American Oil and Supply Company v. United States Casualty Company

• Decision Date: 05 December 1940
• Docket Number: No. 173.,173.
• Citation: American Oil and Supply Company v. United States Casualty Company, 18 A.2d 257, 19 N.J.Misc. 7 (N.J. 1940)
• Court: New Jersey Supreme Court
• Parties: AMERICAN OIL AND SUPPLY COMPANY, PLAINTIFF, v. UNITED STATES CASUALTY COMPANY, DEFENDANT

18 A.2d 257

19 N.J.Misc. 7

AMERICAN OIL & SUPPLY CO.

v. UNITED STATES CASUALTY CO.

No. 173.

Supreme Court of New Jersey. Essex County.

Dec. 5, 1940.

Action by the American Oil and Supply Company against the United States Casualty Company to recover upon an indemnity insurance policy issued to plaintiff.

Judgment for plaintiff.

John A. Laird, of New York City, for plaintiff.

Walter X. Trumbull, of Newark, for defendant.

SMITH, Circuit Court Judge.

This case came on for trial before me on October 31, 1940, and was submitted to the Court without a jury on the pleadings and an agreed statement of facts.The Court heard argument and subsequently briefs were filed.The record consists of the pleadings and stipulation, which includes the record in a case in the Essex Circuit Court, Standard Embossing Plate Manufacturing Company v. American Oil and Supply Company.

The defendant herein issued its indemnity policy to the plaintiff covering the operation of a certain auto truck owned by the plaintiff and referred to later, and this policy was in force on December 27, 1935.

The policy insured the plaintiff against accidents "by reason of the ownership, maintenance, or use of any automobile or trailer described in the schedules of statements, including the loading and unloading of such automobiles or trailer."

The accident involved in this suit is described in the stipulation as follows:

"2.That on said December 27, 1935 an automobile truck covered under the terms of the aforementioned policy and owned by the plaintiff was used to transport certain merchandise consisting in part of two five-pint bottles of nitric acid, intended for a customer of the plaintiff, the Standard Embossing Plate Manufacturing Company, and that the driver of the said truck drove the truck to the place of business of that company and parked at the curb on the street, in front of its place of business.

"3.That the place where the truck driver entered was through a small steel door set within a large movable steel door, which large door permitted direct entrance of trucks into the place of business of the Standard Company and that the practice of the Standard Company in shipping out merchandise was to have its trucks alongside of this door and the embossing plates which they manufactured loaded on the truck through the opened large steel door.Upon occasion, merchandise was also delivered in this fashion although consignments of heavy merchandise were generally received at another entrance.

"4.That upon December 27, 1935, the truck driver upon reaching the Standard Company's plant entered the plant through the small steel door; ascertained that the acid would be received in the room directly inside that door (known as the shipping or receiving room); went back to his truck, leaving the door open; carried both bottles of acid, one in each hand, into the room and placed both bottles down on a rack.The door was eight feet from the street curb and the rack was about seven feet inside the door.

"5.That the bottle which he had been carrying in his left hand broke at the time it was put on the rack, the said bottle not having been broken or leaking prior to its being placed on said rack.That the testimony indicates that the bottle was put down on the rack, immediately thereafter it was found to be broken; the acid from the bottle flowed over the rack and that it damaged certain embossing plates stored beneath the rack.

"6.Thereafter an action was instituted by the Standard Company against American Oil & Supply Co. alleging negligence and this trial resulted in a verdict in favor of the plaintiff in the amount of $900.00 together with costs taxed in the sum of $103.47, which said judgment was entered on September 28, 1937 and was actually paid by American Oil & Supply Co. under date of October 14, 1937."

The complaint in the suit brought by the Standard Embossing Plate Manufacturing Company against the plaintiff alleged an accident as follows:

"In the course of the delivery aforesaid of said two bottles of nitric acid by the defendant, defendant through its servant, agent or employee aforesaid, caused one of said bottles to become broken and the contents thereof to be spilled over and upon the aforesaid thirty steel engraved embossing plates."

The defendant's attorney at the trial of this case moved for a direction of a verdict on two grounds: first, that no reference in the original action was made to a delivery by automobile and that therefore the plaintiff is estopped by the record of that case from claiming that the accident so occurred; namely, by reason of the ownership, maintenance or use of the automobile in question, including its loading and unloading; and secondly, that the accident was not covered by the policy.

On the question of estoppel, the defendant cites the case of Stefus v. London & Lancashire Indemnity Company, 111 N.J.L. 6, 166 A. 339.In that casethe plaintiff sued a policy holder of the defendant for injuries sustained as a result of the operation of the assured's automobile.The policy indemnified the assured only for injuries to third persons accidentally sustained.The complaint in the original action alleged negligence but the defendant insurance company in the cited case attempted to set up by way of answer that the original case was submitted to the jury on the question of whether or not the injuries sued for were sustained in the commission by the assured of a wilful tort, which was not covered by the policy, not being an accident.The court held, however, that the defendant was bound by the record, which alleged an accident and could not show the grounds on which the case was submitted to the jury.

The defendant here now attempts to claim that because the allegations of negligence in the complaint do not include any negligence in unloading that the plaintiff here is estopped by that record from recovering.It is my view that the principle in the cited case does not apply in the instant case so as to support an estoppel.The charge made by the Standard Embossing Plate Manufacturing Company was of damage in making a delivery and that was due to negligence.The policy covers damage done in unloading, which is part of a delivery and is not limited to negligence in unloading.Therefore...