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Law School Case Brief

Kossian v. Am. Nat'l Ins. Co. - 254 Cal. App. 2d 647, 62 Cal. Rptr. 225 (1967)


Where a person is entitled to restitution from another because the other, without tortious conduct, has received a benefit, the measure of recovery for the benefit thus received is the value of what was received.


In Feb. 1964, fire destroyed a portion of an inn, which was owned by one Reichert. At the time, the property was subject to a first deed of trust in which defendant American National Insurance Company ("American") was the beneficiary. American's interest in the property was protected by policies of fire insurance. In March 1964, Reichert entered into a written contract with plaintiff Peter Kossian who agreed to clean up and remove the debris from the fire damaged portion of the inn for the sum of $ 18,900. American had no knowledge of the agreement. After Kossian had fully performed the contract, Reichert filed a petition in bankruptcy. The trustee in bankruptcy abandoned the premises comprising the inn, together with any interest in the fire insurance policies up to the amount of $ 424,000. Thereafter, Reichert and his wife assigned their interest in the policies to American. The insurance carriers paid American's subsequent claims under the policies, which included at least a part of the cost of debris removal and demolition. Kossian later filed a lawsuit against American in California state court seeking to recover insurance money for work he performed in cleaning up and removing debris. American filed a motion for summary judgment, which the trial court granted. Kossian appealed.


Could Kossian recover for services he performed in cleaning up and removing debris after the fire at the inn?




The court of appeal reversed the trial court's judgment. The court concluded that the doctrine of unjust enrichment was applicable to the facts of the case, and that Kossian was entitled to reimbursement out of the insurance proceeds paid to American for work he performed. It was clear that American, in addition to taking over the property that Kossian cleared of debris, also received indemnity insurance payments covering at least part of the cost for clearing that property of debris. American could not be indemnified twice for the same loss. Thus, to the extent that American received insurance proceeds for debris removal performed by Kossian, Kossian should recover. If American received less than the value of Kossian's work, then Kossian should recover to that extent.

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