Haynes v. American Cas. Co.

• Decision Date: 19 April 1962
• Docket Number: No. 222,222
• Citation: 228 Md. 394,179 A.2d 900
• Parties: Mack C. HAYNES, indiv. and t/a Joppa Contractor v. AMERICAN CASUALTY COMPANY.
• Court: Maryland Court of Appeals

Page 394

228 Md. 394

179 A.2d 900

Mack C. HAYNES, indiv. and t/a Joppa Contractor v. AMERICAN CASUALTY COMPANY.

No. 222.

Court of Appeals of Maryland.

April 19, 1962.

T. Carroll Brown and Franklin Somes Tyng, Bel Air (A. Freeborn Brown, Bel Air, and Gordon C. Murray, Baltimore, on the brief), for appellant.

William E. Brannan, Baltimore (Ginsberg & Ginsberg and Hyman Ginsberg, Baltimore, and James H. Cook, Towson, on the brief), for appellee.

Before HENDERSON, HAMMOND, PRESCOTT, HORNEY and SYBERT, JJ.

SYBERT, Judge.

This appeal questions the construction given by the trial court to the term 'caused by accident' in an insurance policy.

The case was submitted below upon a stipulation of facts. The appellant, Mack C. Haynes, individually and trading as Joppa Contractor (plaintiff below), had purchased a manufacturer's and contractor's liability policy from the appellee, American Casualty Company (defendant below), to cover against accident in his excavating operations. The policy includes:

'Coverage B--Property Damage Liability: To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of injury to or destruction of property, including the loss of use thereof, caused by accident and arising out of the hazards hereinafter defined.

'Definition of Hazards

'Division 1--Premises--Operations. The ownership, maintenance or use of premises, and all operations.' (Emphasis supplied.)

During excavation work in Baltimore County, appellant pointed out to his employees the property line within which the work was to be done and then left them for several hours. Upon his return he found they had encroached on adjacent property and cut down 48 trees. When the landowners sued appellant for the resulting damage, the appellee at first undertook to defend the action, but later denied liability under the policy. Appellant then engaged counsel and at the subsequent trial judgment was rendered against him for $1,648 with interest and costs. When the appellee refused to pay the judgment and expenses of the suit, the instant action was filed by the appellant against the insurance company, seeking damages for breach of contract by appellee in not paying the judgment and suit expenses (first count); reimbursement for the fee incurred for private counsel in defending the landowners' suit (second count); payment of counsel fees to be incurred in the instant action (third count); and damages because appellant's bank account had been attached after appellee refused to pay the landowners' judgment (fourth count). Appellant filed a motion for summary judgment in his favor on the first and second counts and on the issue of liability under the third count, which was denied by the trial court.

On the merits the trial court found for the insurer, holding that 'since the employees of the plaintiff intended to cut the trees which they did cut, the result was neither unusual nor unexpected * * *' and therefore did not come within the meaning of the clause 'caused by accident' in the policy. From the judgment entered for appellee upon that finding, appellant brought this appeal, thus requiring a determination of whether the cutting of the trees on the land of another through the inadvertent act of the appellant's employees constituted injury 'caused by accident' within the meaning and terms of the policy.

The parties take the following positions: The insurer says the act of the insured's employees in cutting the trees on the land of another was voluntary and intentional and the damage was the natural result of the act. Thus, it claims, even though the result may have been unforeseen and unintended, there is no coverage under the policy for damage caused by the mistake or error of the insured's employees. The insured, on the other hand, in addition to arguing that the contract when read as a whole provides coverage, also contends that the more modern view of a majority of the jurisdictions is to reject any distinction between the terms 'accidental means' and 'accidental result', so that when an intentional or voluntary act of the insured causes damage which was unforeseen by him at the time, it is held to come within the meaning of the term 'caused by accident'. According to this logic, therefore though the trees were felled intentionally by the insured's employees, the fact that damage was done to the property of another was unforeseen, and hence the injury was 'caused by accident'.

The insurer relies principally on the case of Thomason, Contractor v. United States Fidelity & Guaranty Co., 248 F.2d 417 (C.A.5, 1957), as supporting its theory, as well as upon John Hancock Mut. Life Insurance Co. of Boston v. Plummer, 181 Md. 140, 28 A.2d 856 (1942). In the Thomason case, a bulldozer operator erroneously went beyond certain iron stakes marking the property line which he was to observe in his work and as a result damaged the adjoining property. The question, as in this case, was whether the insurer was liable for the damage because of injury to the property 'caused by accident'. The majority of two judges in the federal appellate court, in applying Alabama law, found for the insurer, stating (at 419 of 248 F.2d):

'* * * Where acts are voluntary and intentional and the injury is the natural result of the act, the result was not caused by accident even though that result may have been unexpected, unforeseen and unintended. There was no insurance against liability for damages caused by mistake or error. The cause of the injury was not an accident within the meaning of this policy.'

In a well reasoned dissent, Judge Rives, after reviewing the Alabama law, concluded (at 420-421) that '* * * the fact that an injury is caused by an intentional act does not preclude it from being caused by accident if in that act, 'something unforeseen, unusual and unexpected occurs which produces the result.' * * *'.

A result in accordance with the views of Judge Rives was reached by the Superior Court of New Jersey, Appellate Division, in the recent case of Minkov v. Reliance Ins. Co. of Phila., 54 N.J.Super. 509, 149 A.2d 260 (1959). There the insurer refused to pay a claim against the insured, a construction company, arising out of damage to an existing brick wall occasioned when the insured had voluntarily sought to straighten the wall in order to erect steel roof trusses. The contract contained a provision identical with the Coverage B clause of the policy before us. The insurance company made the same argument as appellee in this case--that the means which caused the injury were voluntarily employed, and the damage to the wall was foreseeable, and to be expected, and not unusual, hence not 'caused by accident'. In reversing the trial court, the appellate court rejected this argument, stating (at 263 of 149 A.2d):

'Defendant's argument that the damage to the wall was not unusual--not accidental because foreseeable--alluding here to the dictionary definition of 'accident' as an unforeseeable contingency--cannot prevail. Simply because the damage resulted from negligence, a concept which carries with it the element of foreseeability, does not deprive the occurrence of its accidental nature. Although an intentional or willful tort would negative the existence of an accident an act attributable solely to negligence may be an accident. It cannot seriously be contended in the present case that the damage was intentional on the part of plaintiff's employees. To give the word 'accident' the meaning for which defendant argues would manifestly defeat the purpose of the policy, which is to protect against liability in circumstances like those here present.'

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