D'Angelo v. Cornell Paperboard Products Co.

• Decision Date: 03 January 1967
• Citation: 33 Wis.2d 218,147 N.W.2d 321
• Parties: James D'ANGELO, Plaintiff, Employers Mutuals Liability Insurance Co., Intervening Plaintiff-Appellant, v. CORNELL PAPERBOARD PRODUCTS CO., Defendant-Appellant, Indemnity Insurance Co. of North America, Interpleaded Defendant-Respondent.
• Court: Wisconsin Supreme Court

Page 321

147 N.W.2d 321

33 Wis.2d 218

James D'ANGELO, Plaintiff Employers Mutuals Liability Insurance Co., Intervening Plaintiff-Appellant, v. CORNELL PAPERBOARD PRODUCTS CO., Defendant-Appellant Indemnity Insurance Co. of North America, Interpleaded Defendant-Respondent.

Supreme Court of Wisconsin.

Jan. 3, 1967.

Gibbs, Roper & Fifield, Milwaukee, for intervening plaintiff-appellant.

Kivett & Kasdorf, Milwaukee, for respondent, Alan M. Clack, Milwaukee, of counsel.

WILKIE, Justice.

A threshold issue may be stated as follows: Is an order appealable which sustains a motion for a plea in abatement dismissing the action against one of the defendants where the action still continues after dismissal?

Appealability.

Respondent contends that the order sustaining the plea in abatement is not appealable because the respondent was dismissed from the action without prejudice and without costs. Sec. 274.33, Stats., designates orders which are appealable to the supreme court. Sec. 274.33(1) provides for appeal as to an order 'affecting a substantial right, made in any action, when such order in effect determines the action and prevents a judgment from which an appeal might be taken.' Respondent argues that the action will still continue after it is dismissed. Thus the action is not determined nor is the entry of judgment prevented. Respondent concludes that the order is, therefore, not appealable.

But the case of Newberger v. Pokrass ² holds otherwise and is controlling here. In Newberger the plaintiff sued defendant Pokrass and also attempted to sue Pokrass's insurance company; the insurance company moved for a plea in abatement on the basis of a 'no action' clause in its policy. The trial court issued an order sustaining the plea in abatement and dismissing the complaint. Plaintiff appealed and our court held the order was appealable.

'The dismissal resulted from the court's sustaining a plea in abatement. In Cottrill v. Pinkerton (1931), 206 Wis. 218, at page 219, 239 N.W. 442, at page 443, it was held that an order denying a plea in abatement was not an appealable order; the court went on to say:

"* * * if the plea in abatement had been sustained, it would have prevented a final judgment in the action, in which event the order would have been appealable under the express provisions of said section.'

'Also, in Prochnow v. Northwestern Iron Co. (1914), 156 Wis. 408, 409, 145 N.W. 1098, 1104, it was stated that an order resulting from a plea in abatement which dismissed the action as to one of the defendants was appealable. The order in the instant case dismissed the action as to one of the defendants and, as such, is appealable.' ³

In the instant case the order also dismissed the action as to one of the defendants only. Such an order is appealable because it prevents judgment against the dismissed defendant in the action in question. ⁴ The order sustaining the plea in abatement was an appealable order.

The order being appealable, three issues are raised on the merits of the order.

1. Is a forklift truck being operated on private property a motor vehicle for purposes of the direct-action statute?

2. Does a stipulation to permit an answer to be amended waive any defense to an assertion made in the answer?

3. Where a defense is asserted in the answer and the defense does not go to the merits of the action, must a claim of waiver of that defense be pleaded by an amendment to the complaint?

Direct-Action Statute.

Sec. 260.11, Stats., permits a direct action against an insurance company '(i) n any action for damages caused by the negligent operation, management or control of a motor vehicle.' Sec. 260.11 also provides, if the accident occurred in Wisconsin, that this right of direct action may not be affected by a provision in the policy or contract of insurance forbidding such direct action. Appellant contends that the forklift truck which was negligently operated was a motor vehicle within the direct-action statute. If this contention is sustained, the respondent's assertion of the 'no action' clause is ineffective as a means of dismissing the respondent from the action.

