Summary
In Buckeye Union Casualty Company v. Illinois National Insurance Company, 2 Ohio St.2d 59, 206 N.E.2d 209 (1965), the court reaffirmed its decision in Travelers.
Summary of this case from Kentucky Water Service Co. v. Selective Ins. Co.Opinion
No. 38601
Decided April 7, 1965.
Insurance — Automobile liability — Construction of policy — "Use" of automobile, construed — "Loading and unloading" — Who is "insured" not determined by "use" clause.
One who is loading an automobile for the wife of a named insured who is using that automobile with the consent of the named insured is not insured against liability to such wife by a standard liability policy on that automobile.
CERTIFIED by the Court of Appeals for Franklin County.
When the following events occurred, appellant herein, The Buckeye Union Casualty Company, had in effect its comprehensive premises liability policy on the Big Bear Stores in Zanesville, Ohio, and the appellee herein, Illinois National Insurance Company, had in effect its standard automobile liability policy on the automobile of one George Thomas. Under the stipulation upon which the cause was submitted, Lucille Thomas, George's wife, an insured under his policy, parked her husband's car in the parking lot of the Big Bear Store in Zanesville, Ohio, and proceeded to shop. Shortly thereafter, an employee of the store wheeled a cart containing some of Mrs. Thomas' purchases from the Big Bear Store out to her husband's car and loaded those items into the trunk. While Mrs. Thomas was anchoring those packages to her greater satisfaction, the Big Bear employee injured her by slamming the trunk lid on her head.
Mrs. Thomas sued Big Bear Stores. During the course of taking depositions preparatory to defending this suit, Buckeye became aware of Illinois's policy, and that it contained the following language:
"Declarations"* * *
"Item 5. The purposes for which the automobile is to be used are `pleasure and business' unless otherwise stated herein: no exceptions (a) The term `pleasure and business' is defined as personal, pleasure, family and business use. (b) The term `commercial' is defined as use principally in the business occupation of the named insured as stated in item 1, including occasional use for personal, pleasure, family and other business purposes. (c) Use of the automobile for the purposes stated includes the loading and unloading thereof.
"* * *
"Insuring Agreements"* * *
"III. Definition of Insured
"With respect to the insurance for bodily injury liability and for property damage liability the unqualified word `insured' includes the named insured and also includes any person while using the automobile and any person or organization legally responsible for the use thereof, provided the actual use of the automobile is by the named insured or with his permission."
Buckeye concluded that the Big Bear employee was loading, hence was using the Thomas automobile and hence was an insured under the Illinois policy. Buckeye notified Illinois of the Thomas claim. Illinois denied coverage and refused to defend the action.
The trial of the lawsuit, with Buckeye defending, resulted in a verdict for plaintiff in the amount of $15,000. This was reported to Illinois, which did not reply. After motions for new trial and for judgment notwithstanding the verdict were overruled, Buckeye paid the judgment.
Under its subrogation clause, claiming that Illinois was charged with a duty to defend the action and was primarily liable for loss by virtue of the quoted policy language, Buckeye claimed further that Illinois's refusal to do so was wrongful, and, therefore, Buckeye was justified as secondarily liable in defending, paying the judgment and suing for reimbursement.
The trial court held generally for the defendant and dismissed the action. In the opinion of the trial court, it appears that the trial court decided on the stipulated facts that the loading process was completed before the trunk lid was slammed, and that slamming the trunk lid was neither a use of the car with permission nor a part of the loading. Under this finding, the Big Bear employee was not an insured, and the action against Illinois would not lie.
The Court of Appeals, affirming the judgment of the Common Pleas Court, found that the Big Bear employee was an insured under the use-loading provision of the Thomas (Illinois) policy; that Illinois and Buckeye were liable pro rata; that the payment by Buckeye of more than its proportion of the loss under these circumstances created no right to contribution from the other insurer; and, hence, that Buckeye was a volunteer and is not entitled to reimbursement from Illinois (citing Farm Bureau Mutual Automobile Ins. Co. v. Buckeye Union Casualty Co., 147 Ohio St. 79).
Upon motion, the Court of Appeals certified the record to this court, finding that its judgment is in conflict with the judgment of the Court of Appeals of the Eighth Appellate District in Travelers Ins. Co. v. Motorists Mutual Ins. Co., 88 Ohio Law Abs. 129.
Messrs. Wright, Harlor, Morris, Arnold Glander, Mr. Rudolph Janata, Jr., and Mr. Jon M. Anderson, for appellant.
Messrs. Jenkins, Williams, Wendt, Murray Deeg and Mr. Gordon E. Williams, for appellee.
