American Universal Insurance Company v. Dykhouse

• Decision Date: 11 June 1963
• Docket Number: Civ. No. 1268.
• Citation: American Universal Insurance Company v. Dykhouse, 219 F.Supp. 62 (N.D. Iowa 1963)
• Parties: AMERICAN UNIVERSAL INSURANCE COMPANY, a corporation, Plaintiff, v. Emerson J. DYKHOUSE, Administrator of the Estate of Donald B. Sharp, deceased, et al., Defendants.
• Court: U.S. District Court — Northern District of Iowa

219 F. Supp. 62

AMERICAN UNIVERSAL INSURANCE COMPANY, a corporation, Plaintiff, v.Emerson J. DYKHOUSE, Administrator of the Estate of Donald B. Sharp, deceased, et al., Defendants.

Civ. No. 1268.

United States District Court N. D. Iowa, W. D.

June 11, 1963.

John J. Vizintos, Sioux City, Iowa, for plaintiff.

Louis L. Corcoran, Sibley, Iowa, for individualdefendants.

Clyde Putnam, Jr., Des Moines, Iowa, for defendantMotor Vehicle Cas. Co.

HANSON, District Judge.

This case was tried partly pursuant to a stipulation of facts set out as follows:

"1.That the decedent, Donald B. Sharp, had the permission of his superiors in the South Dakota State Department of Agriculture, where he was then employed, to attend the annual meeting or convention of the North Central States Association of Food, Drug, Feed and Fertilizer Control Officials, to be held at the Sheraton-Cataract Hotel in Sioux Falls, South Dakota, on July 26 and 27, 1960; that the said Donald B. Sharp also had the permission of his said superiors in said Department of Agriculture to drive the 1956Ford Mainline automobile, state license number 39, owned by the State of South Dakota, Department of Agriculture, and furnished him by said State of South Dakota, Department of Agriculture, for his use in connection with his duties, which said automobile was then insured by the plaintiff company, to Sioux Falls, South Dakota, from his home at Highmore, South Dakota, on July 25, 1960, for the purpose of attending such meeting.

"2.That if Neal Kroon, the Sheriff of Lyon County, Iowa, were called as a witness by any of the parties in said cause, he would testify as follows: that he was called to the scene of a collision west of Larchwood, Lyon County, Iowa, on the evening of July 25, 1960; that a 1956 Ford automobile owned by the State of South Dakota, Department of Agriculture, state license 39, driven by Donald B. Sharp, and a car owned by Frank Dieren and driven by Gary Dieren were involved in said collision; that said collision occurred about two and one-half miles southeast of the Iowa-South Dakota state line in Lyon County, Iowa, which point of collision was approximately sixteen or seventeen miles southeast of Sioux Falls, South Dakota, on Iowa highway No. 9; that at the time of the collision the Dieren car was headed west on said highway, and the South Dakota State car driven by Sharp was headed east on said highway; that Gary Dieren was accompanied by Marilyn Vogel in the car driven by him, and that Donald B. Sharp was alone in the State vehicle; that Sharp was killed instantly in said collision; that in the State car driven by Sharp, he(the Sheriff) found a half-pint bottle of whiskey, two-thirds to threefourths consumed."

There was a considerable amount of other evidence introduced at the trial.There were two insurance policies in question.The policy issued by American Universal Insurance Co. listed the named insured as the State of South Dakota, Department of Agriculture.Where bodily injury liability and property damage liability were concerned, the policy was to cover both pleasure and business purposes.The automobile involved in the accident was one listed in the policy as being covered, and at the time of the accident, was being driven by the decedent, Donald B. Sharp.The other policy was issued by Motor Vehicle Casualty Company to Donald B. Sharp.This policy injects an issue of excess coverage.

Whether Donald B. Sharp was covered by the American Universal policy depends upon whether he was driving the automobile in question at the time of the accident with permission of the named insured, State of South Dakota Department of Agriculture.The word "permission" must be construed according to the meaning it has been given in other insurance policies.This case was tried without a jury.Therefore, the fact questions as to whether there was implied authority, actual authority, or more than a slight deviation from this permission are to be decided by the judge sitting as the trier of fact.

