Gomez v. Security Ins. Co. of Hartford

• Decision Date: 17 June 1975
• Docket Number: No. 6235,6235
• Citation: Gomez v. Security Ins. Co. of Hartford, 314 So.2d 747 (La. App. 1975)
• Parties: Alfred GOMEZ v. SECURITY INSURANCE COMPANY OF HARTFORD.
• Court: Court of Appeal of Louisiana

Page 747

314 So.2d 747

Alfred GOMEZ v. SECURITY INSURANCE COMPANY OF HARTFORD.

No. 6235.

Court of Appeal of Louisiana, Fourth Circuit.

June 17, 1975.

Rudolph R. Schoemann, New Orleans, for plaintiff-appellant.

Bienvenu & Culver, P. Albert Bienvenu, Jr., New Orleans, for defendant-appellee.

Salomon & Farmer, I. Bernard Salomon and Richard I. Farmer, New Orleans, for third party defendant-appellee.

Before LEMMON and STOULIG, JJ., and BOURG, J. Pro Tem.

LEMMON, Judge.

Plaintiff sued his automobile insurer under the comprehensive coverage of the policy, which included protection against loss caused by theft. The suit was dismissed after a trial on the merits, and plaintiff appealed.

The issue is whether or not the occurrence which caused plaintiff's loss constituted a theft for which the policy provided coverage. ¹

Plaintiff's version of the occurrence was: On the evening of Friday, May 21, 1971 Donald Rigger came to his home in response to a newspaper advertisement, which he had placed in an effort to sell the insured vehicle. After he, Rigger and a person identified as a mechanic took a test ride, Rigger indicated an interest in buying the car, wrote a check for $1,250.00, and asked to see the title as a precaution against liens. He showed Rigger the title but declined the check, stating he preferred to wait until Monday to complete the transaction. Rigger then asked permission to show the car to another mechanic and left but never returned. Unknown to him, Rigger had taken the title and left the check. (He explained he had endorsed the title in blank when his mother wanted to buy the car, but she later decided against it.) He then called the police who informed him that since Rigger had left a check for the sale price, they could not take action until the check was rejected by the bank. On Monday morning he learned at the bank that the check was drawn on an account that Rigger had opened an hour before their meeting the past Friday with a deposit of $25.00. (Testimony by a bank official established that Rigger wrote several other fraudulent checks over the weekened on that account, which the bank immediately closed.) He was unable to locate Rigger at the phony address but did find the vehicle at a used car lot. The dealer, who had the endorsed title (and a bill of sale, according to the testimony of the dealer and two policemen), refused to return the car, but at the suggestion of a policeman agreed to return the car to him upon payment of the sum $600.00, which was the amount the dealer had paid Rigger. After his insurer denied his claim for that sum, he filed this suit.

I

Counsel for plaintiff argues that the evidence shows his client was taken by a 'bunko' artist who knew the police would not pursue him immediately as long as he had left a check which purported to pay for the stolen car. On the other hand, defendant argues that the more reasonable factual finding from the evidence was that plaintiff and Rigger agreed to the sale of the automobile at $1,250.00, at which time the sale was completed (citing C.C. art. 2456), even though the check accepted as consideration turned out to be worthless. Defendant further contends that the trial judge, by rendering judgment for defendant, apparently found the latter interpretation to be more credible and rejected plaintiff's denial that he agreed to sell Rigger the car and accepted the check as payment.

We agree that plaintiff's version contains many improbabilities and unlikely coincidences. However, even if plaintiff's testimony is completely disregarded, the remaining evidence and the overall circumstances clearly establish that the occurrence was a taking under false pretenses rather than a sale.

The evidence taken as a whole is overwhelming that Rigger did not intend to buy the car for $1,250.00. His intention to permanently misappropriate the vehicle by means of fraudulent conduct was demonstrated by his opening the small bank account listing a false address, by his writing a large check on that account, and by his immediate sale of the car the next morning for less than half the amount of the check he left at plaintiff's home.

Since Rigger did not truly consent to buy the thing at the price set by plaintiff, the fact that plaintiff alone intended a contract of sale is not determinative. Both parties must agree on the thing and the price for a valid sale to be complete under C.C. art. 2456. ² While the evidence indicates plaintiff consented to sell the car for $1,250.00, his consent to a sale to Rigger at that price was produced by Rigger's fraudulent conduct. Accordingly, there was no valid contract of sale. ³

The case thus turns on the legal issue of whether Rigger's fraudulent acquisition of the vehicle constituted a loss to plaintiff caused by theft, as contemplated by the policy. The broad language of the policy does not exclude coverage when the theft is perpetrated by fraudulent conduct or false pretenses. Furthermore, since the provisions of an insurance policy are to be interpreted according to the natural import of the language used, we believe the common and usual signification of the word 'theft' reasonably includes a taking by fraudulent conduct under circumstances which evidence an intent to steal. In any event, the use of the broad term without definition or limitation is ambiguous at best and must be construed against the insurance company. Finally, we find persuasive this state's legislative definition of the crime of theft in R.S. 14:67 as 'the misappropriation or taking of anything of value which belongs to another . . . by means of fraudulent conduct, practices, or representations.'

We conclude all of the circumstances surrounding Rigger's taking of the car prove plaintiff's loss was caused by theft, and defendant is liable under the broad coverage of the policy. We further conclude plaintiff proved the amount of his loss at $600.00, the sum he paid to prevent a total loss (by the dealer's sale to a third party) of the vehicle which he sold four months later for $1,250.00.

II

Plaintiff also sought recovery of penalties and attorney's fees under R.S. 22:658 on the basis that defendant's failure to pay the claim was arbitrary and without probable...