Turner v. Bankers & Shippers Ins. Co. of New York

• Decision Date: 13 March 1939
• Docket Number: 17136
• Citation: 187 So. 122
• Parties: TURNER v. BANKERS & SHIPPERS INS. CO. OF NEW YORK.[*]
• Court: Court of Appeal of Louisiana — District of US

187 So. 122

TURNER v. BANKERS & SHIPPERS INS. CO. OF NEW YORK.^[*]

No. 17136

Court of Appeal of Louisiana, Orleans.

March 13, 1939

Appeal from First City Court of New Orleans; Wm. V. Seeber, Judge.

Action by Mrs. James Olin Turner against the Bankers & Shippers Insurance Company of New York to recover the cost of repairing damaged upholstery of her automobile, on ground that the defendant had agreed to place her automobile in the condition it was prior to an accident. From a judgment in favor of the plaintiff, the defendant appeals.

Judgment affirmed.

Where insurer admitted liability under policy protecting owner of automobile from loss in event of damage to automobile, for repair of damaged automobile, and undertook to have it repaired by certain company, alleged fact that upholstery of automobile was damaged during repair would not relieve insurer from liability for repair of upholstery.

Deutsch & Kerrigan, of New Orleans, for appellant.

George Piazza and B.M. Goodman, both of New Orleans, for appellee.

McCALEB, Judge.

This controversy arises under the following state of facts:

On October 14, 1936, the plaintiff, Mrs. James Olin Turner purchased an Oldsmobile automobile and executed a chattel mortgage thereon in favor of the Southern Acceptance Corporation. On the same day, the defendant, Bankers &amp Shippers Insurance Company, issued to the mortgagee, the Southern Acceptance Corporation, its open policy No. E-831508 protecting said mortgagee and Mrs. Turner, the owner of the car, against any loss (subject to a deduction of $50.00) which they might suffer in the event the automobile was damaged as the result of a collision or by being overturned.

On December 6, 1936, while this insurance policy was in full force and effect the automobile was overturned in a collision and was damaged as a consequence thereof. The accident happened near Baton Rouge, Louisiana, and, immediately thereafter, the vehicle was taken to Highland Motors, Inc., a garage and repair shop located in that city. Mrs. Turner promptly notified the insurance company of the mishap and an investigation was conducted by the latter's representatives in an effort to determine the nature and extent of the loss. After obtaining estimates from three concerns engaged in the automobile repair business in Baton Rouge, with respect to the extent of the damage, the insurer selected Highland Motors, Inc. to perform the necessary work in order that the vehicle might be rehabilitated. The estimate of Highland Motors, Inc. for the repairs necessary to place the car in its previous condition was $117.15 and a proof of loss was executed by Mrs. Turner in conformity therewith.

The repairs were completed sometime during the month of January 1937 and the car was delivered by Highland Motors, Inc. to Mrs. Turner at New Orleans. Mrs. Turner refused to accept the machine, claiming that the repair work was unsatisfactory in that the top of the vehicle had not been placed in the same good condition which had existed previous to the accident. At the time plaintiff objected to the condition of the car, Mr. L.C. Hoffmann, the adjuster and representative of the defendant insurer, was present and he conceded that the work of Highland Motors, Inc. had not been sufficient to restore the automobile to its previous state. It was thereupon agreed that, in order to rehabilitate the car, it would be necessary to place a new turret top upon it. The insurance company took the position that, inasmuch as Highland Motors, Inc. had represented that it could place the car in first class condition for the amount originally estimated, it should pay part of the expense which would be incurred as a result of its error in believing that the top of the damaged vehicle was susceptible of repair. The motor company, conceding its error, agreed to bear one half of the expense and, in accordance with this understanding, the car was thereafter taken back to Baton Rouge for the purpose of installing a new turret top.

In March 1937, the work was completed by Highland Motors, Inc. and the car was again delivered to Mrs. Turner at New Orleans. Upon her inspection of the vehicle, she found that the upholstery was in a damaged condition and she refused to accept it in that state. Mr. Hoffmann, the representative of the insurance company, contended that, inasmuch as Mrs. Turner had not previously complained about the damage to the upholstery, the insurance company would not be liable for the cost of its replacement. Mrs. Turner, having been deprived of the use of the car from the date of the accident, was anxious to obtain its possession and Highland Motors, Inc. was not willing to release the vehicle from its custody unless payment was received for the work it had performed.

With affairs in this state, Mr. Hoffmann suggested that he would prevail upon the Southern Acceptance Corporation, the mortgagee of the car, to advance to Highland Motors, Inc. the sum of $83.72 (one half of the cost of the new turret top) and that, if Mrs. Turner would accept delivery of the car, he would reserve to her the right to make an additional claim against the insurance company for damages to the upholstery of the automobile. This proposal was accepted by Mrs. Turner. Accordingly, she executed a second proof of loss and on the reverse side thereof, it was provided:

" It is understood and agreed that in signing this proof of loss of which this agreement constitutes a part, Mrs. James O. Turner, the named assured, does not waive any claim she might have for damage to the upholstering inside the car.

" It being further understood that the said Mrs. Turner will have said damages estimated and present formal claim in due course against the Bankers and Shippers Insurance Co.

" It is also agreed that the sum of eighty three and 72/100 dollars mentioned in the attached proof of loss is an additional payment to the sum of one hundred seventeen and 15/100 dollars previously paid to the named assured.

" [Signed] Bankers & Shippers Insurance Co.

" By Emery & Kaufman, Ltd.,

" As per L.C. Hoffmann"

When the above quoted proof of loss was submitted to the home office of the defendant, it admitted liability for one half of the cost of the turret top and reimbursed the Southern Acceptance Corporation for the advance made to Highland Motors, Inc. but it rejected plaintiff's claim with respect to the damaged upholstery and advised its New Orleans agents by letter to that effect. However, it does not appear that Mrs. Turner was thereafter advised of this fact by the defendant's representatives.

Mrs. Turner contends that, after the second proof of loss had been executed by her, she was in constant communication with Mr. Hoffmann and that he at all times pretended that the insurance company was going to pay for the damage to the upholstery of the automobile. It should be stated, however, that her testimony is somewhat vague in this respect and that Mr. Hoffmann positively declares that, after Mrs. Turner had submitted the second proof of loss, he had no further communications with her.

During the month of November 1937, Mrs. Turner had an estimate made of the cost necessary to repair the upholstery of the automobile and entered into an agreement with the Pontchartrain Motors, Inc. of New Orleans to do the work for $122.70. Being unable to obtain satisfaction from the insurance company for the payment of this amount, she employed an attorney who made formal demand upon the company. Upon the latter's refusal to pay, this suit was instituted by the plaintiff on June 14, 1938.

The defendant resists liability on the claim chiefly upon the ground that the action is prescribed by virtue of a provision in its policy which reads as follows: " No suit or action on this policy or for the recovery of any claim hereunder shall be sustainable in any court of law or equity unless the Assured shall have fully complied with all of the foregoing requirements, nor unless commenced within twelve (12) months next after the happening of the loss; ***"

In the court below, there was judgment in favor of plaintiff in the amount prayed for. The defendant has appealed from the adverse decision.

The main question in the case, to which we give our immediate attention, is whether the trial judge committed error in overruling the defendant's plea of prescription.

It is well established in the jurisprudence of this State that provisions in insurance policies shortening the term of prescription are valid and enforcible. See Ray v. Liberty Industrial Life Insurance Co., __ La.App. __, 180 So. 855, and cases there cited.

Counsel for Mrs. Turner,...