Source: https://law.justia.com/cases/federal/appellate-courts/F2/257/525/78316/
Timestamp: 2019-04-21 02:09:46+00:00

Document:
Baird & Holley, G. A. Sheppard, Los Angeles, Cal., for appellant.
Hindman & Davis, E. Eugene Davis, Sr., Los Angeles, Cal., for appellee.
(1) The court erred in holding the appraisers appointed acted within, and did not exceed their authority.
(2) The court erred in holding that the policies covered all goods and equipment owned by appellant, and that coverage was not limited to the street number addresses listed on the policies.
(3) The court erred in holding that certain goods and equipment stored elsewhere were not considered by the appraisers.
(4) The court erred in holding buildings described by street numbers and "designating areas covered by the policies," had no meaning or effect.
(5) The court erred in not allowing appellant interest on the sums awarded it.
Appellant apparently fails to realize that the first four alleged errors relate to findings made by the trial court which were based on disputed questions of fact. Appellant repeatedly refers to evidence which, if believed, would substantiate its position. It emphasizes that some of this testimony favorable to it was uncontradicted. But neither of these factors is enough to justify a reversal here. In its constant reference to the favorable testimony, it overlooks and nowhere refers to the unfavorable or contradictory testimony in the record. Nowhere does appellant attempt to point out a total lack of evidence to support any finding of fact made by the trial court.
Secondly, the matters urged upon us as improper findings manifestly depend upon conflicting testimony. For example, appellant strenuously urges that the amount found by the court as the value of the property insured on the 30th day of November, 1954, $346,422.66,2 must have been based upon an original figure of $418,509.14 for stock on hand, less $72,000 worth of stock stored at the El Monte plant, and did not take into consideration the approximately $187,000 in stock allegedly stored outside the state of California which would have resulted in insurable stock at the plant worth approximately $159,000. The court was required to accept this figure, says appellant, and it was error not to do so. Yet defendant introduced testimony that two certified public accountants had determined the actual value of the stock as of November 30, 1954 at the various Los Angeles buildings covered by the policy, to be (after deducting the El Monte stock) $325,022.25. They did not take the Honeyville, Utah stock of $21,000 into consideration originally, nor the lump storage of $2,964, nor the barley in Utah, nor any goods in outside locations except El Monte. The defendant relied on the testimony of public insurance adjuster Greenspan, who had determined the actual cash value of the stock of goods on hand on November 30, 1954 as $148,509.14. This did not include anything outside the plant. Despite this testimony in the record, which was based on an auditor's examination of appellant's available books, ledgers and records (some of which had been destroyed in the fire), appellant attacks the witnesses' conclusions as erroneous because those same books, ledgers and records showed various amounts of stock stored in Utah and at the Federal Warehouse in Los Angeles.
The appellee was the prevailing party below, and hence we must take that view of the evidence most favorable to it, just as we must take the view most favorable to the appellant in interpreting the insurance policies involved. Appellee is entitled to the benefit of all favorable inferences from the facts proved relative to the amount of the property insured. If, when so viewed, there was substantial evidence to sustain the findings then the judgment may not be reversed by this Court unless against the clear weight of the evidence, or unless influenced by an erroneous view of the law. John Hancock Mut. Life Ins. Co. v. Cohen, 9 Cir., 1958, 254 F.2d 417; United States v. First Trust Co. of St. Paul, 8 Cir., 1958, 251 F.2d 686; Ellison v. Frank, 9 Cir., 1957, 245 F.2d 837; Vidales v. Brownell, 9 Cir., 1954, 217 F.2d 136. There was much evidence to support the factual conclusions of the trial court, and we see no reason to disturb it.
$132,000.00 ___________ $346,442.66 or $346,442.66 of $187,228.59, or the sum of $71,359.76."
Salvage was next considered in Finding VIII,6 and credited in accordance with the policy provisions. The net amount so found due was found to have been promptly tendered by appellee to appellant.7 These findings are not attacked by appellant, except for the last.
Appellant's fifth error relied upon is the failure of the trial court to award interest. The court failed to award interest because it found, as noted above, that the amount due appellant by appellee had been timely tendered by appellee.
The parties stipulated that "tender was made as alleged in (defendant's) answer."8 The answer recited a tender of $56,309.67 on the first cause of action9 and $36,223.66 on the second.10 These were the precise respective sums awarded to appellant totaling $92,533.32.
