Thus in Clark v. Universal Underwriters Ins. Co. (1965) 233 Cal.App.2d 746 [ 43 Cal.Rptr. 822] and PacificIndem. Co. v. Universal etc. Ins. Co. (1965) 232 Cal.App.2d 541 [ 43 Cal.Rptr. 26], in which the policy provision offered coverage to permissive users only while the insured automobile "is operated by the named insured," the courts had no difficulty finding the provision an impermissible exclusion of permissive users. "`The substantive law of this state cannot be enlarged, circumvented, defeated, or modified by any provision which the insurer may have elected to place in its contract in derogation of or in conflict therewith.'"
Plaintiffs acknowledge that if the Vega vehicle was, in fact, covered by the Home policy, the liability insurance thereby furnished the owner must by law be extended, in such sum as is properly applicable, to Vega as a permissive user. (See Pacific Employers Ins. Co. v. Maryland Cas. Co., supra, 65 Cal.2d 318, 324-325; Atlantic Nat. Ins. Co. v. Armstrong (1966) 65 Cal.2d 100, 104-106 [ 52 Cal.Rptr. 569, 416 P.2d 801]; Exchange Cas. Surety Co. v. Scott (1961) 56 Cal.2d 613, 622-624 [ 15 Cal.Rptr. 897, 364 P.2d 833]; Universal Underwriters Ins. Co. v. Aetna Ins. Co. (1967) 249 Cal.App.2d 144, 148-150 [ 57 Cal.Rptr. 240]; Travelers Indem. Co. v. Colonial Ins. Co. (1966) 242 Cal.App.2d 227, 232-233 [ 51 Cal.Rptr. 724]; Clark v. Universal Underwriters Ins. Co. (1965) 233 Cal.App.2d 746, 748 [ 43 Cal.Rptr. 822]; Pacific Indem. Co. v. Universal etc. Ins. Co. (1965) 232 Cal.App.2d 541 [ 43 Cal.Rptr. 26]; Financial Indem. Co. v. Hertz Corp. (1964) 226 Cal.App.2d 689, 697 [ 38 Cal.Rptr. 249]; Bohrn v. State Farm etc. Ins. Co. (1964) 226 Cal.App.2d 497, 501-504 [ 38 Cal.Rptr. 77]; Globe Indem. Co. v. Universal Underwriters Ins. Co. (1962) 201 Cal.App.2d 9, 12-16 [ 20 Cal.Rptr. 73]; Bonfils v. Pacific Auto. Ins. Co. (1958) 165 Cal.App.2d 152, 156-158 [ 331 P.2d 766].) Plaintiffs insist that the question is not one of evading responsibility for a permissive use of an owned insured automobile, but one where the facts show that the vehicle in question was not insured at all by Home, even to the extent of covering the owner's liability under sections 17150 and 17151 of the Vehicle Code.
Co. v. Lesher (1986) 187 Cal.App.3d 169, 191 [ 231 Cal.Rptr. 791], disapproved on other points, Buss v. SuperiorCourt, supra, 16 Cal.4th at pp. 50, fn. 12, 52, fn. 14; cf. Croskey et al., Cal. Practice Guide: Insurance Litigation 2, supra, ¶ 7:647, p. 7B-32 [speaking generally and without specific reference to such policies]), in order to avoid or at least minimize liability (see Gray v. Zurich Insurance Co. (1966) 65 Cal.2d 263, 279 [ 54 Cal.Rptr. 104, 419 P.2d 168]). As such, it requires the undertaking of reasonable and necessary efforts for that purpose (see ibid.), including investigation (see Pacific Indem. Co. v. Universal etc. Ins. Co. (1965) 232 Cal.App.2d 541, 543-544 [ 43 Cal.Rptr. 26]). It also requires the incurring of reasonable and necessary costs to that end (see Travelers Ins. Co. v. Lesher, supra, 187 Cal.App.3d at p. 191), including investigative expenses (see Pacific Indem. Co. v. Universal etc. Ins. Co., supra, 232 Cal.App.2d at pp. 543-544).
