Auclair v. Allstate Ins. Co.

• Decision Date: 27 September 1978
• Docket Number: No. 78-011,78-011
• Citation: 392 A.2d 1197,118 N.H. 626
• Parties: Mark AUCLAIR v. ALLSTATE INSURANCE COMPANY, Fireman's Fund American Insurance Company, and Hanover Insurance Company.
• Court: New Hampshire Supreme Court

Page 1197

392 A.2d 1197

118 N.H. 626

Mark AUCLAIR v. ALLSTATE INSURANCE COMPANY, Fireman's Fund American Insurance Company, and Hanover Insurance Company.

No. 78-011.

Supreme Court of New Hampshire.

Sept. 27, 1978.

Craig, Wenners, Craig & McDowell, Manchester (Vincent A. Wenners, Jr., Manchester, orally), for plaintiff.

Fisher, Parsons, Moran & Temple, Dover (Robert H. Temple, Dover, orally), for defendant Allstate Ins. Co.

Wiggin & Nourie, Manchester (James W. Donchess, orally), for defendant Fireman's Fund American Ins. Co.

Augustine J. McDonough, P. A., Manchester, waived brief and oral argument for defendant Hanover Ins. Co.

BOIS, Justice.

Petition for declaratory judgment to determine insurance coverage. The case was submitted to the Trial Court (Goode, J.) on an agreed statement of facts and on testimony in the form of depositions of the plaintiff and of his father, Lestor Auclair.

The pertinent facts are as follows: On June 5, 1973, Norman R. Vincent obtained a "nonowners" insurance policy through defendant Fireman's Fund American Insurance Company (hereinafter Fireman's Fund). Attached to this policy was a special endorsement which read in part:

2. The insurance does not apply:

(a) as respects the named insured, to any automobile owned by the named insured . . .

3. If the named insured acquires ownership of an automobile during the policy period, the insurance hereunder shall nevertheless apply with respect to the ownership, maintenance or use of such automobile for a period of 30 days next following the date of such acquisition; provided that the insurance shall not apply beyond the effective date and time that any other insurance is available to the insured with respect to such automobile or would be available but for the existence of this insurance.

Fireman's Fund filed a certificate of financial responsibility with the New Hampshire Director of Motor Vehicles. Vincent then had his motor vehicle operator's license reinstated. His license had been revoked, and the division of motor vehicles had required him to prove his financial responsibility before his license would be reinstated. See RSA 268:3.

On August 8, 1973, Vincent purchased an automobile and was unexplainably issued, by the division of motor vehicles, a title certificate and registration. He never changed his insurance coverage or informed Fireman's Fund of his purchase and registration of the automobile.

The plaintiff's father, Lestor Auclair, of Orlando, Florida, had an automobile policy with Allstate Insurance Company (hereinafter Allstate). The following persons were insured against bodily injury by uninsured automobiles:

Section II, 1. The named insured and his relatives while residents of his household . . ..

On October 6, 1973, in Manchester, New Hampshire, Vincent was driving his automobile when it collided with an automobile owned and operated by John Rexenes. The plaintiff, a passenger in Vincent's automobile at the time, brought this action to determine which, if any, of the defendant insurers is liable for the plaintiff's resulting injuries.

The third defendant, Hanover Insurance Company, moved to dismiss, in effect admitting coverage and the duty to defend its insured, John Rexenes, the owner and operator of the vehicle that collided with the one in which the plaintiff was riding. The Court (King, J.) acted properly in granting Hanover's motion to dismiss the petition to the extent it seeks relief against Hanover.

The trial court found that "defendant Fireman's Fund . . . is under no obligation to defend or pay any judgment or otherwise afford any coverage on behalf of Norman Vincent in the present circumstance." This finding was entered in spite of the fact that Fireman's Fund admittedly waited beyond fifteen days before notifying the director of motor vehicles that its policy provided no coverage. See RSA 268:5 IV. The court further found that "at the time of the accident . . . Mark Auclair was not residing in the insured's (Lester (sic) Auclair) household. Accordingly, defendant Allstate . . . has no obligation to defend or pay any judgment or otherwise afford any coverage on behalf of its insured in this matter." The plaintiff timely excepted to the findings and rulings of the court. All questions of law raised were reserved and transferred.

The first question for our determination is whether Fireman's Fund must provide coverage to its insured, Norman R. Vincent, and therefore to the plaintiff, the insured's passenger. We answer in the affirmative and sustain the plaintiff's exception to the trial court's denial of coverage.

The plaintiff basically advances two reasons for requiring Fireman's Fund to provide coverage despite the exclusionary terms of its policy. The first is that a fair reading of the policy requires that the 30-day period of coverage afforded the insured for a subsequently-acquired owned automobile be extended until the policy is cancelled or expires, if no other insurance is available to the insured. We agree with the trial court that "such a strained and tortured interpretation is clearly without merit." "The well-established rule in this State is that insurance policies are interpreted from the standpoint of the layman 'in light of what a more than casual reading of the policy would reveal to an ordinarily intelligent insured.' " Brown v. City of Laconia, 118 N.H. ---, ---, 386 A.2d 1276, 1277 (1978); Accord, Commercial Union Assurance Companies v. Town of Derry, 118 N.H. ---, 387 A.2d 1171 (1978); Storms v. United States Fidelity and Guaranty Company,118 N.H. ---, 388 A.2d 578 (1978). We hold that the policy definition clearly excludes Vincent's vehicle.

The second contention is that RSA 268:1 VII ("Motor Vehicle Liability Policy") defines the sole type of policy that may be issued in order to provide the requisite proof of financial responsibility. The plaintiff argues that the statute mandates that all motor vehicle insurance policies provide coverage for owned vehicles as well as so-called "nonowners" or "operators" coverage. He would therefore have us read owned-vehicle coverage into Vincent's Fireman's Fund's policy. In so arguing, the plaintiff relies on Hartford Accident and Indemnity Co. v. Come, 100 N.H. 177, 123 A.2d 267 (1956), in which case we acknowledged that our statute was designed to require that every motor vehicle liability policy contain both types of coverage. The plaintiff ignores that both Come and Employer's Liability Assurance Corp., Ltd. v. Roux, 98 N.H. 309, 100 A.2d 416 (1953), held that even though a nonowner policy issued to enable an operator to regain his driving license afforded no coverage to any owned vehicle of the insured, and therefore was not a "motor vehicle liability policy" under the Act, such policy was permissible and met the financial responsibility requirement of the Act. RSA 268:3. This principle was recognized by the trial court in the case at bar when it found that "(a)lthough a . . . liability policy, as defined by RSA 268:1 VII, may be accepted as...