Argonaut Insurance Co. v. National Indemnity Co., 679-69.
| Decision Date | 07 January 1971 |
| Docket Number | No. 679-69.,679-69. |
| Citation | 435 F.2d 718 |
| Parties | ARGONAUT INSURANCE COMPANY, a Corporation, Plaintiff-Appellant, v. NATIONAL INDEMNITY COMPANY, a Corporation, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Tenth Circuit |
Michael C. Stewart, Oklahoma City, Okl., for plaintiff-appellant.
R. D. Looney of Watts, Looney, Nichols & Johnson, Oklahoma City, Okl., for defendant-appellee.
Before BREITENSTEIN and SETH, Circuit Judges, and TEMPLAR, District Judge.
We have here a controversy between two insurance companies over coverage and liability for damages arising out of an automobile accident.
Plaintiff-appellant Argonaut Insurance Company issued a liability policy to Auto Driveaway Company whose business is the transportation of cars from one destination to another. Defendant-appellee, National Indemnity Company, issued a similar policy to Executive Car Leasing Company whose business is the leasing of cars to the public. Both policies were in force at the time of the accident.
A lessee of Executive terminated his lease. Executive engaged Driveaway to transport the car from Miami, Oklahoma, to Los Angeles, California. Through arrangements made by Driveaway, Nancy Blankenship took possession of the car to drive it to Los Angeles. In Oklahoma City, while en route, she ran a stop sign and struck a car driven by Seymour who died as a result of injuries sustained in the accident.
The administratrix of Seymour's estate sued Driveaway and Blankenship. Both insurance companies had timely notice of the accident and the suit. National, the insurer of Executive, refused to defend. Argonaut, the insurer of Driveaway, defended and made a settlement of $55,000. Before the court approved the settlement National was given an opportunity to object but did not do so. Argonaut paid the judgment and sued National on the ground that National had primary coverage. The recovery was within the limits of each policy. The trial court held that Argonaut had primary coverage and this appeal followed.
Both policies contained identical "other insurance" provisions.1 The parties stipulated that the "policies of insurance were contracted by the separate parties in the State of California."
Argonaut says (1) California law controls, (2) where "other insurance" clauses of the type found here are in the liability policies of both the driver and the owner, effect is given to the excess provision of the driver's policy, and (3) the insurer of the owner is primarily liable and must bear the whole loss within the limits of its policy. See American Automobile Insurance Company v. Republic Indemnity Company of America, 52 Cal. 2d 507, 341 P.2d 675. Under this theory National, the insurer of the owner, is primarily liable and Argonaut, the insurer of the driver, is liable only for excess. There is no excess because the recovery was within the limits of each policy. Argonaut argues that under the stated rule it can recoup from National.
National says that California law governs only policy issuance and cancellation and that policy construction is controlled by Oklahoma law because the accident occurred there. Our attention is directed to no Oklahoma decision regarding the effect of identical "other insurance" provisions. We need not speculate on what the Oklahoma law may be because we believe that other policy provisions control the result.
Attached to each policy is a pertinent endorsement. The general rule is that provisions contained in an endorsement prevail over those in the body of the policy. Farmers Ins. Exchange v. Ledesma, 10 Cir., 214 F.2d 495, 498. Also, when written and printed portions of a policy are repugnant, the written clauses will prevail over the printed. Newfoundland American Insurance Company, Ltd. v. Suesz, 10 Cir., 289 F.2d 694, 697; see also Bluewaters, Inc. v. Boag, 1 Cir., 320 F.2d 833, 835. We turn our attention to the endorsements.
The National policy had a typewritten "DRIVEAWAY" endorsement which provided in its ¶ 5 that:
"This insurance shall be considered as excess insurance where other insurance exists in the name of or for the benefit of the insured and this insurance shall not apply and the company shall not be called upon to contribute to the payment of any loss until all...
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