First Nat. Ins. Co. of America v. Perala, No. 3914-III-5

• Court: Court of Appeals of Washington
• Writing for the Court: GREEN; McINTURFF, C. J., and MUNSON
• Citation: 32 Wn.App. 527,648 P.2d 472
• Parties: FIRST NATIONAL INSURANCE COMPANY OF AMERICA, a stock insurance company, and Safeco Insurance Company of America, Appellants, v. Paki D. PERALA and Jane Doe Perala, his wife; and Joann E. Perala and John Doe Perala, husband and wife, Respondents.
• Decision Date: 15 July 1982
• Docket Number: No. 3914-III-5

Page 527

32 Wn.App. 527 648 P.2d 472 FIRST NATIONAL INSURANCE COMPANY OF AMERICA, a stock
insurance company, and Safeco Insurance Company of
America, Appellants,
v.
Paki D. PERALA and Jane Doe Perala, his wife; and Joann E.
Perala and John Doe Perala, husband and wife, Respondents. No. 3914-III-5. Court of Appeals of Washington, Division 3,
Panel One. July 15, 1982.
Rehearing Denied Aug. 26, 1982.

Page 528

Walter G. Meyer, Halverson, Applegate & McDonald, Yakima, for appellants.

Lonny R. Suko, James E. Baker, Lyon, Beaulaurier, Weigand, Suko & Gustafson, Yakima, for respondents.

[648 P.2d 473] GREEN, Judge.

First National Insurance Company of America and Safeco Insurance Company of America appeal from the court's granting summary judgment in favor of Paki Perala and his mother, JoAnn E. Perala (Beaulaurier) in a declaratory judgment action. The question presented is whether the companies are required to provide uninsured motorist coverage under their policies.

On April 22, 1978, Paki Perala was riding as a passenger in a 1968 Chevrolet Malibu owned by his mother and provided for his principal use. The driver was Michael R. Johnson, age 16, who was uninsured. A single vehicle accident

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occurred and Paki was severely injured.

The Peralas presented a claim to First National and Safeco for Paki's injuries under the uninsured motorist provisions of their policies. First National insured the Malibu and Safeco insured another vehicle owned by Mrs. Perala, a 1973 Oldsmobile station wagon. These policies provided liability coverage for Mrs. Perala, as the named insured, Paki, as a relative residing in the same household, and any person using the automobile with the permission of the named insured. The First National policy contained an endorsement excluding liability coverage for drivers under 25 years of age who are not members of the insured's family. ¹

First National rejected the claim and brought a declaratory judgment action to establish its uninsured motorist provisions do not apply. The Peralas answered and cross claimed for declaratory judgment against Safeco, who was joined as a party plaintiff. All parties moved for summary judgment. It was stipulated for purposes of these motions that Michael Johnson, the driver of the Malibu, was negligent in causing the accident. The court interpreted both policies to provide uninsured motorist coverage, granted summary judgment in favor of the Peralas, and ordered arbitration over the liability and damage issues as provided by the policies. The companies appeal.

Both companies claim the uninsured motorist provisions in the policies are inapplicable here because coverage is afforded only for bodily injury caused by an "owner or operator of an uninsured motor vehicle." (Italics ours.) They argue the Malibu was an insured vehicle because it was specifically named in First National's policy and, under Safeco's policy, was furnished for Paki's regular use. Also, First National claims its liability coverage exclusion for

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drivers who are under the age of 25 would be nullified if it is required to provide uninsured motorist coverage.

On the other hand, the Peralas contend the underlying public policy of the uninsured motorist statute is to provide coverage for uninsured motorists, not vehicles, and the statute supersedes contrary language in the insurance policies. They argue, as an insured, Paki is entitled to uninsured motorist coverage regardless of the under-25 exclusion because the driver was uninsured. We agree with the Peralas' position and affirm.

Our state has not specifically addressed the issue presented. The companies rely upon cases from other jurisdictions which have held an injured person may be excluded from uninsured motorist coverage where the automobile in which the person was a passenger was insured. ² Those cases, [648 P.2d 474] however, are all based upon the particular language of the insurance policies and uninsured motorist statutes in those jurisdictions. It would serve no useful purpose to compare them with Washington's statute or the insurance policies here. ³ We are governed by the public policy expressed in Washington's uninsured motorist statute, RCW 48.22.030, and the decisions interpreting it. Rau v. Liberty Mut. Ins. Co., 21 Wash.App. 326, 585 P.2d 157

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(1978). Our statute and those decisions mandate coverage here.

While insurance policies are private contracts and the insurer may bargain for exclusions in a policy, uninsured motorist coverage is mandatory unless the insured specifically and unequivocally rejects such coverage. RCW 48.22.030(4). Mutual of Enumclaw Ins. Co. v. Wiscomb, 97 Wash.2d 203, 210, 643 P.2d 441 (1982); Touchette v. Northwestern Mut. Ins. Co., 80 Wash.2d 327, 332, 494 P.2d 479 (1972); Brummett v. Grange Ins. Ass'n, 4 Wash.App. 979, 981, 485 P.2d 88 (1971). The public policy favoring uninsured motorist coverage controls over the express terms in the contract. Rau v. Liberty Mut. Ins. Co., supra 21 Wash.App. at 328, 585 P.2d 157. Any ambiguities in the policy provisions are interpreted in favor of the insured. McDonald Indus., Inc. v. Rollins Leasing Corp., 95 Wash.2d 909, 913, 631 P.2d 947 (1981); Frontier Lanes v. Canadian Indem. Co., 26 Wash.App. 342, 345-46, 613 P.2d 166 (1980); Nationwide Mut. Ins. Co. v. Kelleher, 22 Wash.App. 712, 715, 591 P.2d 859 (1979).

The policy of the uninsured motorist statute is to protect victims of uninsured drivers, not vehicles. Finney v. Farmers Ins. Co., 92 Wash.2d 748, 751, 600 P.2d 1272 (1979); Cammel v. State Farm Mut. Auto. Ins. Co., 86 Wash.2d 264, 270, 543 P.2d 634 (1975). Finney is controlling here. In that case the passenger in a vehicle was killed in an accident due to the fault of the operator of the vehicle. The operator had liability insurance but the owner of the vehicle did not. Because the operator's policy was insufficient to pay for the damages, the passenger's estate sought recovery under the uninsured motorist provisions of the deceased passenger's policy. The company asserted its uninsured motorist provisions were not applicable because liability insurance covered the operator and the vehicle was therefore insured. The court rejected this assertion holding uninsured motorist coverage exists where either the owner or the operator is uninsured. It reasoned:

We have previously held RCW 48.22.030 is to be liberally construed in order to provide broad protection

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against financially irresponsible motorists. Touchette v. Northwestern Mut. Ins. Co., (supra). The purpose of...