Hendricks v. Meritplan Ins. Co.

• Decision Date: 26 June 1962
• Citation: 205 Cal.App.2d 133,22 Cal.Rptr. 682
• Court: California Court of Appeals Court of Appeals
• Parties: James H. HENDRICKS, a minor, and Joe T. Hendricks, a minor, by Annette Hendricks, their Guardian ad Litem, and Annette Hendricks, Plaintiffs and Appellants, v. MERITPLAN INSURANCE COMPANY, Defendant and Respondent. Civ. 25854.

Page 682

22 Cal.Rptr. 682

205 Cal.App.2d 133

James H. HENDRICKS, a minor, and Joe T. Hendricks, a minor, by Annette Hendricks, their Guardian ad Litem, and Annette Hendricks, Plaintiffs and Appellants, v. MERITPLAN INSURANCE COMPANY, Defendant and Respondent.

Civ. 25854.

District Court of Appeal, Second District, Division 4, California.

June 26, 1962.

Samuel & Lucas and Charles E. Samuel, Long Beach, for plaintiffs and appellants.

Wise, Kilpatrick & Clayton and Robert J. Kilpatrick, Long Beach, for defendant and respondent.

BURKE, Presiding Justice.

This action involves a determination of the effect of an endorsement in an automobile insurance policy, excluding any insurance coverage thereunder while the insured vehicle is being operated by any person under the age of 25 years, upon the uninsured motorist coverage required under section 11580.2 of the Insurance Code.

The action was brought by the minor plaintiffs and their mother for a declaration of right under the policy of liability insurance issued by defendant. The case was submitted upon an agreed statement of facts under which the parties stipulated that:

(1) Plaintiffs suffered bodily injury in a two-car accident on March 19, 1960, while passengers in the insured vehicle.

(2) Neither the owner nor the operator of the second car involved had a bodily injury liability bond or insurance policy applicable to their car at the time of the collision.

(3) The automobile in which plaintiffs were riding was insured by defendant under a policy of liability insurance which included an 'uninsured motorists protection endorsement' and a provision that the policy shall not apply at any time while such automobile is being driven by any person under the age of 25 years.

(4) At the time of the accident the automobile in which plaintiffs were riding was being driven by a person under the age of 25 years.

(5) Plaintiffs made claim against defendant for damages for their injuries under the policy and under the provisions of section 11580.2 of the Insurance Code, and defendant denied these claims on the ground that the policy in question did not apply while the insured vehicle was being operated by a person under the age of 25 years.

(6) None of the plaintiffs were the 'insured' under the policy in question, ¹ and the vehicle in which plaintiffs were riding was driven with the consent and permission of the owner.

Motion by defendant for a nonsuit was granted by the court from which the plaintiffs appeal.

Section 11580.2 of the Insurance Code, as it read at the time of the accident, provided in part as follows:

'No policy of bodily injury liability insurance covering liability arising out of the ownership, maintenance, or use of any motor vehicle, shall be issued or delivered in this State to the owner or operator of a motor vehicle, or shall be issued or delivered by any insurer licensed in this State upon any motor vehicle * * * unless the policy contains, or has added to it by endorsement, a provision insuring the named insured and any other person legally responsible for the use of or using the motor vehicle with the consent, express or implied, of the named insured, for all sums which he shall be legally entitled to recover as damages for bodily injury from the owner or operator of an uninsured motor vehicle, with coverage limits at least equal to the financial responsibility requirements specified in Sections 16059 and 16451 of the Vehicle Code; provided, however, that the insurer and the insured may by supplemental agreement waive application of the provision covering damage caused by an uninsured motor vehicle.' (Emphasis added.) (Stats.1959, ch. 817, § 1.)

The policy in question issued by defendant contained the following endorsement:

'In consideration of the premium at which this policy is written, it is understood and agreed any insurance as afforded by this policy shall not apply at any time while such automobile is being operated by any person under the age of 25 years.'

Defendant claims that the coverage afforded by the policy in question and the above numbered section of the Insurance Code is not available to plaintiffs because of the above quoted endorsement. Defendant maintains that such endorsement constitutes, in effect, a 'supplemental agreement' under which the insurer and the insured waived application of the provisions of the policy covering damage caused by an uninsured motor vehicle; that such right of waiver is expressly recognized in that portion of section 11580.2 of the Insurance Code which we have set forth in italics.

The language of the above quoted section of the Insurance Code, which was first enacted by the Legislature in 1959 as a part of a section by the same number (and re-enacted in 1961) is very broad and comprehensive in scope and established as a matter of public policy that every bodily injury motor vehicle liability policy in this state should provide uninsured motorist coverage. It follows that this section of the Insurance Code becomes in effect a part of every policy of insurance to which it is applicable to the same effect as if it was written out in full in the policy itself. This principle of law was established by our Supreme Court in the case of Wildman v. Government Employees' Ins. Co., 48 Cal.2d 31, 39, 307 P.2d 359. The latter case involved an interpretation of the financial responsibility laws, Vehicle Code, sections 16000-16503, which do not directly concern us in the present case.

Defendant calls our attention to the effect of certain legislation enacted within a few months after February 19, 1957, the date of decision in the Wildman case (Wildman v. Government Employees' Ins. Co., supra, 48 Cal.2d 31, 307 P.2d 359), which may have limited the effect of that decision with respect to the applicability of the financial responsibility laws to a driver who has not been required to furnish proof of ability to respond in damages. No such limitation has been imposed by the Legislature, however, with respect to the mandatory uninsured motorist coverage, and thus the legal principle established in the Wildman case is applicable and the provisions of the uninsured motorist section must be considered a part of every bodily injury liability policy written in this state. (Also see Bonfils v. Pacific Auto. Ins. Co., 165 Cal.App.2d 152, 157, 331 P.2d 766.) Unlike the financial responsibility laws before the court in Wildman, however, the uninsured motorist law contains the specific authorization indicated above whereby the insurer and the insured may by supplemental agreement waive application of such benefits. ²

We must next consider whether the endorsement to the policy can be construed as a supplemental agreement waiving 'application of the provision covering damage caused by an uninsured motor vehicle.' There is no doubt of the insurance company's right to limit the coverage of a policy issued by it and when it has done so the plain language of the limitation must be respected. (Continental Cas. Co. v. Phoenix Constr. Co., 46 Cal.2d 423, 432, 296 P.2d 801, 57 A.L.R.2d 914.) However, any such limitation must conform to the law; if contrary to public policy it is void. (Bonfils v. Pacific Auto. Ins. Co., supra, 165 Cal.App.2d 152, 156, 331 P.2d. 766.)

It should be noted that compliance with section 11580.2 of the Insurance Code is mandatory. It provides that 'No policy...