Breuer v. Continental Insurance Co.

HOLT, Justice. Defendant appeals from the order denying its motion in the alternative for judgment notwithstanding the verdict or a new trial. Plaintiff, the owner of an automobile, was insured by defendant against loss or damage thereto on account of collision or upset. While so insured and on May 25, 1931, the car ran off the highway near Casselton, North Dakota, struck a telephone pole, and was damaged. Defendant was notified of the accident and employed Charles J. Vogel of Fargo to adjust plaintiff’s loss. So far there is no dispute between the parties. But subsequent delays and misunderstandings occurred which resulted in the bringing of this action for conversion of the car. The car was a Willys coupé, bought by plaintiff in the fall of 1930 from a person operating a garage at Callaway, Minnesota. The damage to it was estimated at about $200 and its value before being damaged at $775. Plaintiff desired that the one who sold her the car should repair it. Mr. Vogel had caused Steen & Berg, garage men at Fargo, to estimate the cost of the repair, and plaintiff claims that Vogel agreed to adjust the loss by having Steen & Berg-make the repairs and deliver it to plaintiff in the condition it was before the accident; that she was notified on August 8 that the repairs had been made; that she thereupon went to Vogel and requested its delivery; that Vogel refused to deliver the car unless she signed a subrogation agreement; and that she refused so to sign. She testified that there were subsequent negotiations and futile demands for the car; and that finally, on November 4, 1931, she, with *114 two other persons, went to Vogel’s office and again demanded possession of the car but was refused unless she signed the subrogation agreement. About two months thereafter this action was brought. Defendant maintains that Vogel had no authority to make the agreement plaintiff contends he made; that in fact he neither made such agreement nor employed Steen & Berg to get the car from the garage it was taken to at Casselton, after the collision, nor employed that firm to repair it; that plaintiff directed Steen & Berg to bring the car to their garage at Fargo and make the repairs; and in fact ordered them to repair brake linings, the need of which repair ivas not caused by the accident. Of course, if the contention of defendant was found true by the jury, there was no conversion, as the court properly instructed. Under the testimony adduced by plaintiff, the taking of the car by defendant to Steen & Berg’s garage, and their possession while the repairs were made, was with her consent. It was in legal effect a bailment. There is no proof that anything done with the car, either by defendant through Vogel or by Steen & Berg until the repairs were completed, was in violation of plaintiff’s rights in or to the car. But plaintiff claims that under the agreement the loss was to be adjusted by defendant’s making the repairs and delivering it to her when repaired. The first legal question presented is that Vogel as adjuster had no authority to adjust the loss by agreeing to repair the car; that his employment went no further than to agree with the assured upon the amount of the loss. We doubt whether an adjuster under this policy is so restricted. It provides that the appraised loss or damage shall in no event exceed “what it would then cost to repair or replace the automobile or parts thereof with other of like kind and quality.” If the adjuster in such a case, instead of agreeing upon the amount of the loss to be paid, should agree to replace or repair the parts damaged, it would be rather narrow construction to hold that it was not within his authority. From Roemhild v. Home Ins. Co. 130 Or. 50, 59, 278 P. 87, 90, particularly relied on by defendant, we quote: *115 “In 1 C. J., at page 1237, an adjuster is defined as ‘one whose business is to ascertain the loss and agree with the assured on the settlement; one who determines the amount.of a claim, as a claim against an insurance company; the person who makes the adjustment or settlement.’ ” In Lancashire Ins. Co. v. Barnard (C. C. A.) 111 F. 702, 704, it is said: “But an adjuster is empowered to settle the alleged loss. A settlement of the loss necessarily involves the exercise of the option to pay the damages sustained, or to rebuild or repair the building injured. The whole is always greater than and includes all its parts, and the authority to settle a loss includes the poAver to do any laAvful act and to make any legal contract to fix the amount of and to discharge the liability.” We find no restrictions or limitations Avhen defendant named Mr. Vogel as adjuster of the loss plaintiff sustained in collision or upset of her car. As supporting defendant’s contention, that his authority could go no further than to agree with plaintiff upon the amount of the loss, is cited Chisholm v. Royal Ins. Co. Ltd. 225 Mass. 428, 114 N. E. 715, 716. In that case the adjuster agreed that the insurance company not only should repair the damage to the car resulting from its theft but also should put the car in as good condition as Avhen neAv. The adjuster’s agreement Avas held good to the extent of the coverage of the policy and properly no further, the court saying [225 Mass. 431]: The adjuster “had authority only to ascertain and adjust the loss sustained by the theft of the automobile; and there is nothing in the record to sIioav that the company ratified his alleged agreement to give the plaintiff a practically neAv car, or that it Avaived the provision of the policy limiting its liability to the actual cost of repairing, or, if necessary, replacing the parts damaged or destroyed by the theft.” It seems the inference from this language is against defendant’s contention. Roemhild v. Home Ins. Co. 130 Or. 50, 278 P. 87, *116 is also cited with confidence by defendant. In that case an adjustment of the loss had