The two cases are in conflict, and the certification would require this court to resolve this conflict were it not for the case of Travelers Ins. Co. v. Buckeye Union Casualty Co., 172 Ohio St. 507. The court, however, is of the opinion that its decision in that case is dispositive of the question of liability of Illinois under the facts claimed in the petition.
In an annotation to the case of Travelers Ins. Co. v. Buckeye Union Casualty Co., supra, in 95 A.L.R. 2d 1123, the following language occurs:
"However, where the injury is caused by a third party who has no legal relationship to the named insured it may be necessary to prove, before the liability provisions of the policy become applicable, that such third party was in the actual use of the truck at the time of the injury, with the express or implied permission of the named insured. * * * And while it is much too early to say whether the doctrine as laid down in the Ohio case will spread to other jurisdictions, the fact remains that such a distinction has been suggested to and been accepted by the highest court in Ohio."
The language of paragraphs three and four of the syllabus of Travelers Ins. Co. v. Buckeye Union Casualty Co., supra, is as follows:
"3. Where an injury is caused by the claimed negligence of a third party who is not connected with the truck, who has no legal relationship to the named insured and who under normal circumstances would not be using the truck of the named insured, it must first appear, before the liability provisions of the policy become applicable, that such third party was in the actual use of the truck at the time of the injury, with the express or implied permission of the named insured.
"4. `Loading' and `unloading' are but component parts of the overall `use' contemplated by such an insurance contract and do not therefore become determinative of the question of liability unless or until the party charged with negligence is shown to have been actually using the truck so as to qualify as an `insured' within the definition of that term as used in the policy."
The provision in the subject standard automobile policy that "the purposes for which the automobile is to be used are `pleasure and business' * * * use of the automobile for the purposes stated includes the loading and unloading thereof" enlarges the meaning of the word, "use," when one is attempting to determine whether the car is being "used for pleasure and business."
This enlargement of the meaning of the word, "use," for the purpose stated does not enlarge the meaning for the purpose of defining an insured in the following policy provision:
"Definition of Insured
"With respect to the insurance for bodily injury liability and for property damage liability the unqualified word `insured' includes the named insured and also includes any person while using the automobile * * * provided the actual use is by the named insured or with his permission." (Emphasis added.)
The operation of loading and unloading is covered, but the loader or unloader is not "an insured" unless otherwise made so.
The action to be defended by Illinois must be against an insured of Illinois. Under this holding, we can never arrive at a finding that an insured may be a claimant against a company which has computed a risk to protect the insured only against the claims of others.
The judgment of the Court of Appeals is, therefore, affirmed.
Judgment affirmed.
TAFT, C.J., ZIMMERMAN, O'NEILL, HERBERT and SCHNEIDER, JJ., concur.
I am unable to agree with the majority in this case for the same reason that I was unable to agree with the majority in Travelers Ins. Co. v. Buckeye Union Casualty Co., 172 Ohio St. 507.
The annotation (95 A.L.R. 2d 1122) cited in the majority opinion points out that the reasoning advanced in the Travelers case and followed in the instant case has not been accepted in other jurisdictions. The annotation, at page 1125, comments upon Travelers Ins. Co. v. Buckeye Union, supra, as follows:
"However where the injury is caused by a third party who has no legal relationship to the named insured it may be necessary to prove, before the liability provisions of the policy become applicable, that such third party was in the actual use of the truck at the time of the injury, with the express or implied permission of the named insured. This seems to be the tenor of at least one decision [citing the Travelers case] in which the term `use' was apparently interpreted differently according to whether the injury was caused by the acts of the insured's employee or was occasioned by the acts of a third party. This distinction has not been made in other jurisdictions which, without particularly stressing the point, proceed upon the theory that a person loading or unloading a vehicle is automatically deemed to be using the vehicle." (Emphasis added.)
The policy in question defines its coverage as follows:
" Use of the automobile for the purposes stated includes the loading and unloading thereof.
"* * *
"With respect to the insurance for bodily injury liability and for property damage liability the unqualified word `insured' includes the named insured and also includes any person while using the automobile and any person or organization legally responsible for the use thereof, provided the actual use of the automobile is by the named insured or with his permission." (Emphasis added.)
This provision is clear and unambiguous. Any person loading or unloading the automobile with the permission of the named insured is also an insured with respect to the insurance for bodily injury liability.
By its holding, the majority has rewritten the policy to eliminate from coverage one who is expressly made an insured by the terms of the policy.
For the above reasons, I respectfully dissent.