Hertz Equipment Rental Corp. v. Homer Knost Const. Co., Inc.

• Decision Date: 01 February 1973
• Docket Number: No. 9188,9188
• Citation: 273 So.2d 685
• Parties: HERTZ EQUIPMENT RENTAL CORP. et al., Plaintiff-Appellant, v. HOMER KNOST CONSTRUCTION COMPANY, INC., et al., Defendant-Appellee .
• Court: Court of Appeal of Louisiana — District of US

Page 685

273 So.2d 685

HERTZ EQUIPMENT RENTAL CORP. et al., Plaintiff-Appellant, v. HOMER KNOST CONSTRUCTION COMPANY, INC., et al., Defendant-Appellee .

No. 9188.

Court of Appeal of Louisiana, First Circuit.

Feb. 1, 1973.

Robert L. Kleinpeter and Richard B. Nevils (Kleinpeter & Nevils), Baton Rouge, for plaintiff-appellant.

Frank Coates, Jr. (Taylor, Porter, Brooks & Phillips), Baton Rouge, for defendant-appellee.

Before LANDRY, TUCKER and PICKETT, JJ.

PICKETT, Judge.

The plaintiffs, Hertz Equipment Rental Corporation, and its insurer, Highlands Insurance Company, instituted this action against Homer Knost Construction Company, Inc. and its insurer, Aetna Insurance Company, to recover the sum of $9,939.69, together with legal interest thereon from June 29, 1971, until paid, for damages to a crawler-type lift crane. The defendants answered with a general denial and affirmatively alleged that the damage to the crane resulted from the negligence of the employees of the plaintiff, Hertz Equipment Company, or because of defective parts of the equipment. There was judgment in the District Court against Homer Knost Construction Company, Inc., and in favor of plaintiff, Hertz Equipment Rental Corporation, for the sum of $2,500.00 and in favor of Highlands Insurance Company for the sum of $7,439.69, with legal interest thereon from June 29, 1971, until paid, and for all cost. The suit against Aetna Insurance Company was dismissed with prejudice. The defendants have appealed suspensively and the plaintiffs have appealed devolutively.

For simplicity, plaintiff, Hertz Equipment Rental Corporation, will sometimes hereinafter be referred to as Hertz; the plaintiff, Highlands Insurance Company, as Highlands; defendant, Homer Knost Construction Company, Inc., as Knost; and defendant, Aetna Insurance Company, as Aetna.

On June 15, 1971, Hertz leased to Knost a Model 4000--MV Manitowoc 150 ton crawler type lift crane and all necessary rigging. The crane was insured by Highlands in a property floater insurance policy issued to Hertz on April 1, 1970. The lease rental contract executed by Hertz and Knost included a provision that Knost would assume all risk of loss or damage to the leased equipment; and that lessee would obtain and maintain during the rental period a standard contractor's equipment floater insurance policy to protect the interest of Hertz in the leased equipment. On June 17, 1971, Knost obtained in its favor insurance from Aetna covering the leased equipment; and on June 25, 1971, Aetna provided Hertz with a certificate of such insurance. The crane was then delivered to Knost's job site at the Enjay Plastic Plant in Baton Rouge, Louisiana.

On June 29, 1971, the crane was damaged to the extent of $9,939.69, while on the job site in the Enjay Plastic Plant. Highlands paid Hertz $7,439.69, the amount of damages to the crane, less $2,500.00 deductible; and because of such payment, claims it has been subrogated to the rights of Hertz against the defendants, to the extent of the payment. Hertz seeks payment from the defendants for the sum of $2,500.00 deductible. As stated by the trial Judge, both plaintiffs base their claim upon the provisions of the rental agreement, and particularly paragraph 10, which provides:

'All risk of loss of or damage to the Equipment shall be in Lessee, and Lessee agrees to return the Equipment to Lessor in the condition in which received, ordinary wear and tear only excepted. Lessee shall obtain and maintain during the rental term a standard contractor's equipment floater insurance policy to protect the interest of Lessor as interest may appear to the total amount of the Value of Equipment as set forth in Article 1 hereof and shall, prior to delivery of the Equipment, furnish Lessor with evidence of such insurance including an insurer's certificate that such policy is in effect and shall not be altered or terminated without twenty (20) days' prior written notice to Lessor.'

The stipulation of facts filed in the District Court recites the negligence of the employees of Hertz and Knost are not relevant to the issues involved. Therefore, Hertz being without fault, is entitled to indemnification for its loss. The Trial Judge, in his written reason for judgment, has very clearly and concisely determined the party primarily liable for loss resulting from the damage to the crane as follows:

'In resolving the issues presented for decision by this suit, the Court must first determine the party primarily liable for the loss or damage to the crawler crane. The parties have stipulated that negligence is not relevant in this suit. That being so, the Court must resort to the exhibits presented to determine the basic liability. Paragraph '10' of this rental agreement declares that the lessee, Homer Knost, is to sustain all risk of loss or damage to the leased equipment. There can be no question, therefore, that Homer Knost is primarily liable for the loss or damage to the crawler crane.'

We conclude that Knost is primarily liable to Hertz for its loss. The plaintiffs seek indemnification from Knost and its insurer. On the other hand, the defendants contend that Highlands having insured Hertz, and Aetna having insured Knost for the identical loss, because of conflicting provisions of the insurance policies. Aetna is only responsible for...