Comunale v. Traders & General Ins. Co.

• Decision Date: 18 February 1953
• Court: California Court of Appeals Court of Appeals
• Parties: COMUNALE et al. v. TRADERS & GENERAL INS. CO. et al. Civ. 19101.

Page 495

253 P.2d 495

116 Cal.App.2d 198

COMUNALE et al. v. TRADERS & GENERAL INS. CO. et al.

Civ. 19101.

District Court of Appeal, Second District, Division 2, California.

Feb. 18, 1953.

As Corrected on Denial of Rehearing March 6, 1953.

Hearing Denied April 15, 1953.

W. P. Smith, Los Angeles, for appellant.

Newlin, Holley, Tackabury & Johnston, Frank R. Johnston, Los Angeles, for respondents.

McCOMB, Justice.

Defendant appeals from a judgment in favor of plaintiffs in an action to recover for breach of the terms of an insurance policy after trial before the court without a jury.

Facts: In July of 1947, Percy Sloan purchased from defendants through its agent, Frank Sloan (who is not related to the other Sloans involved herein), a policy of automobile insurance. The policy was written in the name of Percy Sloan's wife, Felie Sloan, as the insured, but the same coverage existed in favor of Percy Sloan as that of his wife.

At the time of the issuance of the policy Percy Sloan owned a 1941 Plymouth. The policy was for a one-year term from July 9, 1947 through July 9, 1948. In addition to specifically providing coverage for the Plymouth the policy contained a clause, hereinafter set forth, with reference to defendant's liability to the insured, for injuries resulting while using other automobiles.

Percy Sloan paid Frank Sloan the premiums required according to the terms of the policy.

On Saturday, March 27, 1948, Percy Sloan, while en route to his aunt's for a social visit and while driving his brother John's truck, struck plaintiffs who were crossing Olympic Boulevard on foot. Percy Sloan was driving his brother John's truck under the following circumstances:

John had purchased the truck to establish another route in his business of picking up and delivering clothes for dry cleaning. Percy asked John if he might use the truck while John was not using it to go to and from work, and said he would pay John what it would cost Percy to pay for public transportation between his home and place of business. One payment of $3.00 was made by Percy to John. Percy drove the truck to and from work, a distance of about five miles, each day for 10 days before the date of the accident and did not drive it at all after that date. The only occasion for which he used it other than traveling to and from his place of business was on the evening of the accident in question.

On the Monday following the accident, March 29, 1948, Percy Sloan called Frank Sloan on the telephone and advised him of the accident and asked if he were covered. He was told that inasmuch as he was driving someone else's truck he was not covered.

In November of 1948, the Comunales (plaintiffs herein) filed suit against Percy Sloan. On or about February 3, 1950, Mr. Leppek, attorney for Percy Sloan, tendered the defendant of the action to defendant herein. On May 18, 1950, defendant advised Mr. Leppek that there was no coverage for the accident in question.

Anthony J. Comunale recovered a judgment in the amount of $25,000 against Percy Sloan and plaintiff Carmela Comunale recovered a judgment in the amount of $1,250 against him. Both judgments have become final and no part of either has been satisfied.

Plaintiffs herein brought the instant action under the provisions of Section 11580(b)(2) of the Insurance Code and Clause II, Condition 6 of the policy issued by defendant.

Questions: First: Did Clause V of the policy of insurance issued by defendant limit its liability so as to relieve it from liability for the accident in the instant case?

No. Clause V of the policy reads in part as follows:

'V. Use of Other Automobiles:

'Such insurance as is afforded by this policy for bodily injury liability and for property damage liability with respect to the automobile classified as 'pleasure and business' applies (1) to the named insured, if an individual and the owner of such automobile, or if husband and wife either or both of whom own such an automobile, and (2) to the spouse of such individual if a resident of the same household, to the employer of such named insured or spouse, and to the parent or guardian of such named insured or spouse, if a minor, as insured, with respect to the use of any other automobile by or in behalf of such named insured or spouse.

'This insuring agreement does not apply:

'(a) to any automobile owned in full or in part by, registered in the name of, hired as part of a frequent use of hired automobiles by, or furnished for regular use to, the named insured or a member of his household other than a private chauffeur or domestic servant of the named insured or spouse.'

In the trial court defendant contended that the proper interpretation of the words 'hired as part of a frequent use of hired automobiles' appearing in clause (a) of the foregoing provisions should be construed as follows:

'The words 'frequent use' apply only to a hired automobile and have nothing to do with the following provision as to an automobile 'furnished for regular use.' There is an obvious reason for this difference. Hired automobiles are always available for regular use at garages that rent them, so that the clause 'furnished for regular use,' if used alone, would exclude coverage from all hired automobiles. Since it was desired to cover the insured during an infrequent use of a hired automobile, it was necessary to insert a provision excluding coverage as to an automobile 'hired as a frequent use of hired automobiles.''

Since defendant placed the foregoing interpretation upon the clause in the trial court it is binding upon it on appeal, (McPherson v. Great Western Milling Co., 44 Cal.App. 491, 494, 187 P. 80),...