Motors Ins. Corp. v. Lopez, 4-9185
Decision Date | 24 April 1950 |
Docket Number | No. 4-9185,4-9185 |
Citation | 217 Ark. 203,229 S.W.2d 228 |
Parties | MOTORS INS. CORPORATION v. LOPEZ. |
Court | Arkansas Supreme Court |
Barber, Henry & Thurman, Little Rock, for appellant.
John H. Lookadoo and Agnes F. Ashby, Arkadelphia, for appellee.
Plaintiff Lopez recovered judgment in the Circuit Court on a policy of automobile collision insurance issued to him by defendant insurance company, and defendant appeals.
Plaintiff's car was overturned and wrecked while he was driving it. The loss fell clearly within the coverage of defendant's policy, and defendant's adjuster was sent promptly to check on the amount of the loss. Plaintiff met the adjuster at a garage to which the wrecked car had been towed. They looked over a 4-page list of repair items prepared by the garage operator, the proposed cost of which totaled $873.72, then plaintiff signed a 'Loss or Damage Agreement' prepared by the adjuster, the gist of which was that he agreed that the sum of $873.72, minus $56.00 under the deductible clause and for tire betterment, should constitute the full amount of his claim. A short while after the adjuster departed plaintiff, according to his own testimony, talked with the garage operators and was told by them that even after his car received the repairs contemplated it would not be in as good condition as before the wreck, that anybody would be able to tell that it was a wrecked car, and that it would never again be as good a car as it had been before the wreck. Plaintiff at once got in touch with the adjuster, telling him that he repudiated the settlement figure on the theory that under the policy the insurer was permitted to repair the automobile or its parts, rather than pay the actual amount by which the car was damaged in money, only if the result would be 'of like kind and quality' as the vehicle before the wreck. This was without question in accordance with the actual provisions of the policy.
The insurer refused to reconsider the amount to be paid under the policy. Plaintiff then brought this action claiming that the car was worth $1850 before the wreck and $400 after the wreck so that, with $50 off under the deductible clause, he was entitled to $1400 under the policy, plus interest, 12 percent penalty and an attorneys' fee. Ark.Stats. § 66-514. At the trial before a jury the insurer relied upon the 'Loss or Damage Agreement', contending that plaintiff was bound by it, and also contended that actual damage to the wrecked car did not exceed the amount of the cost of proposed repairs as originally calculated. The jury's verdict was for the plaintiff in all respects, and judgment was rendered against defendant for the $1400 claimed, together with the statutory 12 percent penalty and a $350 attorneys' fee.
The first matter to be considered is appellant insurer's contention that the 'Loss or Damage Agreement' was a settlement contract binding upon the plaintiff. That 'Agreement', after setting forth the amount of damage settled upon, contained these words:
The terms of this 'Agreement' of course show that it is not a contract, and is not by itself intended to be a contract. It is designed 'to fix and evidence' the amount of the claim, and purports to bind the insured to the amount thus fixed and evidenced, but it does not purport to find the insurer at all. It expressly declares that the insurer is bound to nothing by it, is not committed to the making of any payment whatever. No consideration moving from the insurer, in return for the insured's agreement to limit his claim to the amount set, is even recited. No promises are made by the insurer. The only consideration referred to, on the insurer's side, is the payment to be made if and when and in the event that insurer chooses or is compelled to pay on the policy. This one-sided undertaking is not a contract in any legal sense. It lacks the mutuality which is required by the most elementary principles of our law. Eustice v. Meytrott, 100 Ark. 510, 140 S.W. 590; Restatement, Contracts, $80; 1 Williston, Contracts, § 103 et seq.
Appellant insurer urges, however, that we have held otherwise, and cites Cash v. Home Inc. Co., 197 Ark. 670, 125 S.W.2d 99, as holding that an identical loss and damage agreement was valid. It is true that the agreement in the Cash case was substantially indentical with that here involved, and that it was held valid, but there is one significant difference in the facts. This difference is that in the Cash case the insurance company had already made the payment agreed upon. Once the payment was made by the insurer the one-sided conditional agreement of the insured was turned into an executed contract. The payment was the consideration for the insured's undertaking to limit his claim.
In the present case, in contrast, the payment was never made. The insured withdrew his...
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...provided that purpose be otherwise relevant in the case at trial. 5 Wigmore, Evidence, § 1361; 6 Ibid., § 1770; Motors Ins. Corp. v. Lopez, 217 Ark. 203, 229 S.W.2d 228 (1950)." Bryant v. Moss, 295 Ala. 339, 329 So.2d 538, 541 Furthermore, it was not error for the trial court to make an off......
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