Opinion
For Opinion on Hearing, see 110 Cal.Rptr. 1, 514 P.2d 953.
Opinion on pages 287 to 299 omitted.
HEARING GRANTED
Burnhill, Rode, Moffitt & Moore, Oakland, for respondent Gail V. Stapler, Administratix of Estate of James Michael Stapler, Deceased; Cyril Viadro, San Francisco, of counsel.
Bledsoe, Smith, Cathcart, Johnson & Rogers, San Francisco, for appellant.
[101 Cal.Rptr. 699]MOLINARI, Presiding Justice.
Plaintiff insurance company appeals from a judgment in favor of defendants Paul Bruce Smith and Gail V. Stapler, Administratrix of the Estate of James Michael Stapler, in an action for declaratory relief.
The facts which have been stipulated to are as follows: On May 18, 1968, Smith sustained personal injuries while riding in an automobile owned by him and driven by James Michael Stapler with Smith's permission. Smith brought an action against Stapler's estate for damages for personal injuries.
On the date of the accident there was in existence a policy of liability insurance covering Smith's automobile. The policy was issued to Smith and named him as the insured. The policy contains the following relevant provisions: First, it provides that plaintiff agrees '(1) To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of (A) bodily injury sustained by other persons, . . .' Second, it provides that under coverage (A) the 'unqualified word 'insured' includes (1) the named insured, and . . . (4) any other person while using the owned automobile, provided the operation and the actual use of such automobile are with the permission of the named insured . . . and are within the scope of such permission, . . .' Third, the policy provides that 'This insurance does not apply under: . . . (i) coverage A, to bodily injury to the insured or any member of the family of the insured residing in the same household as the insured; . . .'
On August 3, 1969, plaintiff brought the instant action for declaratory relief, alleging that the policy did not provide any coverage for the alleged injuries to Smith, and praying for a declaratory judgment determining that it was not obligated to afford coverage for the injuries sustained by Smith nor to pay any judgment which might be rendered in favor of Smith for the injuries sustained in the accident. Plaintiff also prayed for a determination that it had 'no obligation or duties of any kind or description to defendants, or each of them, under the terms of the . . . policy . . ..' Smith filed an answer in which he alleged that Stapler was an 'insured' under the policy by virtue of his permissive use of Smith's automobile and prayed for a declaratory judgment to that effect.
The cause was submitted on briefs and thereafter judgment was entered in favor of defendants. The judgment ordered that defendants have judgment for declaratory relief as follows: 'That the contract for automobile insurance coverage between plaintiff STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY and the defendant PAUL BRUCE SMITH provides coverage for permissive users of said defendant's automobile; that the provision of said policy purporting to exclude coverage for bodily injuries sustained by certain insureds under the policy in uncertain and ambiguous and is hereby construed against plaintiff and in favor of defendant; that plaintiff is obligated to afford coverage to the defendant GAIL V. STAPLER, special administratix of the Estate of JAMES MICHAEL STAPLER, on account of the action for personal injuries brought against said estate by the defendant PAUL BRUCE SMITH; . . .'
Findings of fact were not requested.
Farmers Ins. Exch. v. Geyer (1967) 247 Cal.App.2d 625, 55 Cal.Rptr. 861; Farmers Ins. Exch. v. Brown (1967) 252 Cal.App.2d 120, 60 Cal.Rptr. 1; and Hale v. State Farm Mut. Auto. Ins. Co. (1967) 256 Cal.App.2d 177, 63 Cal.Rptr. 819.
We observe, initially, that no extrinsic evidence was offered or presented with respect to the meaning of the provisions of the policy. Accordingly, the interpretation of said provisions is a question of law and their meaning must be derived solely from the terms of the instrument. In ascertaining the meaning of the subject provisions we are not bound by the interpretation made by the trial court but we must make an independent examination of the terms of the policy, notwithstanding that such terms may be uncertain, vague or ambiguous. (Parsons v. Bristol Development Co., 62 Cal.2d 861, 865, 44 Cal.Rptr. [101 Cal.Rptr. 700] 767, 402 P.2d 839; Moving Picture etc. Union v. Glasgow Theaters, Inc., 6 Cal.App.3d 395, 405, 86 Cal.Rptr. 33; Estate of Russell, 17 Cal.App.3d 758, 766, 95 Cal.Rptr. 88.)
