Daggs v. Foremost Ins. Co.

• Decision Date: 04 November 1983
• Citation: 148 Cal.App.3d 726,196 Cal.Rptr. 193
• Court: California Court of Appeals Court of Appeals
• Parties: Elton M. DAGGS, Jr., Plaintiff and Appellant, v. FOREMOST INSURANCE CO., Defendant and Respondent. Civ. 68335.

Page 193

196 Cal.Rptr. 193

148 Cal.App.3d 726

Elton M. DAGGS, Jr., Plaintiff and Appellant, v. FOREMOST INSURANCE CO., Defendant and Respondent.

Civ. 68335.

Court of Appeal, Second District, Division 5, California.

Nov. 4, 1983.

Hearing Denied Feb. 16, 1984.

Barry M. Schiller, Beverly Hills, for plaintiff and appellant.

Staitman & Snyder, Jack M. Staitman and Ernest Allen Wish, Encino, for defendant and respondent.

ASHBY, Associate Justice.

This action is brought directly against the liability insurer of the party alleged to be liable for plaintiff's personal injuries. The trial court granted summary judgment in favor of the insurer, on the ground that the insurance policy clearly and unambiguously excluded coverage of the liability in question, and therefore the insurer had no duty to defend or indemnify the insured. Plaintiff appeals. ¹

On May 19, 1974, plaintiff Elton M. Daggs, Jr., was competing in a motorcross motorcycle race at Valley Cycle Park, a motorcycle racing park operated by Muntz Motor Cycle Parks, Inc. (hereinafter Muntz). Plaintiff was injured while operating his motorcycle when he collided with a chain link barrier fence surrounding the motorcycle course.

Plaintiff commenced an action against Muntz alleging that the chain link fence was negligently designed and constructed and a dangerous and defective condition likely to cause injury to persons using the motorcycle park, and that plaintiff was injured thereby.

Muntz' liability insurer, defendant Foremost Insurance Company, refused to defend Muntz, on the ground the liability was clearly excluded from policy coverage. Plaintiff settled with Muntz and as a part of that settlement received an assignment of Muntz' causes of action against Foremost for breach of contract and bad faith. Plaintiff then brought this action against Foremost for declaratory relief, breach of contract, and bad faith.

Foremost issued Muntz a "General-Automobile Liability Policy" effective for a policy period of one year from November 14, 1973. Describing the insured's operations as "Motorcycle Park rated as recreational park or playground Code No. 0301b" and "Motorcycle Racing Code No. 0300s," the policy provided owners', landlords' and tenants' liability coverage and personal injury liability coverage. The general promise of the policy was to "pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of [p] A. bodily injury or [p] B. property damage [p] to which this insurance applies, caused by an occurrence and arising out of the ownership, maintenance or use of the insured premises and all operations necessary or incidental thereto, and the company shall have the right and duty to defend any suit against the insured seeking damages on account of such bodily injury or property damage ...."

However, the policy contained three specific exclusions applicable to this case, exclusion (c), endorsement No. 4, and endorsement No. 7.

Under "Exclusions," the policy states: "This insurance does not apply: [p] .... [p] (c) to bodily injury or property damage arising out of (1) the ownership, maintenance, operation, use, loading or unloading of any mobile equipment while being used in any prearranged or organized racing, speed, or demolition contest or in any stunting activity or in practice or preparation for any such contest or activity ...."

Endorsement No. 4 states: "In consideration of the premium for which this policy is written, it is understood and agreed that as respects motorcycle racing, Code 0300s per Schedule L 6416 coverage for bodily injury liability excludes any coverage for any person injured while practicing for or participating in any race, contest or exhibition and immediate medical and surgical relief to any person injured." (Emphasis in original.)

Endorsement No. 7 provides: "In consideration of the premium for which this policy is written, it is agreed that this policy shall not apply under Coverages A or P to injury sustained by any person while participating in an organized racing event nor to immediate medical [sic] associated with such injury as provided under Supplementary Payments."

It is clear from plaintiff's allegations against Muntz in the underlying action, and his responses to requests for admissions in the instant case, that plaintiff was injured while operating his motorcycle in an organized racing event at the insured's facilities. This being the case, the policy unambiguously excludes coverage of plaintiff's accident.

To avoid the specific policy exclusions, plaintiff misplaces reliance upon the principles of State Farm Mut. Auto. Ins. Co. v. Partridge (1973) 10 Cal.3d 94, 109 Cal.Rptr. 811, 514 P.2d 123. In that case the insured, a hunter, filed down the trigger mechanism of his pistol so that the gun would have " 'hair trigger action.' " (Id., at p. 97, 109 Cal.Rptr. 811, 514 P.2d 123.) While driving in the countryside in his four-wheel-drive vehicle with a passenger sitting next to him, he hunted jack rabbits by shooting from the windows of the moving vehicle, his modified pistol in hand. While chasing a rabbit over rough terrain, he hit a bump, and the pistol discharged, wounding the passenger. It was clear that the insured's automobile liability policy covered the accident, but the issue presented was whether his homeowner's policy, which had a higher limit, also provided coverage. The homeowner's policy had an exclusion for " 'bodily injury ... arising out of the ... use of ... any motor vehicle.' " (Id., at pp. 98-99, 109 Cal.Rptr. 811, 514 P.2d 123.)

The Supreme Court found that the homeowner's policy provided coverage notwithstanding the exclusion, based on the fact that the insured had been negligent both in modifying the gun by filing its trigger mechanism and in driving his vehicle off the paved road onto the rough terrain, these two negligent acts constituting independent concurrent proximate causes of the injuries. (Id., at pp. 99, 102, 109 Cal.Rptr. 811, 514 P.2d 123.) The Supreme Court concluded, "[A]lthough the accident occurred in a vehicle, the insured's negligent modification of the gun suffices, in itself, to render him fully liable for the resulting injuries. Under these facts the damages to [the passenger] are, under the language of the homeowner's coverage clause, 'sums which the Insured ... [became] legally obligated to pay' because of the negligent filing of the trigger...