Cherot v. United States Fidelity and Guaranty Co., 5972.

• Decision Date: 24 March 1959
• Docket Number: No. 5972.,5972.
• Parties: Harold Lorne CHEROT, Appellant, v. UNITED STATES FIDELITY AND GUARANTY COMPANY, a corporation, Central Surety & Insurance Corporation and Orville Lester Carter, Appellees.
• Court: U.S. Court of Appeals — Tenth Circuit

71 ALR 2d 959, 264 F.2d 767 (1959)

Harold Lorne CHEROT, Appellant, v. UNITED STATES FIDELITY AND GUARANTY COMPANY, a corporation, Central Surety & Insurance Corporation and Orville Lester Carter, Appellees.

No. 5972.

United States Court of Appeals Tenth Circuit.

February 26, 1959.

Rehearing Denied March 24, 1959.

Bryan Tabor, Tulsa, Okl. (Rucker, Tabor & Cox, Joseph A. Sharp, Joseph F. Glass, Tulsa, Okl., on the brief), for appellant.

Alfred B. Knight, Tulsa, Okl., for appellee, U. S. Fidelity & Guaranty Co.

Thomas R. Brett, Tulsa, Okl. (Robert D. Hudson, Tulsa, Okl., on the brief), for appellee, Central Surety Co.

Before HUXMAN, MURRAH and BREITENSTEIN, Circuit Judges.

HUXMAN, Circuit Judge.

This was a declaratory judgment action in which the two appellee insurance companies sought and obtained a declaratory judgment, declaring that they were not required to defend a damage action instituted by Harold Lorne Cherot against Orville Lester Carter arising out of an automobile accident under policies of insurance which they had issued. It was the companies' claim that there was no liability because of an exclusionary clause in each policy. USF&G Company had issued its policy to Howard F. Schultz on the Auburn automobile involved in the collision, and Central Surety Insurance Company had issued its policy to Orville Lester Carter. They were both conventional liability insurance policies. Schultz owned a 1932 Auburn automobile which he left with Carter for repair. While the car was being driven by Carter, it was involved in an accident in which Cherot was injured.

The USF&G policy provided that it should not apply "to an owned automobile while used in the automobile business." The Central policy excluded coverage of "a non-owned automobile while used (1) in the automobile business by the insured." The Central policy also contained this provision. "Automobile business means the business of selling, repairing, servicing, storing or parking of automobiles."

Appellee insurance companies contended successfully in the trial court that the automobile was being used in the automobile business by Carter at the time of the accident, and that, therefore, there was no liability against either of them because of the above exclusionary clauses.

There was no oral testimony in the trial court. The case was submitted on statements at the pretrial conference and on the depositions of Howard Schultz and Orville Lester Carter. In the absence of oral testimony in the trial court, findings of fact by that court do not carry the same weight on appeal as they do when oral testimony is heard. In that posture of the case, an appellate court is equally capable with the trial court of examining evidence and drawing conclusions therefrom.¹ Nonetheless we are loath to overturn the findings of an experienced trial judge unless, in our opinion, they are clearly erroneous.

What constitutes doing business is a question of law. Whether one is engaged in business under the definition is a question of fact. The books are replete with definitions defining business or what constitutes doing business. In Kelley v. United States, 10 Cir., 202 F.2d 838, 841, we defined business as follows:

"`Business\' is a comprehensive term. It has been defined as that which `occupies the time, attention and labor of men for the purpose of a livelihood or profit.\'"

In Gray v. Board of County Commissioners of Sedgwick County, 101 Kan. 195, 165 P. 867, 868, L.R.A.1918F, 182, the Kansas Court said that:

"`Business\' has been held to be synonymous with `calling,\' `occupation,\' or `trade,\' and defined as `any particular occupation or employment engaged in for a livelihood or gain.\'"

Throughout these cases and numerous others runs the idea of effort occupying a substantial part of one's efforts or time carried on for the purpose of profit or gain.

Thus considered, we are of the view that the evidence fails to sustain the court's finding that the insured automobile was being used by Carter in the automobile business within the meaning of the exclusionary clauses of these two policies. Carter and Schultz were both employed as full-time employees for the Reda Pump Company. Carter was a mechanic and Schultz was sales manager. Prior to his employment by Reda Pump Company, Carter had worked as a garage mechanic. He enjoyed working on cars and did so as an "accommodation" to his friends and as a "hobby." At his home he had some manual and mechanical...