Unpublished Disposition, 931 F.2d 896 (9th Cir. 1991)

MEMORANDUM^* 

We affirm the district court. The plain language of the policies supports its ruling in the action for declaratory judgment. We understand the argument that Guarantee provided excess coverage. It fails because the undisputed facts preclude its application. Guarantee obtained telephonic statements from Joe and Jimmy to support its argument. Even if the statements had been admitted, and we hold that their denial was proper, see United States v. Yoshida, 727 F.2d 822, 823 (9th Cir. 1983); White by White v. Pierce County, 797 F.2d 812, 814-15 (9th Cir. 1986), they use the term "hired" without defining it. The question is not what Jimmy and Joe assumed, but whether a hiring within the meaning of the insurance policy occurred. The statements were not probative of any material fact.

We also reject the argument that the Bankers and Guarantee policies provide pro rata coverage. See C.C. Housing Corp. v. Ryder Truck Rental, Inc., 106 N.M. 577, 746 P.2d 1109, 1113 (1987) (where tractor-owner's policy provided that insurance did not apply if there was other coverage applicable to the trailer and available to the lessee/renter, and trailer-owner's policy provided only excess coverage when trailer was connected to a motor vehicle owned by someone else, coverage for the trailer was excess, the clauses were irreconcilable, and court prorated coverage). The Bankers and Guarantee policies are not irreconcilable. Id., 106 N.M. at 581, 746 P.2d at 1113 ("If ... two 'other insurance' clauses, when read together, do not deny coverage to the insured, the clauses are not mutually repugnant, and the court will honor the language of each insurance policy.")

The district court correctly used New Mexico law to determine the proper interpretation of the insurance policies that were entered into in New Mexico by New Mexico residents whose businesses were in New Mexico. The court, however, held that the award of attorney's fees was governed by Arizona law. Conflict of laws analysis fails to support this holding. But both parties sought attorney's fees in their pleadings and cross-motions for summary judgment. Litigation was conducted on the assumption that pursuant to Arizona law, attorney's fees would be awarded to the prevailing party. Guarantee is estopped from denying that Arizona law governs the issue. See Riley v. Fitzgerald, 178 Cal. App. 3d 871, 875, 223 Cal. Rptr. 889, 891 (1986).

We reject the argument that the fees awarded were excessive. The trial judge gave reasons for the award. We find no abuse of discretion.

AFFIRMED.