The question presented is whether the words 'the insured' as used in the insuring agreement and in the exclusionary clause apply to any person against whom a claim is asserted and who is covered either as a named insured or as an additional insured, or only to the named insured. Resolution of this question depends on the proper construction to be given the exclusionary clause when read with the other relevant provisions of the insurance contract, with settled rules of construction in mind, and considered in the light of the settled public policy of this state. (See Farmers Ins. Exch. v. Frederick, 244 Cal.App.2d 776, 780, 53 Cal.Rptr. 457.) It involves a consideration of the insuring agreement as well as the exclusionary clause.
Under the terms of the policy the word 'insured' is defined as including 'the named insured' and any other person using the insured automobile with the permission of the named insured. Accordingly, under the circumstances of the instant case the persons falling within the category of 'the insured' were Smith, the named insured, and Stapler, the person driving the automobile with Smith's permission. Adverting to the insuring agreement, we note that it specifically provides that plaintiff is obligated 'To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of (A) bodily injuries sustained by other persons, . . .' (Emphasis added.) This language obviously means that in the instant case both Smith and Stapler were insured for damages sustained by persons other than themselves since the term 'sustained by other persons' has reference to persons other than a person who is 'the insured' under the policy. This interpretation finds further support in the exclusionary clause which provides that the insurance does not apply to bodily injury to 'the insured' or any member of his family residing in the same household as 'the insured.' Since the term 'the insured' in the present case includes both Smith and Stapler, the exclusionary clause clearly means that neither Smith nor Stapler, nor any member of their families residing in their household can claim damages for bodily injury sustained as a result of the operation and use of the automobile insured under the subject policy.
Several California cases have been cited to us as being indicative of the interpretation we should make in the instant case (i. e., Pleasant Valley etc. Assn. v. CalFarm Ins. Co., 142 Cal.App.2d 126, 298 P.2d 109; Globe Indem. Co. v. Universal Underwriters Ins. Co., 201 Cal.App.2d 9, 20 Cal.Rptr. 73; Campidonica v. Transport Indemnity Co., 217 Cal.App.2d 403, 31 Cal.Rptr. 735; Travelers Indem. Co. v. Colonial Ins. Co., 242 Cal.App.2d 227, 51 Cal.Rptr. 724; Farmers Ins. Exch. v. Frederick, supra, 244 Cal.App.2d 776, 53 Cal.Rptr. 457; Farmers Ins. Exch. v. Geyer, 247 Cal.App.2d 625, 55 Cal.Rptr. 861; Farmers Ins. Exch. v. Brown, 252 Cal.App.2d 120, 60 Cal.Rptr. 1; Hale v. State Farm Mut. Auto. Ins. Co., 256 Cal.App.2d 177, 63 Cal.Rptr. 819; American Home Assur. Co. v. State Farm Mut. Auto. Ins. Co., 1 Cal.App.3d 355, 81 Cal.Rptr. 732). A review of these cases discloses that, except for the holding that the policy will be construed to provide protection to a permissive user as an additional insured, none presented for interpretation language identical to or in the context of that which confronts us here, but each turned either upon the particular language of the policy in question or upon ambiguous language which was construed in favor of the insured.
