Christiansen v. Holiday Rent-A-Car, RENT-A-CAR
| Decision Date | 07 August 1992 |
| Docket Number | RENT-A-CAR,No. 910226-CA,910226-CA |
| Citation | 845 P.2d 1316 |
| Parties | Patricia CHRISTIANSEN, Plaintiff and Appellant, v. HOLIDAY, d/b/a Flexi-Lease, Inc., and Devon K. Hammer, Defendants and Appellants. HOLIDAY, d/b/a Flexi-Lease, Inc., Third-Party Plaintiff and Appellant, v. Harold T. HINCKLEY and Rex Howell, d/b/a Airport Shuttle Parking, Third-Party Defendants and Appellees. HOLIDAY; Patricia Christiansen; Don Maw and Beverly Maw; David Lingard; John Lingard; and Craig Lingard, Plaintiffs and Appellants, v. Harold T. HINCKLEY and Rex Howell, d/b/a Airport Shuttle Parking, and The Home Insurance Company, Defendants and Appellees. |
| Court | Utah Court of Appeals |
Samuel King, James E. Hawkes, and Craig S. Cook (argued), Salt Lake City, for appellants.
S. Baird Morgan (argued), Strong & Hanni, Salt Lake City, for Home Ins. Co.
Robert L. Stevens (argued), Richards, Brandt, Miller & Nelson, Salt Lake City, for Hinckley, Howell d/b/a Airport Shuttle Parking.
Before BILLINGS, JACKSON and ORME, JJ.
Appellant, the plaintiff in a personal injury suit, challenges the trial court's determination that third-party defendant Airport Shuttle Parking breached a contractual obligation to secure liability insurance for defendant Holiday Rent-A-Car. Alternatively, appellant contests the trial court's decision that, as a result of its breach, the third-party defendant is only liable for $15,000 in damages. We affirm.
In May of 1979, Harold Hinckley and Rex Howell leased a parcel of property near Salt Lake International Airport and began operating an automobile parking service called Airport Shuttle Parking (Airport) on that property. Under the terms of the lease agreement, Airport was obligated to lease and pay rent on all of the buildings which stood on the property. However, the company only needed one small building, to serve as its office. So, to defray rent costs, Airport entered into a sublease agreement with Holiday Rent-A-Car (Holiday) whereby the two companies would share the use and expense of one of the buildings.
As part of the sublease arrangement, Airport allegedly agreed to obtain liability insurance that would cover Holiday once the two companies began sharing Airport's facilities. However, the written sublease agreement included no language addressing Airport's duty to obtain insurance for Holiday; the document's only mention of insurance is a statement that "[l]essee [Holiday] agrees to pay 50% of all utility bills, maintenance, property taxes and insurance (liability & fire)." Nonetheless, Holiday cancelled its existing liability policy once it moved its operations into the shared building.
In February 1980, while cleaning a car wash drain in the shared building, Holiday employees removed the cover from a manhole located immediately on one side of a door. Appellant Patricia Christiansen, a shuttle bus driver for Airport, subsequently walked through the doorway from the other side, did not see the open manhole, and fell into it. As a result, she injured her back. Appellant filed suit against Holiday in June 1981, alleging negligence on the part of Holiday's employees.
In September 1981, Holiday's attorney sent a letter to Airport in which he tendered defense of appellant's claim to Airport based upon the sublease agreement. Airport forwarded the letter to its insurer, the Home Insurance Company (Home). Home agreed to defend Airport in connection with the incident, but not Holiday. It did not regard Holiday as covered under the insurance policy since the policy did not name Holiday as an insured.
In February 1982, Holiday filed a third-party complaint against Airport and its owners, Hinckley and Howell, alleging that under the terms of the sublease agreement Airport was obligated to procure liability insurance that would cover Holiday for any judgment Holiday incurred in the suit filed by appellant. Holiday's complaint claimed that Airport had failed to obtain such liability insurance, thus breaching the sublease agreement. Airport answered the complaint, asserting that the written sublease agreement required Holiday to pay 50% of the insurance premiums, and, since Holiday had failed to do so, the company was not entitled to insurance coverage.
