Harper v. Hartford Acc. & Indem. Co.

• Citation: 111 N.W.2d 480,14 Wis.2d 500
• Parties: Clyde HARPER et al., Appellants, v. HARTFORD ACCIDENT AND INDEMNITY COMPANY, Respondent.
• Decision Date: 31 October 1961
• Court: United States State Supreme Court of Wisconsin

Page 480

111 N.W.2d 480

14 Wis.2d 500

Clyde HARPER et al., Appellants, v. HARTFORD ACCIDENT AND INDEMNITY COMPANY, Respondent.

Supreme Court of Wisconsin.

Oct. 31, 1961.

The plaintiff Clyde Harper recovered a judgment against Allen Norton, Jr. for personal injuries suffered in the amount of $7,636.50 while he was a passenger in a 1951 Cadillac driven by Norton. This suit was brought on the judgment against the defendant Hartford Accident and Indemnity Company who insured the Lincoln Manufacturing Company, the owner of the car. The complaint alleged Norton on September 27, 1954, the date of the accident, had obtained permission to drive the Cadillac and was covered by the defendant's policy, which was denied by the answer. The defendant moved for a summary judgment, which motion was granted. Judgment was entered dismissing the complaint, and the plaintiff appealed.

Vaudreuil & Vaudreuil, Kenosha, for appellants.

La France, Thompson, Greenquist, Evans & Dye, Racine, for respondent.

HALLOWS, Justice.

There is no issue of fact raised by the pleadings and the affidavits. The question of law to be decided is whether or not the insurance liability policy issued by the defendant covered Norton as an additional insured at the time of the accident.

The defendant issued an automobile liability policy on the 1951 Cadillac used for business and pleasure and owned by the Lincoln Manufacturing Company, which company was referred to as a corporation in the affidavits but as a partnership in the trial court's opinion. Lincoln Manufacturing Company was located in Chicago, Illinois. Henry A. Smith, referred to as the president of the company and as a partner of the partnership, had possession of the car and used it both for business and pleasure. He kept the car at his residence in Winthrop Harbor, Illinois. His adult daughter, Leona Grabowski, was a member of his household but did not know how to drive a car.

On September 22, 1954, Henry A. Smith left for a vacation and gave his daughter permission to use the automobile for the purpose of learning to drive. He also informed her that the Granger Motors, Inc., of Kenosha, Wisconsin, would deliver to their home a new Oldsmobile, which he had purchased, and the driver would take his old Oldsmobile back. Smith informed his daughter to inquire of the Granger employee whether he would give her driving instructions. On the 25th of September, 1954, Mr. Freeman accompanied by Norton delivered the new Oldsmobile to the Smith home and the two men transferred the license plates and personal belongings from the old car to the new car. Mrs. Grabowski inquired of Mr. Freeman about driving lessons and was informed he would be unable to accommodate her before September 28th.

After the two men left, Norton returned and offered to give Mrs. Grabowski a driving lesson. The lesson was given for about half an hour. Norton agreed to return the next day, but on the following day, Mrs. Grabowski was busy and unable to find time for a lesson. Norton told her the Cadillac needed gas and her father was entitled to a free wash and simonize job. Mrs. Grabowski consented to Norton taking the car for that purpose and gave him $2 for gas. About eight o'clock Norton returned the car but it had not been washed or simonized and a fender had been damaged. After some discussion, Norton stated he had no way to get back to Kenosha without the car and he would see that the car was washed, simonized and the fender repaired. Mrs. Grabowski allowed Norton to take the car to have these things done and ordered him to return it on the following day (Monday) by five o'clock. Mrs. Grabowski believed Norton was an employee of the Granger Motors, Inc. and the car was to be taken to the Granger garage. However, Norton at no time ever stated to Mrs. Grabowski he was an employee of the Granger Motors, Inc. or he would take the car to Granger's. That night, sometime after midnight, Norton was involved in the accident in Racine county, Wisconsin, some 15 miles north of Kenosha, while he was driving the Cadillac with the plaintiff and several others as passengers.

The preliminary question arises whether the law of Illinois or of Wisconsin applies because the insurance policy was written in Illinois covering an owner and a car kept in Illinois but the accident happened in Wisconsin. The failure to plead and prove the common law of Illinois raises the presumption that it is the same as the law of Wisconsin. Switzer v. Weiner, 1939, 230 Wis. 599, 284 N.W. 509; DeLorenzo v. Supreme Lodge, Knights of Pythias, 1936, 222 Wis. 141, 268 N.W. 217; Jensen v. Jensen, 1938, 228 Wis. 77, 279 N.W. 628. By sec. 328.01, Stats., the courts of Wisconsin are required to take judicial notice of the statutes of sister states. Switzer v. Weiner, supra. Like Wisconsin, Illinois has an omnibus coverage clause requirement by statute (S.H.A.Ill.Ch. 95 1/2, sec. 58k [now § 7-317]), which is deemed to be a part of the policy by operation of law. Konrad v. Hartford Accident & Indemnity Co., 1956, 11 Ill.App.2d 503, 137 N.E.2d 855. The Illinois omnibus coverage statute is substantially the same as the Wisconsin statute (sec. 204.30(3)). This being so, the judicial construction of the foreign statute will be presumed to be the same as Wisconsin in the absence of evidence to the contrary. Hansen v. Hensen, 1957, 274 Wis. 262, 80 N.W.2d 230.