Travelers Indem. Co., Geyer, Brown, Hale, and American Home hold that the terms used in an exclusionary clause should reflect the definitions contained in the policy. These cases lend support to the interpretation we have made in the present case. In Travelers Indem. Co. we held that a policy covering liability on 'the insured' [101 Cal.Rptr. 701] for damages to persons accidently injured by reason of the ownership, maintenance or use of the insured vehicle 'if such claims are made on account of . . . Bodily Injury or Death suffered by any person or persons, other than the insured or his employees' (242 Cal.App.2d at p. 234, 51 Cal.Rptr. at p. 728) excluded coverage for a claim by the named insured who was injured during a loading operation conducted by a permissive user of the insured vehicle. Geyer, Brown, and Hale involved family exclusionary clauses similar to that in the present case. These exclusionary clauses were held to be unambiguous and to effectively exclude coverage for a claim of injury to a family member residing in the same household with the named insured.
In Hale the spouse seeking coverage was also a 'named insured' in the policy, and in Geyer and Brown the claiming spouse, although not specifically named as an insured, was held to be a 'named insured' because the policy provided that the 'named insured' included the spouse of a resident of the same household.
State Farm Mut. Auto. Ins. Co. v. Cummings (1971) 21 Cal.App.3d 441, 98 Cal.Rptr. 320; and American Home Assur. Co. v. State Farm Mut. Auto. Ins. Co. (1969) 1 Cal.App.3d 355, 81 Cal.Rptr. 732.
In American Home, Mrs. Dorothy Crawford, the named insured in a policy providing for liability for injuries to others arising out of the use of her automobile, was injured because of a defect in a parking lot causing her to slip and fall while she was unloading some boxes from the rear of her automobile. Crawford brought an action against McColl's Dairy, the parking lot owner, for her personal injuries and McColl tendered the defense of the action to Crawford's insurance carrier. In a declaratory relief action McColl's Dairy contended that it was a person who was 'using' the automobile with Crawford's permission while she was unloading it and, hence, was covered by said policy for liability to Crawford for the injuries she sustained. The reviewing court held that McOll's Dairy was not 'using' the vehicle and also that the policy excluded Crawford from any recovery for an injury to herself.
Adverting to Frederick we note that the insuring clause in that case undertook to indemnify either the named insured or the additional insured against bodily injury to or sustained by any person. It was there held that the named insured truck owner could sue for injuries sustained while riding in the truck driven by a permissive driver, under the rationale that the named insured was not suing himself but the permissive driver for whose liability the insurer had agreed to be responsible. In the light of this interpretation, an exclusionary clause similar to that in the present case was held to have an ambiguous application to the accident in question and, therefore, should be interpreted to mean that it excluded from coverage for bodily injury only the one who actually drives the insured vehicle and the resident members of the driver's family. We observe that in Frederick the basic insuring clause to which the exclusionary clause was related provided coverage for liability for 'bodily injury to any person' (emphasis added), while in the instant case, in conformity with Vehicle Code section 16454, the policy provides coverage for 'bodily injury sustained by other persons' (emphasis added), i. e., persons other than the 'insured,' which term, in turn, is defined to include within its meaning the 'named insured.' We observe, further, that with respect to the application of the same exclusionary clause involved in this case, Brown, Geyer, Hale and American Home distinguished and declined to follow the majority opinion in Frederick.
Vehicle Code section 16454, in pertinent part, provides: 'Any motor vehicle liability policy need not cover any liability for injury to the assured . . ..'
The total definition of insured reads:
Pleasant Valley and Campidonica are not in point. These cases deal essentially with whether coverage was extended to certain permissive users as additional insureds. In these cases, coverage was extended under a truck owner's policy to persons who were sued for injuries to the truck driver sustained while the truck was [101 Cal.Rptr. 702] being loaded or unloaded and such persons were determined to be permissive users of the truck. Globe is likewise not in point. It merely holds that a permissive user of an automobile is an insured under an insurance policy, although the policy does not include within its definition of 'insured' persons using the designated automobile with the permission of the named insured, because such coverage is deemed a part of the policy by virtue of statutes requiring such coverage.
