DiOrio v. New Jersey Mfrs. Ins. Co., Inc.
| Citation | 63 N.J. 597,311 A.2d 378 |
| Parties | Gennaro DiORIO et al., Plaintiffs-Appellants, v. NEW JERSEY MANUFACTURERS INSURANCE COMPANY, INC., et al., Defendants-Respondents. |
| Decision Date | 04 December 1973 |
| Court | United States State Supreme Court (New Jersey) |
E. Barry Kline, Trenton, for plaintiffs (Kline & Kline, Trenton, attorneys).
William T. McElroy, Morristown, for defendants (William T. McElroy, of counsel, Richard D. Catenacci, New York City, on the brief; Hughes, McElroy, Connell, Foley & Geiser, Newark, attorneys).
The opinion of the Court was delivered by
This is a declaratory judgment action to determine whether a 'non-owned automobile' was covered by the 'Family Automobile Policy' issued by defendant carrier. The policy expressly covered the operation of a 'non-owned automobile' by the named insured or by a 'relative' of his, defined as a resident of the same household. The operator was Gennaro DiOrio, the 17-year old son of the named insured, Generoso DiOrio. The son was a resident of the father's household. The trial judge, sitting without a jury, found for the carrier, and the Appellate Division affirmed. We granted certification. 63 N.J. 262, 306 A.2d 465 (1973).
The appeals were prosecuted by the injured claimant. Neither the named insured nor his son participated.
'Part I' of the policy, dealing with 'liability,' provides protection for the following persons:
(2) any relative, but only with respect to a private passenger automobile or trailer, provided his actual operation or (if he is not operating) the other actual use thereof is with the permission, or reasonably believed to be with the permission, of the owner and is within the scope of such permission.
There is no dispute that Gennaro's operation was with the 'permission' of the owner of the non-owned automobile as that word has been construed. The policy defines 'non-owned automobile' to mean:
an automobile or trailer Not owned by or furnished for the regular use of either the named insured or any relative, other than a temporary substitute automobile. (Emphasis is ours.)
We have italicized the critical phrase. The carrier contended the automobile in question was 'furnished for the regular use' of the son and hence there is no coverage. The trial court and the Appellate Division agreed. No member of our Court votes to uphold that finding. Two members of our Court in their dissenting opinion are 'inclined' to do so but would affirm the judgment on the different ground that the automobile was 'furnished for the regular use of' the father and that therefore, as they read the policy, coverage is denied the son even though the automobile was not 'furnished for the regular use' of the son. 1 Neither the trial court nor the Appellate Division made any finding with respect to this alternative ground. For the reasons which will appear, we disapprove the finding that the vehicle was 'furnished for the regular use' of the son, and we remand the matter to the trial court with respect to the alternative ground we have just described.
The policy covered a Chrysler, which was not involved in the accident. The car the son was driving was a DeSoto owned by a partnership which ran a gasoline service station. The father was one of two equal partners. The DeSoto was covered by a liability policy obtained by the partnership from another carrier, and the complaint alleged that carrier has offered the full amount of its policy, $50,000. The DeSoto was used by both partners in the regular business of the partnership. The father also used the DeSoto to travel daily between his home and the service station.
The record does not reveal the extent, if any, to which the father used the DeSoto for non-business purposes. His deposition touches the subject, on examination by the carrier's counsel, in this hazy, conclusional way:
Q. Now, with regard to the DeSoto, you used it, as you indicated, about every day. You brought it home with you every night? A. Correct.
Q. Did you have unrestricted use of that DeSoto? I mean, you would do whatever you wished? A. Yes, surely.
Q. And you used it day to day as you have indicated? A. Yes.
Thus 'unrestricted use' were the words of counsel used in the context of the trips to and from work. We cannot be usre the father's response should be read as broadly as the carrier would read it. There was no testimony that the father used the DeSoto for personal ends (the trip to and from the service station was business oriented in our view) and no testimony as to any agreement between the partners in that regard.
