Fireman's Fund Am. Ins. Companies v. Central Securities, Inc.

• Decision Date: 11 December 1971
• Docket Number: No. 46120,46120
• Citation: 208 Kan. 263,491 P.2d 914
• Parties: FIREMAN'S FUND AMERICAN INSURANCE COMPANIES, Appellant, v. CENTRAL SECURITIES, INC., Appellee.
• Court: Kansas Supreme Court

Page 914

491 P.2d 914

208 Kan. 263

FIREMAN'S FUND AMERICAN INSURANCE COMPANIES, Appellant, v. CENTRAL SECURITIES, INC., Appellee.

No. 46120.

Supreme Court of Kansas.

Dec. 11, 1971.

Syllabus by the Court

1. An opening statement which fails to assert a theory of recovery on which plaintiff relies does not provide a basis for summary judgment when the theory of recovery is supported by deposition testimony and answers to interrogatories.

2. Counsel who makes an ambiguous opening statement is entitled to a presumption that he did not intend an admission fatal to his client's cause.

3. In order to dispose of litigation by summary judgment against a plaintiff it must be conclusively shown that the cause of action is completely without merit after a full consideration of the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any.

4. In an action brought by an insurance company against its agent for failing to notify its principal of a change in sue of insured premises, the record is examined and it is held the trial court erred in granting summary judgment for the defendant.

David G. Arst, Wichita, argued the cause and was on the brief for the appellant.

Richard C. Hite, of Hahrs, Nelson, Fanning, Hite & Kellogg, Wichita, argued the cause and was on the brief for the appellee.

OWSLEY, Justice:

This is an action by Fireman's Fund American Insurance Companies for damages against its agent, Central Securities, Inc.

On June 2, 1969, this case came on for trial before a jury, and after each of the parties made their opening statements the trial court, without motion, rendered a summary judgment for the defendant. Plaintiff appeals.

We must determine whether or not there was a genuine issue as to any material fact based on the pleadings, depositions, answers to interrogatories, and admissions.

The petition disclosed that the plaintiff in an insurance corporation and that defendant was the authorized agent of the plaintiff for the purpose of securing insurance business; that on or about February 11, 1965, defendant solicited and received an application for fire insurance on premises owned by one Nellie J. Myers; that as a result of the application and representation made therein the plaintiff issued a policy of insurance on said premises insuring against loss by fire; that the risk assumed by plaintiff was based upon the representation made by said Nellie J. Myers that the building was being used as a wholesale paper warehouse; that subsequent to the issuance of such insurance policy the occupancy and use of said premises was changed and the new use was for the fabrication of polyurethane; that the fire risk involved in use of said premises for the fabrication of polyurethane was greater than the risk assumed by plaintiff under its original policy and the underwriting standards of plaintiff prohibited the latter risk; that the defendants received due notice of the change in occupancy and use of said premises, but failed to notify plaintiff of said change; that subsequently, while said policy was in force said premises were destroyed by fire and the amount of the loss was paid to the insured; that if defendant had notified plaintiff of said change the policy of insurance wuld have been canceled by the plaintiff; and that said loss was caused by the negligence of the defendants in failing in their duty to advise the plaintiff of said change in occupancy and use.

Counsel for plaintiff in his opening statement digressed from the allegation of the petition that the policy of insurance would have been conceled upon notification of the change in use of the premises, saying:

'The reason we feel this way is this: first of all-and as it will develop through the testimony any the exhibits-fire insurance companies have what they call Underwriters-some work for them. And in this particular case this is what happened. They also have engineers. These engineers along with the Kansas Inspection Bureau it totally separate, but our own company engineer goes out and looks at a building of this kind and determine whether or not we should cover it by insurance. It depends on the structure of the building and what the tenants are doing and so on. Then, they decide, number one, whether or not they are going to insure it or not. They pass the information to the company's Underwriters and it is their function to determine whether they will insure it or not, and if they do, they will determine what, if any changes, will be made; if the sprinkler system is good, if the venting system is good, or what not.

'We contend we never had the opportunity to do this. W...