Jackson v. Lajaunie, s. 51959--51961
| Decision Date | 11 December 1972 |
| Docket Number | Nos. 51959--51961,s. 51959--51961 |
| Citation | 264 La. 181,270 So.2d 859 |
| Parties | Carl J. JACKSON, Jr. v. Ronald T. LAJAUNIE et al. |
| Court | Louisiana Supreme Court |
Borowski, Lofaso, McMahon & McCollam, Philip J. McMahon, Houma, for plaintiff-appellant in No. 51960 and respondents in Nos. 51959 and 51961.
Ernest A. Kelly, Houma, for defendant-applicant in No. 51959, and respondent in Nos. 51960 and 51961.
Watkins, Watkins & Walker, J. Louis Watkins, Jr., Sidney P. Ingram, Houma, for defendant-respondent.
Christovich & Kearney, J. Walter Ward, Jr., New Orleans, for defendant-applicant in No. 51961 and respondents in Nos. 51959 and 51960.
Plaintiff, while a customer in a filling station operated by defendant Lajaunie, suffered a gunshot wound in the chest. A pistol belonging to an employee of the defendant was in the station. Lajaunie, believing the pistol to be loaded with blank ammunition, fired it at plaintiff as a prank. Very serious and disabling injuries resulted from the shot.
Jackson sued Lajaunie and United States Fidelity and Guaranty Company; Lajaunie brought in Continental Insurance Company through a third party demand. USF&G insured Lajaunie under a 'Garage Liability Policy;' Continental had issued a 'Homeowers Policy' to Lajaunie which also insured him against personal liability to a limit of $25,000.
In the trial court Jackson obtained a judgment against Lajaunie for $38,533.64, but his demands against USF&G were dismissed. Lajaunie, as third party plaintiff, was given a judgment against Continental for $25,000.
The Court of Appeal increased Jackson's award to $63,533.64, affirmed the dismissal of his suit against USF&G, and affirmed (except for a finding concerning attorney's fees and costs) Lajaunie's judgment against Continental. Jackson v. Lajaunie, La.App., 253 So.2d 540.
We granted writs on the applications of Jackson, Lajaunie and Continental. Jackson complains of both the interpretation of the garage liability policy provisions which allowed USF&G to escape liability and the inadequacy of the award. Lajaunie also complains of the judgment in favor of USF&G and of the increase in quantum by the Court of Appeal. Continental complains of both the failure of the prior courts to give effect to an exclusionary clause in its homeowners policy and of the recognition of the right of its insured to recover attorney's fees and other costs of defense.
USF&G Coverage.
The relevant insuring clauses in the garage liability policy issued by USF&G are:
'The Company will pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of
'A. bodily injury or
'B. property damage
'to which Part 1 applies, caused by accident and arising out of the garage operations hazard.
'Garage Operations Hazard
'The ownership, maintenance or use of the premises for the purposes of a garage, and all operations necessary or incidental thereto, hereinafter called 'garage operations."
The district court found no coverage because 'shooting a pistol at a customer is not a necessary operation . . . in the business of operating . . . a service station . . .' The Court of Appeal apparently agreed, and further found that Lajaunie's 'use of the pistol for purposes of pranks cannot be considered an act 'arising out of a garage operations hazard' within the clear meaning of the policy language, even though the incident occurred on the business premises.'
The insuring clause in the garage liability policy is far broader than the interpretation adopted by the prior courts. If a fair interpretation of the insuring agreement provides coverage, and if there is no applicable exclusionary clause, USF&G must be cast.
Although the USF&G policy contains a lengthy section on exclusions, there is no contention that any of them are applicable. Accidental shooting as the result of a prank is not of the same character as any enumerated act for which coverage is excluded. Acts and circumstances for which coverage is excluded include the operation of elevators, racing, construction, accidents covered by workmen's compensation, and accidents involving nuclear material.
This phase of the case, therefore, must be decided by interpreting the scope of the insuring clause alone: is Lajaunie's liability one 'arising out of the garage operations hazard?' 'Garage Operations Hazard' is further defined:
'The ownership, maintenance or use of the premises for the purposes of a garage, and all operations necessary or incidental thereto, hereinafter called 'garage operations."
