Rutherford, Inc. v. Rouse

BRAY, J. From a judgment against them for $6,741.43 entered upon a jury verdict, defendants Rouse and Underwriters at Lloyd’s appeal.

Questions Presented

1. Did the evidence of insurance issued by defendants to plaintiff cover the Atkinson contract ?

2. Was the cost of fighting fire an element of damage under the policy?

Facts

In May, 1949, plaintiff had a contract with the Utah Construction Company to do clearing over segments of a roadway which the latter had contracted with the United States government to build through a national forest in Oregon. Under this contract, plaintiff was required to obtain a contract of indemnity insurance. An underlying contract of insurance limited to a $5,000 loss was obtained from the Hartford Fire Insurance Company. The excess over this amount was obtained from defendants Rouse and Underwriters for plaintiff by its insurance brokers, Johnson and Wright, dealing through defendant Philip Antrobus, Inc., who represented Rouse and the Underwriters. The policy in question [131]indemnified plaintiff “for any and all sums which the Assured shall by law become liable to pay, and shall pay, or by final judgment be adjudged to pay ... as damages for:— Damage to Property ... by reason of operations” described in the Hartford policy, and for loss “in respect of Property Damage Liability only” on certain numbered contracts between plaintiff and the Utah Construction Company “and extensions of, or additions to, contracts at the same location between the same parties.” The term of the policy was from May 27, 1949, to May 27, 1950. Early in 1950 plaintiff completed its work for the Utah Construction Company. Plaintiff thereupon took a subcontract from Guy F. Atkinson Company, which held a master contract for the construction of a further segment of the highway. March 30, 1950, plaintiff’s broker wrote Antrobus: “Will you kindly furnish us with certificate of insurance under captioned policy for: Guy F. Atkinson, Cascade Building, Portland, Oregon. This is in connection with some work which Rutherford, Inc., is subcontracting from Guy F. Atkinson near Lowell, Oregon. The amount of the contract is approximately $200,000.00. We will furnish you with additional information when we get a copy of the contract.” March 31st, Antrobus replied: “We enclose Certificate of Insurance for Guy F. Atkinson per your letter dated March 30th. We wish to remind you that the above captioned Certificate expires on May 27, and we will appreciate renewal advices at your convenience.” Enclosed was the following document: