No. 88,320
IN THE COURT OF APPEALS OF THE STATE OF KANSAS
J. MICHELLE JOHNSON and ALAN L. JOHNSON,
Appellees,
v.
WESTHOFF SAND COMPANY, INC.,
Defendant,
v.
MID-CONTINENT CASUALTY COMPANY,
Appellant.
SYLLABUS BY THE COURT
1. A party's waiver of its right to a full trial rather than a bench trial on stipulated facts should be explicit and unequivocal.
2. A party claiming error has the burden of furnishing a record showing prejudicial error. In the absence of such a record, an appellate court presumes that the action of the lower court was proper.
3. An appellate court's standard of review is de novo when the district court's decision is based upon stipulated facts and construction of the underlying insurance policy.
4. Failure to provide timely notice is not alone sufficient to excuse defense by an insurance company; there must also be a showing of actual prejudice to the insurance company. Such prejudice is not presumed, and the burden is on the insurer to show the prejudice is substantial.
5. It is not required that an insured personally give notice of an occurrence; the issue is whether notice was given by anyone to the insurance company, giving it an opportunity to make an investigation and defend the litigation.
6. An insurance company to successfully raise a noncooperation defense must show that it acted in good faith and attempted to secure the attendance and testimony of its insured at trial. In addition, the company must show substantial prejudice resulting from an inability to locate its insured before trial.
7. Whether an insurance company's refusal to pay is without just cause or excuse is determined on the facts and circumstances in each case.
8. An award of attorney fees rests within the judicial discretion of the trial court. An award will not be disturbed on appeal absent a showing of abuse of discretion.
9. K.S.A. 40-256 provides for the allowance of reasonable attorney fees. This statute does not contemplate a speculative or contingent fee conditioned on winning a case.
10. Circumstances to be considered in determining reasonable attorney fees include the amount and character of the services rendered; the labor, time and trouble involved; the nature and importance of the litigation or business in which the services were rendered; the responsibility imposed; the amount of money or the value of the property affected by the controversy or involved in the employment; the skill and experience called for in the performance of the services; the professional character and standing of the attorney and the results secured.
11. The judgment creditor in a garnishment proceeding is a third-party beneficiary of the underlying contract of insurance entitled to assert a claim arising from a breach of the insurance company's duty to exercise reasonable care and good faith in efforts to settle a claim against its insured.
12. An insurance company guilty of wrongfully refusing to defend an action against its insured may be held liable for the amount of a judgment in excess of policy limits on a showing that the excess judgment is traceable to the refusal to defend.
Appeal from Johnson District Court; GERALD T. ELLIOTT, judge. Opinion filed February 7, 2003. Affirmed in part, vacated in part, and remanded with directions.
James Borthwick and Brian Martin, of Blackwell Sanders Peper Martin LLP, of Kansas City, Missouri, and William Corum, of the same firm, of Overland Park, for appellant.
Rex A. Sharp, of Gunderson, Sharp & Rhein, P.C., of Prairie Village, for appellees.
Before BEIER, P.J., ELLIOTT and KNUDSON, JJ.
KNUDSON, J.: In this garnishment proceeding Mid-Continent Casualty Company (Mid-Continent) appeals from the entry of judgment in favor of the garnishors, J. Michelle Johnson and Alan L. Johnson, who earlier had obtained a default judgment of $2,268,784.52 against Mid-Continent's insured, Westhoff Sand Company, Inc. The underlying Mid-Continent policy provided $1,000,000 in liability coverage. The district court rejected Mid-Continent's policy defenses and concluded the insurance company wrongfully refused to defend its insured. An excess judgment was entered against Mid-Continent, with attorney fees of $1,202,336.65 awarded under K.S.A. 40-256. Mid-Continent has filed a timely appeal.
Except for the amount of attorney fees awarded, we affirm the judgment of the district court. We set aside the award of attorney fees and remand to the district court for further hearing to determine an appropriate award.
Stipulation of Facts
The district court's decision was based upon the following stipulated facts agreed to by the parties:
"1. On June 14, 1992, Mr. Shultz was driving a semi and passing another truck at night in a construction zone going uphill without any signs or markings on Highway 54. Alan Johnson, driving his family in the other direction, encountered the two semis side-by-side coming at him. Alan Johnson went for his ditch, but so did Mr. Shultz. To avoid the head on collision with a semi, Alan Johnson attempted to shoot the gap between the oncoming semis resulting in a wreck injuring Alan and permanently ripping off Michelle's dominant right arm just below the elbow.
"2. On December 3, 1993, plaintiffs J. Michelle Johnson and Alan L. Johnson ('Alan and Michelle Johnson' or 'the Johnsons') sued in this Court: Roger L. Shultz, a truck driver; Southwest Transportation Company, the trucking company Mr. Shultz was driving for; Great West Casualty Company, Southwest Transportation Company's insurer; J. H. Shears' Sons, Inc., the general contractor ('Contractor') for the construction job on Highway 54 where the wreck occurred; C-Hawk Construction, Incorporated, and Twin Traffic Marking Corporation, both believed to be subcontractors responsible for signage on the construction job.
"3. In early January, 1994, while the Johnsons' attorneys were still trying to serve some of the defendants with service of process, Mr. Shultz gave notice that he had filed for Chapter 7 Bankruptcy. Ultimately Mr. Shultz, due to the bankruptcy and automatic stay, had to be dismissed from the case in April, 1994, as reflected in the First Amended Petition.
"4. On January 21, 1994, Michelle Johnson filed a Statement of Monetary Damages in the amount of $5,000,000, while Alan Johnson filed a Statement of Monetary Damages in the amount of $1,000,000, under Supreme Court Rule 118.
"5. On May 13, 1994, the Johnson[s] moved to file a Second Amended Complaint to drop Twin Traffic Marking Corporation (which discovery showed had no construction duties at the time of the wreck) and to add Revelle Leasing, Inc. (owner of the semi); Russell Leasing, Inc. (co-employer of Mr. Shultz); Westhoff Brothers Paving and Sand Company (a road construction subcontractor) ('Westhoff Brothers')[;] and the Kansas Department of Transportation (KDOT), since in April, 1994, some of the defendants claimed KDOT and Westhoff Brothers Paving and Sand Company were at fault.
"6. The Johnsons were granted leave to file the Second Amended Petition, which was filed on June 3, 1994. The Johnsons then attempted to serve the additional parties with the Second Amended Petition by certified mail, but the certified letter to Westhoff Paving went unclaimed.
"7. By mid-July, 1994, Westhoff Brothers still had not been served, some of the additional defendants had not answered the Second Amended Petition, and Revelle Leasing, Inc. had given notice of Chapter 7 Bankruptcy.
"8. The Barton County Sheriff was requested on July 23, 1994 to personally serve Earl Westhoff for Westhoff Brothers, which was done on August 1, 1994. On August 1, 1994, the Johnsons' attorneys spoke with Earl C. Westhoff by telephone. Earl Westhoff stated that he was operating a company by the name of Westhoff Sand Company, Inc. and doing construction work on U.S. Highway 54 during June, 1992, in the area where the wreck occurred. The Johnsons' attorneys then contacted the Kansas Secretary of State and found that Westhoff Sand Company, Inc. had its principal place of business at 3223 Railroad Avenue, Great Bend, Kansas 67530 and its Registered Agent was Earl C. Westhoff.
"9. On August 9, 1994, the Johnsons moved for leave to file a Third Amended Petition pursuant to K.S.A. 60-215(c), substituting Westhoff Sand Company, Inc. for the incorrectly named Westhoff Brothers.
"10. On September 16, 1994, this Court granted the Johnsons leave to file a Third Amended Petition.
"11. On September 22, 1994, the Third Amended Petition was filed naming Westhoff Sand Company, Inc. ('Westhoff') as a defendant. The Johnsons alleged that Westhoff contracted with KDOT to work on the Highway 54 project and removed permanent 'no passing' and other warning signs without placing temporary warning signs in the construction zone which it had a duty to do, all resulting in injury and damages to the Johnsons.
"12. On September 28, 1994, the Court orally entered the following initial scheduling order: mediation to be completed by December 31, 1994, plaintiffs identify experts by February 28, 1995, defendants identify experts by April 30, 1995, witness and exhibit lists exchanged by April 30, 1995, and discovery cutoff of June 30, 1995, with a pre-trial on July 11, 1995.
"13. The Third Amended Petition was served on Westhoff by certified mail on September 29, 1994. Westhoff's Answer was due 20 days thereafter, or on October 19, 1992.
"14. The Johnsons did not file a motion under K.S.A. 60-203 with respect to Westhoff, so the lawsuit against Westhoff was commenced upon service on September 29, 1994.
"15. The Johnsons were deposed on October 13, 1994, with other depositions scheduled for December, 1994.
"16. Westhoff failed to file an Answer by October 19, 1994.
"17. Neither Westhoff nor Earl Westhoff ever notified Mid-Continent of the June 14, 1992 accident, or the lawsuit served on Westhoff. Neither Westhoff nor Earl Westhoff ever notified Mid-Continent of the Third Amended Petition or its service.
"18. On November 3, 1994, after receiving no Answer from Westhoff, the Johnsons' attorneys determined from KDOT who insured Westhoff, and telephoned Mid-Continent. This was Mid-Continent's first oral notice of the claim and lawsuit. Mid-Continent asked the Johnsons' attorney to forward written information.
"19. On November 4, 1994, the Johnsons' attorney mailed a letter and a copy of the Third Amended Petition, and notice of the scheduled December 8, 1994 mediation direct to the insurer, Mid-Continent. See Exhibit A attached and incorporated by reference.
"20. On November 7, 1994, Mid-Continent received from the Johnsons' attorney written notice of the lawsuit, the Summons and a copy of the Third Amended Petition naming Westhoff, and notice of the December 8, 1994 mediation. See Mid-Continent adjuster's handwritten contemporaneous notes attached and incorporated by reference as Exhibit B. See also paragraph 2 of the November 22, 1994 letter of Mid-Continent attached and incorporated by reference as Exhibit C.
"21. Upon receipt of the written notice from the Johnsons' attorney, Mid-Continent attempted to locate any policy issued to Westhoff to confirm that it had insured Westhoff and to determine if that policy might provide coverage for the Johnsons' claims against Westhoff.
"22. Policy No. GL149726 (the 'Policy') was issued by Mid-Continent to Westhoff and was in effect on June 14, 1992, but because it expired on January 1, 1993, it was already in off-site storage. Mid-Continent retrieved the policy from storage on November 16 or 17, 1994, and then confirmed that Westhoff was an insured at the time of the wreck under the Policy, with policy limits of $1,000,000.
"23. Mid-Continent's adjuster referenced the need to send a reservation of rights letter for delayed notice.
"24. On November 17, 1994, Mid-Continent called Thurman-Morrison & Associates, the local agent in Great Bend, Kansas, who handled the insurance policy, and received a telephone number for Westhoff Brothers (believed to be a related company), and for father, Earl Westhoff, and son, Paul Westhoff, who were believed to be principals in Westhoff. Mid-Continent also learned that Randy Hayden was the agent who handled Westhoff's account after Thurman-Morrison & Associates and received Randy Hayden's telephone number.
"25. On November 18, 1994, Mid-Continent attempted to call Earl Westhoff at his home telephone number and there was no answer, and then attempted to call Paul Westhoff at his home telephone number, which was no longer in service.
"26. On November 21, 1994, Mid-Continent again attempted to call Earl Westhoff but received no answer.
"27. On November 21, 1994, Mid-Continent then called Randy Hayden, who told Mid-Continent:
(a) Westhoff was one of his clients in 1993 (after the Mid-Continent insurance policy expired), but Westhoff went out of business and still owed Hayden's agency approximately $5,600, which amount had been turned over to a collection agency;
(b) Paul Westhoff split with his dad under bad circumstances, apparently left town owing lots of people money, and there was no current telephone listing for Paul Westhoff in the then current local telephone directory; and
(c) Earl Westhoff's home address in Great Bend, Kansas and confirmed from the current local telephone directory Earl Westhoff's home telephone number that Mid-Continent already had.
"28. On November 21, 1994, Mid-Continent tried calling Westhoff at the telephone number provided for Westhoff Brothers by Thurman-Morrison & Associates, but there was no answer, and Mid-Continent also tried to call Earl Westhoff at home, but there was no answer.
"29. Mid-Continent then called the Johnsons' attorney on November 21, 1994, to request additional information. The Johnsons' attorney confirmed that he had had problems obtaining service on Westhoff, but did so on September 29, 1994. The Johnsons' attorney also informed Mid-Continent that he believed Earl Westhoff was then working in Missouri in the St. Joseph area. The Johnsons' attorney again suggested Mid-Continent send a representative to the December 8, 1994 mediation, and offered access to pleadings and discovery.
"30. On November 22, 1994, a Mid-Continent adjuster, after assigning Claim Number 1401540 to the matter, sent a letter by certified mail to Westhoff at its last known work address, with a copy to the Thurman-Morrison & Associates agency. See Exhibit C attached and incorporated by reference.
"31. On the same date, Mid-Continent sent an identical letter to Earl Westhoff at the last residential address Mid-Continent had been able to obtain for him, with a copy to the Thurman-Morrison & Associates agency.
"32. The Mid-Continent certified letters to Westhoff and Earl Westhoff were unclaimed. See Exhibit D certified letter returns, attached and incorporated by reference.
"33. Mid-Continent never had any contact with Westhoff or any Westhoff employees.
"34. Mid-Continent did not defend Westhoff in the lawsuit.
"35. Other than the agent, Westhoff's subsequent agent, and the Johnsons' attorney, Mid-Continent did not contact anyone else regarding Westhoff, the Johnsons, or the lawsuit.
"36. On December 8, 1994, a mediation was held in Kansas City which all counsel, parties, and insurers attended, except Mid-Continent and Westhoff. The mediation did not result in a settlement, but the case was settled in the weeks following, with the exception of Westhoff/Mid-Continent which never appeared or answered.
"37. On January 13, 1995, the Johnsons moved for default judgment against Westhoff, served a statement of monetary damages, served a Notice of Hearing for January 27, 1995, and presented to this Court a Journal Entry of Default Judgment which was approved and signed on February 1, 1995 in the amount of $2,268,784.52. The Johnsons did not serve any of these pleadings on Mid-Continent.
"38. Before default judgment, the Johnsons never made a settlement demand to Mid-Continent or to Westhoff, and Mid-Continent never made a settlement offer to the Johnsons.
"39. After the default judgment, Affidavits were signed stating that the Johnsons' attorneys would have recommended and the Johnsons would have accepted a policy limits offer of $1,000,000 from Mid-Continent to settle with Westhoff. See Affidavits, Exhibit E, attached and incorporated by reference.
"40. In February, 1997, the Johnsons instituted this garnishment action against Mid-Continent to collect on the default judgment.
"41. Westhoff never assigned any claims it may have had or claimed to have against Mid-Continent to the Johnsons.
"42. The Certificate of Insurance filed by subcontractor Westhoff with KDOT was in the amount of $1,000,000 for the highway construction project in question. Exhibit F, attached and incorporated by reference.
"43. J. H. Shears' Sons, Inc. entered into a subcontract agreement with Westhoff providing that the agreement between J. H. Shears' Sons, Inc. and KDOT 'is made a part of this Subcontract Agreement and incorporated herein by this reference.' Specifically, paragraph 2, provides that the Subcontract Agreement was deemed to 'include the Contract [between J. H. Shears' Sons, Inc. and KDOT] including the general and special conditions . . . [and] special provisions . . . . In all respects, the Subcontractor, by execution of this Subcontract Agreement, assumes toward the Contractor the same obligations and responsibilities that the Contractor assumes toward the Owner [KDOT] in the Contract Documents.' Paragraph 10 of the Subcontract Agreement provides that 'prior to commencing any work hereunder, the Subcontractor will furnish to the Contractor a certificate from Subcontractor's insurance carriers as evidence that Subcontractor is properly covered with the insurance coverages in the amounts and/or limits not less than those proscribed [sic] below (in thousands): general liability insurance $1,000.'; i.e. $1,000,000.' The KDOT Standard Specifications for State Road and Bridge Construction ('Blue Book') applied to Westhoff's Subcontract.
"44. A true and correct copy of Mid-Continent's Policy No. GL149726, issued to Westhoff and in effect on June 14, 1992 is attached as Exhibit G, and incorporated by reference.
"45. Kansas procedural and substantive law applies to this case."
Mid-Continent presents the following issues on appeal: (1) Did the district court err in determining the parties proceeded to trial on stipulated facts; (2) did the court err in concluding Mid-Continent's policy defenses were without legal merit; (3) did Mid-Continent act without just cause and excuse entitling the Johnsons to attorney fees; (4) was there sufficient evidence to support the amount of the court's award for attorney fees; and (5) did the court err in finding the Johnsons were entitled to recover damages in excess of Westhoff's policy limits?
The Legal Standard Supporting Judgment
Before considering the substantive issues on appeal, we must first examine the legal standard adopted by the district court in granting judgment against Mid-Continent. Initially, both parties filed motions for summary judgment based upon stipulated facts. Subsequently, the parties framed the written legal issues to be decided by the court. After oral argument, the court took all issues under advisement. Two years later the court entered its judgment, noting that the parties had agreed to try the garnishment issues upon stipulated facts.
Mid-Continent claims the district court erred in applying legal standards applicable to bench trials rather than summary judgment standards. Mid-Continent is adamant there was never any agreement by the parties and the court that the submission went beyond the summary judgment stage. The Johnsons are equally adamant there was an agreement to proceed with trial upon stipulated facts.
In their written appellate brief, the Johnsons' attorney states:
"The undersigned specifically recalls this agreement because neither party had additional evidence to present to the trial court and the garnishment action would ultimately be tried to the court anyway. The hearing in the courtroom when this issue was addressed was either not on the record or has not been transcribed and provided to the [appellate court]."
This perceived error was brought to the district court's attention by Mid-Continent in its motion to amend or alter judgment. In their reply to the motion, the Johnsons specifically alleged: "[The district court], during oral argument, made clear that this was a court 'trial'. Both parties agreed with that proposition." Mid-Continent, in its reply, held its ground, stating: "The record does not support the conclusion that the parties agreed to a trial based on stipulated facts." In denying Mid-Continent's motion, the district court was nonspecific in its ruling.
A party's waiver of its right to a full trial rather than a bench trial on stipulated facts should be explicit and unequivocal. See Acuff-Rose Music, Inc. v. Jostens, Inc., 155 F.3d 140, 142-43 (2nd Cir. 1998). However, we note that Mid-Continent, in spite of the Johnsons' allegations to the district court and the district court's denial of its motion for relief from judgment, intentionally chose not to include the transcript from the original hearing or the transcript, if any, from the oral argument on the motion for relief from judgment in the record on appeal.
"A party claiming error has the burden of furnishing a record showing the prejudicial error in the lower court. In the absence of such a record, an appellate court presumes that the action of the lower court was proper. State v. Moncla, 262 Kan. 58, 68, 936 P.2d 727 (1997)." Sours v. Russell, 25 Kan. App. 2d 620, 631, 967 P.2d 348 (1998), rev. denied 267 Kan. 887 (1999).
We have not been provided with the crucial transcript ostensibly supporting waiver and the district court's determination that a bench trial was to be conducted. Mid-Continent raised this issue as a point on appeal but has chosen not to include the transcripts necessary to provide this court with a complete record. Under these circumstances, we hold Mid-Continent has failed to demonstrate the district court erred in concluding the parties had submitted all issues for trial to the court on the stipulated facts.
Policy Defenses
The comprehensive general liability insurance policy issued by Mid-Continent insuring Westhoff on June 14, 1992, contained the following conditions:
"4. Insured's Duties in the Event of Occurrence, Claim or Suit:
(a) In the event of an occurrence, written notice containing particulars sufficient to identify the insured and also reasonably obtainable information with respect to the time, place and circumstances thereof, and the names and addresses of the injured and of available witnesses, shall be given by or for the insured to the company or any of its authorized agents as soon as practicable.
(b) If claim is made or suit is brought against the insured, the insured shall immediately forward to the company every demand, notice, summons or other process received by him or his representative.
(c) The insured shall cooperate with the company and, upon the company's request, assist in making settlements, in the conduct of suits and in enforcing any right of contribution or indemnity against any person or organization who may be liable to the insured because of injury or damage with respect to which insurance is afforded under this policy; and the insured shall attend hearings and trials and assist in securing and giving evidence and obtaining the attendance of witnesses. The insured shall not, except at his own cost, voluntarily make any payment, assume any obligation or incur any expense other than for first aid to others at the time of accident.
"5. Action Against Company: No action shall lie against [Mid-Continent] unless, as a condition precedent thereto, there shall have been full compliance with all of the terms of this policy, nor until the amount of the insured's obligation to pay shall have been finally determined either by judgment against the insured after actual trial or by written agreement of the insured, the claimant and the company.
"Any person or organization or the legal representative thereof who has secured such judgment or written agreement shall thereafter by entitled to recover under this policy to the extent of the insurance afforded by this policy."
Mid-Continent unsuccessfully argued to the district court that coverage was voided because of Westhoff's failure to give timely notice of the occurrence or cooperate with the company.
Our standard of review is de novo, as the district court's decision was based upon stipulated facts and construction of the insurance policy issued by Mid-Continent. See McTaggart v. Liberty Mut. Ins., 267 Kan. 641, 645, 983 P.2d 853 (1999).
In denying Mid-Continent's policy defenses, the district court stated in its memorandum decision:
"Mid-Continent relies on policy defenses to avoid liability. A garnishment trial is a proper method to litigate policy defenses following the entry of judgment. Watson v. Jones, 227 Kan. 862, 610 P.2d 619 (1980). The carrier has the burden of proof to establish these policy defenses. Baugher v. Hartford Fire Ins. Co., 214 Kan. 891, 900-01, 522 P.2d 401 [1974].
"The policy defenses relied upon Mid-Continent are: (1) breach of the duty to notify, and (2) breach of the duty to cooperate.
"The policy language relied upon by Mid-Continent is found on the 'conditions' page, paragraph 4 of the policy, Exhibit G.
"Subparagraph (a) provides as follows:
'In the event of an occurrence, written notice containing particulars sufficient to identify the insured and also reasonably obtainable information with respect to the time, place and circumstances thereof, and the names and addresses of the injured and of available witnesses, shall be given by or for the insured to the company or any of its authorized agents as soon as practicable.'
"Garnishee defendant Mid-Continent argues that no notice was ever given to it by Westhoff Sand Company and this is not disputed by the plaintiffs-garnishors. The first notice of any claim and of the lawsuit was provided to garnishee by telephone call from the plaintiffs' attorney November 3, 1994, and was followed up by a letter and a copy of the third amended petition November 4, 1994. It does not matter who gives the notice so long as notice is given and the insurer has actual notice thereby giving it an opportunity to make an investigation and defend the suit. Jameson v. Farmers Mutual Automobile Ins. Co., 181 Kan. 120, 127, 309 P.2d 394 (1957).
"There are no facts and no evidence that Westhoff failed to give notice of the occurrence to Mid-Continent as soon as practicable in accordance with the policy requirements. The stipulated facts do not justify any conclusion or finding other than that the first Westhoff knew about the occurrence or the lawsuit was when Westhoff was served.
"It is not controverted that Westhoff never gave notice to Mid-Continent of the law suit either following service on [him] for Westhoff Brothers accomplished August 1, 1994, or following service of the third amended petition by certified mail on September 29, 1994.
"Failure to provide timely notice is not alone sufficient to excuse performance by the [insurer], Kansas also requires a showing of actual prejudice as a result of the untimely notice. Such prejudice is not presumed and the burden is on the insurer to show that the prejudice is substantial. Creek v. Harder Constr., 25 Kan. App. 2d 232, 236-37, 961 P.2d 1240 (1998). Creek also makes it clear that an insurer must demonstrate prejudice in order to escape liability based upon its insured's failure to provide notice.
"Garnish[ee], Mid-Continent claims it was prejudiced both by losing the ability to raise the statute of limitations defense and by losing any chance of learning from Westhoff what other meritorious defenses it had. This prejudice in turn is predicated on the notion variously stated and repeated throughout the briefing as follows:
'Mid-Continent therefore could not participate in the scheduled mediation or defense of the underlying action without running the risk that it would be estopped from relying upon breach of the duty of cooperation later just as happened to the insurer in Watson. Mid-Continent's Memorandum in Support, page 9.'
"Notwithstanding the several variations of that argument made repeatedly, the Court finds and determines as a matter of law neither the argument nor the Watson case established such prejudice. As the defendant itself states on page 8 of its brief:
'The Kansas Supreme Court affirmed on the ground that the insured's failure to appear at trial did not constitute non-cooperation based upon the facts and circumstances of the case and did not rule upon the trial court's finding of estoppel.'
"In Watson the Kansas Supreme Court explicatively states on page 870 of Volume 227:
'We see no purpose in adding unnecessarily to the length of this opinion by discussing the presence or absence of estoppel since the appeal must be affirmed anyway for failure to establish the policy defense.'
"Just as the Court in Boone v. Lowry, 8 Kan. App. 2d 293, 299-300, 657 P