EXPRESS PERMISSION

As to the express authority or permission for the use of the automobile in question at the time of the accident, the State of South Dakota Travel Regulations are most in point.These regulations in Exhibit A say that the direct route will usually be taken.The regulations in Exhibit A became effective on August 1, 1959.However, the regulations allow an indirect route to be taken or for the travel to be interrupted.According to the regulations, this is allowed whenever it is for the convenience of the officer or employee in question.Donald B. Sharp was killed in the accident and, therefore, his purposes cannot be known.The travel regulations prescribe only that the extra expense of the indirect route is to be borne by the employee or officer taking such indirect route.In Section XV of the travel regulations, it is stated that travel not exceeding twenty-five miles from the South Dakota boundary line shall be considered as instate travel.There was evidence that Donald B. Sharp never reached Sioux Falls, South Dakota, which tends to show that an indirect route was taken.There was evidence that Donald B. Sharp had not registered at any hotel or motel in Sioux Falls.The evidence that he might have been driving around the countryside close to Sioux Falls to cool off on this warm summer night is not inconsistent with this.Neither is the evidence that the Sharp car may have been pointed east at the time of the accident inconsistent with the taking of an indirect route or of an interruption of travel for the convenience of Sharp.There is no evidence that Sharp did not bear any extra expense, or that he had not done this in the past.

Donald B. Sharp in no way violated any express travel instructions.There were no allegations made or evidence of any violation of any express instructions.

Exhibits B and C also deal with certain travel restrictions.These restrictions in exhibits B and C, as shown by the evidence, were not intended to apply to employees in the status of Donald B. Sharp.Exhibit C states that no State owned vehicle shall be used for personal convenience of the traveler including driving the vehicle to and from work, and all vehicles must be parked at night and on non-work days in designated parking lots.The testimony was uncontested that Donald B. Sharp had permission to take the automobile home in the evening with him.There is evidence from his wife that Donald B. Sharp used the automobile sometimes in the evenings and on the weekends around his home.It was not admitted on direct examination but was admitted reluctantly on cross-examination of the wife of Donald B. Sharp.Plus, at least on one occasion, he detoured to Highmore, South Dakota, to see his son and sometimes his wife rode in the state car with him.

In depositions of Mr. Ernest L. Johnson, Secretary of Agriculture for the State of South Dakota, and Mr. Stanley Fosnes, the Assistant Director of the Division of Purchasing and Printing, the issue of the affect of the regulations was gone into.The evidence was that the clause in Exhibit C stating that the Department, institution and agency heads shall be responsible for the limitation in use of any passenger vehicles in the custody of their respective department, institution or agency, left discretion in the head of the particular agency as to the use to be made of the automobiles in their agency.

Travel directives are sent to the heads of the agencies, and the head of a particular agency then distributes whatever he desires to the particular employee.This is the procedure according to the knowledge of Mr. Fosnes.Mr. Johnson stated that he did not know what instructions had been given to Donald B. Sharp with respect to the use of the state-owned car.The records, according to Mr. Johnson, showed that a state-owned car had been assigned to Donald B. Sharp.

It is admitted by stipulation that Donald B. Sharp was driving the 1956Ford Mainline automobile with license number 39 owned by the State of South Dakota, Department of Agriculture, and that it was furnished him for the purpose of use in connection with his duties at the time of the collision.This automobile is listed as the 13th car in the policy of insurance issued by the American Universal Insurance Co. to the State of South Dakota, Department of Agriculture.This automobile was covered by this policy when an employee of this Department was operating the automobile with permission.

IMPLIED AUTHORITY OR SLIGHT DEVIATION

It is not necessary for the Court to make a finding as to implied authority or as to deviation because there was express authority for the use in this case.However, even if there was not express authority, the deviation would be incident to the purposes of his employer, that is, travel to Sioux Falls for the convention.Also, there was evidence of such prior personal use of the automobile whereby it might be inferred that it was being acquiesced in.However, the reason for this acquiescence was that it was expressly allowed by the travel regulations.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The Court makes the following findings and conclusions:

1.That the authority given in the travel regulations marked Exhibit A were in effect at the time of the collision.

2.That the limitations existing in the directives shown as Exhibits B and C were not carried into effect as to this particular employee, Donald B. Sharp; and that the department for which Donald B. Sharp was working did not follow the directives given in Exhibits B and C and the department had the above mentioned discretion to govern the use of the automobiles under its custody.

3.There was permission to use the automobile in question for the trip to Sioux Falls to attend said meeting or convention and this is undisputed.The exact purpose for which the car was being used at the time of the collision cannot be determined because Donald B. Sharp is deceased....