In September 1982, appellant and Holiday reached a settlement under which Holiday agreed to pay appellant $15,000 for her injuries and assign to her Holiday's claims against Airport and Home. In return, appellant agreed not to seek any further recovery from Holiday. The settlement also called for submission of the issue of damages for a "conditional determination." A hearing was subsequently held, and appellant's damages were set at $246,033.88. Airport's attorney appeared at the hearing to protest it but did not participate in the proceedings. Home was not represented at the hearing.
In October 1982, a trial was held to resolve the issue of whether Airport had promised to add Holiday to Airport's liability policy as an additional insured. Apparently persuaded by the reference in the sublease to a sharing of insurance premiums, testimony about discussions between Airport and its insurance agent, and the timing of Holiday's cancellation of its own policy, the jury returned a special verdict holding that such an obligation existed. 1 Then, in March 1983, Airport moved for summary judgment on the issue of whether it had breached this obligation. In its motion, Airport conceded that it had failed to procure insurance coverage for Holiday, and admitted liability for the $15,000 Holiday had paid to appellant pursuant to the settlement agreement. However, Airport denied liability for the full $246,033.88 judgment. Appellant responded with her own motion for summary judgment, arguing that Holiday was actually covered under Airport's insurance policy and, as a result, Home was liable for the full amount of appellant's judgment. The trial court granted Airport's motion for summary judgment, concluding that Airport's admission it breached the agreement to procure insurance was dispositive and that such breach had caused Holiday $15,000 in damages. Accordingly, Airport was ordered to reimburse Holiday only that amount.
Appellant appealed the summary judgment. The Utah Supreme Court reversed, holding that since appellant had introduced evidence contradicting Airport's admission of breach, "[w]hether Holiday was covered by Airport's insurance issued by Home was a genuine issue of material fact that precluded summary judgment." Christiansen v. Holiday Rent-A-Car, 742 P.2d 77, 79 (Utah 1987). The Court also vacated the trial court's determination of damages, stating that "the issue of damages should never have been addressed by the trial court in the context of this motion for summary judgment," id., since liability remained in issue. The case was remanded for a determination of whether Holiday was insured under Airport's policy and the calculation of appropriate damages.
On remand, appellant, Airport, and Home all filed motions for summary judgment. Those motions were denied. The trial court then proceeded to examine Airport's insurance policy and concluded that Holiday was not insured under the policy. Accordingly, the court held that Airport had breached its obligation to obtain insurance for Holiday. The trial court then turned to the issue of damages and determined that the only damage Holiday had suffered from Airport's breach was the $15,000 Holiday had paid to appellant. Further, the court held the $246,033.88 consent judgment was unenforceable against Airport.
Appellant now challenges the trial court's decision that Holiday was not insured under Airport's policy. Alternatively, appellant claims that, even if Holiday was uninsured, Airport is liable for the full amount of the judgment.
Appellant claims that, as a result of the interlocking relationship of several provisions of Airport's liability policy issued by Home, the policy provides coverage for Holiday. The trial court on remand declined to adopt appellant's position, holding that
In this case, interpretation of Airport's liability policy is a question of law determined solely by reference to the words in the agreement. See LDS Hosp. v. Capitol Life Ins. Co., 765 P.2d 857, 858 (Utah 1988); Zions First Nat'l Bank v. National Am. Title Ins. Co., 749 P.2d 651, 653 (Utah 1988) (). Accordingly, we afford no particular deference to the trial court's decision that Holiday was not covered under Airport's policy, but review it for correctness. Carter v. Utah Power & Light Co., 800 P.2d 1095, 1097 (Utah 1990).
