Liberty Mut. Ins. Co. v. Colonial Ins. Co.
| Decision Date | 01 June 1970 |
| Citation | 87 Cal.Rptr. 348,8 Cal.App.3d 427 |
| Court | California Court of Appeals Court of Appeals |
| Parties | LIBERTY MUTUAL INSURANCE COMPANY, Plaintiff and Respondent, v. COLONIAL INSURANCE COMPANY, Defendant and Appellant. Civ. 26427. |
Carroll, Davis, Burdick & McDonough, San Francisco, for appellant.
Mullally & McCorkindale, Oakland, for respondent.
In this declaratory relief action defendant, Colonial Insurance Company (hereafter 'Colonial'), appeals from a judgment against it and in favor of plaintiff, Liberty Mutual Insurance Company (hereafter 'Liberty'), based upon the holding that Colonial was the primary insurer and Liberty was only the excess insurer of the personal injury claim of one Johnson.
On December 17, 1962 Johnson drove a truckload of steel onto the premises of the Butler Manufacturing Company (hereafter 'Butler Co.'). During the unloading process he sustained personal injuries when a portion of the load fell on him.
Johnson was the employee of an independent hauling contractor engaged by the consignor, Columbia-Geneva Steel Company, to haul the steel to the premises of Butler Co. There was no contractual or business relationship between the hauling contractor and Butler Co.
A crane being used to assist in unloading the truck was owned and operated by Butler Co. and was permanently affixed to Butler's premises by an overhead rail track. This equipment was not and could not be used on a public highway nor could it in any sense be considered as a motor vehicle under the Vehicle Code.
Liberty had issued to Butler Co. a 'Comprehensive General Liability Policy' insuring it for damages caused by bodily injury sustained by any person on its premises.
Liberty had also issued to Butler Co. an 'Automobile Policy' which contained a clause entitled 'OTHER INSURANCE.' This clause covers Two different situations. The first is as follows:
'If the insured has other insurance against a loss covered by this policy the company shall not be liable under this policy for a greater Proportion of such loss than the applicable limit of liability stated in the declarations bears to the total applicable limit of liability of all valid and collectible insurance against such loss;' (italics added). The Colonial policy contains an identical provision.
The second situation provided for in the Liberty policy is as follows: 'provided, however, the insurance under this policy with respect to loss arising out of the maintenance or use of any hired automobile insured on a cost of hire basis Or the use of any non-owned automobile shall be Excess insurance over any other valid and collectible insurance.' (Italics added.)
Colonial erroneously takes the position that the 'excess' provision quoted above cannot apply unless the vehicle involved was insured by Liberty 'on a cost of hire basis.' This overlooks the fact that the 'excess' provision can and does also apply to 'the use of any non-owned automobile.'
The trial court expressly found that 'It is true that the said truck was not owned by or hired by Butler Manufacturing Company or its employees.' This finding is supported by substantial evidence. It therefore follows that Liberty's 'Automobile Policy' is excess insurance in the instant situation.
Colonial had issued to the hauling contractor an 'Automobile Insurance Policy' specifically describing the truck and covering liability for bodily injuries caused by the operation of the truck.
There is no contention that the unloading of the truck was not a part of the operation of the truck or that the Butler Co. employees who assisted in such unloading were not additional insureds within the terms of the Colonial policy.
Johnson filed a personal injury action against Butler Co. and certain of its employees, including one Klatt, the operator of the crane at the time of the accident to Johnson. (This action is hereafter referred to as the Johnson action.)
Liberty employed attorneys who undertook the defense of this action during the pleading stage, Colonial having refused to do so. Prior to trial Liberty again tendered the defense thereof to Colonial, which continued its refusal to participate in the action or defend it. No explanation for such refusal was given by Colonial.
On June 22, 1964, during the ensuing trial of the Johnson action, the attorneys for Johnson and the attorneys employed by Liberty to represent defendants Butler Co. and three of its employees, Crain, Sweet and Klatt, stipulated in open court to a judgment against them and in favor of Johnson in the sum of $75,000.
The court signed and filed its formal judgment on June 23, 1964, in which the following express finding is made: '(T)he court specifically finds that the plaintiff has suffered severe and permanent injuries and has sustained damages as a result of The accident described in the complaint.' (Italics added.) Liberty satisfied the judgment in full on June 25, 1964.
The accident is described in the complaint as follows: 'that at said time and place (i.e., premises of Butler Co.), defendant, Butler Manufacturing Company, a corporation, by and through its employees, * * * (1) so negligently and carelessly Maintained the area where plaintiff was obliged to park his tractor and trailer for unloading purposes and (2) so negligently and carelessly Managed, supervised, controlled and directed The unloading of said trailer as to cause said sheet steel to fall from said trailer and upon the body of plaintiff. * * *' (Italics added.)
Thus, the complaint describes an accident that was caused by Either or both of two factors, (1) the negligent and careless Maintenance by Butler Co. of the area where Johnson was obliged to park his tractor and trailer in order to unload and (2) the negligence and carelessness by Butler Co. and its employees in the management, supervision, control and direction of the Unloading of the steel.
Liberty is the primary insurer if negligent maintenance of the premises was The proximate cause of the accident. Colonial is the primary insurer if the negligent manner of unloading the steel was The proximate cause of the accident. If Both were the proximate causes of the accident then both Liberty and Colonial are jointly and equally liable to Butler Co. as primary insurers. Under these circumstances we think that each is a concurrent primary insurer of Butler Co.'s liability to Johnson.
Colonial's contention that the...
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