We now advert to the recently decided case of State Farm Mut. Auto. Ins. Co. v. Cummings, 21 Cal.App.3d 441, 98 Cal.Rptr. 320, where the reviewing court, in a case involving the same insuring clauses as those in the instant case, held that automobile repairmen were not additional insureds under a policy issued to a named insured who, together with a passenger, was injured as a result of an accident resulting from alleged negligent brake repairs performed on the insured vehicle. The repairmen, when sued by the named insured and the passenger, had claimed that they were covered as additional insureds under the named insured's policy. In reaching its decision, the court relied upon its previous decision in American Home. The court made the following general statement respecting the coverage afforded by the policy: 'The provisions of the policy now under discussion cover a risk which Vehicle Code section 16451 requires each policy of vehicle liability insurance to include. The code section coverage requirement is 'against loss . . . imposed by law for damages arising out of ownership, maintenance, or use. . . .' Therefore, when we speak of such coverage we are talking about a matter of statutory interpretation. The language quoted, it seems to us, speaks only to liability of the insured and for which he must answer to third parties--in short, to indemnity insurance. It does not contemplate 'all-risk' insurance to cover the insured's own injuries and those of persons to whom he owes no liability. [Citations.]' (21 Cal.App.3d at p. 445, 98 Cal.Rptr. at p. 323.)
Shippers Dev. Co. v. General Ins. Co., 274 Cal.App.2d 661, 79 Cal.Rptr. 388, decided by this court, is distinguishable. In that case the plaintiff supplier sought protection and indemnity under a trucker's comprehensive liability policy for an injury incurred by one of the trucker's employees on the supplier's dock. The policy contained an exclusionary clause providing that 'This policy does not apply: . . . to damages . . . sustained by an employee (except domestic) of the insured arising out of and in the course of his employment, . . .' We were called upon to determine the meaning of the phrase 'an employee . . . of the insured' and concluded that under California law such phrase, as used in an exclusionary clause, applies only when the injured party was employed by the particular insured, named or additional, who seeks the protection of the policy. (At p. 673, 79 Cal.Rptr. at p. 395.)
The exclusionary clause in Shippers is directed solely to the existence of a particular relationship, while that in the present case is directed to status in addition to relationship. It provides that no coverage will be afforded 'to the insured or any member of the family of the insured . . ..' The employee exclusionary clause would be analogous only if it excluded 'the insured or any employee of the insured.' Vehicle Code section 16454 specifically authorizes the exclusion of one who has the status of being an 'insured' by its provision that 'Any motor vehicle liability policy need not cover any liability for injury to the assured . . ..' The determination of who is an assured is resolved by reference to the policy of insurance. The policy in the instant case provides that the 'unqualified word 'insured' includes (1) the named insured, . . .' We perceive that the named insured does not lose his status as an 'insured' when he brings an action against an additional insured. This situation may be contrasted with that in Suippers when an employee of the named insured brought a suit against an additional insured. In the latter situation [101 Cal.Rptr. 703] the relationship of employment was found to be nonexistent and thus the exclusionary clause was held to be inapplicable.
