United States Fidelity & Guaranty Co. v. Corbett

Bell, J. (After stating the foregoing facts.) In an action by the owner of personal property, such as an automobile, to recover for loss or damage sustained by him as a result of a tortious injury thereto, the measure of damages is to be determined under general principles of law. Olliff v. Howard, 33 Ga. App. 778 (127 S. E. 821). But in a suit on a contract, as a policy of insurance, whereby the owner is insured against actual loss or damage to an automobile by collision, the measure of the insurer’s liability will be determined according to the terms of the contract. In an action on an insurance policy, to recover the “actual loss or damage” by collision to an automobile, in which it is stipulated that the insurer shall in any event be liable “only for the actual cost of repairing, or, if necessary, replacing the parts damaged and destroyed,” where it is possible by repair and replacement to restore the automobile to its former condition within a reasonable time (Non-Royalty Shoe Co. v. Phoenix Assurance Co. (Mo.), 178 S. W. 246; Central Garage Co. v. Columbia Ins. Co., 96 N. J. L. 456, 115 Atl. 401), the defendant might by proper pleading and evidence limit the plaintiff’s recovery to the amount necessary to accomplish such restoration. Spivey-Johnson Portrait Co. v. Belt Automobile Ins. Assn., 210 Ala. 681 (99 So. 80); Letman v. Employers Liability Assurance Corp., 170 Ill. App. 379; Wolff v. Hartford Eire Ins. Co., 204 Mo. App. 491 (223 S. W. 810); Md. Motor Car Ins. Co. v. Smith (Tex. Civ. App.), 254 S. W. 526; Commercial Fire Ins. Co. v. Allen, 80 Ala. 571 (6) (1 So. 202); Burkett v. Ga. Home Ins. Co., 105 Tenn. 548 (58 S. W. 848); Texas Moline Plow Co. v. Niagara Fire Ins. Co., 39 Tex. Civ. App. 168 (87 S. W. 192); McCready v. Hartford Fire Ins. Co., 61 App. Div. 583 (70 N. Y. Supp. 778). The actual cost of repairing or replacing the injured or destroyed parts could be materially greater or less than the actual depreciation in value of the property by reason of the injury. 17 C. J. 877; 26 C. J. 353; 2 Sutherland on Damages (4th ed.), 3040, § 821; So. Ry. Co. v. Ky. Grocery Co., 166 Ky. 94 (178 S. W. 1162); and cases cited above. But “Policies of insurance will be liberally construed in favor of the object to be accomplished, and the conditions and provisions of contracts of insurance will be strictly construed against the insurer who prepares such contracts.” Johnson v. Mutual Life Ins. Co., 154 Ga. 653 (115 S. E. 14). So, [611] under the provisions of the policy now under consideration, the undertaking of the company to insure the owner against “actual loss or damage” must be taken as the primary obligation, under which the measure of the liability would be the difference between the value of the property immediately before the injury and its value immediately afterwards (Eberhardt v. Federal Ins. Co., 14 Ga. App. 340 (2), 80 S. E. 856); and the stipulation that the liability should not exceed the cost of repair ot replacement must be construed as a subordinate provision, limiting or abating the primary liability, to be pleaded defensively if the insurer would diminish or limit the amount of recovery by reason thereof. Mechanics Ins. Co. v. Hoover, 105 C. C. A. 128 (182 Fed. 590, 31 L. R. A. (N. S.) 873); Standard Sewing Machine Co. v. Royal Ins. Co., 201 Penn. 645, 51 Atl. 354; Haden v. Imperial Ins. Co., 197 Mo. App. 574 (198 S. W. 72). Since an appraisement which conforms to the requirements of the policy and under the agreement for submission is, in the absence of fraud, accident, or mistake, binding and conclusive upon the parties as to the amount of the loss or other matters submitted (Eberhardt v. Federal Ins. Co., supra; Saville v. Ætna Ins. Co., 8 Mont. 419 (20 Pac. 646, 3 L. R. A. 542); 26 C. J. 425, § 560), it would seem that if the insurer saw fit to submit the question of the amount of its liability to appraisers, without insisting upon such secondary or subordinate stipulation and without bringing facts before them to show its applicability in reducing the liabilitjp and if the appraisement was otherwise valid, the insurer could not rely--upon such matter in defense to a suit upon the policy for the amount so determined by the appraisers. But whether it might do so by plea is a question not for decision under the record before us. The question now presented is whether the defense could be made by a demurrer attacking the petition upon the ground that it appeared that the appraisers determined the amount of the loss in a manner contrary to the terms of the policy, where there is nothing to show that the defendant made any contention before them that its liability should be fixed by the special provision referred to. We are satisfied that the defense could not be so made by demurrer. Where a policy of insurance against loss or damage to property provides that if the parties thereto fail to agree as to the amount of loss, it shall be determined by appraisers, one tp be [612] named by each of the parties and the two thus named to select a third, to whom the parties shall submit any difference, and that the award in writing of such appraisers, or a majority