With respect to the son's use of the DeSoto, we accept the trial court's summary of the underlying facts although not the conclusions it drew from them:
In his deposition, Generoso DiOrio testified, in substance, as follows: He is the father of Gennaro, who resided with him. At the time of the accident in question, he was the registered owner of a 1967 Chrysler which was generally for his wife's use. At the time of its purchase in November, 1966, he also owned a 1956 De Soto which, at that time, was covered by a New Jersey Manufacturers policy. Ownership was transferred to Mike and Joe's Texaco Service Station, to be used as a service car, and the De Soto was removed from the New Jersey Manufacturers policy. It was thereafter covered by the Reliance policy.
After the transfer, he continued to use the car daily to drive to and from work. He did not use the Chrysler for that purpose. The Do Soto was also used at the station when a customer needed a car while his was being repaired, or to pick up parts. It was also used by DiOrio's partner.
When his son, Gennaro, obtained a learner's permit shortly after his 17th birthday on January 27, 1968, the De Soto was used for instructional purposes at least four times a week. On those occasions, the father taught him how to drive or supervised the son's operation of the automobile. It has been stipulated by counsel that Gennaro DiOrio received his driver's license on April 23, 1968. When Gennaro desired the car thereafter, he was required to ask his father for permission, and he had to return home by 11:00 p.m.
The gist of Gennaro DiOrio's deposition, substantially corroborating his father's testimony is that when he obtained his learner's permit, he generally used the De Soto to practice, accompanied by his father. He used the Chrysler for that purpose only once or twice. After passing the test and obtaining his driver's license, he used the De Soto about four times a week after dinner, first obtaining permission from his father. His mother used the Chrysler, but she did not usually let him take it. The one he used regularly was the De Soto.
I find from the depositions that the De Soto was the automobile generally available to Gennaro DiOrio for his own purposes; that it was the one he drove, accompanied by his father, until he obtained his driver's license; and that it was the one he used thereafter, although only with his father's permission.
As we have said, the trial court found there was no coverage because the car was 'furnished for the regular use' of the son, and the Appellate Division affirmed that finding. We are satisfied the car was not 'furnished for the regular use' of the son.
An insurance policy, though in form a contract, is a product prepared and packaged by the insurer. The buyer scarcely understands the detailed content of what he is buying. When a court construes a policy, it cannot be indifferent to that reality. We think it fair to read the policy with the enthusiasm of the insurer's production department.
A liability policy may be confined to a specific automobile or it may be written for an individual without regard to any specific automobile. This policy is prominently labeled 'Family Automobile Policy.' The label of course does not mean the policy covers only a 'family automobile.' Rather it imports coverage for members of a family, not limited to the operation of a specified car, I.e., a 'family automobile.' Indeed, as stated above, the policy expressly extends coverage to a 'non-owned automobile' and does so for both the named insured and every 'relative,' meaning 'a relative of the named insured who is a resident of the same household.'
Thus the son was within the policy's ostensible coverage. But 'non-owned automobile' is defined to mean:
an automobile or trailer not owned by or furnished for the regular use of either the named insured or any relative. * * * The question is, how much of the ostensible coverage was taken away by this definition?
In deciding what this insurance package includes, the courts turn to the underwriting concept they believe the insurer had in mind. It is sometimes said the insurer must have intended only 'occasional' use by an insured, so that a use which is more than 'occasional' demonstrates the car was 'furnished for the regular use.' The premise seems to be that the insurer charged little or nothing for the additional coverage of a 'non-owned automobile.' We find no basis for that assumption. We know only that the insurer packaged a 'Family Automobile Policy' which specifically offers, not only coverage with respect to a designated automobile, but also coverage for liability with respect to non-designated automobiles. The record is silent with respect to the underwriting experience the insurer took into account in fixing the premium for a policy offering the additional coverage. We should not assume the additional coverage was thrown in for nothing.
In defining a 'non-owned automobile' the insurer could easily have limited the coverage to such an automobile 'if it is used only occasionally' or 'if it is used only on irregular occasions.' Coverage thus expressed would not be as attractive as coverage spelled out in the words the insurer chose,' not owned by or furnished for the regular use of.' The word 'furnished' connotes much more than...
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