Summary
In Travelers, the owner of a tank truck was insured against losses arising out of the use of his truck, including its loadings and unloadings. An employee of the truck owner drove the truck to a Gulf Refining Company bulk station to pick up a load of fuel. As the truck driver climbed onto the bed of the tank to remove the cover, a Gulf employee swung a loading pipe toward the truck.
Summary of this case from Hartford v. Zurich Ins. Co.Opinion
No. 36821
Decided December 20, 1961.
Insurance — Automobile indemnity — Construction of policy — Language given ordinary and commonly accepted meaning — "Loading" and "unloading" construed — Negligence of third party using truck — Truck being actually used, when.
1. A policy of automobile indemnity insurance is to be construed in the light of the subject matter with which the parties are dealing and the purpose to be accomplished, and the language used must be given its ordinary and commonly accepted meaning. ( Bobier v. National Casualty Co., 143 Ohio St. 215, approved and followed.)
2. "Loading," as used in such insurance policy, begins at the time the insured or his agents or servants connected with the truck receive the article and, as part of a continuing operation, place it upon the truck; and "unloading" ceases when the article is taken from the truck by such persons and, as part of a continuing operation, is delivered to the customer or to a place designated for delivery. ( Bobier v. National Casualty Co., 143 Ohio St. 215, approved and followed.)
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.
APPEAL from the Court of Appeals for Franklin County.
This is an appeal from a judgment of the Court of Appeals ( 112 Ohio App. 386) affirming a declaratory judgment rendered in favor of the defendants by the Court of Common Pleas of Franklin County. The action was begun by The Travelers Insurance Company, appellant herein and hereinafter referred to as Travelers, against The Buckeye Union Casualty Company, hereinafter referred to as Buckeye, and John Keiser, appellees herein.
One R.T. McCracken was the owner of a tank truck, the operation of which was insured by an automobile liability policy issued by Buckeye. Keiser was a truck driver employed by McCrakenn. The pertinent provisions of the policy issued by Buckeye to McCracken were as follows:
"Declarations"* * *
"Item 5. The purposes for which the automobile is to be used are business, pleasure and commercial.
"* * *
"(c) Use of the automobile for the purposes stated includes the loading and unloading thereof.
"* * *
"The Buckeye Union Casualty Company * * * agrees with the insured, named in the declarations made a part hereof * * * subject to the limits of liability, exclusions, conditions and other terms of this policy:
"Insuring Agreements"I. Coverage A — Bodily injury liability — To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury, sickness or disease, including death at any time resulting therefrom, sustained by any person, caused by accident and arising out of the ownership, maintenance or use of the automobile.
"* * *
"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. The insurance with respect to any person or organization other than the named insured does not apply: (a) to any person or organization, or to any agent or employee thereof, operating an automobile repair shop, public garage, sales agency, service station or public parking place, with respect to any accident arising out of the operation thereof, but this exclusion does not apply to a member of the same household as the named insured; (b) to any employee with respect to injury to or sickness, disease or death of another employee of the same employer injured in the course of such employment in an accident arising out of the maintenance or use of the automobile in the business of such employer."
The Gulf Refining Company, hereinafter referred to as Gulf, operated a bulk station from which diesel fuel was sold. Gulf was insured by a policy of premises liability insurance issued by Travelers. The policy insured Gulf against liability for damages resulting from bodily injury, sickness or disease, including death caused by accident. It covered the use of owned, hired and nonowned automobiles, and such use was defined as including "the loading and unloading thereof." However, Travelers' policy also provided that if Gulf had other insurance against a loss covered by Travelers' policy, the liability should be borne proportionately, and, further, that the insurance under Travelers' policy in case of loss from use of a nonowned automobile should be excess insurance over any other valid and collectible insurance available to Gulf.
On April 6, 1954, Keiser drove McCracken's tank truck to the Gulf bulk station to purchase a tank load of diesel fuel for McCracken. Keiser drove the truck onto the loading platform, stopped the truck, got out of the cab and climbed up onto the bed of the truck. He removed the cover from the opening in the tank. The station was equipped with movable overhead pipes for the filling of tank trucks, and an employee of Gulf moved a pipe toward the truck in order to fill it. As the pipe got near the truck a quantity of diesel fuel rushed out onto Keiser, causing him to lose his balance. He fell from the truck to the ground, sustaining personal injuries.
Thereafter, Keiser brought suit against Gulf in the federal District Court, claiming that his injuries were a result of the negligence of the Gulf employee and praying for $100,000 damages. It was the claim of Travelers, after Keiser's suit was brought, that Buckeye's policy covered Gulf because McCracken's truck was being loaded at the time of the accident.
