Opinion
This case involves the interpretation of certain language in an insurance policy providing “all risk” coverage for an underwater construction project. The facts essential for the determination of the case may be summarized as follows:
The Carmel Sanitary District of Carmel-By-The-Sea (District) wanted to build an outfall pipe and diffuser system by which the treated sewage accumulated in its treatment plant ashore could be carried away and disposed of in the deep sea. The project required the construction of an effluent line (a concrete lined pipe extending way into the ocean) which was to be buried in the ocean floor in order to be protected against waves and surf action. The installation of the effluent line, the primaiy subject of the project, .necessitated the construction of a temporary trestle. The trestle, which constituted an integral part of the whole project, performed two main functions. One, it was utilized as a place from which the ocean depth was measured for the purpose of insuring a gradual descent of the effluent line. Two, it also served as a platform from which the excavations and pipe-laying operations were conducted.
Pursuant to bid, the building of the above described project was awarded to plaintiff Healy Tibbitts Construction Company, a general *746 contractor specializing in underwater marine construction (hereinafter appellant or contractor). The contract specifications required that before commencing the work the contractor submit written evidence that he had obtained so-called builders’ risk “all-risk” insurance coverage upon the entire project, including completed work and work in progress. Accordingly, the contractor requested its broker, Kelly, Kinkead & Hoag (hereafter Hoag) to review the contract specifications and obtain the necessary insurance. Hoag contacted Walter Clark, an underwriter with Sayre & Toso, which in turn was the underwriting manager of respondent and cross-appellant Employers’ Surplus Lines Insurance Company (Employers). In the course of their discussion, Hoag advised Clark in general terms of the construction project, including the fact that it called for the installation of a temporary trestlе. Following his meeting with Clark, Hoag directed a memorandum to Clark dated May 24, 1971, which, in effect, confirmed his request for “Builders’ Risk ‘All Risk’ coverage (including Fire, Flood & Earthquake), including completed work and work in progress” with the insured amount of $408,400, and at a premium rate of 2 percent. Thereafter, Hoag received a cover note from Clark on behalf of Sayre & Toso, Inc., wherein they bound the risk, describing the coverage as “ ‘All Risk’ Builders Risk (Installation Floater) as per form PP 1-54-0.”
As a result of the foregoing efforts, Employers issued an insurance policy covering the Carmel sewer project for the principal sum of $408,400, with a premium rate of 2 percent on said amount. The $408,400 figure represented the total contract price which included the cost of the temporary trestle as well. The insurance policy which bore the description “Installation Floater (Broad Form) Outfall Sewer, Carmel, California,” was sent to Hoag, who forwarded it to appellant with a transmittal letter stating that the Employers’ рolicy covered the captioned job for the period June 4, 1971 to December 1, 1971, “as per coverages outlined in the specifications.”
In reliance upon Hoag’s representation that the construction at issue was fully covered by the insurance policy, appellant commenced its construction activities. The working trestle was installed first, 600 feet in length running into the ocean and across the surf line. On the outboard side, the trestle had a dogleg of approximately 225 feet. On or about November 29, 1971, in the course of pipe-laying operations, an ocean storm arose which destroyed the outboard 225 feet of the trestle constituting the dogleg. The incident caused considerable delay in the *747 construction as well as sizable damages. As a result of the loss of the working platform, construction activities were suspended during the winter and the project was completed the following spring only by thе added expense of applying a floating barge for the pipe-laying operations. As a consequence of the storm, the removal cost of debris also greatly increased.
Knowing that previous damage to the trestle, totaling $11,011.36, caused by two prior storms, had been paid, appellant submitted its claim to Employers to recoup the loss suffered due to the November 29 storm. Placing its primary reliance on the exclusionary clause, Employеrs rejected the claim on the ground that the temporary trestle was not insured under the policy.
Thereupon, appellant brought an action against both the insurance carrier and Hoag, seeking recovery in three counts. The first cause of action was directed against Employers and was predicated on breach of insurance contract. In the second and third causes, appellant stated alternative causes of action against Hoag in the event recovery on the first cause of action was denied. The theories advanced against Hoag were negligent failure to procure the type of insurance requested (second cause of action), and breach of contract to obtain insurance for appellant (third cause of action). Employers, in turn, filed a cross-complaint against appellant, contending that the two earlier claims had been рaid by mistake and therefore are subject to recovery by the cross-complainant.