Appellant cites three cases in support of this point, none of which controls. Thus, Mutual Life Ins. Co. of New York v. Wells Fargo Bank, 9 Cir., 1936, 86 F.2d 585, 588, is not applicable, for there the tender was in a lesser amount than that ultimately found due. Appellant cites the case of Sanitary Farm Dairies v. Gammel, 8 Cir., 1952, 195 F.2d 106, for the general rule that when defendant attempts by pleading to prevent plaintiff from obtaining any recovery, the tender is not effective to stop interest. That valid rule is not here applicable, because defendant in answering both the first and second cause of action contained in plaintiff's complaint admitted there were due the sums found due (Tr. pp. 15, 16, 18) and tendered the same. In addition, appellee raised as a separate defense to the second cause of action only the defense of misrepresentation. Nor was the tender here made conditional, and hence the cited case of Maryland Casualty Co. v. Southern Pacific Co., 9 Cir., 1942, 119 F.2d 672, is inapplicable.
The law of California is controlling (Concordia Ins. Co. of Milwaukee v. School District, 1931, 282 U.S. 545, 51 S. Ct. 275, 75 L. Ed. 528) and is found in California Civil Code sections 1504 and 3287, California Code of Civil Procedure, § 2074, and such cases as Lineman v. Schmid, 1948, 32 Cal. 2d 204, 195 P.2d 408; Happoldt v. Guardian Life Ins. Co., 1949, 90 Cal. App. 2d 386, 203 P.2d 55, and, National Union Fire Ins. Co. of Pittsburgh, Pa., v. California Cotton Credit Corp., 9 Cir., 1935, 76 F.2d 279, 289.
"The first policy contained a full-reporting or so-called `honesty' clause, which limits recovery to that proportion of the loss which the last reported value bears to the actual cash value of the property covered. The second policy contained an average clause which limited recovery to the proportion of the loss which the face value of the policy bears to the actual value of the property at time of loss.
"The controversy over both policies is the same and relates solely to the accuracy of the appraisers' estimate of the actual cash value of the property covered at the time of loss. Plaintiff asserts that the figure is substantially too high, thus resulting in a reduced recovery under the above clauses. Having heard the testimony of the appraisers, I have concluded and am satisfied that they performed their duties with great care and deliberation.
"Plaintiff contends that the award should be set aside on the grounds that the appraisers exceeded the limits of the submission agreement by including in the actual cash value property not covered by the insurance contract.
"The premises involved are a dog food cannery. The policy by its terms covers `801-805-817 E. 18th St. and 1701 Griffith St., Los Angeles, California.' The mailing address and main entrance are 817 E. 18th St. and the premises are usually known as 817 E. 18th St. From the outside the structure appears to be one large building, and is used as such and each unit is connected by a conveyor belt. On the inside the building contains several semi-separate units, which have been assigned by the city different street numbers, including some not listed in the policy. The appraisers considered all the property in the building in arriving at the actual cash value. Plaintiff contends that only the property located in the units whose addresses appear on the policy should have been considered.
"The court, having viewed the premises and having heard testimony as to the operation of the plant, is of the opinion that the entire plant is one integrated unit. This is admitted by plaintiff. The policies in question covered the entire premises and not just the addresses listed on the policy. In fact, the street numbers encircled the entire plant. There was thus no error by the appraisers in fixing the actual cash value to include all property located throughout the building.
"Plaintiff's second attack on the award is that property located in certain outside warehouses was erroneously included in the actual cash value. It is true that such would not properly be includable in determining actual cash value under the terms of the policies. But plaintiff has failed to establish that any improper matters were considered by the appraisers. The rule is well settled that every reasonable intendment is in favor of an award made by appraisers who have acted pursuant to the terms of a clause in a policy such as is involved here. [Aetna Ins. Co. v. Hefferlin, 9 Cir., 260 F. 695; Lundblade v. Continental Ins. Co., D.C.Cal., 74 F. Supp. 795]. Plaintiff has failed to establish any facts which would justify this court in finding that the appraisers had violated the terms of the submission agreement. On the contrary, the evidence shows that nothing in the outside warehouses was considered by the appraisers in determining the actual cash value.

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