Ar-Glen Corp. v. Travelers Ins. Co.

• Decision Date: 05 November 1957
• Docket Number: AR-GLEN
• Citation: 8 Misc.2d 589,167 N.Y.S.2d 332
• Parties: CORP., Sam Gruber and Joseph Gruber, Plaintiffs, v. TRAVELERS INSURANCE COMPANY and George Bostwick, Defendants.
• Court: New York Supreme Court

Page 332

167 N.Y.S.2d 332

8 Misc.2d 589

AR-GLEN CORP., Sam Gruber and Joseph Gruber, Plaintiffs, v. TRAVELERS INSURANCE COMPANY and George Bostwick, Defendants.

Supreme Court, Special Term, Monroe County.

Nov. 5, 1957.

George J. Nier, Jr., Rochester, for plaintiffs.

Casper V. Baltensperger, Rochester, for defendants.

HENRY, Justice.

This is an action for a judgment declaring that plaintiffs are entitled to coverage under a policy of automobile liability insurance issued by Travelers Insurance Company and covering a Diesel Mack Tractor owned by the defendant, Bostwick. The action arises out of an accident which occurred in Middleburgh, New York, on April 9, 1955, on which date the above policy was in effect. On April 6, 1955, Bostwick entered into an agreement with Beaney Transport Company, of Brockport, New York, to haul a trailer, owned by Ruth T. Beaney and containing a load of hams, from Brockport to New York City. It was agreed between Bostwick and Beaney Transport Company that, if the company had no load to be returned from New York to Brockport in the trailer, Bostwick was free to use the trailer to carry cargo for any third party on his return trip to Brockport. When the load of hams was delivered to New York City, there being no long to be returned to Brockport, for Beaney Transport Company, Bostwick agreed with the plaintiff, Ar-Glen Corp., to haul a load of bananas in the Beaney trailer to Syracuse, New York. To maintain the temperature at 60? , Ar-Glen Corp. nailed to the bed of the trailer a temporary propane gas heater. Thus equipped, Bostwick began his return trip. On April 9th, at Middleburgh, New York, Bostwick opened the rear doors to check the temperature of the trailer and was injured in the resulting explosion.

In September, 1956, Bostwick began an action in Supreme Court, Monroe County, against Ar-Glen Corp. and two named officers. His complaint alleges in substance that Ar-Glen Corp. and its two officers were negligent in that they installed a defective heater in the trailer and failed to provide sufficient ventilation knowing that the gas flame would consume the oxygen in the trailer and thereby cause a dangerous condition.

In the present action, Ar-Glen Corp. and the two officers demand judgment declaring that they are insured under the Travelers policy insuring Bostwick's tractor and that therefore Travelers is bound to defend them and to pay all sums which they may be legally obligated to pay in the action brought against them by Bostwick.

The pertinent parts of the policy bearing upon the issues herein are as follows:

Under Item 1, the occupation of the insured is stated to be 'truckman'.

Under Coverage A, Travelers agrees to pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury sustained by any person caused by accident and arising out of the ownership, maintenance or use of the automobile.

Under Article III, the insured is defined to be the named insured which 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. Coverage thereunder is specifically excluded in the cases of persons operating garages, sales agencies, service stations or public parking places.

The policy also contained a clause excluding coverage relating to any accidents occurring while towing a trailer not covered by like insurance in the company. However, such defense has not been argued and would not be available under Section 59-a of the Vehicle and Traffic Law. Royal Indemnity Co. v. American Casualty Company of Reading, Pennsylvania, 5 Misc.2d 533, 159 N.Y.S.2d 45; Wheeler v. Piscina, 277 App.Div. 1014, 100 N.Y.S.2d 373, dismissed 302 N.Y. 689, 98 N.E.2d 484.

If Ar-Glen Corp. is successful in its action for a declaratory judgment, the result is that any judgment in favor of Bostwick will be paid by his own insurer. While that issue was once in doubt, it has now been resolved in New York. Where the named insured is himself injured by the negligence of one using the vehicle, with his permission, in the absence of a specific exclusion, the user is held to be an additional insured within the meaning of the omnibus clause and the named insured one of the 'persons' whose injury is within the coverage of the policy. Aetna Casualty & Surety Company v. General Casualty Company of America, 285 App.Div. 767, 140 N.Y.S.2d 670; Royal Indemnity Co. v. American Casualty Company of Reading, Pennsylvania, 5 Misc.2d 533, 159 N.Y.S.2d 45.

We now turn to the question whether or not the installation of the heater in the trailer was a 'use' thereof within the purview of the omnibus clause. It is well settled that the insurer's duty to defend depends upon the allegations of the complaint. Mason-Henry Press v. Aetna Life Insurance Company, 211 N.Y. 489, 105 N.E. 826; Goldberg v. Lumberman's Mutual Casualty Insurance Company, 297 N.Y. 148, 77 N.E.2d 131. In this case, the allegations of Bostwick's complaint relate to a defective heater. However, as the complaint may be construed, the heater alone would not have caused the accident. It is further alleged by Bostwick that the defendants failed to provide a vent in the trailer and that they installed the heating equipment knowing that the gas flame would consume the oxygen within the trailer and thereby cause a dangerous condition. In construing the coverage of an automobile liability policy, the court must consider whether the occurrence was a natural and reasonable incident or consequence of the use of the vehicle for the purpose shown on the declarations even though unforeseen or unexpected. 5A American Jurisprudence, Automobile Insurance § 71. The movement of the vehicle is not the sole test of intended coverage as is illustrated by the decisions arising under the so-called loading and unloading clause. Wagman v. American Fidelity & Casualty Co., Inc., 304 N.Y. 490, 109 N.E.2d 592; Kemnetz v. Galluzzo, Sup., 163 N.Y.S.2d 998; Lowry v. R. H. Macy & Co., Sup., 119 N.Y.S.2d 5. Under this theory, it has been held that liability coverage extended to a child alighting from a school bus (...