Fireman's Fund Ins. Co. v. Allstate Ins. Co.
| Decision Date | 30 September 1991 |
| Docket Number | No. C008965,C008965 |
| Citation | 286 Cal.Rptr. 146,234 Cal.App.3d 1154 |
| Court | California Court of Appeals Court of Appeals |
| Parties | FIREMAN'S FUND INSURANCE COMPANY, Plaintiff and Appellant, v. ALLSTATE INSURANCE COMPANY et al., Defendants and Respondents. |
Johnson, Pagliero & Schachter, Robert H. Johnson, and Luther R. Lewis, Sacramento, for plaintiff and appellant.
Richard J. Edson and Edson & Laplante, Sacramento, for defendants and respondents, Allstate Ins. Co. and Northbrook Property and Cas. Ins. Co.
This appeal involves the Highway Carriers' Act (Pub.Util.Code, § 3501 et seq.) 1 which requires a highway carrier to obtain "adequate protection" against liability for personal injury or death as a prerequisite to the issuance or continuance of an operating permit. (§ 3631.) A carrier must supply the Public Utilities Commission (PUC) with evidence of insurance, bond, or qualification as a self-insurer. (§ 3632.) Section 3634 provides "[t]he policy of insurance or surety bond shall not be cancelable on less than 30 days' written notice to the commission, except in the event of cessation of operations as a highway carrier...." (Emphasis added.) This limitation on cancellation is repeated in PUC General Order 100-K: "Every insurance certificate ... shall contain a provision that such certificate ... shall remain in full force and effect until canceled in the manner provided by Section (5) of this General Order." 2 (Emphasis added.) Section (5) of General Order 100-K provides: "A certificate of insurance ... shall not be cancelable on less than thirty (30) days' written notice to the Public Utilities Commission, such notice to commence to run from the date notice is actually received at the office of the Commission." Similar unambiguous language appears in the standard form PUC endorsement TL-675 attached to all policies insuring vehicles subject to PUC regulation.
Plaintiff Fireman's Fund Insurance Company (Fireman's) appeals from a judgment entered in favor of defendants Allstate Insurance Company (Allstate) and Northbrook Property and Casualty Insurance Company (Northbrook) following a court trial in Fireman's declaratory relief action. Fireman's issued a commercial automobile liability policy to a group of independent truckers. Although the truckers discontinued Fireman's coverage and substituted other insurance at the same policy limits, Fireman's failed to give the required notice of cancellation to the PUC. Thus, we conclude Fireman's policy was in full force and effect on the date of the accident giving rise to damage claims. Allstate and Northbrook are entitled to prejudgment interest. We also conclude the trial court properly found the Allstate and Northbrook policies did not cover the highway carrier as an additional insured. Accordingly, we affirm the judgment.
Lisa DeNoon and her passenger, Stephanie White, were seriously injured on May 29, 1985, when a tractor-trailer rig jumped the center divider on the Yolo Causeway and collided with DeNoon's vehicle. Ultimately, a personal injury action was filed on behalf of the two women against shipper Spring Air Mattress (owner of the trailer), carrier Better Home Deliveries, Leaseway Transportation Corporation (Better Home's parent company), sub-carrier Richardson Trucking (owner of the tractor), Timothy Gerk (the truck driver), and various entities involved in construction work being done on the Yolo Causeway at the time of the accident. A coverage dispute developed among three of six insurers involved in the personal injury litigation and resulted in the declaratory relief action now before us on appeal. DeNoon settled for more than $6 million. White settled for $267,500.
Spring Air was absolved of liability in the underlying personal injury action. However, Fireman's and Industrial Indemnity, Spring Air's insurers on the date of the accident, participated in the settlement on behalf of Richardson Trucking as an additional insured. The Spring Air policies are not at issue in this appeal.
On the date of the accident, Leaseway and Better Home were insured by a $1 million primary policy issued by Allstate and a $5 million excess policy issued by Northbrook.
Richardson Trucking secured insurance through a program administered by Better Home and Leaseway for truckers who contracted with Better Home. Richardson Trucking was covered by a $1 million primary policy, No. KLA 321 44 96, issued by Fireman's to "Independent Contractors of Better Home Deliveries, Inc.," for two policy periods beginning July 1, 1983, and ending July 1, 1985. Harold Lang, the insurance and risk manager for Leaseway, discontinued Fireman's policy and replaced it with a $1 million primary policy issued by Central National Insurance Company to "Specified Independent Contractors of Leaseway," effective November 1, 1984. Central National defended Richardson Trucking, paid its policy limits, and has not contested coverage.
Although Fireman's filed a certificate of insurance with the PUC on August 27, 1984, shortly after the beginning of the second policy period, certifying its policy, KLA 321 44 96, was effective July 1, 1984, until cancelled, it did not notify the PUC of cancellation. There is no record of Central National filing a certificate of replacement insurance with the PUC. However, the PUC received notice of alternate or replacement insurance coverage for Richardson Trucking issued by the Insurance Company of the State of Pennsylvania, which was not a party to the declaratory relief action giving rise to this appeal.