of them, shall determine the amount of loss, and-where the policy contains no other provisions respecting the effect of the appraisement, an appraisement had thereunder does not constitute either a statutory or common-law award, and the question of whether the submission to the appraisers should have been in writing should be determined by the terms of the policy. The policy now under consideration did not require a written submission. Blakely Oil &c. Co. v. Proctor & Gamble Co., 134 Ga. 139 (2) (67 S. E. 389); Williams v. Hamilton Fire Ins. Co., 118 Misc. 799 (194 N. Y. Supp. 798). When the allegations of the petition are construed in the light of the provisions of the policy, it sufficiently appears that the parties had a difference, namely, as to the amount of the loss, and this was the matter submitted to the appraisers; and it can not be said that the appraisement was invalid because it nowhere appears in the petition “what question of dispute between petitioner and defendant was submitted to the appraisers.” Eberhardt v. Federal Ins. Co., supra. The fact that the appraisers may have had no authority to “award any sum to any jDerson,” and that they may have exceeded their powers in attempting to determine the liability, and in other respects, would not vitiate that part of the appraisement which was responsive to the question submitted. Hexter v. Equitable Fire &c. Ins. Co., 123 Me. 77 (121 Atl. 555); and compare Civil Code (1910), § 5022. The policy not requiring it, it was not necessary for the appraisement to set out in detail the facts made the basis thereof, and a statement of the amount of loss in a general conclusion was sufficient. 26 C. J. 423. Under the allegations of the petition, the appraisement was not invalid for any reason urged in the demurrers. But even granting, for the sake of the argument, that the appraisement was void, the first count of the petition contained sufficient allegations, independently thereof, to state a cause of action, doing so even by the measure of liability asserted in the demurrers to be the proper measure. A void appraisement has no effect upon the rights of the parties, and suit may be maintained on the policy without regard thereto. 26 C. J. 425; Ætna Ins. Co. v. Jester, 37 Okla. 413 (132 Pac. 130, 47 L. R. A. (N. S.) 1191). [613] The averment in the first count of the petition, that the actual loss and damage to the automobile consisted of a stated amount alleged to be necessary for the actual cost of repairing and replacing the various parts destroyed, as shown by an attached statement itemizing the “parts and articles and the cost of each, together with the other cost required to be expended . . in repairing and replacing the damaged or destroyed parts of said automobile,” was not subject to special demurrer on the ground that it failed to show what parts were injured and what parts were destroyed. Central Ga. Power Co. v. Stubbs, 141 Ga. 172 (3) (80 S. E. 636); Central Ga. Power Co. v. Fincher, 141 Ga. 191 (2) (80 S. E. 645); Mackle Construction Co. v. Wyatt, 29 Ga. App. 617 (116 S. E. 877). The allegations made for the purpose of subjecting the defendant to liability for attorney’s fees and damages were not open to special demurrer upon the ground that they were mere conclusions of the pleader. Rogers v. American National Ins. Co., 145 Ga. 570 (3) (89 S. E. 700); Jefferson Fire Ins. Co. v. Brackin, 147 Ga. 47 (2) (92 S. E. 930). From what has been said the first count of the petition was not subject to the general demurrer nor to any of the special demurrers. The petition contained a second count which sought a recovery upon the arbitration or award. An appraisement such as was contemplated by the terms of the policy in question would not determine liability. Not being an award, either common-law or statutory, it could amount to nothing more than a contractual method of ascertaining the loss, settling no other fact, and could not alone be the basis of a cause of action or judgment. The question of ultimate liability remained open, and the suit at last could be founded only upon the policy. Republic Iron & Steel Co. v. Norris, 25 Ga. App. 809 (104 S. E. 921); Eberhardt v. Federal Ins. Co., 14 Ga. App. 340 (80 S. E. 856); Willingham v. Veal, 74 Ga. 755 (3); Central R. Co. v. Rogers, 57 Ga. 336 (2); Williams v. Hamilton Fire Ins. Co., supra; Dunton v. Westchester Fire Ins. Co., 104 Me. 372 (71 Atl. 1037, 20 L. R A. (N. S.) 1058); 5 C. J. 17; 26 C. J. 425; City of Omaha v. Omaha Waterworks Co., 218 U. S. 180 (30 Sup. Ct. 615, 54 L. ed. 991, 48 L. R. A. (N. S.) 1084). The rule would be otherwise as to an adjustment or [614] arbitration adjusting tbe liability as well as the loss. 26 "C. J. 432. In Littleton v. Patton, 112 Ga. 438 (37 S. E. 755), in which a suit on an award provided for in an original contract was held good as against a general demurrer, it appears that the parties “further agreed that they would pay such sums as were allowed by the arbitrators.” Since the second count was subject to the general demurrer, it is unnecessary to notice the special demurrer to this count. Judgment affirmed in part, and reversed in part. Jenlcins, P. J., and Stephens, J., concur.