Bedgood v. Hartford Acc. & Indem. Co.

• Decision Date: 03 July 1980
• Docket Number: No. OO-430,OO-430
• Citation: 384 So.2d 1363
• Parties: Oscar V. BEDGOOD and Vernon Bedgood, Appellants, v. HARTFORD ACCIDENT AND INDEMNITY COMPANY, Appellee.
• Court: Florida District Court of Appeals

Page 1363

384 So.2d 1363

Oscar V. BEDGOOD and Vernon Bedgood, Appellants, v. HARTFORD ACCIDENT AND INDEMNITY COMPANY, Appellee.

No. OO-430.

District Court of Appeal of Florida, First District.

July 3, 1980.

James C. Husbands of Nabors & Husbands, Panama City, for appellants.

Lynn C. Higby of Isler, Higby, Brown, Smoak & Watson, Panama City, for appellee.

ERVIN, Judge.

The Bedgoods challenge the trial court's final summary judgment holding Oscar Bedgood's 1963 Mercury was not a covered vehicle under his automobile insurance policy. They argue that although he acquired the Mercury before the effective date of the policy, the vehicle did not acquire its status as an owned automobile until after it became operable and, because its operability occurred within 30 days of the date of the insureds' accident, coverage was afforded. We agree that genuine issues of material fact remain unresolved and so reverse and remand.

Our determination of the correctness of the trial court's summary judgment is somewhat complicated due to the sparse record before us. The stipulated facts show only that on March 3, 1976, Oscar Bedgood purchased the Mercury, later involved in an accident while being driven by Bedgood's son, Vernon. Following Oscar Bedgood's acquisition of the Mercury, Hartford insured him and his 1965 Ford Falcon for the policy year beginning May 22, 1976. The Mercury was never added to the policy nor was the issuing agent ever requested to do so. Finally, title was never transferred to Bedgood's name at the Department of Motor Vehicles, and the automobile was not operable on the public highways until August 4, 1976, four days before the accident.

The basis of the Bedgoods' claim for coverage, and the insurer's denial of it, rests upon that clause of the policy automatically insuring newly acquired automobiles. It provides:

'(O)wned automobile' means

(c) a private passenger, . . . automobile ownership of which is acquired by the named insured during the policy period, provided

(2) the company insures all private passenger, . . . automobiles owned by the named insured on the date of such acquisition and the named insured notifies the company within 30 days after the date of such acquisition of his election to make this and no other policy issued by the company applicable to such automobile, . . ..

On its face the clause appears to prohibit coverage of an automobile acquired more than 30 days before the occurrence of an accident if the company was not notified by the insured of its acquisition. Were we to conclude that the 1963 Mercury was precisely that an automobile our inquiry would be ended, and the judgment in favor of the carrier should necessarily be sustained. The policy, however, does not explicitly define automobile, but does motor vehicle, described as "a 4-wheel self-propelled vehicle of the type required to be registered and licensed under Florida law . . . ." The registration and licensing requirements of Florida motor vehicles are set out under Chapter 320, which specifically includes automobile within its definition of motor vehicle. See Section 320.01(1)(a). Additionally, the policy defines an insured motor vehicle as "a motor vehicle of which the named insured is the owner and with respect to which (a) bodily injury liability and insurance of the policy applies and (b) security is required to be maintained under the Florida Automobile Reparations Reform Act, . . . ." The Act requires an insurer to pay PIP benefits to certain persons occupying an owner's vehicle provided such persons do not own unprotected motor vehicles for which security is compelled. Section 627.736(4)(d). This court has consistently held that only those motor vehicles which are required by Florida law to be registered are subject to the security requirements of the Act, and there are no registration or security requirements for motor vehicles which are neither operated over the public streets or highways of Florida nor maintained for that purpose. Staley v. Florida Farm Bureau Mut. Ins. Co., 328 So.2d 241 (Fla. 1st DCA 1976); Tapscott v. State Farm Mutual Automobile Ins. Co., 330 So.2d 475 (Fla. 1st DCA 1976); Ward v. Florida Farm Bureau Cas. Ins., 375 So.2d 898 (Fla. 1st DCA 1979); Malen v. American States Insurance Co., 376 So.2d 473 (Fla. 1st DCA 1979). Thus a vehicle previously required to be registered is excused from registration requirements, and its owner correspondingly excused from the security requirements of the Reparations Reform Act "when the owner no longer 'maintains' the vehicle in order to operate it on public streets and highways." Tapscott v. State Farm Mutual Automobile Ins. Co., supra, at 477.

