Opinion ID: 681237
Heading Depth: 3
Heading Rank: 2

Heading: The Resulting Injury Issue

Text: 10 The district court noted that the plaintiff's president testified at trial that he had decided to cancel his specific pollution coverage policy with Federated, regardless of representations made by Williams, because of the high cost of the policy. In fact, Breshears dropped pollution coverage for the site at issue before the meeting with Williams even took place, thus Williams' statements cannot have caused Breshears to give up its insurance protection for the gas spill. Federated thus argues, and the district court agreed, that the only way plaintiff could have been damaged by Williams' misrepresentations would be for plaintiff to have shown that it could have obtained pollution insurance from another insurer at a cost it would have been willing to pay. Plaintiff did not produce any such evidence, thus the court held that the plaintiff did not meet the injury requirement as a matter of law. 11 Plaintiff contends that the evidence it produced, showing that it would have looked for other insurance had the alleged misrepresentations not been made, was sufficient to satisfy the resulting damage element. Indeed, plaintiff's President also testified that if he had not been able to obtain pollution insurance from another insurer, he would have probably looked to sell the site. If successful, either option would have avoided the pecuniary damage plaintiff has suffered in this case as a result of its liability for the spill. Plaintiff contends that, in reliance on Williams' statements that it was insured for incidents such as gasoline spills, it did not look for viable alternatives during the period between its dropping of its pollution insurance and the time of the accident. 12 Under California law, a plaintiff may recover for fraud when he shows that, because of the defendant's misrepresentations, he has sustained some pecuniary damage or injury by reason of having been put in a position worse than he would have occupied had there been no fraud. R.D. Reeder Lathing Co. v. Cypress Ins. Co., 3 Cal.App.3d 995, 999 (1970). We conclude that plaintiff was not obligated under California law to show that it would have been successful, in either trying to sell the site or obtaining another insurance policy at a low price, in order to have met its burden. Plaintiff produced sufficient evidence that it has sustained injury by having been put in a worse position by Williams' statements. Whether plaintiff's position of looking for coverage, or to sell the site, is a better position than that of still believing it is fully covered is a question that the jury should have decided in this case as a factual matter. 13 Therefore, we conclude that the district court erred in ruling for Federated as a matter of law on the fraudulent misrepresentation claim, and we remand that claim to the district court for retrial.