Aetna Ins. Co. of the Midwest v. Rodriguez, 75S03-8801-CV-14

• Decision Date: 06 January 1988
• Docket Number: No. 75S03-8801-CV-14,75S03-8801-CV-14
• Parties: AETNA INSURANCE COMPANY OF THE MIDWEST, Appellant, v. John RODRIGUEZ; John Rodriguez, d/b/a Atlas Transmission; John Rodriguez, d/b/a Custom Automotive; Shaver Motors, Inc., Associated Adjusters and Shaver Motors, Inc., Appellees.
• Court: Indiana Supreme Court

Page 386

517 N.E.2d 386

AETNA INSURANCE COMPANY OF THE MIDWEST, Appellant, v. John RODRIGUEZ; John Rodriguez, d/b/a Atlas Transmission;

John Rodriguez, d/b/a Custom Automotive; Shaver

Motors, Inc., Associated Adjusters and

Shaver Motors, Inc., Appellees.

No. 75S03-8801-CV-14.

Supreme Court of Indiana.

Jan. 6, 1988.

Rehearing Denied March 10, 1988.

Charles T. Jennings, Donna H. Fisher, Jennings, Maas & Stickney, Indianapolis, for appellant.

Clyde D. Compton, Bonnie C. Coleman, Hodges, Davis, Gruenberg, Compton & Sayers, P.C., Merrillville, for appellees.

ON CIVIL PETITION TO TRANSFER

GIVAN, Justice.

On August 28, 1986, the Court of Appeals rendered the first opinion in this case in which they reversed the decision of the trial court. Aetna v. Rodriguez (1986), Ind.App., 496 N.E.2d 1321. On March 12, 1987, the Court of Appeals, in an opinion on rehearing, affirmed the decision of the trial court. Aetna v. Rodriguez (1987), Ind.App., 504 N.E.2d 1030.

In the latter opinion, the Court of Appeals relied upon the case of Skendzel v. Marshall (1973), 261 Ind. 226, 301 N.E.2d 641 for the proposition that a conditional sale vendor should be treated as a mortgagee. Although the Court of Appeals quoted at length from Judge McLaughlin's trial court judgment, for the sake of understanding this opinion, we will repeat that quotation here:

"We have a prospective insured, Rodriguez, without a high school education (although he has made more money than most Judges will ever see) buying a product in a highly technical field. He knows he wants fire insurance to protect his property and knows that he must have insurance to protect the former owner of the property to whom he still owes money. He contacts an insurance broker-agent who under the specific facts of this case, is the agent of the company and not that of the prospective insured.

The only facts in the record show that the prospective insured, Rodriguez, tells the broker-agent that he is buying this property from Shaver Chevy and making payments; that he wants insurance and wants Shaver Chevy protected on it.

The prospective insured does not know the difference between contracts and mortgages, much less the legal differences between the defenses of an insurance company as to contract sellers, loss payees, and mortgagees. I proffer the thought that, although others may know the distinction between the actual terms, only insurance attorneys and underwriters know the distinction as to company defenses which may be invoked against each of the above three classes of insureds, and I further suggest that many agents do not understand same or know there is a difference between the defenses.

No one asked the proposed insured: 'Are you buying this real estate on a long term conditional sale contract or did you get a deed then in return sign a promissory note and a real estate mortgage?' Neither did anyone check the Recorder's Office to determine any correct facts. No one even checked the correct names of the parties, but simply used the street vernacular.

The broker-agent and company were faced with a situation in which the words used by the prospective insured, Rodriguez, were susceptible of two or more meanings or interpretations. They did nothing to determine the correct interpretation or facts, but simply adopted the interpretation and wrote the insurance policy in the manner most...