National Indem. Co. v. United States

Decision Date06 July 1977
Docket Number73-566-HP and 73-642-HP.,Civ. No. 76-1008-HP
Citation444 F. Supp. 1356
PartiesNATIONAL INDEMNITY COMPANY, by Omni Aviation Managers, Inc., Plaintiffs, v. UNITED STATES of America, Defendant.
CourtU.S. District Court — Central District of California

Joyce Lanza, Law Offices of Arthur Wasserman, Los Angeles, Cal., for plaintiff National Indem. Co.

Marshall Filler, Deputy Atty. Gen., Dept. of Justice, Washington, D. C., Donald A. Fareed, Sp. Asst. U. S. Atty., William D. Keller, U. S. Atty., Frederick M. Brosio, Jr., Asst. U. S. Atty., Los Angeles, Cal., for defendant.

FINDINGS OF FACT AND CONCLUSIONS OF LAW ON DAMAGE ISSUES

PREGERSON, District Judge.

On March 22, 1977, the court made its findings of fact and conclusions of law in these consolidated cases on the issue of liability. The court concluded that Aardema, pilot of the Piper; Duval and Rudelson, instructor and student pilots of the Cessna 003; and Federal Aviation Administration (FAA) personnel were all negligent, and that the negligence of each was a proximate cause of the Piper/Cessna mid-air collision in the skies over Santa Monica, California on September 9, 1971. Applying California's doctrine of comparative negligence, the court then assigned a specific percentage factor to the degree of negligence attributable to each party as follows:

                     Party                       Percentage of Fault
                FAA employees — US Gov't               20  
                Aardema                                45  
                Rudelson                               10  
                Duval                                  25  
                

On May 17, 18, 19, 20, and 25, 1977, the court tried the damage issues arising out of these three consolidated cases. Those issues included National Indemnity's asserted subrogation claims against the United States. Finding of Fact 11, made on March 22, 1977, refers to National Indemnity's subrogation claim. That finding states:

On the date of the collision, National Indemnity Company was the insurer of Aviation Unlimited, Inc., the operator of Cessna 003, and Melvin Miller, the owner of the aircraft. On that date Duval was employed as a flight instructor by Aviation Unlimited, Inc., and by reason of such employment became an insured under National Indemnity's insurance policy. As a result of the mid-air collision, National Indemnity paid money to the Rudelson heirs and other persons or business entities for property damage. By reason of such payments, National Indemnity is subrogated to the rights of its insured against third parties.

At trial, National Indemnity was represented by Joyce R. Lanza of the Arthur Wasserman law firm, and the United States was represented by James Stotter, II, Assistant U. S. Attorney.

The court, having heard the evidence, having studied counsel's post-trial briefs, and having given the matter due consideration, makes its findings of fact and conclusions of law on the subrogation issues in the National Indemnity case, No. 76-1008-HP, as follows:

FINDINGS OF FACT

1. At the time of the mid-air collision, the FAA air traffic controllers on duty at the Santa Monica Control Tower were acting within the course and scope of their employment by the United States.

2. At the time of the mid-air collision, Duval was acting within the course and scope of his employment as a flight instructor for Aviation Unlimited, Inc., the operator of the Cessna 003. Duval was operating the Cessna with the consent and permission of its owner, Melvin Miller.

3. Pursuant to its policy No. NCO 1157, National Indemnity, in settlement of claims asserted against its insureds, made the following payments on which its subrogation claims are based:

(a) November 12, 1971, the sum of $5,250.00 to its named insured and the Bank of America for the loss of Cessna 003.
(b) July 27, 1972, the sum of $300.00 to General Telephone Company of California for property damage caused when the aircraft struck the ground.
(c) April 18, 1975, the sum of $551.39 to the Los Angeles Department of Water and Power for property damage caused when the aircraft struck the ground.
(d) July 26, 1974, the sum of $15,000.00 to Lloyd F. and Pauline Larson for injuries and damages sustained by them when the aircraft struck the ground.
(e) April 18, 1975, the sum of $100,000.00 to the Rudelson heirs in settlement of their wrongful death claim.