An argument before the lower court, predicated upon 1957 statutory amendments, that a "garage endorsement" limited Universal's liability to the amount of its vicarious statutory liability as owner under the provisions of sections 17150 and 17151 of the Vehicle Code, has been abandoned. (See Interinsurance Exchange v. Ohio Cas. Ins. Co. (1962) 58 Cal.2d 142, 145-146 and 150-154 [ 23 Cal.Rptr. 592, 373 P.2d 640] [cf. same case (1961) (Cal.App.) 17 Cal.Rptr. 259]; Clark v. Universal Underwriters Ins. Co. (1965) 233 Cal.App.2d 746, 748-749 [ 43 Cal.Rptr. 822]; Pacific Indem. Co. v. Universal etc. Ins. Co. (1965) 232 Cal.App.2d 541, 543 [ 43 Cal.Rptr. 26] ; Globe Indem. Co. v. Universal Underwriters Ins. Co. (1962) 201 Cal.App.2d 9, 13-14 and 16-18 [ 20 Cal.Rptr. 73]; Royal Exchange Assur. v. Universal Underwriters Ins. Co. (1961) 188 Cal.App.2d 662, 665-666 [ 10 Cal.Rptr. 686].) It now contends that as between the two insurers the coverage provided by the insurer of the driver-purchaser should be exhausted before resort is had to the insurance furnished by its policy.
(P. 35.) The most recent decision applying the rule of American Automobile, supra, 52 Cal.2d 507, and Continental Casualty, supra, 57 Cal.2d 27, is Pacific Indem. Co. v. Universal etc. Ins. Co. (1965) 232 Cal.App.2d 541 [ 43 Cal.Rptr. 26]. There one Hamlin owned an automobile which he loaned to one Oakry.
(See, e.g., Columbia Southern Chemical Corp. v. Manufacturers & Wholesalers Indemn. Exch. (1961) 190 Cal.App.2d 194, 205 [11 Cal.Rptr. 762] (Columbia); Pacific Indem. Co. v. Universal etc. Ins. Co. (1965) 232 Cal.App.2d 541, 543-544 [43 Cal.Rptr. 26] [duty to defend includes duty to investigate]; see generally 7C Appleman, Insurance Law and Practice (Berdal ed. 1979) section 4691, p. 264; 14 Couch on Insurance (2d ed. 1982) section 51:65, p. 547.) In Aerojet's words: "Before one can defend, it must investigate to determine whether plaintiff's claim is good, bad, or sufficiently uncertain as to deserve settlement."
31] [same]; Metz v. Universal Underwriters Ins. Co. (1973) 10 Cal.3d 45 [ 109 Cal.Rptr. 698, 513 P.2d 922] [exclusion in violation of statute invalidated]; Bonfils v. Pacific Auto. Ins. Co. (1958) 165 Cal.App.2d 152, 157-158 [ 331 P.2d 766] [statute deemed to afford broader coverage than policy]; American Auto. Ins. Co. v. Transport Indem. Co. (1962) 200 Cal.App.2d 543, 552 [ 19 Cal.Rptr. 558] [same]; Hendricks v. Meritplan Ins. Co. (1962) 205 Cal.App.2d 133, 138 [ 22 Cal.Rptr. 682] [uninsured motorist statute voided policy provision attempting to restrict coverage]; Voris v. Pacific Indemnity Co. (1963) 213 Cal.App.2d 29, 34 [ 28 Cal.Rptr. 328] [uninsured motorist statute required coverage for motorcycle]; Campidonica v. Transport Indemnity Co. (1963) 217 Cal.App.2d 403, 406 [ 31 Cal.Rptr. 735] [statute required coverage for permissive user of vehicle]; Bohrn v. State Farm etc. Ins. Co. (1964) 226 Cal.App.2d 497 [ 38 Cal.Rptr. 77] [same]; Pacific Indem. Co. v. Universal etc. Ins. Co. (1965) 232 Cal.App.2d 541, 543 [ 43 Cal.Rptr. 26] [same]; United States Steel Corp. v. Transport Indem. Co. (1966) 241 Cal.App.2d 461, 465 [ 50 Cal.Rptr. 576] [same]; Hartford Accident Indemnity Co. v. Transport Indemnity Co. (1966) 242 Cal.App.2d 90, 91 [ 51 Cal.Rptr. 168] [same]; California Steel Buildings, Inc. v. Transport Indemnity Co. (1966) 242 Cal.App.2d 749, 753-754 [ 51 