The principal contentions of Travelers may be found in the two final paragraphs of the amended petition and the prayer thereof, reading as follows:
"Plaintiff further says that the injuries and damages claimed by Keiser arose out of the use of a nonowned automobile under the provisions of plaintiffs policy, and arose out of the use of said truck under the provisions of the policy of defendant, The Buckeye Union Casualty Company; that, according to the claims of defendant, John Keiser, Gulf Refining Company was legally responsible for the use of the truck, to wit, the loading thereof, and such use was by R.T. McCracken or with his permission; that accordingly Gulf Refining Company is an `insured' under the policy of defendant, The Buckeye Union Casualty Company, and is entitled to coverage thereunder against the aforesaid claims of defendant, John Keiser; that the defendant, The Buckeye Union Casualty Company, is required to defend said case No. 4619 on behalf of Gulf Refining Company; and that the insurance afforded Gulf Refining Company under plaintiff's policy is excess insurance over the insurance available to Gulf Refining Company under the policy of defendant, The Buckeye Union Casualty Company.
"Plaintiff further says that it has requested defendant, The Buckeye Union Casualty Company, to assume its obligations to Gulf Refining Company under its aforesaid policy of automobile liability insurance, and undertake the defense of said case No. 4619, and to assume, up to the limits of its policy, the responsibility for any judgment that may be therein rendered against, or any settlement which in connection therewith may be made on behalf of, Gulf Refining Company; and that defendant, The Buckeye Union Casualty Company, has declined and refused to do so.
"Wherefore, plaintiff prays the declaratory judgment of this court that, with respect to the aforesaid claims of John Keiser, Gulf Refining Company is an insured under the policy of The Buckeye Union Casualty Company and is entitled to coverage thereunder; that the coverage afforded to Gulf Refining Company under the plaintiff's policy is excess over such coverage under the policy of defendant, The Buckeye Union Casualty Company; that The Buckeye Union Casualty Company is required to undertake the defense of said case No. 4619 on behalf of Gulf Refining Company and to assume, up to the limits of its policy, the responsibility for any judgment that may be therein rendered against, or any settlement which in connection therewith may be made on behalf of, Gulf Refining company * * *."
The allowance of a motion to certify the record brings the cause to this court for review.
Messrs. Wright, Harlor, Morris, Arnold Glander, for appellant.
Messrs. Power, Griffith Jones, for appellee The Buckeye Union Casualty Company.
Messrs. Graham, Graham, Gottlieb Johnston, for appellee John Keiser.
At the outset, it is clear that the provisions of the insurance policy issued to Gulf by Travelers could neither enlarge nor restrict the coverage of the policy issued by Buckeye to McCracken. We are only concerned, therefore, with the contract between Buckeye and McCracken, and in construing the latter contract it is fundamental, of course, that the intent of the parties thereto, when ascertained, will be cotrollling. In other words, did Buckeye and McCracken intend to protect Gulf when their contract was executed?
Provisions of insurance policies similar to those now under consideration have been the subject of considerable litigation. 160 A.L.R., 1259. In the majority of the reported cases, however, the party charged with negligence was either the named insured or someone clearly using the automobile or truck with the permission of the named insured. Bobier v. National Casualty Co., 143 Ohio St. 215, 54 N.E.2d 798; Pacific Automobile Ins. Co. v. Commercial Casualty Ins. Co., 108 Utah 500, 161 P.2d 423, 160 A.L.R., 1251; Raffel v. Travelers Indemnity Co., 141 Conn. 389, 106 A.2d 716; State, ex rel. Butte Brewing Co., v. District Court, 110 Mont. 250, 100 P.2d 932; Stammer v. Kitzmiller, 226 Wis. 348, 276 N.W. 629; Thompson Heating Corp. v. Hardware Indemnity Ins. Co., 74 Ohio App. 350, 58 N.E.2d 809; Commercial Standard Ins. Co. v. New Amsterdam Casualty Co. (Ala. 1961), 131 So.2d 182; Allstate Ins. Co. v. Valdez (Mich. 1961), 190 F. Supp., 893.
In those cases, the ordinary and permissive use of the automobiles or trucks, as the case may be, was established and continuous, and, the "loading and unloading" clause being a reasonable extension of the use, the sole question for determination was whether loading had begun or unloading had ended. In resolving the question, some jurisdictions turned to the so-called "coming to rest" doctrine, as illustrated by such cases as St. Paul Mercury Indemnity Co. v. Standard Accident Ins. Co., 216 Minn. 103, 11 N.W.2d 794, and Stammer v. Kitzmiller, supra, but most jurisdictions are now committed to the broader construction of such policies, which is known as the "complete operation" doctrine, as exemplified by the case of Pacific Automobile Ins. Co. v. Commercial Casualty Co., supra. This court adopted the latter view in the case of Bobier v. National Casualty Co., supra, where paragraph four of the syllabus states:
"`Loading,' as used in such insurance policy, begins at the time the insured or his agent or servants connected with the truck, receive the article and, as part of a continuing operation, place it upon the truck; and `unloading' ceases when the article is taken from the truck by such employees and, as part of a continuing operation, is delivered to the customer or to the place designated for delivery."
Although Travelers places considerable reliance upon the Bobier case, it appears doubtful that a literal application of the above-quoted language to the facts now before us would give any justification for such reliance. Here, there was no movement by anyone of anything, liquid or solid, which had any relationship to the purposeful presence of the truck. Obviously, the tank truck was not on the premises of Gulf to secure any equipment from Gulf. It was there for the purpose of obtaining diesel fuel.
