Aetna Cas. & Sur. Co. v. Brethren Mut. Ins. Co.
Decision Date | 08 December 1977 |
Docket Number | No. 218,218 |
Citation | 38 Md.App. 197,379 A.2d 1234 |
Parties | The AETNA CASUALTY AND SURETY COMPANY et al. v. The BRETHREN MUTUAL INSURANCE COMPANY et al. |
Court | Court of Special Appeals of Maryland |
Benjamin R. Goertemiller and E. Charles Dann, Jr., Baltimore, with whom were John S. Landbeck, Jr., Aberdeen, and Semmes, Bowen & Semmes, Baltimore, on the brief, for appellants.
William H. Hicks, Baltimore, with whom were George M. Radcliffe and Niles, Barton & Wilmer, Baltimore, on the brief, for appellees.
Argued before GILBERT, C. J., and MASON and LISS, JJ.
The Aetna Casualty and Surety Company (Aetna) and its insured, J. William Boniface (Boniface), appellants, filed a declaratory judgment action in the Circuit Court for Baltimore County, seeking a declaration that an insurance policy issued to Boniface by The Brethren Mutual Insurance Company (Brethren), appellee, provided him with coverage for certain claims made against him by one Henry L. Barnett (Barnett). They also sought a declaration: 1) that Brethren is responsible for certain attorneys' fees and other costs incurred by Aetna in defending Boniface against the claims being made against him by Barnett, and 2) that Brethren must pay the attorneys' fees and other costs incurred by Boniface and Aetna in pursuing the declaratory judgment action. On February 14, 1977, a hearing on the merits of the declaratory judgment action was held before Judge Marvin J. Land, who denied all of the requested declarations. This appeal was taken from that decision.
The facts are not disputed, and the parties have set forth in the joint record extract filed in this appeal an agreed statement of facts which we will accept as the factual basis for this controversy. That statement, with minor amendments, we repeat here verbatim:
Other Insurance. The insurance afforded by this policy is primary insurance except when stated to apply in excess of or contingent upon the absence of other insurance. When this insurance is primary and the insured has other insurance which is stated to be applicable to the loss on an excess or contingent basis, the amount of the company's liability under this policy shall not be reduced by the existence of such other insurance.
When both this insurance and other insurance apply to the loss on the same basis, whether primary, excess or contingent, the company shall not be liable under this policy for a greater proportion of the loss than that stated in the applicable contribution provision below:
(a) Contribution by Equal Shares. If all of such other valid and collectible insurance provides for contribution by equal shares, the company shall not be liable for a greater proportion of such loss than would be payable if each insurer contributes an equal share until the share of each insurer equals the lowest applicable limits of liability under any one policy or the full amount of the loss is paid, and with respect to any amount of loss not so paid the remaining insurers then continue to contribute equal shares of the remaining amount of the loss until each such insurer has paid its limit in full or the full amount of the loss is paid.
(b) Contribution by Limits. If any of such other insurance does not provide for contribution by equal shares, the company shall not be liable for a greater proportion of such loss than the applicable limit of liability under this policy for such loss bears to the total applicable limit of liability of all valid and collectible insurance against such loss.
"In addition, on December 7 & 8, 1973, Boniface was a named insured under a policy of insurance (No. 51648) issued by Brethren, which provided fire and extended coverage and which included a 'Farmers' Comprehensive Personal Liability Endorsement'. Under the terms of this endorsement which also contained $100,000 limits, Brethren was obligated to:
I. COVERAGE L PERSONAL LIABILITY
The company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury or property damage to which this insurance applies, caused by an occurrence, and the company shall have the right and duty to defend any suit against the insured seeking damages on account of such bodily injury or property damage, even if any of the allegations of the suit are groundless, false or fraudulent, and may make such investigation and settlement of any claim or suit as it deems expedient, but the company shall not be obligated to pay any claim or judgment or to defend any suit after the applicable limit of the company's liability has been exhausted by payment of judgments or settlements.
"The policy also contained an exclusion which provided that coverage does not apply:
(b) to bodily injury or property damage arising out of
(1) business pursuits of any insured except
(i) activities therein which are ordinarily incident to non-business pursuits and
(ii) farming, or
(2) the rendering of or failing to render professional services.
"It also defined farming to include, 'the operation of roadside stands maintained principally for the sale of the insured's farm products.' In addition, the policy contained the following provision:
Other insurance. The insurance afforded by this endorsement is primary insurance except that with respect to loss arising out of the ownership, maintenance, operation, use, loading or unloading of 1) any automobile or midget automobile at the insured premises, or 2) watercraft, or any land public conveyance, this insurance shall be excess insurance over any other valid and collectible insurance available to the insured.
When both this insurance and other insurance apply to the loss on the same basis, whether primary, excess or contingent, the company shall not be liable under this policy for a greater proportion of the loss than that stated in the applicable contribution provision below:
(a) Contribution by Equal Shares. If all of such other valid and collectible insurance provides for contribution by equal shares the company shall not be liable for a greater proportion of such loss than would be payable if each insurer contributes an equal share until the share of each insurer equals the lowest applicable limit of liability under any one policy or the full amount of the loss is paid, and with respect to any amount of loss not so paid the remaining insurers then continue to contribute equal shares of the remaining amount of the loss until each such insurer has paid its limit in full or the full amount of the loss is paid.
(b) Contribution by Limits. If any of such other insurance does not provide for contribution by equal shares, the company shall not be liable for a greater proportion of such loss than the applicable limit of liability under this endorsement for such loss bears to the total applicable limit of liability by all valid and collectible insurance against such loss.
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