Cal.Rptr. 797] [same]; U.S. Fire Ins. Co. v. Transport Indem. Co. (1966) 244 Cal.App.2d 110, 112-113 [ 52 Cal.Rptr. 757] [same]; Stolte, Inc. v. Seaboard Surety Co. (1967) 250 Cal.App.2d 169, 172 [ 58 Cal.Rptr. 477] [same]; Abbott v. Interinsurance Exchange (1968) 260 Cal.App.2d 528 [ 67 Cal.Rptr. 220] [policy could not exclude coverage mandated by statute]; Valdez v. Federal Mut. Ins. Co. (1969) 272 Cal.App.2d 223, 234 [ 77 Cal.Rptr. 411] [same]; Modglin v. State Farm Mut. Automobile Ins. Co. (1969) 273 Cal.App.2d 693[ 78 Cal.Rptr. 355] [statute mandated coverage for vehicle garaged and used in California]; Mid-Century Ins. Co. v. Hernan
Rather, appellant attempted to invalidly exclude permissive users from any coverage whatsoever. The attempted exclusion was void; in the absence of a valid differentiation in coverage between the named insureds and permissive users, the insurer is liable to the same extent to all insured parties. ( Clark v. Universal Underwriters Ins. Co. (1965) 233 Cal.App.2d 746, 748-749 [ 43 Cal.Rptr. 822]; Pacific Indem. Co. v. Universal etc. Ins. Co. (1965) 232 Cal.App.2d 541, 543 [ 43 Cal.Rptr. 26]; Globe Indem. Co. v. Universal Underwriters Ins. Co. (1962) 201 Cal.App.2d 9, 17-18 [ 20 Cal.Rptr. 73].) Respondents are therefore entitled, as the trial court determined, to coverage in the amounts specified by the policy.
"(e) Notwithstanding the foregoing subdivisions, the insurer and any named insured may, by the terms of such policy or by a separate writing, agree that coverage under the policy shall not apply while said motor vehicles are being used by a natural person or persons designated by name. Such agreement by any named insured shall be binding upon every insured to whom such policy applies. Uber v. Ohio Cas. Ins. Co., 247 Cal.App.2d 611, 616-617 [ 55 Cal.Rptr. 720], reads: "The omnibus clause in an automotive liability insurance policy extends coverage thereunder to a person using an automobile owned by the named insured with the express or implied permission of the latter; is statutorily included in every such policy ( Wildman v. Government Employees' Ins. Co., 48 Cal.2d 31, 39 [ 307 P.2d 359]; General Ins. Co. of America v. Truck Ins. Exchange, 242 Cal.App.2d 419, 422 [ 51 Cal.Rptr. 462]; Pacific Indem. Co. v. Universal etc. Ins. Co., 232 Cal.App.2d 541, 543 [ 43 Cal.Rptr. 26]; see also Ins. Code, § 11580.1, subd. (d) — added 1963); is prescribed to effectuate the statutory purpose of broadening insurance coverage to protect the public when the automobile to which the policy relates is operated by one other than the insured owner [citing cases]; and must be applied in light of this purpose." In the above 1967 case, the court makes note that Insurance Code section 11580.1, subdivision (d), supra, was added in 1963, as part of the law extending coverage to the victims of the negligence of a permissive user of the automobile of an insured owner so that the general public may be protected.
( Ibid., p. 10. See also Pacific Indem. Co. v. Universal etc. Ins. Co., 232 Cal.App.2d 541, 543 [ 43 Cal.Rptr. 26].) If the law writes the driver into the policy as an insured with all rights he would have had, had he been mentioned by name or covered as a member of a described class we see no reason why his coverage should not be subject to such lawful limitations, conditions and qualifications as the policy contains.