But aside from this observation, the Bobier case is of questionable value in the disposition of the problem which now confronts us. In that case, the damage was caused by employees connected with the truck; they were in the continuous use of the truck on the business of the named insured; loading and unloading were natural consequences of that use; their actions inured to the benefit of the named insured; and their negligence was clearly imputable to the named insured. They were, therefore, "insured" within the scope of the definition of that term as used in the policy, and the coverage afforded in that case was within the common understanding and conception of the scope of liability insurance.
But where, as here, the injury is caused by 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.
Reverting to the language in the contract, to say that "use includes loading and unloading" is not tantamount to saying that the contemplated use is exclusively confined to loading and unloading. The former contemplates more than the latter. In our judgment, loading and unloading are but component parts of "use," and the former is of no consequence unless or until the party charged with negligence is shown to have been using the truck so as to qualify as an "insured" within the definition of that term as used in the policy. And, although "using" and "actual use" do not have the limited meaning of "operating" or "actual operation" ( Brown v. Kennedy, 141 Ohio St. 457), neither can such words be extended beyond what may reasonably be implied from the circumstances of the case or the relationship of the parties. Where third parties are involved, it cannot be validly claimed that mutual acquiescence constitutes permissive use until some particular use of the truck appears which may be the subject of acquiescence. Since it is fair to assume that McCracken paid premiums to Buckeye for his own protection, it reasonably follows that a strong symptom of use would appear when the third party performed some act relating to the truck which was for the benefit of McCracken.
Here, the facts are that the equipment used by Gulp's employee was exclusively owned by Gulf, and the acts performed by Gulf's employee related exclusively to his own employment. The insured truck was still under the exclusive control of McCracken's employee. We do not find, therefore, that Gulf's employee was using McCracken's truck for any purpose at the time of the accident. Suppose, for example, that ten trucks were waiting in line for a load of diesel fuel when a Gulf employee injured someone in the area in like manner as in this case. Would the negligence creating liability be traceable to the insurers of the trucks?
The most persuasive authority cited by Travelers is the case of Wagman v. American Fidelity Casualty Co., Inc., 304 N.Y. 490, 109 N.E.2d 592. That case was judicially noticed in the cases of Spurlock v. Boyce-Harvey Machinery, Inc. (La.App.), 90 So.2d 417, and Lowry v. R.H. Macy Co., Inc., 119 N.Y. Supp. (2d), 5, which also have facts that parallel the facts of the instant case. In none of those cases was the party charged with negligence an employee of the named insured.
In the Wagman case, a truck was parked at the curb in front of a Bond store. Two Bond employees rolled garments out of the store on movable racks to the curb line where the driver of the truck reached down and lifted the garments into the truck.
The named insured's employees did not leave the truck and none of Bond's employees entered the truck or brought the garments farther than the curb line. Wagman, who was employed by Bond, was engaged in counting and checking the clothes (something, incidentally, which he could have done when the truck was miles away), but he did not participate in the actual pushing or carrying of the garments. On his way back to the store, he bumped into a pedestrian causing her to fall to the sidewalk and sustain injuries.
In extending the coverage of the truck policy to Wagman, the court recognized, at page 495, that "the only problem is whether plaintiff may be regarded as having been `using' the vehicle within the meaning of the policy." Then, after stating that "the answer to that is clear," the court cited the case of Zurich Gen. Accident Liability Ins. Co. v. Eagle Ind. Co., 279 App. Div. 574, 107 N.Y. Supp. (2d), 552, and the case of Conrad v. Duffin, 158 Pa. Sup., 305, 44 A.2d 770. We agree that the only problem in that case was whether Wagman was using the truck when he was counting clothes for Bond, but we fail to comprehend the manner in which the two cited cases dispose of that problem. In each of the cited cases, the party charged with negligence was actually using the truck involved with the permission of the named insured before the accident occurred which gave rise to the cause of action. In neither case, therefore, was the court confronted with the problem of whether the party involved was "using" the vehicle within the meaning of the policy.
In reality, the construction given to the policy in the Wagman case was new, but we cannot, in the absence of any showing that the Bond employee was using the truck, reconcile the conclusion therein with what we conceive to be the intention of the parties to such a contract.
To accord to this policy the construction which Travelers claims was intended leads to the conclusion that McCracken paid premiums to Buckeye so that Buckeye would insure and protect Gulf against the claims of McCracken. It seems doubtful that the parties to the contract so intended. In our opinion, Gulf's employee was not using McCracken's truck for any purpose. He was not, therefore, an "insured" under the policy issued by Buckeye.
The judgment of the Court of Appeals is affirmed.
Judgment affirmed.
ZIMMERMAN, acting C.J., DOYLE, TAFT and BELL, JJ., concur.
MATTHIAS and HERBERT, JJ., dissent.
ZIMMERMAN, J., sitting in the place and stead of WEYGANDT, C.J.
DOYLE, J., of the Ninth Appellate District, sitting by designation in the place and stead of ZIMMERMAN, J.
KERNS, J., of the Second Appellate District, sitting by designation in the place and stead of O'NEILL, J.