Clearly, if there are no security requirements for vehicles not maintained for operation on Florida's public streets, it would be illogical to require an owner to notify an insurance company of such a vehicle's acquisition within 30 days thereafter since the sole purpose of such notification is simply to provide security for the acquired vehicle. And so we conclude that the word "automobile" in the automatic coverage clause, when harmonized with other provisions of the policy and Florida law, means one operated over the public streets and highways or maintained for that purpose. And, if not so used, it need not be insured.

We are not unaware that a sizable body of out-of-state cases holds that coverage of a newly-acquired automobile is not dependent upon the vehicle's condition, but turns simply upon when it was acquired. E.g., Wisbey v. Nationwide Mutual Insurance Co., 264 Or. 600, 507 P.2d 17 (1973); Stockberger v. Meridian Mutual Insurance Co., 395 N.E.2d 1272 (Ind.App.1979) ("an automobile is an automobile . . . ." Id. at 1276); Illinois National Insurance Co. v. Trainer, 1 Ill.App.3d 34, 272 N.E.2d 58 (1971); Brown v. State Farm Mutual Insurance Co., 306 S.W.2d 836 (Ky.App.1957); Providence Washington Insurance Co. v. Hawkins, 340 S.W.2d 874 (Tex.Civ.App.1960). Those cases did not, however, involve policies which, as the one before us, defined motor vehicle as one required to be licensed and registered under Florida law and to be secured and maintained under the Florida Automobile Reparations Reform Act.

Having determined that the term "automobile" is subject to the above construction, we find it impossible to glean from this sparse record whether the 1963 Mercury's condition was such that it was maintained for operation over the public highways for a period no less than 30 days before the accident. We know only it was not operable until four days preceding the accident. Mere inoperability of the vehicle does not satisfy the test, although it is unquestionably a factor to be considered in determining whether the Mercury was a vehicle required to be secured. Other pertinent questions include the length of time of the automobile's inoperability before the accident, see, Tapscott, supra, the extent of the vehicle's inoperability, Malen v. American States Ins. Co., supra, whether it was placed in storage prior to its restoration to operability, Staley v. Florida Farm Bureau Ins. Co., supra, and the subjective element of whether the owner intended to maintain the vehicle on the public streets. Ward v. Florida Farm Bureau Cas. Ins., supra. For example, a jeep, not operable on the highway due to a lack of rear brakes and other major deficiencies, and intended by its owner to be used only on farmland, was held not an automobile within the automatic coverage clause. Martin v. Nationwide Mutual Fire Insurance Co., 235 So.2d 14 (Fla. 2d DCA 1970). Other cases have also recognized that vehicles needing major repairs are not automobiles within the terms of policy. See Quick v. Michigan Millers Mutual Insurance Co., 112 Ill.App.2d 314, 250 N.E.2d 819 (2d Dist.1969); Luke v. American Family Mutual Insurance Company, 476 F.2d 1015 (8th Cir.1973). However, a vehicle requiring only minor repairs, such as the replacement of a battery, Farmers Insurance Company of Washington v. Miller, 87 Wash.2d 70, 549 P.2d 9 (1976), or a reverse gear, GEICO v. Titus, 18 Wash.App. 208, 566 P.2d 990 (1977), would not lose its status as an owned automobile.

In summarizing the various cases which construed clauses similar to that before us, the Second District Appellate Court of Illinois stated:

In those cases where the circumstances be they the combination of the degree of disrepair of the car, the intent of the owner, or otherwise suggest that the nonoperating condition is a mere temporary one, the courts have been inclined to find that the vehicle was an "automobile" within the terms of the policy. In those cases where such circumstances suggest either that the inoperable condition is probably permanent, or apt to be of long duration with little reasonable possibility of restoring the car to a condition where it can be driven on the roads, the courts have then tended to find that the vehicle is not an "automobile" within the terms of the policy. Quick v. Michigan Millers Mutual Insurance Co., supra, 250 N.E.2d 821 at 821.

The final summary judgment is reversed and remanded for further proceedings consistent with this opinion.

WENTWORTH, J., concurs.

ROBERT P. SMITH, Jr., J., dissenting with opinion.

ROBERT P. SMITH, Jr., J., dissenting:

I cannot agree that the clause automatically insuring newly acquired automobiles operates to cover Bedgood's 1963 Mercury, which was in an accident on August 8, 1976. Bedgood acquired that automobile on March 3, 1976, before the policy period began on May 22, 1976. Even if this policy renewed an earlier Hartford policy, Bedgood did not notify Hartford, "within 30 days...