 24 October 1957 |
| Docket Number | No. 5612.,5612. |
| Parties | DUBUQUE FIRE AND MARINE INSURANCE COMPANY, Appellant, v. Clifford CAYLOR, Fayne Caylor and Merle Caylor, doing business as Caylor Brothers Construction Company, Appellees. |
| Court | U.S. Court of Appeals — Tenth Circuit |
Robert L. Jackson, Kansas City, Mo. (Dean C. Allard and Donald C. Little, Kansas City, Mo., were with him on the brief), for appellant.
Clem W. Fairchild, Kansas City, Mo., and Karl V. Shawver, Jr., Paola, Kan. (Davis, Thomson, Vandyke & Fairchild, Kansas City, Mo., and Shawver & Shawver, Paola, Kan., were with them on the brief), for appellees.
Before BRATTON, Chief Judge, and PHILLIPS and BREITENSTEIN, Circuit Judges.
Clifford Caylor, Fayne Caylor and Merle Caylor, d/b/a Caylor Brothers Construction Company,1 brought an action against the Dubuque Fire and Marine Insurance Company2 in the District Court of Miami County, Kansas, on an insurance policy issued by the Insurance Company to the Caylor Brothers seeking to recover under the policy losses suffered by reason of damage to the engines of three pieces of heavy construction equipment owned by them and covered under the policy.
The action was removed from the state court to the United States District Court for the District of Kansas on the ground of diversity of citizenship. From a judgment in favor of the Caylor Brothers for $4,850 the Insurance Company has appealed.
On January 31, 1952, and February 1, 1952, the Caylor Brothers were the owners of a number of pieces of heavy construction equipment, among which were two HD 19 tractors and a Super C LeTourneau Tournapoll 3T. Such heavy equipment was being used by the Caylor Brothers on a highway construction project near Hoxie, Kansas. On July 27, 1950, the Insurance Company issued to Caylor Brothers its Policy SP 17766, described as a "Scheduled Property Floater" to which was attached a "Contractor's Equipment Form" endorsement which, among other things, specifically described and listed, as property covered thereunder:
One Allis Chalmers HD 19 Tractor, Serial No. 931;
One Allis Chalmers HD Tractor, Serial No. 1468;
One Super C LeTourneau Tournapoll 3T, No. 5086CIH.
The endorsement attached to the policy, an interpretation of which presents the primary question in this appeal, in part provided:
In the course of the Caylor Brothers' operation of its equipment on the highway project, it was customary to have the equipment assembled at the end of the day's work at some central location for servicing and maintenance. A pick-up truck was used in the servicing operation, on which was carried, among other things, permanent anti-freeze having an ethylene glycol base,3 and crankcase and gear lubricating oil. Sometime prior to 4:30 p.m. on January 31, 1952, some one of the Caylor Brothers' employees, working in the dark, put an amount of the anti-freeze solution in the container used to pour lubricating oil into the engines of such equipment, which, sometime thereafter, but before the time of the damage, was poured into the crankcases of the engines of the three pieces of equipment above described.
Thereafter, on January 31, 1952, the HD 19 Tractor No. 1468, which had been used during the day in question, suffered an engine seizure and the following day the other tractor and the Tournapoll had similar occurrences. As a result of the anti-freeze solution being mingled with the crankcase oil already in the engines, a marked interference with normal lubrication of the pistons, connecting rods and other moving parts in the engines occurred, which caused the pistons and connecting rods to overheat and the engines to seize and lock. It is not disputed that the ethylene glycol in the anti-freeze solution was the agent causing such interference with the lubrication and the subsequent seizure of the pistons.
The total damages were stipulated to be $5,000, and under a deductible feature of the policy, the Insurance Company was entitled to deduct $50 per vehicle, or a total of $150.
The primary issue presented in this appeal is whether the damage to each engine was a "direct loss or damage from any external cause," within the meaning and terms of the policy endorsement, quoted supra.
As previously noted, the policy insured against "direct loss." The second paragraph of the policy provided that coverage thereunder extended to "loss or damage * * *, directly caused by the risks and perils insured against." (Italics ours.) The reasonable interpretation of the phrase "direct loss" is that it is synonymous in intendment with the phrase "directly caused" or "direct cause," so that the issue is whether the losses were caused, as stated by counsel for the Insurance Company in their brief, "directly from an external cause."
It is well settled that the words "direct cause," as used in insurance policies, ordinarily are synonymous in legal intendment with the words "proximate cause."4 "Proximate cause" has many times been defined as that cause, which in natural and continuous sequence, unbroken by any efficient intervening cause, produces the injury, and without which the injury would not have occurred.5
The engine seizure and subsequent damage resulted from the presence of ethylene glycol in the anti-freeze solution. But for its presence in the engines the damage would not have occurred. The pouring of the anti-freeze solution in the engines was the efficient cause, unbroken by any efficient intervening cause, which, in a natural and continuous sequence, produced the damage.
Following the pouring of the antifreeze solution into the crankcases of the engines, the use or operation of each engine was a normal, natural, probable and foreseeable event. Such use or operation was not an efficient intervening cause of the damage, but a mere contributing or concurring cause,6 and the damage directly resulted from the pouring of the anti-freeze solution into the crankcases. Clearly, the operation of the engines without the presence of the anti-freeze solution in the crankcases would not have caused the damage. Hence, the pouring of the anti-freeze solution into the engines was the proximate cause of the damage and the direct cause of the loss within the meaning of the policy, or the direct loss within its terms and particular wording.
The trial court found that "sometime prior to the damage...
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