We conclude by adverting also to a case in a foreign jurisdiction. In Capece v. Allstate Insurance Company (1965) 88 N.J.Super. 535, 212 A.2d 863, the insuring clause obligated the insurer "To pay all damages which the insured shall become legally obligated to pay because of . . . bodily injury sustained by other persons . . ."; (p. 866) the definition of 'insured' was substantially the same as the instant policy; and the exclusionary clause was identical with that in issue in the instant case. There, Capece, a service station operator, was injured when he was struck by an automobile as it was driven onto a service lift by one Giordano to whom the automobile had been entrusted for servicing by Magnano, the owner of the automobile. Capece obtained a judgment for damages against Giordano and the latter's insurance carrier sought indemnification or contribution from the carrier which covered Magnano's automobile upon the basis that the Magnano policy covered Giordano. The contention was made by Giordano's carrier that the exclusionary clause should apply only to one who qualifies as an insured and is seeking the protection of the policy, and that, therefore, since Giordano was the only insured seeking the protection of the policy, Capece, even though qualifying as an additional insured, was entitled to recover on the policy for injuries sustained by reason of Giordano's negligence. (P. 865.) The reviewing court held that when Magnano, the named insured, entrusted the automobile to Giordano he became an additional insured by virtue of his use of the automobile with the permission of the named insured, that Capece also became an additional insured legally responsible for the use of the automobile with permission through Giordano; that Capece thus became an insured under the policy; that the exclusionary clause precluded Capece from recovering against Magnano's carrier the amount of his judgment against Giordano; and that since Capece could not do so neither could Giordano's carrier. The appellate court's conclusion found support in both the insuring and exclusionary clauses and turned upon the significance of the language 'bodily injury sustained by other persons' as intending to cover injuries sustained by persons other than the insured. In reaching this conclusion, the reviewing court noted that 'The circumstances of the accident which give rise to liability determine who qualifies as an insured in a given case.' (P. 868.) (See also Shaw for Use of Michigan Mut. Liability Ins. Co. v. State Farm Mutual Insurance Company, 107 Ga.App. 8, 129 S.E.2d 85, 86-87.)
Relying upon Gray v. Zurich Insurance Co., 65 Cal.2d 263, 273, 54 Cal.Rptr. 104, 419 P.2d 492, defendant administratrix contends that the judgment should be affirmed because plaintiff breached its duty to defend the suit brought by Smith. We observe that no evidence was submitted below respecting a refusal to defend. 'In reaching a decision on appeal an appellate court is governed by the record; will not consider facts having no support in the record; and will disregard statements of such facts set forth in a brief. [Citations.]' (Oldenkott v. American Electric, Inc., 14 Cal.App.3d 198, 207, 92 Cal.Rptr. 127, 133.) It is appropriate to note, however, as consonant with our interpretation of the relevant provisions of the policy, that plaintiff had no duty to defend. A carrier is only required to defend a suit potentially seeking damages withing the coverage of the policy. (Gray v. Zurich Insurance Co., supra, 65 Cal.2d at p. 275, 54 Cal.Rptr. 104, 419 P.2d 492.) In the instant case there was no coverage under the policy for the injuries sustained by Smith. Accordingly, neither liability nor potential liability existed under the policy and plaintiff is not obligated to defend the action brought by Smith against Stapler's estate. (State Farm Mut. Auto. Ins. Co. v. Flynt, 17 Cal.App.3d 538, 548-549, 95 Cal.Rptr. 296; State Farm Mut. [101 Cal.Rptr. 704] Auto. Ins. Co. v. Cummings, supra, 21 Cal.App.3d 441, 446-447, 98 Cal.Rptr. 320.)
The judgment is reversed with directions to enter judgment that plaintiff is not required to defend the administratrix of Stapler's estate or his estate in the action brought against him by Smith.
Defendant Smith has not filed a respondent's brief, apparently relying upon Stapler's brief since the issues raised by this appeal are the same as to both respondents.
In Pleasant Valley etc. Assn. v. Cal-Farm Ins. Co., supra, the policy read: "With respect to the insurance afforded for liability, the unqualified word insured includes the named insured and also includes any person while using the automobile * * * with his permission." (142 Cal.App.2d at p. 129, 298 P.2d at p. 111.) The court rejected the contention that the exclusion which read 'any employee of the insured' should be read 'any employee of only the named insured.' (142 Cal.App.2d at p. 131, and pp. 131-133, 298 P.2d at p. 112.)
ELKINGTON, J., concurs.
SIMS, Associate Justice.
