DiLeo v. United States Fidelity & Guaranty Co.

GOLDENHERSH, P. J.,

dissenting:

I respectfully dissent from the conclusion reached by the majority.

In its findings of fact the trial court found that the time required, with the exercise of due diligence and dispatch, to restore the building to a condition suitable for use in the operation of plaintiffs’ business was 4 months (finding No. 30). This finding of fact is supported by the evidence.

There is no need to remand the cause to determine what the normal payroll expenses for key personnel necessary to enable plaintiffs to resume business would be during the four-month period, for the reason that the trial court has already done so. In its finding No. 24 the trial court adopted the calculations in defendants’ exhibit 2 which are predicated upon a normal payroll for the period of $12,040.42, and an actual payroll of $1,381.69, and the evidence sustains a finding that these expenditures were necessary within the contemplation of the policy. Had plaintiffs actually paid these sums for the four month period, they would be recoverable under the policy.

The fact that plaintiffs did, or did not resume business does not affect the measure of recovery under the policy. In either event the time in question is that required “with the exercise of due diligence and dispatch to rebuild, repair or replace such part of the property herein described as has been damaged or destroyed.” Even in instances where there is an actual resumption of business, there might still be an issue of whether it was accomplished with due diligence and dispatch, and in both situations the measure of recovery is the reduction in gross earnings, less charges and expenses which do not necessarily continue.

The evidence shows that although the retention of the employees was necessary to enable plaintiffs to resume operations with the same quality of service which existed immediately preceding the loss, the fact is that plaintiffs’ actual loss is only for the two-week period. In my opinion the judgment compensates plaintiffs for the actual loss sustained, and to award plaintiffs a sum of money admittedly not expended would result in a recovery in excess of what is warranted by the provisions of the policy.

In my opinion, the trial court awarded plaintiffs the sum due under the evidence, and in that respect I would affirm the judgment.

I agree with what was said by the majority with respect to prejudgment interest, and would remand the case for the sole purpose of modifying the judgment by awarding plaintiffs interest on the sum of $4,987.87, commencing 60 days after the date on which defendants were furnished proof of loss.