Gardner Trucking Co., Inc. v. South Carolina Ins. Guar. Ass'n, 22943

• Decision Date: 09 December 1988
• Docket Number: No. 22943,22943
• Citation: 297 S.C. 235,376 S.E.2d 260
• Court: South Carolina Supreme Court
• Parties: GARDNER TRUCKING COMPANY, INC., Appellant, v. SOUTH CAROLINA INSURANCE GUARANTY ASSOCIATION, Respondent. . Heard

Page 260

376 S.E.2d 260

297 S.C. 235

GARDNER TRUCKING COMPANY, INC., Appellant, v. SOUTH CAROLINA INSURANCE GUARANTY ASSOCIATION, Respondent.

No. 22943.

Supreme Court of South Carolina.

Heard Dec. 9, 1988.

Decided Jan. 23, 1989.

Brian L. Boger and Ronald S. Corning, Columbia, for appellant.

Ronald M. Childress, Columbia, for respondent.

TOAL, Justice:

Appellant, Gardner Trucking Company, ("Gardner") brought this action against the South Carolina Guaranty Association ("Guaranty Association") to recover insurance proceeds for damage to his Piper Comanche airplane. The Guaranty Association denied coverage on the basis of policy exclusions: (1) that the aircraft was converted while in possession of any person under a bailment; (2) that the FAA had not issued an airworthiness certificate; (3) that Gardner entrusted the airplane to a pilot who lacked the required hours and experience on the particular plane. The Honorable Frank P. McGowan granted summary judgment in favor of the Guaranty Association. We affirm the decision of Judge McGowan.

BACKGROUND

Mr. Gardner, a Walterboro resident, left his Comanche plane in Portland, Indiana in 1981. Due to medical problems suffered by Mr. Gardner, the plane remained in Portland until late 1983 or early 1984. In late 1983, Mr. Altrip, a truck driver for Mr. Gardner's company, drove a truck to Indiana intending to fly Gardner's plane back to South Carolina. When Altrip experienced mechanical problems with the plane, he landed it in Fort Wayne, Indiana. Altrip then returned to South Carolina without the plane.

Approximately one month later, in February of 1984, Altrip again tried to fly the plane back to South Carolina. He eventually returned the plane to South Carolina. When he returned to South Carolina, he reported to Gardner's office that he had arrived safely. Once in South Carolina, Mr. Altrip continued to fly the plane. He claimed that Gardner told him that if Altrip retrieved the plane, he could fly it as much as he wanted as long as he agreed to pilot the plane anytime Gardner wanted to fly.

On February 26, 1984, Altrip flew the plane out of the Walterboro Airport. When attempting to land, the plane's landing gear malfunctioned. Altrip landed the plane without any landing gear. Consequently, the underside of the plane was severely damaged. Several days after the crash, Gardner reported the plane as stolen to the Sheriff's Department.

It is undisputed that Altrip only had thirty hours experience in retractable gear aircraft and ten hours experience in the Comanche model. It is also undisputed that the airplane did not have an airworthiness certificate.

Gardner filed a claim with the Guaranty Association to collect the insurance proceeds for the damage to the plane. The Guaranty Association denied coverage, pointing to the following exclusions contained in its policy:

"This policy does not apply

* * *

* * *

(2) to any occurrence or to any loss or damage occurring while the aircraft is operated in flight by other than the pilot or pilots set forth under Item 7 of the Declarations. ¹

* * *

* * *

(4) to any Insured:

(b) Who operates or permits the operation of the aircraft, while in flight, unless its airworthiness certificate is in full force and effect.

* * *

* * *

(7) to loss due to conversion, embezzlement or secretion by any person in possession of the aircraft under a bailment, lease, conditional sale, purchase agreement, mortgage or other encumbrance."

The trial judge granted summary judgment on the basis of all of the above enumerated policy exclusions.

On appeal, Gardner only took issue with the trial judge's decision that the insurance provision which excludes coverage when an item was converted while under a bailment applied to the present case. Gardner conceded that he abandoned his exceptions with respect to the other two insurance exclusions. Since Gardner has abandoned his...