At trial, the court ruled that the policy as written failed to cover the temporary working trestle as a matter of law. The trial court nonetheless submitted the issue of coverage to the jury on the theory of estoppel based upon the representations made prior to and subsequent to the issuance of the policy. After hearing extensive evidence and being properly instructed, the jury rendered verdicts in favor of appellant and against Employers in the sum of $86,320; in favor of Hoag and against appellant; and in favor of appellant and against Employers on the latter’s cross-complaint. At the same time, pursuant to an earlier stipulation of the parties, the court allowed prejudgment interest on the sum of $43,115 of the principal judgment from the date of the complaint.
Employers moved for a new trial and the motion for a new trial was granted on the ground of insufficiency of evidence to justify the verdict. *748 Subsequently, at the request of appellant, and despite the fact that neither appellant nor Hoag had moved for a new trial, the court amended its prior order, nunc pro tunc, extending the order for a new trial to the judgment rendered in favor of Hoag as well, and limited the new trial to the issue of liability. Appellant and Hoag appealed from the оrder granting a new trial; Employers, in turn, filed a notice of cross-appeal from the adverse judgments entered on the complaint and cross-complaint.
Although the parties raise a host of issues involving procedural as well as substantive matters, it clearly appears that the initial question presented for adjudication is whether the insurance policy in dispute covers the loss caused to the trestle. Since in order to answer this question we must interpret thе insurance contract, first we will set out the basic principles controlling the interpretation of contracts, then proceed to review the pertinent provisions of the policy in light of the controlling principles of construction.
As has been frequently reiterated, the paramount rule governing the interpretation of contracts is to give effect to the mutual intention of the parties as it existed at the time of contracting, so far as the samе is ascertainable and lawful (Civ. Code,
1
§ 1636;
Lemm
v.
Stillwater Land & Cattle Co.
(1933)
The specific rules pertaining to the construction of insurance contracts may be summarized as follows: Absent circumstances indicat
*749
ing a contrary intention, words in an insurance policy are to be used in their plain and ordinary sense (§ 1644;
Jarrett
v.
Allstate Ins. Co.
(1962)
We turn now to the pertinent provisions of the policy. At the outset, we emphasize that the policy as written and issued by Employers embraces covеrage for all loss and damage to the insured property short of the exceptions specifically noted. 2 Also, the policy provides in general terms that “This Endorsement Covers Property of the Insured or Property of Others for Which the Insured May Be Legally Liable Consisting Principally of the Type Designated in the Declarations While in Transit, While at the Site of Installation and While Being Installed and Tested by the Insured or His *750 Employees.” (Emphasis added.) Finally, the exclusionary clause upon which Employees’ claim of nonliability is predicated excepts only such property or part of property of the insured that fails to constitute an installation or a part of an installation. The pertinent part of the exclusionary clause reads as follows: “2. This Endorsement Does Not Cover: [f| A. Property Owned by the Insured While at Locations Owned, Leased or Controlled by the Insured, Except [If] (I) Premises of Installation and [1f] (II) Places of Temporary Storage While Such Property Is in Due Course of Transit To or From Premises of Installation: [If] B. Tools, Contractors’ Equipment and Any Property Not a Part of or Destined to Become a Part of an Installation. ...” (Emphasis added.)
The cited provisions of the policy thus maké it evident that the crucial issue upon which the outcome of the issue of coverage ultimately depends is whether the insurance policy written and issued by Employers extends coverage to the damaged trestlе as a part of the installation. We believe a proper interpretation of the insurance contract in dispute compels the conclusion that the trestle built by the contractor must be deemed an installation or a part of an installation within the meaning of the policy, and as a consequence Employers must be held liable as a matter of law under the written insurance provisions.
To begin with, we note that in order to be covered the insuranсe contract at issue requires only that the property of the insured be “Premises of Installation,” or “a Part of an Installation.” The permanency of the installation is clearly not a requisite under the language of the policy. As defined in the cases, the word “install” means “ ‘to set up or fix . . . for use or service,’ ” while the word “installation” means “ ‘the whole of a system of machines, apparatus and accessories set up and arranged for working . . .’”
(Metzler
v.
Thye
(1912)
We entertain no doubt that under the above-stated broad definition and the circumstances of the instant case, the trestle clearly qualifies either as “Premises of Installation” or at least “a Part of an Installation” and thus falls within the coverage of the pоlicy. As the
*751
record indicates, the trestle, although removed at the completion of the main project, was built in the same manner as a permanent structure and was affixed to the ground. In fact, it was embedded in the ocean floor, being driven through sand and into rock excavations. Moreover, the record demonstrates that the construction of the trestle comprised a substantial portion of the project, constituting an indispensable and integral part thereof without which the building of the main project could not have been adequately conducted and completed. These important facts lend ample support to the conclusion that the trestle was constructed “ ‘for use or service’ ” and also that it was a part and parcel of the “ ‘whole of a system of. . . apparatus and accessories set up and arranged for working . . .’ ”
(Metzler
v.
