Farr v. Traders & General Ins. Co.
| Decision Date | 28 May 1962 |
| Docket Number | No. 5-2697,5-2697 |
| Parties | A. T. FARR, Appellant, v. TRADERS & GENERAL INSURANCE COMPANY, Appellee. |
| Court | Arkansas Supreme Court |
Charles C. Wine and LeRoy Autrey, Texarkana, for appellant.
Shaver, Tackett & Jones, Texarkana, for appellee.
This litigation results from an oil well 'blow in.' Appellant, A. T. Farr, Jr., was drilling for oil in Lafayette County; about 9:30 p. m. on June 10, 1960, while the drill pipe was being removed, the well 'blew in', erupting like a volcano and sending oil, water, and mud hundreds of feet into the air; a large crater developed; the entire rig was lost; and the semi-liquids coming from the well began to flow over surrounding land. Immediately after the 'blow in' Farr employed H. R. Wootton, whose crew, working with bulldozers, was able to erect levees to minimize the damage to adjacent lands and streams. Two days later (Sunday, June 12th) the Haliburton Oil Well Cement Company succeeded in 'killing the well' and stopping the eruption. Wootton's work of clearing the land by use of bulldozers continued for approximately three weeks; and the payment of Wootton's charges of $7,325.00 is the matter of contention in this litigation.
Wootton recovered judgment against Farr for the amount claimed. Farr (appellant) then brought this action against the appellee, Traders & General Insurance Company (hereinafter called 'Insurance Company') claiming that under its policy issued to Farr the Insurance Company was obligated to pay the judgment Wootton had obtained against Farr. The Insurance Company denied liability; and trial to the Court, without a jury, resulted in a finding and judgment for the Insurance Company. This appeal ensued.
The policy which the Insurance Company issued to Farr was a liability policy, and not a property damage policy. So at the outset Farr concedes, with admirable candor, that the basis of his recovery is not the coverage in the policy but rather: (a) the actions of the insurance adjusters in authorizing the Wootton work; or (b) that Farr's prompt employment of Wootton resulted in minimizing the Insurance Company's liability for damages to adjacent landowners, and the Insurance Company would be unjustly enriched if it did not pay the Wootton judgment against Farr. We examine these contentions.
I. The Actions Of The Insurance Adjusters. As aforesaid, the well 'blew in' at 9:30 p. m. Friday night, June 10, 1960, and within two hours thereafter Farr had Wootton and his crew building levees, minimizing the damage that the erupting well might cause. The next day after the explosion, Farr's bookkeeper notified the insurance agents who had issued the policy to Farr. Pursuant to such notification, the Insurance Company sent two independent insurance adjusters (J. C. Floyd and Carl W. Pelley) to investigate and report. Floyd and Pelley visited the well site on Tuesday, June 14th, and discussed the matter with Farr. What was said in the conversation is a matter of dispute. Farr testified that the adjusters told him to continue the work and satisfy the property owners; but the adjusters testified that they merely congratulated Mr. Farr on his promptness, investigated the full situation, and settled with the landowners for their property damage. The adjusters denied that they had any authority to bind the Insurance Company for Wootton's work. Thus, there is a direct conflict in the testimony.
Later, and before Wootton had completed his work, he and Farr met with the insurance adjusters in Texarkana and the conversations that transpired at that meeting are likewise in dispute. Farr and his witnesses testified that the insurance adjusters agreed that the Insurance Company would pay Wootton's claim within ten days after the work was completed and a final bill was submitted. On the other hand, Pelley and Floyd testified that they definitely informed Farr and Wootton that the adjusters had no authority to authorize payment of the bill and that the adjusters would send the bill to the ...
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