4. In defending the claims described in paragraph 3, National Indemnity spent the following sums for attorneys fees and investigation costs:

(a) July 2, 1975, the sum of $42.35 to Charles W. Funaro for investigation costs.
(b) January 24, 1975, the sum of $4,192.55 to Charles W. Funaro for investigation costs.
(c) January 24, 1975, the sum of $20,563.77 payable to William G. Tucker for attorney's fees.
(d) January 13, 1977, the sum of $6,578.27 payable to William G. Tucker for attorney's fees.

5. Pursuant to the Federal Tort Claims Act, 28 U.S.C. § 2671 et seq., National Indemnity filed a claim for damages with the FAA on August 6, 1975. The FAA failed to dispose of the claim within six months after filing. Pursuant to 28 U.S.C. § 2675(a), National Indemnity treated such failure as a denial of its claim and filed its complaint on March 20, 1976.

The following conclusions of law, insofar as they may be considered findings of fact, are found by this court to be true in all respects.

From the foregoing facts the court concludes:

CONCLUSIONS OF LAW

1. A Federal Tort Claims Act suit may be brought by an insurer who by operation of law has become subrogated to the rights of an insured who could have brought the action originally. U. S. v. Aetna Casualty & Surety Co., 338 U.S. 366, 70 S.Ct. 207, 94 L.Ed. 171 (1949).

2. "`Subrogation' as applied to an insurer is its right to be put in the position of its insured against third parties legally responsible to the insured for the loss or damage (i. e., the casualty) which the insurer has insured and to the extent of the amount paid." Sacramento-Yolo Port Dist. v. Cargill of California, Inc., 4 Cal.App.3d 1004, 1010, 84 Cal.Rptr. 822, 826 (1970).

3. 28 U.S.C. § 2401(b) provides: "A tort claim against the United States shall be forever barred unless it is presented in writing to the appropriate Federal agency within two years after such claim accrues or unless action is begun within six months after the date of mailing . . . of notice of final denial of the claim by the agency to which it was presented." After six months have elapsed, the claimant need no longer wait for the agency's formal denial because 28 U.S.C. § 2675(a) provides: "The failure of an agency to make final disposition of a claim within six months after it is filed shall, at the option of the claimant any time thereafter, be deemed a final denial of the claim. . . ."

4. The property damage claim for loss of the Cessna 003 accrued on the date of the collision. The other claims listed in paragraph 3 of the findings of fact are based on the theory of implied indemnity and each arose on the date National Indemnity made payments in full settlement of a claim asserted against its insured. De La Forest v. Yandle, 171 Cal.App.2d 59, 340 P.2d 52 (1959); Aerojet General Corp. v. D. Zelinsky & Sons, 249 Cal.App.2d 604, 57 Cal.Rptr. 701 (1967). Contrary to National Indemnity's contention, "no waiver exists under 28 U.S.C. § 1346 the jurisdictional statute once the . . . period of limitations has run. Thus, after the two-year period the District Court has no jurisdiction over the action." Humphreys v. United States, 272 F.2d 411, 412 (9th Cir. 1959); see United States v. DeCamp, 478 F.2d 1188, 1191 (9th Cir. 1973). The claims described in subparagraphs (a) and (b) of paragraph 3 of the findings of fact are time barred. The remaining claims listed in paragraph 3 were timely filed. The same is true of the claims listed in paragraph 4, except to the extent that they involve expenditures for attorney's fees and costs relating to time barred claims. See Prentice v. North American Title Corp., 59 Cal.2d 618, 30 Cal. Rptr. 821, 381 P.2d 645 (1963); Isthmian Lines, Inc. v. Schirmer Stevedoring Co., 255 Cal.App.2d 607, 611-12, 63 Cal.Rptr. 458, 461 (1967) on the subject of recoverability of attorney's fees and expenses relating to implied indemnity claims.

5. As to the timely filed claims, the crucial question is whether Aviation Unlimited and...

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5 cases
  • Rudelson v. U.S.
    • United States
    • U.S. Court of Appeals — Ninth Circuit
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