Continental Cas. Co. v. Transport Indem. Co.

• Decision Date: 09 March 1962
• Citation: 114 N.W.2d 137,16 Wis.2d 189
• Parties: CONTINENTAL CASUALTY CO., a foreign insurance corporation, Appellant, v. TRANSPORT INDEMNITY CO., a foreign corporation, Respondent.
• Court: Wisconsin Supreme Court

Page 137

114 N.W.2d 137

16 Wis.2d 189

CONTINENTAL CASUALTY CO., a foreign insurance corporation, Appellant, v. TRANSPORT INDEMNITY CO., a foreign corporation, Respondent.

Supreme Court of Wisconsin.

March 9, 1962.

Sonnenberg & Boden, Milwaukee, for appellant.

Kivett & Kasdorf, Milwaukee, A. W. Kivett, Nonald J. Lewis, Milwaukee, of counsel, for respondent.

DIETERICH, Justice.

Continental had at all times material to this action, a policy of insurance in full force and effect issued to 'Kenosha Auto Transport Corp. and/or Lessors of Equipment to Kenosha Auto Transport Corp.' Both parties agree that this policy extended coverage during any 'bobtailing' operation of a truck-tractor covered by the policy and that the policy extended coverage to the accident here involved. (Bobtail, is the type of operation where the tractor is driven without a trailer.)

Transport had at all times material to this action a policy of insurance in full force and effect issued to 'Kenosha Auto Transport Corporation * * *.' The relevant portions of the coverage clauses in this policy read as follows: '(1) To pay on behalf of the insured all damages which the insured shall become legally obligated to pay, * * * for damages which arise out of the occupation of the named insured as stated in the declarations, * * *.' (Occupation of insured in declaration is stated as 'motor carrier for hire, warehousing and driveaway operations.')

Issues.

(1) Whether an insurance policy filed by a motor carrier to conform with sec. 194.41 (1), Stats., extends the coverage of such policy to cover an accident where the lessor-driver of a tractor leased to the motor carrier, drives such tractor on a personal mission and becomes involved in a collision?

(2) Whether if such policy does provide coverage for damages airsing from such accident, the damages shall be prorated on the basis of policy limits with a second insurer whose policy does cover such accident, or whether the excess clause of the policy in question shall be given effect?

Sec. 194.02, Stats., provides:

'Legislative intent. It is hereby declared to be the purpose and policy of the legislature in enacting chapter 194 to confer upon the motor vehicle department and the public service commission the power, authority and duty to supervise and regulate the transportation of persons and property by motor vehicles upon or over the public highways of this state * * * so as to protect the safety and welfare of the traveling and shipping public in their use of highways; * * *' (Italics ours.)

The relevant portion of sec. 194.41(1), Stats., reads as follows:

'* * * the indemnitor shall be directly liable for * * * all damages for injuries to or for the death of persons or for injuries to or destruction of property that may be recovered against the owner or operator of each such motor vehicle by reason of the negligent use or operation thereof.' (Italics ours.)

Construing the words of sec. 194.41(1), Stats., so that the statute will be harmony with the public purpose enunciated in sec. 194.02, requires a broad interpretation be put on the words 'owner' and 'operator' as used in the statute.

Owner.

The term 'owner' is of quite general application and is frequently applied to one having an interest in or claim upon property less than absolute and unqualified title. The word 'owner' has no fixed meaning, but must be interpreted in its context and according to the circumstances in which it is used. In Moore v. Palmer (1957), 350 Mich. 363, 86 N.W.2d 585, where the lease of a truck-tractor provided that the lessee would assume all legal liabilities which might arise as though, in fact, the truck-tractor was owned by the lessee, the court held that the lessee was the 'owner' of the truck-tractor at the time it was involved in a collision with an automobile, when the truck-tractor was being driven by the lessor who was the employee of the lessee. The word 'owner' as used in the statute is applicable to Kenosha Auto Transport.

Operator.

An 'operator' of an automobile is one who directs or superintends it. The term 'operator' as used in Vehicle Code is broadly interpreted so as to include others than those in physical control of vehicle. 29 Words and Phrases (1961 Supp.) pp. 175, 176.

The word 'operator' covers more than the driver in physical control of the truck-tractor or the statute would have to be construed as not requiring a corporation in the business of using leased trucks to haul cargo to file their insurance policies under sec. 194.41(1), Stats. This would clearly be contrary to the legislative purpose of ch. 194, as expressed in sec. 194.02. The term 'operator' as used in sec. 194.41(1), Stats., includes not only the common carrier but also the driver. Rusch v. Mielke (1940), 234 Wis. 380, 291 N.W. 300 and Miller v. Kujak (1958), 4 Wis.2d 80, 87, 90 N.W.2d 137.

Lease.

The pertinent provisions under the terms of the lease as to whether the word 'owner' should cover Kenosha Auto Transport, the lessee in the instant case, read as follows:

Sec. II. 'For the duration of the lease, the carrier lessee shall be entitled to the exclusive possession, control and use of the leased equipment and may sub-lease the same to other authorized carriers to the same extent and effect as though the owner thereof.'

Sec. III. 'For the duration of the lease the carrier lessee assumes full responsibility for the operation and use of the leased equipment and to that end also assumes the responsibility for the payment of just claims covering bodily injury or property damage arising from its use of such equipment during the term of this lease * * *.'

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