The following insurers contributed to the DeNoon settlement:
Central National ...................... $ 732,500
Fireman's Fund (KLA policy) ........... $ 250,000
Fireman's Fund (Spring Air policy) .... $ 500,000
Industrial Indemnity .................. $2,000,000
Allstate .............................. $1,000,000
Northbrook ............................ $2,200,350
Fireman's filed this action seeking a declaration Richardson Trucking had no coverage under its policy, No. KLA 321 44 96, for claims arising from the DeNoon/White personal injury action. Fireman's alleged the policy was terminated on November 1, 1984, and replaced by the Central National policy which became effective on that same date. Allstate and Northbrook filed a cross-complaint alleging Fireman's failure to comply with PUC cancellation requirements resulted in the policy, No. KLA 321 44 96, remaining in effect to its $1 million limits. The cross-complaint also alleged the Allstate and Northbrook policies never covered Richardson Trucking or its driver, Timothy Gerk. Allstate and Northbrook maintained they were entitled to recover $750,000 from Fireman's.
Fireman's moved for summary judgment and summary adjudication of issues. Allstate and Northbrook filed a similar cross-motion. The trial court denied Fireman's motion in its entirety. It ruled Fireman's policy provided $1 million in coverage to Richardson Trucking on May 29, 1985, as excess above the Central National policy. The court also found Fireman's policy limits would have to be exhausted before the Allstate and Northbrook policies would come into effect.
In its trial brief, Fireman's conceded the trial court had adjudicated the issue of whether Fireman's policy provided any coverage at all, but argued the court was still free to determine the level of coverage since those issues had not been affirmatively adjudicated in Fireman's motion for summary judgment and summary adjudication of issues. Allstate and Northbrook maintained the order on the cross-motions resolved all issues necessary to a final judgment.
The case proceeded to trial. In an 18-page ruling, the trial court found "[t]he provisions of the Public Utilities Code, General Order 100-K and the certificate of insurance itself, provide that the policy and the Certificate of Insurance are not cancelable and remain in full force and effect until the required notice is given to the Public Utilities Commission." In its order the court determined:
Fireman's appeals and contends its policy did not provide coverage on May 29, 1985, and, if it did provide coverage, that coverage was (1) excess to all other coverage available to Richardson Trucking, (2) co-excess with the Northbrook policy, or (3) limited to the minimum PUC requirement. It therefore asserts Richardson Trucking was covered by the Allstate and Northbrook policies. It finally claims the trial court erred in awarding defendants prejudgment interest.
Our pivotal concern is whether the express language of section 3634 applies where the original insurer fails to give written notice of cancellation, the insured...
To continue reading
Request your trial
-
Western Security Bank v. Superior Court
...knew or could compute the amount the Bank was entitled to recover on the letters of credit. (Fireman's Fund Ins. Co. v. Allstate Ins. Co. (1991) 234 Cal.App.3d 1154, 1173, 286 Cal.Rptr. 146.) The Court of Appeal correctly assessed Western's liability for prejudgment 1 Among other things, Se......
-
Schwartz v. Twin City Fire Ins. Co., 05 Civ. 7943(PKC).
...Fire Ins. Co., 64 F.3d 1282, 1291 (9th Cir.1995) (quotation omitted)(applying California law); Fireman's Fund Ins. Co. v. Allstate Ins. Co., 234 Cal.App.3d 1154, 286 Cal.Rptr. 146, 158 (1991) Additionally, the determination of whether to award pre-judgment interest is subject to the equitab......
-
Uzyel v. Kadisha
...evidence are not ascertainable. ( Lineman v. Schmid (1948) 32 Cal.2d 204, 212, 195 P.2d 408; Fireman's Fund Ins. Co. v. Allstate Ins. Co. (1991) 234 Cal.App.3d 1154, 1172-1173, 286 Cal.Rptr. 146.) A legal dispute concerning the defendant's liability or uncertainty concerning the measure of ......
-
Bullock v. Philip Morris USA, Inc.
...evidence are not ascertainable. ( Lineman v. Schmid (1948) 32 Cal.2d 204, 212, 195 P.2d 408;Fireman's Fund Ins. Co. v. Allstate Ins. Co. (1991) 234 Cal.App.3d 1154, 1172–1173, 286 Cal.Rptr. 146.) Damages determined by a verdict are made certain as of the date that the verdict is entered, so......
-
The Aftermath of Catastrophes: Valuing Business Interruption Insurance Losses
...is generally preferred to one that leaves a part unreasonable or of no effect[.]"); Fireman's Fund Ins. Co. v. Allstate Ins. Co., 286 Cal. Rptr. 146, 155-56 (Ct. App. 1991) ("In short, an insurance contract is to be construed in a manner which gives meaning to all its provisions in a natura......