Both parties agree that the precise point for determination on this appeal has not been determined by the court of last resort in Illinois; and the cases from the intermediate appellate courts of Illinois do not seem inconsistent with the law of this state. See Cocos v. American Automobile Ins. Co., 1939, 302 Ill.App. 442, 24 N.E.2d 75; Byrne, for Use of King v. Continental Casualty Co., 1939, 301 Ill.App. 447, 23 N.E.2d 175; People v. Luster, 1937, 292 Ill.App. 244, 11 N.E.2d 47; Standard Accident Ins. Co. v. New Amsterdam Cas. Co., 7 Cir., 1957, 249 F.2d 857 [Federal court applying Illinois law]. The question of permission will, therefore, be decided by the law of Wisconsin.

The defendant's policy contained the following omnibus coverage clause:

'* * * the unqualified word 'insured' includes the Named Insured and also includes any person while using the automobile and any person or organization legally responsible for the use thereof, provided the actual use of the automobile is by the Named Insured or with his permission.'

This clause is substantially the same as sec. 204.30(3), Stats. ¹ The first contention of the plaintiff is that Leona Grabowski had a right, as an adult member of the household of Henry A. Smith, to give permission to others to use the Cadillac. The appellant strenuously argues that Henry A. Smith was the real insured because the policy provided coverage while the car was used for business or pleasure and the car was, in fact, used by Smith for his pleasure and kept garaged at his residence. We do not decide this question because, assuming Smith was the named insured or its equivalent, the determination of the case turns on the scope of the permission given by Leona Grabowski.

The appellant argues the Lincoln Manufacturing Company, through Smith, gave its permission to Leona Grabowski to use the car and, relying on Schimke v. Mutual Automobile Ins. Co., 1954, 266 Wis. 517, 64 N.W.2d 195, and Mauer v. Fesing, 1940, 233 Wis. 565, 290 N.W. 191, concludes that Leona Grabowski, as the first permittee, had the right to permit Norton to use the car and what use he made of the car was immaterial. Passing over the question of whether Leona Grabowski was the first permittee or the second, this argument proceeds on the initial permission rule which is grounded on the theory that when the named insured has initially given permission to another to use his auto and that person deviates from the permission granted, such use while the auto remains in the possession of the permittee is with permission under the omnibus clause, although the particular use may be for a purpose not contemplated by the named insured. This idea, but not so broadly stated, appears in Drewek v. Milwaukee Automobile Ins. Co., 1932, 207 Wis. 445, 240 N.W. 881. In that case, an employee of the named insureds, who were grocers, obtained permission from his employer to use a truck by falsely stating he desired to use it to haul a phonograph for himself after his regular working hours; instead, the employee hauled furniture for a friend and while so engaged, negligently caused the death of the passenger in the car. The court said this was a mere deviation from the letter of the permission and then defined permission in the omnibus clause to mean the consent obtained in the first instance from the assured to the possession of an auto by the operator thereof regardless of the use to which he puts it while it continues in his possession by virtue of that initial consent. We think it significant the permittee was driving the car at the time of the accident.

Other states have differed in the extent to which they adopted the initial permission rule in a broader application. For an excellent review and commentary on the rule, see Anno., Omnibus clause of automobile liability policy as covering accident caused by third person who is using car with consent of permittee of named insured, 160 A.L.R. 1195. 2 A.L.R. Blue Book, Supp.Dec.1946-1952, p. 738; 3 A.L.R. Blue Book, Supp.Dec.1952-1958, p. 668; 1961 A.L.R.Supp.Dec., Issue No. 5, p. 329. Wisconsin has not applied the rule of initial permission to use a car to authorize a permittee to let another person drive the car when the owner expressly forbids such delegation. Prisuda v. General Casualty Co., 1956, 272 Wis. 41, 74 N.W.2d 777. In Locke v. General A. F. & L. Assur. Corp., 1938, 227 Wis. 489, 279 N.W. 55, the court denied coverage on the ground there were no facts or circumstances to warrant an inference the named insured had any knowledge the permittee would permit anyone else...