Contreras v. America, Compania General De Seguros, S.

Decision Date16 May 1975
Citation48 Cal.App.3d 270,121 Cal.Rptr. 694
CourtCalifornia Court of Appeals Court of Appeals
PartiesJesus CONTRERAS, Individually, and as Guardian ad Litem of Luis Contreras and Maria Contreras, Plaintiff and Appellant, v. AMERICA, COMPANIA GENERAL DE SEGUROS, S.A., Defendant and Respondent. Civ. 33495.

Sidney L. Berlin, Berlin & Goodman, Redwood City, for plaintiff-appellant.

Amtonio C. Velaszuez, James C. Travis, San Francisco, for defendant-respondent.

MOLINARI, Presiding Justice.

In this action seeking to establish the limits of insurance protection under a policy of insurance issued in California by defendant insurance company America, Compania General De Seguras, S.A. (hereinafter 'America') solely for liability arising out of the operation of a motor vehicle in Mexico, plaintiff appeals from a summary judgment in favor of America. The judgment adjudicates that the occupant-exclusion clause in the policy is valid and that the liability limits are those provided for in the policy. We have concluded that the provisions of Insurance Code section 11580.1 are a part of the insurance contract, that under this statute the occupant-exclusion clause is invalid, and that pursuant to its provisions the liability limits are those therein provided rather than the lesser limits provided for in the policy. The judgment must therefore be reversed.

America is a corporation chartered under the laws of the Republic of Mexico, and is a foreign corporation doing business as an insurance company in California. On June 15, 1971, it issued a policy of automobile liability insurance in favor of Jesus Perez Huerta, now deceased. Huerta was at that time, and until his death, a resident of Redwood City, County of San Mateo, California. Although at time of issuance, the policy effective date was June 21, 1971, by subsequent endorsement the policy was made effective as of June 20, 1971. The policy was issued and delivered in California.

The policy issued by America was a policy of automobile liability insurance covering liability arising only from ownership, maintenance or use of the insured's 1969 Chevrolet station wagon In Mexico. It was written in both Spanish and English and bore the notation 'Special Automobile Policy for Tourists.' The policy provided coverage of $5,000 for bodily injury to one person for one accident, $10,000 for multiple injury claims arising from one accident (with a limit of $5,000 for each person), $3,000 for property damage; and a total maximum coverage of $20,000. The policy excluded any coverage for liability arising from bodily injury suffered by any passenger-occupants of the insured's automobile.

On June 19, 1971, Huerta left for Mexico in his Chevrolet station wagon, accompanied by Jesus Contreras, Contreras' wife and five of the Contreras children. A collision occurred on June 20, 1971, outside the City of Navajoa, State of Sonora, in Mexico. Contreras' wife and three of his children were killed in the accident and the other two children were seriously injured. Huerta was killed in the accident. Contreras filed the instant action against America as an individual and as guardian ad litem for the two injured children alleging that the deaths of his wife and the three children and the injuries to the two children were proximately caused by Huerta's negligence. The action sought a declaratory judgment that the policy's occupant-exclusion clause be declared invalid, that the liability limits of the insurance policy be determined to be $15,000 for one person and $30,000 aggregate for one accident, and that upon establishing Huerta's negligence plaintiff be awarded a judgment against America in the sum of $30,000, to be apportioned among plaintiff and his two minor children.

Each of the parties filed a motion for summary judgment. Since these motions proceed on agreed facts no triable issues were presented and the sole questions became issues of law. These questions of law may appropriately be determined on a motion for summary judgment. (Wilson v. Wilson, 54 Cal.2d 264, 269, 5 Cal.Rptr. 317, 352 P.2d 725; Nelson v. United States Fire Ins. Co., 259 Cal.App.2d 248, 251, 66 Cal.Rptr. 115.) The trial court granted America's motion for summary judgment and denied plaintiff's motion for a summary judgment.

Included in the stipulated facts was the stipulation that plaintiff has received all the benefits under America's policy as required by Mexican law. We apprehend these to be the medical and burial expenses provided for in the policy as there is no dispute that plaintiff is entitled to these benefits. The dispute is whether America is obligated to pay damages for the deaths and injuries to the passenger-occupants and, if so, whether the limits of such liability are those provided for in the policy limits or the higher limits provided for by California law.