Thye, supra,
It is evident that the holding of the trial court that the working trestle as a matter -of law was precluded from coverage under the policy is erroneous and lacking in either legal or factual support. It is well settled under established law that the intention of the parties must be ascertained, in the first instance, from the language of the contract itself
(Sawyer
v.
City of San Diego, supra,
The court is aware of the argument of appellant that it is customary to fix the premium of a policy on a construction job on a percentage of the total cost of construction whether covered by the policy or not. If this is indeed so, it seems only fair to the insured that the insurance company point out those portions of the job not covered by the policy either at the time the premium payment is accepted or the policy issued. Such action is even more important and more urgently indicated when the policy is representеd as an “all risk” policy.
Finally, even assuming arguendo that the amount of the premium is not determinative of this issue, the policy itself is in the amount of *753 $408,400, the full amount of the contract including the trestle. Since the cost of the trestle was approximately one-third of the total contract, can Employers seriously argue that it did not intend to insure the trestle? We think not.
Therefore, we hold that the insurance policy issued by Employers as a matter of law provides coverage for the trestle, and as a consequence Employers is bound by virtue of the policy to pay compensation to appellant for its loss sustained to the trestle. This holding disposes of and/or renders moot numerous other issues raised on appeal.
We are constrained to comment, however, on the fact that the trial court granted the motion for a new trial on the ground that the estoppel, the alternative theory of recovery, was not supported by sufficient evidence. This conclusion is somewhat difficult to understand in the light of the facts that have already been discussed, i.e., the premium for. the policy was calculated in substantial part on the cost of the trestle, and the dollar amount of coverage also includes this cost. It seems to this court that these facts standing alone would support a verdict based on estoppel. Additionally, however, Employers had already paid two similar claims on the trestle. Had Employers denied coverage on the first claim of $2,073.11, a comparatively small sum, appellant could have sought other insurance or challenged Employers’ interpretation of the contract instead of being lured into a false sense of security. The problem thus created by Employers’ payment of the claim was then compounded by the payment of the second claim of $9,938.25, a substantial sum, by Employers. Why the paymеnt of these claims by Employers would not also support a finding of estoppel is indeed mystifying. Assuming arguendo that there was no coverage, then surely Employers misled the appellant by accepting the premium and paying two similar claims, thereby representing that there was coverage. The appellant was thus induced to refrain from obtaining full coverage in reliance upon Employers’ conduct and was damaged, facts which completed the bаsic requirements of estoppel.
This brings us to two other issues, both of which are obviously without any substance and subject to summary disposition. Employers’ contention that the ambiguity in the policy was caused by Hoag, who requested the policy, is manifestly specious. It is unarguable that the policy was written and issued by Employers. The cases are numerous which hold that where the language in a contract is ambiguous the contract
*754
must be construed against the party who has
prepared
it (§ 1654;
Taylor
v.
J. B. Hill Co.
(1948)
Finally, as to the granting of a new trial as to Hoag, when neither Hoag nor the appellant made a motion for said new trial, the trial court lacked jurisdiction to make such an order. The provisions of section 657 of the Code of Civil Procedure require that a new trial may be granted “on the application of the party aggrieved.” The cоurt has no inherent power to grant a new trial on its own motion (see 5 Witkin, Cal. Procedure (2d ed. 1971) § 45, p. 3621). Furthermore, where only one of several defendants serves a notice, the court lacks jurisdiction to grant a new trial as to the others (see 5 Witkin, Cal. Procedure, supra;
Lee
v.
Superior Court,
The order granting a new trial is reversed and the judgment on the complaint is affirmed. The prejudgment interest stipulated to by the jury and allowed by the trial court is ordered reinstated. The judgment on the cross-cоmplaint is affirmed. Costs on appeal are awarded to appellants Healy Tibbitts Construction Co. and Kelly, Kinkead & Hoag.
Taylor, P. J., and Rouse, J., concurred.
A petition for a rehearing was denied September 16, 1977, and the petition of the defendant, cross-complainant and appellant for a hearing by the Supreme Court was denied October 13, 1977.
Notes
Assigned by the Chairperson of the Judicial Council.
Unless otherwise indicated, all references will be made to the Civil Code of California.
Paragraph 3 of the policy provides that “THIS ENDORSEMENT INSURES AGAINST ALL RISKS OF DIRECT PHYSICAL LOSS OF OR DAMAGE TO THE INSURED PROPERTY EXCEPT AS OTHERWISE PROVIDED.” (Emphasis added.)