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Peter Kossian v. American National Insurance Co.

California Court of Appeal, Fifth District
254 Cal.App.2d 647 (1967)


Facts

A portion of the Bakersfield Inn, owned by Reichert, was destroyed by fire. At the time of the incident, the property was subject to a deed of trust (i.e., mortgage) in which American National Insurance Company (American National) (defendant) was the beneficiary. Reichert hired Peter Kossian (plaintiff) to clean up and remove the debris from the fire-damaged portion of the Inn for $18,900. American National had no knowledge of the agreement between Kossian and Reichert. Kossian completed the work within two months. During that time American National provided notice to Reichert that he was in default on the deed of trust. Kossian did not know about the default until after the work was completed. After Kossian had fully performed the work, Reichert filed for bankruptcy. Thereafter, American National submitted claims totaling $160,000 under fire insurance policies, including the estimated sum of $18,000 for removing and cleaning the debris from the Inn. After negotiations between American National and the fire insurance carriers, a figure of $135,620 was agreed upon and paid to American National. Kossian filed suit against American National seeking payment for the work he performed. The trial court granted American National’s motion for summary judgment and Kossian appealed.

Rule of Law

Issue

Holding and Reasoning (Stone, J.)

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