I dissent. In my opinion the policy provisions at issue in this case were properly interpreted by the lower court and the cases decided since its decision do not dictate or compel a contrary result. Two principles govern the result in this case. In general a policy will be construed to provide protection to an additional insured against a claim for injuries or death suffered by the named insured unless such risk is expressly excluded. (Bachman v. Independence Indem. Co. (1931) 214 Cal. 529, 531, 6 P.2d 943; Farmers Ins. Exch. v. Frederick (1966) 244 Cal.App.2d 776, 781-782, 53 Cal.Rptr. 457; Travelers Ins. Co. v. Norwich Union Fire Ins. Soc. (1963) 221 Cal.App.2d 150, 152-153, 34 Cal.Rptr. 406; and see 7 Appleman, Insurance Law and Practice, § 4409, at p. 380.) The recognized statutory requirement that the policy cover permissive users (see Veh.Code, § 16451) implies that the policy should be read as though it were written in the name of any additional insured who is entitled to its protection. (See Farmers Ins. Exch. v. Frederick, supra, 244 Cal.App.2d at p. 780 and p. 781, fn. 3, 53 Cal.Rptr. 457; U.S. Fire Ins. Co. v. Transport Indem. Co. (1966) 244 Cal.App.2d 110, 116-117, 52 Cal.Rptr. 757; United States Steel Corp. v. Transport Indem. Co. (1966) 241 Cal.App.2d 461, 473-474, 50 Cal.Rptr. 576; Campidonica v. Transport Indem. Co. (1963) 217 Cal.App.2d 403, 407, 31 Cal.Rptr. 735; Globe Indem. Co. v. Universal Underwriters Ins. Co. (1962) 201 Cal.App.2d 9, 19, 20 Cal.Rptr. 73; and Pleasant Valley etc. Assn. v. Cal-Farm Ins. Co. (1956) 142 Cal.App.2d 126, 134, 298 P.2d 109; Appleman, op. cit., at p. 381.) These principles were recognized in Frederick, supra, and should control in this case.
State Farm seeks to avoid the holding of Frederick, in which a hearing by the Supreme Court was denied, by reference to the argument advanced in the dissent in that case, and by reference to the fact that the insuring clause in the policy at bench reads 'to pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injuries sustained by other persons,' (emphasis added) whereas in Frederick the clause covers sums ". . . which the insured becomes legally obliged to pay because of . . . bodily injury to any person." (Emphasis the court's, at 244 Cal.App.2d p. 778, 53 Cal.Rptr. at p. 458.) The distinction brings Frederick close to the orbit of Travelers Ins. Co. v. Norwich Union Fire Ins. Soc., supra, 221 Cal.App.2d 150, 34 Cal.Rptr. 406 (see discussion in Frederick at 244 Cal.App.2d at pp. 782-783, 53 Cal.Rptr. 457), and leaves the instant case subject to the influence of Travelers Indem. Co. v. Colonial Ins. Co. (1966) 242 Cal.App.2d 227, 51 Cal.Rptr. 724, where exclusion was predicated on the wording of the insuring agreement (242 Cal.App.2d at pp. 232-233, 51 Cal.Rptr. 724). In the latter case, however, 'insured' was found to be synonymous with 'named insured.' There was no omnibus clause, no definition clause nor exclusion clause, and all references were to the person to whom the policy was issued. In this case, if the reading of Globe Indem. Co. v. Universal Underwriters Ins. Co., supra, 201 Cal.App.2d 9, 20 Cal.Rptr. 73, and other earlier cases is applied, the insuring clause may be read 'other persons than the insured, be he the named insured or an additional insured, against whom liability is asserted.'
[101 Cal.Rptr. 705]In Geyer, Brown and Hale 1 the person to whom the policy was issued, the actual named insured, was the driver, and the exclusion was applied to bodily injury to another person who either expressly or by definition fell within the characterization of a 'named insured,' and who in any event was an excluded relative of the driver to be charged. They in no way impeach the principle that when the unqualified term 'the insured' is used in a policy it should be read as referring to the person, be he named or additional insured, against whom the claim for damages is asserted. Application of this principle to their facts is perfectly consistent with the results in Geyer, Brown and Hale.
