Parlier Fruit Co. v. Fireman's Fund Insurance

DRAPER, J. Plaintiff’s packing house was destroyed by fire in 1952. This action was brought to recover upon policies of fire insurance covering the packing house and its contents, as well as on oral “binder coverages,” allegedly issued by a-general agent for six defendant insurers, covering use and occupancy loss. On the first trial, judgment was in favor of plaintiff as to the fire insurance, and in favor of defendants on the binder coverages. The judgment for plaintiff was affirmed on appeal, and that in favor of defendants was reversed. (Parlier Fruit Co. v. Fireman’s etc. Ins. Co., 151 Cal.App.2d 6 [311 P.2d 62].) Retrial concerned only the use and occupancy insurance. The trial court determined the form of policy which was contemplated by the parties; that the premium for such policy was $1,950.75; and that plaintiff’s use and occupancy loss thereunder was $74,985. Judgment was entered in favor of plaintiff for the latter amount plus interest, less, however, the amount of the annual premium. Plaintiff appeals, contending only that the premium of $1,950.75 should not have been deducted.

Plaintiff’s principal argument is that defendants cannot have this offset because they failed to assert it by way [359]of counterclaim or cross-complaint. But defendants introduced evidence establishing the premium for a policy of the type upon which recovery is here allowed, and showing that such a policy would be issued only upon payment of the annual premium at the outset. Plaintiff not only failed to object to this testimony, or to move to strike it, but cross-examined at length in an attempt to establish a short rate premium charge. The general rule that “ (a)n unpleaded issue tried without objection becomes an issue in the ease” (Smith v. Smith, 115 Cal.App.2d 92, 99 [251 P.2d 720]; see also Hails v. Marts, 28 Cal.2d 775 [172 P.2d 52]) has been applied to such unpleaded defenses as the statute of limitations (Jones v. Pleasant Talley Canal Co., 44 Cal.App.2d 798, 806-807 [113 P.2d 289], laches (Matieson v. Bank of Italy, 97 Cal.App. 643, 649 [275 P. 998]), and contributory negligence (Moeller v. Packard, 86 Cal.App. 459, 460 [261 P. 315]). In the case at bar, the existence of plaintiff’s right to issuance of a definite insurance policy under the “binder coverage” was at the heart of its case. Plaintiff could not have the benefits of such a policy without its burdens. In such situation, it is both proper and fair to hold that plaintiff made the premium offset an issue by permitting and participating in the presentation of evidence as to the propriety and amount of that charge.