We do not perceive that the issue in this case involves a 'conflict of laws' or 'choice of law' problem. (See Reich v. Purcell, 67 Cal.2d 551, 63 Cal.rptr. 31, 432 P.2d 727, and Hurtado v. Superior Court, 11 Cal.3d 574, 114 Cal.Rptr. 106, 522 P.2d 666.) We are not concerned with whether the laws of California or Mexico are identical, or whether only one of these states has an interest in having its law applied, or whether the forum will apply its own rule of decision with respect to an issue on tort (see Hurtado v. Superior Court, supra, at pp. 579--582, 114 Cal.Rptr. 106, 522 P.2d 666), but with a case arising out of an insurance contract issued and delivered in this state and the interpretation of that contract. The question presented is whether certain provisions of the Insurance Code and the Vehicle Code are imposed on insurance policies issued and delivered in California but covering liability for accidents and injuries occurring in Mexico. The fulcrum on which the issue turns is the principle that insurance policies are governed by the statutory and decisional laws in force at the time the policy is issued and such provisions are read into each policy issued thereunder and become part of the contract with full binding effect on each party. (Interinsurance Exchange v. Ohio Cas. Ins. Co., 58 Cal.2d 142, 148, 23 Cal.Rptr. 592, 373 P.2d 640; see Wildman v. Government Employees' Ins. Co., 48 Cal.2d 31, 39--40, 307 P.2d 359.)

At the time America issued the policy in question Insurance Code section 11580.1 provided, in pertinent part, as follows:

'(a) No policy of automobile liability insurance described in Section 16057 of the Vehicle Code covering liability arising out of the ownership, maintenance, or use of any motor vehicle shall be issued or delivered in this state on or after the effective date of this section unless it contains the provisions set forth in subdivision (b). . . .

'(b) Every policy of automobile liability insurance to which subdivision (a) applies shall contain all of the following provisions:

'(1) Coverage limits not less than the limits specified in subdivision (a) of Section 16059 of the Vehicle Code. . . .

'(c) In addition to any exclusion as provided in paragraph (3) of subdivision (b), the insurance afforded by any such policy of automobile liability insurance to which subdivision (a) applies may, by appropriate policy provision, be made inapplicable to any or all of the following:

'(1) Liability assumed by the insured under contract.

'(2) Liability for bodily injury or property damage caused intentionally by or at the direction of the insured.

'(3) Liability imposed upon or assumed by the insured under any workmen's compensation law.

'(4) Liability for bodily injury to any employee of the insured arising out of and in the course of his employment.

'(5) Liability for bodily injury to an insured.

'(6) Liability for damage to property owned, rented to, transported by, or in charge of, an insured.

'(7) Liability for any bodily injury or property damage with respect to which insurance is or can be afforded under a nuclear energy liability policy.

'(8) Any motor vehicle or class of motor vehicles, as described or designated in the policy, with respect to which covereage is explicitly excluded, in whole or in part.

'The term 'insured' as used in paragraphs (1), (2), (3), and (4) of this subdivision shall mean only that insured under the policy against whom the particular claim is made or suit brought. The term 'an insured' as used in paragraphs (5) and (6) of this subdivision shall mean any insured under the policy. . . .' 1

Adverting to Vehicle Code sections 16057 and 16059, 2 referred to in Insurance Code section 11580.1, we note that these statutes were a part of division 7 of the Vehicle Code entitled 'Financial Responsibility Laws.' (Veh.Code, §§ 16000--16560.) The Financial Responsibility Laws permit a motorist to use highways without establishing his financial responsibility until he is involved in an accident, but withdraw this permission when, upon the happening of an accident, the motorist demonstrates his financial irresponsibility by failing to comply with prescribed security deposit requirements. (Turner v. State Department of Motor Vehicles, 265 Cal.App.2d 649, 653, 71 Cal.Rptr. 616.)

Vehicle Code section 16057 provided that every driver or employer involved in an accident is exempted from the requirements of security if he files with the Department of Motor Vehicles satisfactory evidence that the owner or driver of the vehicle involved in the accident had in effect at the time of the accident an automobile liability policy or bond with respect to the operation of the vehicle. (See Veh.Code, § 16050.)

Vehicle Code section 16059 provided as follows: 'No policy or bond shall be effective under Section 16057 unless issued by an insurance company or surety company authorized to do business in this state except as provided in subdivision (b) of this section, nor unless the policy or bond is subject, if the...

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