Transport Indem. Co. v. Seib

• Decision Date: 05 February 1965
• Docket Number: No. 35787,35787
• Citation: 11 A.L.R.3d 1368,132 N.W.2d 871,178 Neb. 253
• Parties: , 11 A.L.R.3d 1368 TRANSPORT INDEMNITY COMPANY, Appellee, v. John SEIB, Appellant, Impleaded with John Seib d/b/a Shipper's Motor Express et al., Appellees.
• Court: Nebraska Supreme Court

Page 871

132 N.W.2d 871

178 Neb. 253, 11 A.L.R.3d 1368

TRANSPORT INDEMNITY COMPANY, Appellee, v. John SEIB, Appellant Impleaded with John Seib d/b/a Shipper's Motor Express et al., Appellees.

No. 35787.

Supreme Court of Nebraska.

Feb. 5, 1965.

Syllabus by the Court

1. Under section 25-12,109, R.R.S.1943, a business record of an act, condition, or event is competent evidence if the custodian or other qualified witness testifies to its identity and the mode of its preparation, and if it was made in the regular course of business at or near the time of the act, condition, or event, and if, within the sound discretion of the court, the sources of the information, method, and the time of preparation were such as to justify its admission.

2. The purpose of the statute, section 25-12,109, R.R.S.1943, was to permit the admission in evidence of systematically entered records made in the usual course of business, without the necessity of identifying, locating, and producing as witnesses the individuals who made the original entries in the records.

3. No particular mode or form of record is required, and a record prepared by electronic equipment and stored on tape, if it complies with the requirements of the statute, is as admissible as a book account or record recording the same information and calculations.

4. The business record statute, section 25-12,109, R.R.S.1943, was intended to bring the realities of business and professional practice into the courtroom and the statute should not be construed narrowly to destroy its usefulness.

5. The law presumes that parties understand the import of their contracts and that they had the intention which the contract terms manifest.

6. A court may, either before or after judgment in the furtherance of justice, and on such terms as may be proper under the circumstances, permit an amendment to the pleadings when the amendment does not change substantially the claim or defense.

Nelson, Harding & Acklie, Charles F. Noren, Charles J. Kimball, Lincoln, for appellant.

Perry & Perry, Lincoln, for appellee.

Heard before WHITE, C. J., CARTER, SPENCER, BOSLAUGH, and BROWER, JJ., and POLLOCK and SIDNER, District Judges.

WHITE, Chief Justice.

This is an action for insurance premiums. From a jury verdict and judgment for the plaintiff in the sum of $6,639.46 John Seib, hereinafter referred to as defendant, appeals.

The defendant operated a fleet of trucks in various states. The plaintiff writes retrospective insurance. By the terms of the contract, exhibits 1 and 2, the defendant pays an advance premium based on a percentage of his gross monthly receipts. The insurance covers bodily injury, property and material damage, and cargo liability. As the losses are reported to the plaintiff, it processes and pays them. The defendant is given a quarterly report of his loss experience. The defendant pays all losses and expenses up to $1,000 and the plaintiff pays all over that sum. According to the formula agreed to by the parties, the earned premium is calculated retrospectively. The loss experience of other operators is not a factor. Each loss has added to it certain investigation, overhead, taxes, fees, and management costs, and the net sum is charged back against the defendant as earned premium. The sum, so computed on cach loss, cannot be more than $1,000. The plaintiff pays the balance of the loss. If the advance premiums exceed the losses, the defendant gets a refund; if they are less, he is obligated to pay the balance as an earned premium. The object of the insurance is to give an operator the opportunity to take advantage of a good safety record in his insurance costs. The contract and policy may be canceled at any time by either party. The insurance went into force in April 1960 and was canceled on May 16, 1961.

To establish the amount of premium due, the plaintiff, whose home office is in Los Angeles, California, offered in evidence exhibit 14 which was received over objection as to foundation. Its admission is now assigned as prejudicial error.

The evidence supports the following summary of the nature of exhibit 14 and the foundation for its admission. Exhibit 14 is prepared and printed by electronic equipment. It was prepared by, and under the direction of, Leland S. Thomas, a director of the company, who is director of accounting for plaintiff, and whose testimony is the foundation for the admission of exhibit 14. Records, such as exhibit 14, are under the custody and control of Thomas. A fair inference from the record is that the figures reported and the computations made are accurate calculations within his personal knowledge. On direct examination, this witness, Leland S. Thomas, testified: 'Q. (BY MR. ACKLIE) Mr. Thomas, was Exhibit 14 computed, say, by an I.B.M. or other tabulating machine? A. Those calculations are prepared by machine, yes. They are all electric computers. We have our formulas set out, first, as to the type of policy this is. There are different plans of insurance which you can pursue, on all retrospective policies, so you have to have a formula in order to feed this particular information into the machine, and each time you have a case, we feed that formula into the machine, and the machine does the calculating work, whether multiplying or subtracting the premiums. It just does what used to be done by keeping books. We feed the formulas, and the machine will do that, and keep them on tape.'

The information as to the losses is fed into the machine, the machine records them, makes the necessary formula calculations, and it is stored on tape. On four of the large pages of this exhibit is recorded each accident by date, name of driver, type of accident (coded), amount and type of loss allocated expenses according to the policy contract, and other information from which the premium can be computed. The total of the paid losses chargeable as premiums for policy year is found on the first two pages of exhibit 14. There is recorded the amount of advance premiums paid. The individual loss records on the last four pages support the figures in the calculation of premiums owed and due on pages 1 and 2. On pages 1 and 2, the machine takes the composite totals of the losses allocated to premiums, subjects them to the formula of the contract (exhibits 1 and 2), computes the total premium owed for the year, deducts the payments made, and enters the total due. It is a bookkeeping record made in the usual course of business. It was sent quarterly to the insured, Seib, and it is a cumulative record. The information is stored on the tape and at any time the machine can retrieve a record such as exhibit 14 giving the losses paid to date and the premium paid and due according to the formula. Thomas testified that the calculations on exhibit 14 are made exactly in conformity with the defendant's premium formula in the contract. This witness, Thomas, made a detailed explanation of each item on exhibit 14. He took the entire list of claims shown on exhibit 14, computed the amounts charged and due according to the contract formula, and reconciled these figures with the machine-produced results on exhibit 14. This witness' testimony, mostly as to foundation for exhibit 14, stretches across 141 pages of this record. All of it cannot be summarized. It shows that this record and computation were made as the usual part of plaintiff's business operation, that the keeping of this record was an indispensable part of the business, and that the record was kept separate for the insurance contract of the defendant. This exhibit shows $39,828.50 paid claims for the policy year April 1, 1960, to April...