The Insuring Agreements of Airport's insurance policy state, in relevant part: "Coverage E--Liability: This company will pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of bodily injury or property damage to which this insurance applies...." Paragraph III of the Insuring Agreements defines "Insured" in considerable detail but does not encompass Holiday within that definition. 2 Nonetheless, appellant claims that Holiday is brought within the scope of coverage by "Exclusion (e)" of the policy, which states: "This policy does not apply: ... (e) under Coverage E, to liability assumed by the Insured under any contract or agreement except an insured contract...." The policy's definition of "insured contract" includes a written lease of premises, such as the sublease agreement between Airport and Holiday. Thus, as appellant...
To continue reading
Request your trial
-
Rupp v. Transcontinental Ins. Co.
...Moreover, a covenant not to enforce the excess judgment does not nullify the claims against the insurers. Christiansen v. Holiday Rent-A-Car, 845 P.2d 1316, 1322 (Utah Ct.App.1992) (holding that settlement agreement's covenant not to execute judgment did not immunize an insurer from liabili......
-
SEABED HARVESTING, INC. v. DNR
...company's breach of promise to obtain liability insurance with refinery as additional insured). See also Christiansen v. Holiday Rent-A-Car, 845 P.2d 1316, 1321 (Utah App.1992), cert. denied, 853 P.2d 897 (Utah 1993) (quoting Richmond v. Grabowski, 781 P.2d 192, 194 (Colo.App.1989)) ("party......
-
Utah Transit Auth. v. Greyhound Lines, Inc.
...Id.37 Id. at 666 n. 1.38 Id. at 666.39 Id.40 Id.41 Id.42 Id. at 667.43 Id. at 670.44 Id. at 667–70.45 See Christiansen v. Holiday Rent–A–Car, 845 P.2d 1316, 1322 (Utah Ct.App.1992) (“Applying the principles of Pickhover and Richmond to the instant facts, we conclude that [the lessee] is lia......
-
Bonnema v. Shafizadeh, 2005 UT App 54 (UT 2/10/2005)
...procure the insurance and fails to do so assumes the position of the insurer and, thus, the risk of loss." Christiansen v. Holiday Rent-A-Car, 845 P.2d 1316, 1321 (Utah Ct. App. 1992) (quoting Richmond v. Grabowski, 781 P.2d 192, 194 (Colo. Ct. App. 1989)). Because Plaintiffs breached the L......
-
CHAPTER 5 Comprehensive or Commercial General Liability (CGL) Insurance: Coverage A for "Bodily Injury" or "Property Damage" Liabilities
...Texas: State Farm Fire and Casualty Co. v. Gandy, 925 S.W.2d 696 (Tex. 1996) (minority view). Utah: Christiansen v. Holiday Rent-A-Car, 845 P.2d 1316 (Utah App. 1992) (minority). [86] See: Arkansas: Blagg v. Fred Hunt Co., 612 S.W.2d 321 (Ark. 1981). Connecticut: Leahey v. Lawrence D. Coon ......
-
Chapter 5
...Texas: State Farm Fire and Casualty Co. v. Gandy, 925 S.W.2d 696 (Tex. 1996) (minority view). Utah: Christiansen v. Holiday Rent-A-Car, 845 P.2d 1316 (Utah App. 1992) (minority). [84] Arkansas: Blagg v. Fred Hunt Co., 612 S.W.2d 321 (Ark. 1981). Connecticut: Leahey v. Lawrence D. Coon & Son......
-
Utah Standards of Appellate Review
...Co., 765 P.2d 857, 858 (Utah 1988); Buehner Block Co. v. UWC Assocs., 752 P.2d 892, 895 (Utah 1988); Christiansen v. Holiday Rent-A-Car, 845 P.2d 1316, 1319 (Utah App. 1992), cert, denied, 853 P.2d 897 (Utah 1993). (5) Whether a privilege exists in a defamation action. Russell v. Thomson Ne......