Behringer v. State Farm Mut. Auto. Ins. Co.

Decision Date07 May 1957
Citation275 Wis. 586,82 N.W.2d 915
PartiesElla BEHRINGER, Plaintiff and Respondent, v. STATE FARM MUTUAL AUTO. INS. CO., et al., Defendants, Irvin Ringle, d/b/a Ringle Auto Service Garage, et al., Appellants.
CourtWisconsin Supreme Court

Genrich, Terwilliger, Wakeen, Piehler & Conway, Wausau, for appellants.

Schmitt & Wurster, Merrill, Krueger & Fulmer and Smith, Okoneski, Puchner & Tinkham, Wausau, Roberts, Roe, Boardman, Suhr & Bjork, Madison, for respondents.

CURRIE, Justice.

It is contended by Universal Underwriters that the affidavits in support of the motion for summary judgment conclusively establish that the SR-21 was filed by it through mistake which renders the SR-21 ineffective for any purpose of imposing liability upon it. Such mistake consists of its assumption, based upon the information at hand when it filed the SR-21, that the sixteen year old Arden Leffel possessed a driver's license at the time of the accident instead of merely an instruction permit.

Under the provisions of sec. 85.08(7), Stats., Arden was restricted to driving only during daylight hours with but one other passenger in the car, such other passenger being a licensed driver seated beside him. Therefore, Arden was operating the Ringle car illegally at the time of the accident because it was at night and the car was occupied by more than one other passenger. Universal Underwriters maintain that the principle of Quin v. Hoffmann, 1954, 265 Wis. 636, 62 N.W.2d 423, applies and voids any coverage under its policy. This is because the permission by Arden's father to drive was an illegal permission.

The briefs of counsel raise certain issues with respect to the application of Quin v. Hoffmann, supra. One of such issues is whether Quin v. Hoffmann should not be reconsidered and repudiated because of the amendment made to sec. 204.30(3), Stats., by the 1955 legislature. A second is whether the instant case cannot be distinguished from Quin v. Hoffmann on the ground that here the minor driver actually possessed a license or permit to drive, while in the Quin case he possessed neither. Because of the disposition that we make of the appeal we find it unnecessary to pass on such issues. We will assume for the purpose of deciding this case only that if Universal Underwriters had not filed the SR-21 it would have had a defense under the principle enunciated in Quin v. Hoffmann.

In Laughnan v. Griffiths, 1955, 271 Wis. 247, 73 N.W.2d 587, we analyzed the Wisconsin Safety Responsibility Law (sec. 85.09(5) to (16)(c), Stats.) to ascertain its underlying objective in order to determine the legal effect of the filing of an SR-21 by an automobile liability insurance company. We therein stated the following conclusion, 271 Wis. at page 259, 73 N.W.2d at page 594:

'We confine our determination at this time to holding that an automobile liability insurance company can make itself liable on a policy issued by it where, after investigating the facts, it, acting through a duly authorized agent or employee, voluntarily files with the commissioner a SR-21 form admitting coverage as to the accident described in such SR-21 intending to be bound thereby, even though without the filing of the SR-21 there might not be liability.'

By use of the words 'intending to be bound thereby' we did not have reference to any undisclosed subjective intention of the company, but only that the company had filed the SR-21 for the purpose of complying with the Safety Responsibility Law.

We also held in the Laughnan case that sec. 85.09(11), Stats., clearly recognizes that the SR-21 may constitute an admission against interest as to the coverage of the policy on the part of the insurance company which has filed the same. However, we expressly left undecided the further issue of whether the filing of an SR-21 does not constitute more than an admission against interest. Our later decisions in Prisuda v. General Casualty Co., 1956, 272 Wis. 41, 74 N.W.2d 777, and Pulvermacher v. Sharp, 1957, 275 Wis. 371, 82 N.W.2d 163, while referring to a filed SR-21 as an admission against interest, are not to be interpreted as a holding that such an SR-21 might not have greater effect than a mere admission against interest.

Our analysis of the Safety Responsibility Law in the Laughnan case clearly demonstrated that the objective of such act was to protect the persons damaged or injured through the negligence of an operator of a motor vehicle. This was accomplished by providing a penalty against such operator and, if he were not the owner of the vehicle driven by him, then also against such owner, in the event there was in existence no policy of automobile liability insurance which covered the operation of such vehicle at the time of the accident and no cash indemnity fund or other security is deposited with the commissioner. Such penalty, for failure to meet either of such two alternative requirements, consisted of suspending both the offending operator's driver's license and the registration of the vehicle operated by him. If a policy of existing insurance is the alternative means selected to comply with the Law such fact has to be evidenced by the filing of the SR-21.

Keeping in mind the objective of the Law, if a policy of existing automobile liability insurance is to be relied upon as the source of compensating the person who has sustained damage or injury, surely the legislature intended this to be as effective for such purpose as the alternative method of depositing security with the commissioner. However, as borne out by our decision in the Pulvermacher case, the legislature, albeit possibly unintentionally, left one loophole in accomplishing such result. This came about by not providing that such existing policy of insurance meet any higher or more stringent requirements than specified by secs. 204.30(3) and 204.34(2), Stats. Under such statutes a policy may contain valid exclusion clauses which will prevent recovery on it. However, for reasons hereinafter pointed out, our decision in the Pulvermacher case, that the filing of the SR-21 should not bar the insurance company from raising the defense of a policy exclusion clause, should be limited to exclusion clauses which prohibit recovery upon the policy by the named insured.

We deem it highly significant that the Safety Responsibility Law affords a sixty day period following receipt by the motor vehicle department of the accident report before the driver's license and the vehicle's registration may be suspended because of failure to either file a proper SR-21, or to deposit security in the amount required by the commission. It seems evident that one of the purposes of providing such sixty day period is so that, if there is an existing policy of automobile liability insurance, the insurer may have adequate opportunity to conduct an investigation to determine whether the facts warrant filing an SR-21. We are therefore constrained to hold that, when a company has through an authorized officer, employee, or agent filed an SR-21 with the commissioner for the purpose of complying with the Safety Responsibility Law, the company cannot thereafter deny liability upon its policy because of any act occurring, or fact existing, as of the time of such filing, which it then knew, or could have known through the exercise of due diligence. In other words, the legal effect of filing an SR-21 under such circumstances is to conclusively certify that under the facts then existing its policy insured both the named owner and the named operator of the particular vehicle described in the SR-21 as to which the same was filed.

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