Evans v. Century Cas. Co.

• Decision Date: 25 April 1966
• Docket Number: No. 21254,21254
• Citation: 159 Colo. 596,413 P.2d 457
• Parties: Ross EVANS, Plaintiff in Error, v. CENTURY CASUALTY COMPANY. Defendant in Error.
• Court: Colorado Supreme Court

Page 457

413 P.2d 457

159 Colo. 596

Ross EVANS, Plaintiff in Error, v. CENTURY CASUALTY COMPANY. Defendant in Error.

No. 21254.

Supreme Court of Colorado, In Department.

April 25, 1966.

Taylor & Madden, Denver, for plaintiff in error.

Ben L. Wright, Jr., Denver, for defendant.

PRINGLE, Justice.

Plaintiff in error, Evans, will be hereinafter referred to as the defendant or by name. Defendant in error, Century Casualty Company, will be referred to as plaintiff or Century.

Ross Evans, the defendant in the trial court, purchased in his own name a 1960 Cessna 182 Skylane airplane. Thereafter, he executed a promissory note payable to the United States National Bank of Grand Junction in the amount of $13,500 and gave as security for the note a chattel mortgage on the airplane.

Evans insured the airplane with Century against risk of loss by collision. According to Century, Evans warranted that the airplane would not be used for commercial or limited commercial (charter) purposes. The policy excluded coverage for the airplane if used for commercial or limited commercial purposes. It also contained a clause which provided that, in case of loss of the aircraft, Century would pay the note held by the bank; and also, in the event the loss occurred while Evans was performing any act constituting a breach of warranty or policy condition, Century would, to the extent of the payment made to the bank, be subrogated to the rights which the bank held against the insured. The policy also contained a provision that any qualified pilot who met certain conditions might operate the airplane within the coverage of the policy.

On August 15, 1962, while on a flight to Artesia, Colorado, the airplane crashed. It was being piloted at that time by one William Nelson, who was a qualified pilot within the terms of the policy. A Mr. and a Mrs. Fordyce and a Mr. Waite were passengers in the airplane at the time of the mishap.

Century took the position that the airplane was destroyed while carrying passengers for hire and paid the balance due on the note to the bank; it allowed for the salvage of the aircraft and then brought suit against Evans for indemnification, contending that the use was beyond the coverage of the policy and therefore a breach of warranty. In his answer, Evans denied that he had warranted that the airplane would not be used for commercial purposes and denied that the use of the airplane on the flight in question was a commercial or charter use.

At the trial, Century called to the witness stand the defendant, the pilot, Nelson, and passenger Fordyce. Century also introduced into evidence the deposition of Waite, one of the other passengers on the trip. Evans and the pilot, Nelson, both testified on behalf of the defendant.

At the close of the case, the court granted Century's motion for a directed verdict on the issue of liability, holding that the flight was, as a matter of law, one which carried passengers for hire. Thereafter, another trial was held on the issue of the salvage value of the aircraft and the amount of attorney's fees to be awarded to the plaintiff. The second trial produced a judgment for attorney's fees in the amount of $1871.30 and set the salvage value of the airplane at $3500.00.

Evans raises four assignments of error which he contends dictate reversal of the judgment. The main thrust of Evans' argument is directed to the trial court's action in declaring that, as a matter of law, the flight to Artesia constituted a flight for hire and therefore was outside the coverage of the policy.

Since trial was had to a jury, we must take the evidence introduced in behalf of Evans as being true and view it in the light most favorable to him in determining whether the court was justified in taking this issue from the jury. Elliott v. Hill, 148 Colo. 553, 366 P.2d 663; Freeman v. Boyer Bros., 82 Colo. 509, 261 P. 864, 55 A.L.R. 1285; Straight v. Western Light & Power Co., 73 Colo. 188, 214 P. 397.

Applying those principles to the evidence in this case, it appears that Nelson helped Evans at the airport while Evans was engaged in other pursuits, and in return was permitted to use the airplane for his own personal use when he so desired. Nelson, however, was not authorized by Evans to carry passengers commercially when he was using the airplane. Nelson testified that while at the airport he received a call from Fordyce asking if he could take Fordyce and two others to Artesia. He testified that he wanted to make a trip to Artesia for his own personal reasons and so agreed to take the three passengers. He further testified that he never intended to charge these passengers for the trip and that there was no discussion at any time of rates or of any payment at all.

Fordyce testified that he called the airport because he wanted to fly to Artesia on business. He called the Craig Flying Service and Nelson answered the telephone. He asked Nelson if there was an airplane which could take three passengers to Artesia, and Nelson replied in the affirmative. No one told Fordyce the flight was free and no one told him there would be a charge. He was never quoted any rates, nor was any agreement even discussed as to the charge. After the accident, Nelson filed a flight report with the Federal Aviation Agency stating he was on his own personal business.

From this evidence, the trial court found, as a matter of law, that since the airplane was not being used for Evans' business and pleasure on the day in question, it therefore followed, as a matter of law, that it was necessarily being used as a carrier of passengers for hire. We cannot follow that reasoning. According to the testimony of Evans and Nelson, the airplane was being...