In the case at bar the vehicle in question was a forklift truck being operated on private property and not on the public highways. In Rice v. Gruetzmacher ⁵ a forklift was also involved and it was also being operated on private property. This court concluded that a vehicle such as a forklift was not a motor vehicle under the direct-action statute unless being operated upon a highway at the time of the accident. The rationale of that holding was a distinction between motor vehicles and 'a class of self-propelled land vehicles which are designed primarily for uses dissimilar to transporting or drawing persons or property upon a highway.' ⁶

Nelson v. Ohio Casualty Ins. Co. ⁷ spells out the distinction more definitively than Rice. Nelson states that in Rice our court was 'dealing with a class of motor-propelled vehicles so designed that they might never be used for transporting or drawing persons or property on a public highway.' ⁸ Rice established that such a class of vehicles were not motor vehicles within the meaning of sec. 204.30(4), Stats., unless operated on a public highway at the time the accident occurred. ⁹

In the case at bar the forklift truck was not a motor vehicle within the direct-action statute unless it was being operated on a public highway at the time of the accident. At that time the forklift truck was being operated on private property. This is not disputed. Thus, the forklift is not a motor vehicle and the appellant may not directly sue respondent under sec. 260.11, Stats.

Appellant contends, however, that the nature of the vehicle involved and not the place of the accident is controlling. Appellant attempts to distinguish Rice by stating that the forklift in question was frequently operated on the public highway. Appellant emphasizes this distinction because of the difference in sec. 341.05, Stats., at the time of the accident in the case at bar and at the time of the accident in Rice. In 1958, sec. 341.05(12) exempted vehicles from registration if the vehicle was 'a fork-lift truck or a trailer which is used principally off the highway and is operated only across a highway.' At the time Rice was decided, however, sec. 341.05(12) stated that a vehicle was exempted from registration when it 'Is a fork-lift truck or a trailer which is used principally off the highway.'

Appellant's affidavit supports the contention that the forklift truck in this case was frequently used on the highway, not just operated across the highway. Thus the forklift truck was required to be registered and became a motor vehicle because it was not exempted from registration.

The fact that a vehicle is or is not a motor vehicle for purposes of registration under sec. 341.05, Stats., has no relationship to whether a vehicle is a motor vehicle for purposes of the direct-action statute. In Snorek v. Boyle ¹⁰ our court adopted the definition of motor vehicle contained in sec. 340.01(35) and Rice specifically excludes vehicles which are not primarily designed for transporting or drawing persons or property upon a highway from coverage by the direct-action statute. In Rice, a forklift truck similar to the one in the case at bar was specifically held to be part of such a class of vehicles so that it was not covered unless the forklift was being operated on a public highway.

We conclude, therefore, that Indemnity could not be joined as a party defendant under sec. 260.11, Stats. Joinder then must be permitted, if at all, by the ruling that Indemnity waived its right to assert the 'no action' provision of its policy with Cornell. Effect of Stipulation.

Appellant attempted to assert the defense of estoppel to prevent the order granting a plea in abatement based on the 'no action' clause in the insurance policy. The essence of this defense is that the respondent had asserted that there was no policy coverage. By such an assertion, the authorities uniformly hold that any defenses based on clauses in the policy are waived. In particular, once a defense of no-policy coverage is asserted, any defense based upon the 'no action' clause is waived. ¹¹

Although appellant mistakenly argued estoppel instead of waiver, the basis of appellant's contention that the 'no action' clause could not be utilized by respondent was made clear to the trial court in appellant's affidavit pursuant to the motion for a plea in abatement. The trial court refused to permit appellant to assert this defense to the 'no action' clause because appellant had stipulated to permit respondent to amend his complaint to include the clause as one of its defenses.

In substance, the trial court's position is that appellant's stipulation to permit an amendment to the pleadings waives any defenses to claims or defenses which might be asserted in the amended answer. This construction of the stipulation is much too broad. In the construction of stipulations, the primary rule is to ascertain and give effect to the intention of the parties. ¹² Any ambiguity in stipulations may be resolved by resorting to statements of counsel made in the presence of the trial judge. ¹³ In this instance appellant's counsel made clear to the trial judge that he had stipulated to permit the answer to be amended merely as a procedural facilitation. Based on these statements, a narrow construction should be given to the scope of the stipulation.

The trial court is also wrong about the effect of the stipulation. It assumed that the stipulation was tantamount to an admission of the truth of any amendment made to the answer. The stipulation, however, merely permitted an amendment to be made but did not acknowledge the binding force of the amendment. In Wisconsin, by analogy, our court has held that a stipulation as to the admission of evidence does not mean such evidence is accepted as true, material, or of any...