been made, and a certain agreement was alleged between a garage having charge of the repairs and the adjuster as to transporting the car from one place to another in order to make the repairs. In the action for damages by a third party, injured in a collision on the highway when the car was transported, the trial court excluded evidence by the insurance company that the adjuster had no authority to enter the agreement for transportation. This was held error. This case is not an authority upon the facts which the jury was warranted in finding in the case at bar. However, we find it unnecessary here to define the limits of the authority conferred on Mr. Vogel by his employment as loss adjuster, for we consider that there is evidence from which the jury could find that defendant adopted and ratified Vogel’s acts in undertaking to repair the car in settlement of the loss. Plaintiff testified that she did not direct Steen & Berg to take possession of the car or to repair it. In this she was in a measure supported by the fact that Steen & Berg charged the work to Vogel. Vogel’s authority to employ Steen & Berg is indicated by defendant’s making its check or draft for the amount of the repairs payable to the order of Steen & Berg as well as to plaintiff. There was no pretense that defendant so made it payable at plaintiff’s request. By letter of November 5, 1931, plaintiff advised defendant directly as to the agreement she had made with Vogel, pursuant to Avhich she had delivered possession of the car for repairs by defendant, and complained of the refusal to return it to her. She also advised defendant of the unreasonable demand of Vogel that she should first make a subrogation assignment to defendant. There was no subsequent word from defendant in any manner denying authority in Vogel in the premises. In our opinion the jury could well find that Vogel had authority to make the settlement plaintiff testified he did make with her. It appears that the only excuse Vogel and defendant made for not delivering the car, after being repaired, was, according to plaintiff’s testimony, that she should first make a subrogation assign *117 ment to defendant of her cause of action for negligence of a third party. At the trial defendant virtually conceded that this was an unreasonable demand, for the car left the road through no one’s negligence, unless it was the negligence of plaintiff herself, Avho then held the steering wheel. While the repairs were going on Steen & Berg suggested that brake linings should be replaced, at a cost of $11 or $12. This was not covered by the policy, and plaintiff agreed to pay for that. At no time did that item figure in the controversy or misunderstandings between the parties to this action. So neither the failure to sign the subrogation document nor the brake linings ordered by plaintiff can serve as a valid excuse for depriving plaintiff of possession of her car, and need not be considered of any importance in this appeal. Defendant urges that a cause of action for breach of contract cannot be changed into a cause of action for conversion. Lininger Imp. Co. v. Queen City F. Co. 73 Colo. 412, 216 P. 527; Farmers State Bank v. Bowles, 52 N. D. 553, 203 N. W. 903, 40 A. L. R. 377, are cited. A mere reading of those decisions indicates the rule to be inapplicable to the facts herein as the jury could and did find them. If the car was bailed to defendant for the purpose of repairing the damage covered by the policy, plaintiff was entitled to a return when repaired. If then Avithheld from her without just cause, there was a conversion, and she Avould be entitled to the reasonable value of the car. The same damages would result if the action had been for failure to deliver after the repairs were made. But a Avrongful exercise of dominion over personal property to the exclusion of the rightful oAvner, depriving the latter of its use and possession, is conversion. Wellberg v. Duluth A. S. Co. 146 Minn. 29, 177 N. W. 924, appears to be in point here. There are many assignments of error upon rulings excluding or admitting testimony. They have all been examined, but we find none that can be held prejudicial to defendant. The attorneys on both sides were vigilant in interposing technical objections. But in the course of the trial, with the introduction of other testimony or proper foundation, the objections faded and the evidence sought *118 to be introduced was properly received or excluded. We discover no substantial error in the rulings. Exception is also taken to that part of the charge which submitted to the jury whether or not defendant by conduct had estopped itself from asserting that Vogel had exceeded his authority, in that the court eliminated the question of his actual authority from the jury. But as we read the part of the charge now challenged, it specifically leaves to the jury to find what authority defendant had given him. It was stated that defendant claimed that Vogel had no general authority; that he was appointed for a specific purpose and was without authority to make the agreement plaintiff asserted was made. The charge as given finds support in 2 Couch, Insurance, p. 1168, on the subject of apparent authority. We think there is no merit in the contention that plaintiff waived her cause of action for conversion when on November 1, 1931, she presented another proof of loss to defendant in an attempt to get her car. Defendant did nothing in reliance thereon. Plaintiff recovered on a second cause of action for premium paid on this policy but which had not been earned when, by defendant’s conversion of the car, the policy-became useless to her. Of course if there was no conversion of the car there could have been no recovery on the second cause of action. But Ave conclude that the verdict for conversion must stand, and that the unearned premium on the policy should be returned. Defendant does not question the amount. The order is affirmed.