Indiana Lumbermens Mut. Ins. Co. v. Statesman Ins. Co.

• Court: Indiana Supreme Court
• Writing for the Court: HUNTER; ARTERBURN; DeBRULER; DeBRULER
• Citation: Indiana Lumbermens Mut. Ins. Co. v. Statesman Ins. Co., 291 N.E.2d 897, 260 Ind. 32 (Ind. 1973)
• Decision Date: 01 February 1973
• Docket Number: No. 273S15,273S15
• Parties: INDIANA LUMBERMENS MUTUAL INSURANCE COMPANY, Plaintiff-Appellant, v. STATESMAN INSURANCE COMPANY, Defendant-Appellee.

Page 897

291 N.E.2d 897

260 Ind. 32

INDIANA LUMBERMENS MUTUAL INSURANCE COMPANY, Plaintiff-Appellant, v. STATESMAN INSURANCE COMPANY, Defendant-Appellee.

No. 273S15.

Supreme Court of Indiana.

Feb. 1, 1973.

Stewart, Irwin, Gilliom, Fuller & Meyer, Samuel A. Fuller, Indianapolis, for plaintiff-appellant.

Arthur J. Sullivan, David F. McNamar, Steers, Klee, Sullivan & LeMay, Indianapolis, for defendant-appellee.

HUNTER, Justice.

This case is before this Court on a Petition to Transfer from the Appellate Court. It is an action between Indiana Lumbermens Mutual Insurance Company (Lumbermens) and Statesman Insurance Company (Statesman) the petitioner, arising out of a subrogation claim from a settlement by Lumbermens of a negligence claim.

The facts are as follows:

Jack Walker, an employee of the Imperial Water Conditioning Company was delivering a water softener to the home of Mr. and Mrs. Soots. While transporting the softener down the basement stairs of the Soots home, the stairs collapsed and Walker was seriously injured. The sole and proximate cause of the accident was the negligent maintenance of the stairway. There was never any contention that Walker was negligent in the unloading of the water softener.

Lumbermens insured the Soots. After Walker sued, Lumbermens settled with Walker for his injuries and paid him $17,000.00. Lumbermens then instituted the present action against Statesman which had a liability insurance policy on the truck which Walker drove to the premises. Lumbermens' theory was that the 'loading and unloading' clause of the so-called 'omnibus' clause of the truck liability policy afforded coverage to Soots, the homeowners. First of all, the policy provides that 'use' of the vehicle includes the 'loading and unloading thereof.' Lumbermens contends that the homeowners were users of truck by virtue of their cooperating with the driver in the loading and unloading process. Lumbermens then contends that the Soots would become insureds under the omnibus clause ¹ of Statesman's truck liability policy which insures all users. The theory is that by cooperating in the unloading process the homeowners became 'users' and therefore insureds.

Statesman filed a Motion for Summary Judgment in the Hancock Circuit Court. Judge George B. Davis granted the motion and entered findings. On appeal, the Appellate Court of Indiana reversed. See, Ind.App., 274 N.E.2d 419. Transfer was sought to the Supreme Court of Indiana and we granted transfer. For the reasons hereinafter stated, the trial court's granting of summary judgment should have been affirmed.

The accident did not arise out of the use of the truck. As the trial court pointed out, the proximate cause of the accident was the negligent maintenance of the staircase. The Appellate Court case notes in quoting another case that we are not here dealing with proximate cause but with contract language. However, we are in fact in this instance not dealing with the two parties to the contract. The party claiming to be an insured in this case never paid a penny's premium to the insurer. We are therefore not in a situation where we must construe the contract language any certain way and can seek out the general intent of the contract from a neutral stance.

We are of the opinion that what was intended by the words in the contract, 'arising out of the ownership, maintenance or use' of the truck as applied to unnamed insureds is synonymous to being caused by use of the truck (including the loading and unloading). Otherwise the insurance company becomes the insurer for every sort of accident by anyone to whom a delivery is made. We are in agreement with the trial court that the 'efficient and predominating cause' of the accident must arise out of the use of the vehicle in order for an unnamed insured to be covered.

One authority in the field has stated:

'Before there is coverage under a policy extending to loading and unloading, there must be come connection between the use of the insured vehicle and the injury, and unless the court can determine that the loading or unloading of the vehicle was an efficient and producing cause of the injury, there is no right of indemnity for the accident. In other words, liability of an insurance company under the policy depends on the existence of a causal relationship between the loading or unloading and the injury, and if the injury was proximately due to the unloading, the insurance company is liable,...