Fireman's Fund Ins. Co. v. New Zealand Ins. Co.

• Decision Date: 17 April 1968
• Docket Number: No. 8601,8601
• Parties: FIREMAN'S FUND INSURANCE COMPANY, a corporation, Appellant, v. NEW ZEALAND INSURANCE COMPANY, Limited, a corporation, Appellee.
• Court: Arizona Supreme Court

Page 1020

439 P.2d 1020

103 Ariz. 260

FIREMAN'S FUND INSURANCE COMPANY, a corporation, Appellant, v. NEW ZEALAND INSURANCE COMPANY, Limited, a corporation, Appellee.

No. 8601.

Supreme Court of Arizona, In Division.

April 17, 1968.

Moore, Romley, Kaplan, Robbins & Green, Phoenix, for appellant.

Snell & Wilmer, Phoenix, for appellee.

STRUCKMEYER, Justice.

This action was brought by Fireman's Fund Insurance Company, a corporation, against New Zealand Insurance Company, Ltd., a corporation, to recover the sum of $20,675 expended in defense and settlement of a wrongful death action. The action was determined in the court below on an agreed statement of facts. From an adverse judgment in favor of New Zealand, this appeal was taken.

The statement of facts discloses that the Schnaufer Construction Company, a corporation, was the general contractor for the construction of a warehouse. Schnaufer engaged the Valley Redi-Mix Company, a corporation, to deliver premixed concrete in mobile mixer trucks. Delivery was to be made to the east side of the new building where the concrete was to be emptied from the trucks into a steel bucket. Public liability insurance on the Valley Redi-Mix trucks was carried with New Zealand. Schnaufer further 'employed' Richard J. Follet, doing business as Sloane's Transfer & Storage Company, to transport the concrete in the steel bucket by means of a mobile crane for use in the forms on the second floor. Public liability insurance on the mobile crane was carried with Fireman's Fund.

The Valley Redi-Mix trucks were equipped with chutes down through which the concrete was poured from the trucks into the steel bucket. The steel bucket was then lifted by the crane operated by an employee of Follet and moved to the forms where it was emptied. Louis C. Harmon, who was directly employed by Schnaufer, had the responsibility of guiding the bucket. While he was attempting to guide the bucket on November 1, 1957, the crane's operator allowed its boom to make contact with a high-tension wire and Harmon suffered injuries by electrocution from which he subsequently died. Fireman's Fund defended the suit for wrongful death brought by Harmon's widow and then brought this action to recover the amount expended in the defense and settlement of the case.

The sole issue is whether the New Zealand policy which covered the use of the Redi-Mix truck also covered the transportation of the cement by the crane until it reached the forms.

As a generality, the cases agree that liability must be ascertained from the language used in the policy, it being the cardinal principle of construction that the intention of the parties as derived from the language must prevail. This is, of course, the accepted rule in Arizona. Dairyland Mutual Insurance Co. v. Andersen, 102 Ariz. 515, 433 P.2d 963; D.M.A.F.B. Federal Credit Union v. Employers Mutual Liability Insurance Co., 96 Ariz. 399, 396 P.2d 20.

The New Zealand policy provided:

'1. COVERAGE A--BODILY INJURY LIABILITY--AUTOMOBILE: To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury, * * * including death at any time resulting therefrom, sustained by any person, caused by accident and arising out of the ownership, maintenance or use of any automobile.

'CONDITIONS

'3(e) USE. Use of an automobile includes the loading and unloading thereof.'

It is apparent that the basic purpose of the policy was to protect Valley Redi-Mix against damages which it might become obligated to pay because of accident arising out of the use of the vehicle.

It is urged that under similar clauses the word 'unloading' has been given two interpretations, viz., what is known as the 'coming to rest' rule and the 'complete operation' rule. Wagman v. American Fidelity & Casualty Co., 304 N.Y. 490, 109 N.E.2d 592 (1952), a loading case, discusses the two rules.

'The narrower construction, adopted in some states, insists upon a close connection between the vehicle and the acts for which coverage is claimed. 'Loading' is interpreted by the courts of those jurisdictions as including only the immediate act of placing the goods upon the vehicle,--excluding the preliminary acts of bringing the goods to the vehicle; and 'unloading' is taken to embrace only the operation of removing the goods from the vehicle to a place of rest. (Citations.) The broader construction, adopted in a majority of the jurisdictions which have passed upon the question, is that 'loading and unloading' embrace, not only the immediate transference of the goods to or from the vehicle, but the 'complete operation' of transporting the goods between the vehicle and the place from or to which they are being delivered.' 109 N.E.2d at 594.

And see annotation 95 A.L.R.2d 1122 and articles and law reviews cited at p. 1124. Under New York's definition, the 'complete operation' of transporting the goods ends at the place 'to which they are being delivered.' With this we have no quarrel if by 'the place to which they are being delivered' means the place the parties have agreed that possession of the goods will be accepted from the consignor and does not mean the final destination after all transit is exhausted.

Thereafter, the Supreme Court of New York, Appellate Division, in Lamberti v. Anaco Equipment Corp., 16 A.D.2d 121, 226 N.Y.S.2d 70 (1962), found liability as against the insurer of a transit-mix concrete truck where, at the job site, the concrete was poured from the truck into a bucket of a crane. The bucket tipped and some concrete was dropped and struck the driver of the truck. The Court concluded that the accident came within the meaning of the word 'unloading' as that term was construed in Wagman v. American Fidelity & Casualty Co., supra, saying:

'The bucket cannot be considered 'the place * * * to which' the concrete was being delivered. It was merely the necessary conduit by which the concrete was conveyed to its place of delivery.' 226 N.Y.S.2d 70, 73.

Lamberti v. Anaco Equipment Corp., supra, is the precursor of three other cases in which the concrete was delivered to the construction site and thereafter some person or persons were injured in the course of its emplacement. Those cases holding coverage where the cement had left the control of the trucker invariably cite to and quote from Lamberti. See Travelers Insurance Co. v. W. F. Saunders & Sons, Inc., Case 1, 18 A.D.2d 126, 238 N.Y.S.2d 495 (1963), affirmed in memorandum decision 13 N.Y.2d 1019, 245 N.Y.S.2d 597, 195 N.E.2d 308; St. Paul Mercury Insurance Co. v. Huitt, 336 F.2d 37 (6 Cir. 19...