Any suggestion in Geyer that the provisions of section 16454 would not authorize the application of the exclusion to preclude coverage in the event a permissive user covered as an additional insured negligently caused injury to a member of his family residing in his household, will have to be tested in a case presenting those facts. Section 16454, like the policy involved, does not expressly require that the term 'assured' in referring to an exclusion must refer to both the tortfeasor, insured as an additional insured, and, as well, to the named insured. This case presents the question of the construction of the policy. If it is determined that the exclusion is not applicable, it is unnecessary to determine whether it is valid or invalid when applicable.
In Cummings and American Home 2 the principal issue was whether the tortfeasor was an additional insured as a permissive user of the vehicle. In each case this issue was determined in favor of the insurer. In Cummings the court did use the exclusionary clause as an alternative ground of decision, but there the victim and actual driver of the vehicle was the named insured. The repetition of the Geyer, Brown and Hale rule adds stature to its rationale but does not strengthen its foundation.
State Farm insists that the definitions contained in the policy should be inserted in the insuring clause and in the exclusionary clause. The insuring clause which reads, 'To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of (a) bodily injury sustained by other persons . . . and to defend any suit against the insured alleging such bodily injury . . .' (emphasis added) would then exclude not only bodily injury to the named insured, but also, if a resident of the same household, his spouse, and any relative of the named insured or of his spouse, and any permissive user of the automobile, because none would be other than a defined insured. 3 The exclusion, if similarly read, would be superfluous [101 Cal.Rptr. 706] as the named insured and 'any member of the family of the insured residing in the same household as the insured' already would have been excluded by omission from the coverage.
The insurer's argument overlooks the fact that before the exclusion can operate the coverage to which it applies must be ascertained. The definition indicates: 'Under coverages A, B, C and M, the unqualified word 'insured' includes: . .' Once it has been determined that the person legally obligated or sued is a person included within the definitions, the definitions have served their purpose. The exclusion only has meaning if it applies to the insured so found to be covered and his family.
To give the insuring agreement and the exclusion the meaning sought by State Farm would be to rewrite the policy in the language found in the policy of Geyer, which reads, 'This policy does not apply . . . to the liability of any insured for bodily injury to (a) any member of the same household of such insured . . . or (b) the named insured.' (247 Cal.App.2d at p. 628, 55 Cal.Rptr. at p. 863; emphasis added.) This result is not only not required by Geyer, Brown or Hale, but also disregards the principle evoked in Pleasant Valley Assn., 4 echoed in Campidonica, and applied in Frederick, that an exclusionary clause of this type applies only when the injured party bears the stated relationship to the particular insured, named or additional, who seeks the protection of the policy.
There is no public policy which dictates that the indemnity extended to a permissive user should be inapplicable in the sole event he strikes the named insured. The insurer has taken the risk that if those operating the named insured's vehicle with his permission fail to exercise due care and cause injury, it will pay the damages within the policy limits.
The insurer may be warranted in excluding liability of any additional insured to the named insured because of fear of collusion. A similar consideration may motivate a desire to exclude the liability of any insured, named or additional, to members of his family. Or, as in Geyer, it may inspire an exclusion directed at both situations (see 247 Cal.App.2d at p. 628, 55 Cal.Rptr. 861). It is sufficient to note here that the clause in issue when construed under the circumstances of this case does not clearly exclude the liability of an additional insured to the named insured. I would affirm the judgment.
'Definitions--Insuring Agreements I and II
'Insured--Under coverages A, B, C and M the unqualified word 'insured' includes: (1) the named insured, and (2) if the named insured is a person or persons, also includes his or their spouse(s), if a resident of the same household, and (3) if residents of the same household, the relatives of the first person named in the declarations, or of his spouse, and (4) any other person while using the owned automobile, provided the operation and the actual use of such automobile are with the permission of the named insured or such spouse and are within the scope of such permission, and (5) under coverages A and B any person or organization legally responsible for the use of such owned automobile by an insured as defined under the four subsections above.'