'Garage' is defined to include a service station. All parties except USF&G argue that if this accident arose out of the use of the premises for the purpose of a service station, there is coverage by the USF&G policy. USF&G argues that there is coverage for 'premises claims' (slippery floors and other such defects in the premises which result in injury), but that if the injury does not arise out of a defective condition in the premises, coverage is only afforded if the injury arises out of activities necessary or incidental to operation of the garage. Thus, because participation in pranks and horseplay is not necssary or incidental to the operation of the garage, USF&G does not cover the injuries suffered by plaintiff.
The only authority cited by USF&G for this interpretation of the insuring agreement is 1 R. Long, The Law of Liability Insurance § 7.06 (1966). That source cannot be construed to mean that a claim arising out of the use of non-defective premises must also arise out of operations necessary and incidental to service station operation to be covered by the garage liability policy.
The only case found which interprets the 'Garage Operations Hazard' in this context holds contrary to the interpretation advanced by USF&G. Knowles v. Lumbermens Casualty Company, 69 R.I. 309, 33 A.2d 185 (1943), held: 'ownership, maintenance, occupation or use of the premises' for garage purposes in the 'hazard' definition was not modified by the phrase 'operations necessary or incidental thereto;' and coverage was afforded an accidental injury arising from the use of the premises for garage purposes even if the 'operation' which caused the injury was not necessary and incidental to the conduct of the business. The injury in the Knowles case occurred when a watch dog kept on the garage premises knocked down a lady pedestrian. The court found that keeping a watch dog was not necessary and incidental to the garage operations, but found coverage nevertheless because the accident arose from the use of the premises as a 'garage.'
'The automobile garage policy affords coverage for many hazards which would ordinarily be covered by separate policies.' 1 R. Long, The Law of Liability Insurance § 7.07 (1966). The premises hazard coverage in the policy before us is couched in language similar to that in a premises hazard policy issued to a tavern keeper, interpreted by the Michigan Supreme Court in 1960. The tavern keeper negligently handled a pistol, causing it to discharge, killing a patron. Coverage was afforded for bodily injury in the following language: 'To pay . . . all sums which the insured shall become obligated to pay . . . caused by accident and arising out of the hazards hereinafter defined . . . The ownership, maintenance or use, for the purposes stated in the declarations, of premises, or property and all operations occurring during the policy period which are necessary or incidental thereto . . .' The Michigan court affirmed the judgment against the insurer, finding 'the accident complained of did arise out of hazards defined in the policy . . .' Young v. Morrall, 359 Mich. 180, 101 N.W.2d 358, 360, 362 (1960).
It answers nothing to argue, as does USF&G, that 1
It is admitted that the shooting was accidental. It is irrelevant that shooting customers is not normally anticipated in service station operations. If the accident is one 'arising out of . . . use of the premises for the purposes of a (service station),' which is the language of the policy, the insured and his victim are protected. 2 The plaintiff was at the station to buy gasoline from the defendant, an acquaintance of long standing. He was visiting with him near the cash register after paying for the gasoline when he was shot by Lajaunie, whose only thought was to frighten Jackson by firing the pistol which he mistakenly believed to be loaded with blank ammunition. The broad language of the garage liability policy's insuring clause covers this accident.
Continental's Exclusion.
The Continental Insurance Company had issued a 'homeowners' policy to Lajaunie. Under 'Section II' Lajaunie was protected against personal liability. The insuring agreement was 'to pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of bodily injury.'
This broad coverage is restricted in the exclusionary clauses. Continental relies on the following portion of the first paragraph under 'Special Exclusions'--paragraph (a):
'Section II of this Policy Does Not Apply:
'(a) (1) to any business pursuits of an Insured, except under Coverages E and F, (personal liability and medical payments) activities therein which are ordinarily incident to non-business pursuits, (2) to the rendering of any professional service or the omission thereof, or (3) to any act or omission in connection with the premises, other than as defined, (the defined premises being Lajaunie's home, and not the service station) which are owned, rented or...
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