United States Fidelity & Guaranty Co. v. Breslin
| Decision Date | 19 April 1932 |
| Citation | 243 Ky. 734 |
| Parties | United States Fidelity & Guaranty Company v. Breslin. |
| Court | United States State Supreme Court — District of Kentucky |
1. Reformation of Instruments. — Evidence held to justify reformation of indemnity policy on ground that mutual mistake occurred when insured's residence number was inserted, instead of proper statement to cover insured's work at all locations.
2. Insurance. — Injury to pedestrian falling because of gravel which fell from motortruck while crossing sidewalk held within protection of contractor's indemnity policy, notwithstanding policy excluded injuries caused by motortruck.
The indemnity policy did not exclude injuries caused by a fall on the sidewalk, even though the fall resulted from conditions created by sand and gravel which had fallen from a motortruck, since the condition could have been created by other means, and the part played by the truck merely contributed to create the condition, and was not a cause of the injury.
3. Insurance. — In contractor's action to reform indemnity policy to cover work at all locations, testimony that insurer, in examining pay roll to ascertain premium to be paid, considered pay roll which applied to all various places where contractor's work was done, held competent.
Appeal from Jefferson Circuit Court
HITE H. HUFFAKER and JOHN R. MOREMAN for appellant.
LUKINS & JONES and JOSEPH LAZARUS for appellee.
Affirming.
This was an action upon an indemnity insurance contract. Frank G. Breslin sued the United States Fidelity & Guaranty Company to secure indemnity for the amount of a judgment which he had been compelled to pay, together with interest, costs, and expenses. The insurance company interposed the defense that the indemnity contract did not cover cases not occurring at a single location named in the policy, and that the loss in question did not occur at such place, and further that the loss for which indemnity was sought was expressly excluded from the contract by a provision excepting injuries caused by an automobile or truck, and did not result from a casualty covered by the contract. Subsequently the plaintiff amended his pleading seeking to reform the contract of insurance on the ground of mutual mistake in designating the location where the work was to be done. The action was transferred to equity, the chancellor reformed the contract, and a judgment was rendered in favor of the plaintiff for the full amount claimed. The insurance company has prosecuted an appeal, presenting three questions which will be discussed and disposed of in the order presented.
1. It is first insisted that in order to warrant the reformation of a written instrument on the ground of mutual mistake it is necessary to show the parties had an agreement that was not expressed in the written memorial by reason of mutual mistake of the parties, and that no such agreement was proven in the present case. The general principles which govern the reformation of insurance contracts are well settled and need not be restated. Insurance Company of North American v. Evans, 229 Ky. 613, 17 S.W. (2d) 711; Svea Fire & Life Ins. Co. v. Foxwell, 234 Ky. 95, 27 S.W. (2d) 675; Continental Ins. Co. v. Baker, 238 Ky. 265, 37 S.W. (2d) 62; Springfield Fire & Marine Ins. Co. v. Snowden, 173 Ky. 664, 191 S.W. 439; Kentucky Title Co. v. Hail, 219 Ky. 256, 292 S.W. 817; Kitchen v. Yorkshire Ins. Co., 226 Ky. 376, 10 S.W. (2d) 1074; Lancashire Ins. Co. v. Lucas, 34 S.W. 899, 17 Ky. Law Rep. 1324; Gardner v. Continental Life Ins. Co., 125 Ky. 464, 101 S.W. 908, 31 Ky. Law Rep. 89; National Union Fire Ins. Co. v. Light's Admr., 163 Ky. 169, 173 S.W. 365; Central Life Ins., Co. v. Robinson, 181 Ky. 507, 205 S.W. 589; Kentucky Central Life & Accident Ins. Co. v. Pemberton, 212 Ky. 510, 279 S.W. 968; Westchester Fire Ins. Co. v. Wilson, 220 Ky. 142, 294 S.W. 1059; AEtna Ins. Co. v. Steele, 222 Ky. 57, 299 S.W. 1091; Lee v. Hartford Fire Ins. Co., 223 Ky. 533, 4 S.W. (2d) 372; Harrel's Admr. v. Harrel, 232 Ky. 469, 23 S.W. (2d) 922; Home Ins. Co. v. Evans, 201 Ky. 487, 257 S.W. 22; Cecil v. Kentucky Livestock Ins. Co., 165 Ky. 211, 176 S.W. 986; Georgia Casualty Co. v. Bond-Foley Lumber Co., 187 Ky. 511, 219 S.W. 442.
The parties are not in disagreement respecting the legal principles prevailing. The argument is whether the evidence in the present record is sufficient to warrant a reformation of the contract. The evidence tended to show that Breslin was a general contractor engaged in the construction business in the city of Louisville. He carried various kinds of insurance, among which was a policy to protect him against liability for injuries to members of the general public. All of his insurance had been carried by a single local agency, but in several different companies. The Union Indemnity Company had carried the public liability risk. That company ceased to carry such business as Breslin offered, and the agent applied to the United States Fidelity & Guaranty Company to take it over since he represented no other company carrying insurance of that character. The insurance desired by Breslin was indemnity against loss from injuries by reason of his operations sustained by any member of the general public. The premium was based upon the entire remuneration earned during the policy period by all persons employed by the assured in all business operations "as expressed in statement No. 4." The policy excluded from its protection any suit based upon injury or death caused by any vehicle or automobile owned, hired, borrowed, or used by the insured. The automobile insurance was carried in another company. Statement No. 4 in the policy read as follows: "Locations of place or places where work is to be done — 2705 West Main Street, Louisville, Ky." Immediately following statement No. 4 the policy contained a classification of operations which called for sand and gravel digging, including drivers, chauffeurs, and employees engaged in the construction, repair, and maintenance of buildings, installation of equipment, including machinery, and the office clerical force. As matter of fact, 2705 West Main street was not the place where any work was to be done or any wages were to be earned. It was a former residence of Mr. Breslin and undoubtedly crept into the policy by inadvertence or mistake. If that provision of the policy should be permitted to stand, Mr. Breslin would have no insurance whatever under the policy, and there would be no substantial premium earned for the company. It is shown by the evidence that the United States Fidelity & Guaranty Company undertook to insure against liability occurring at all points where Mr. Breslin was engaged in work, and where any member of the public might happen to sustain an injury. Mr. Breslin desired that character of protection....
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