Liberty Mutual Ins. v. American Employers Ins.
| Decision Date | 03 December 1976 |
| Docket Number | No. 17772,17772 |
| Citation | 545 S.W.2d 216 |
| Parties | LIBERTY MUTUAL INSURANCE COMPANY, Appellant, v. AMERICAN EMPLOYERS INSURANCE COMPANY et al., Appellees. |
| Court | Texas Court of Appeals |
Appellees, American Employers Insurance Company (American) and Homette Corporation (Homette), have brought suit seeking declaratory relief. The issue is whether the insurance policy issued by Liberty Mutual Insurance Company (Liberty), appellant, to U.S. Plywood Corporation (Plywood), a division of Champion International Corporation (Champion), also covers Homette as an insured. Suit had been filed against Homette by the widow of a Plywood truck driver who was killed when part of a load of materials he had delivered to Homette fell on him during the unloading of Plywood's truck by two employees of Homette, at Homette's place of business. They also seek a declaration that Liberty has an obligation to defend said suit.
The trial court, sitting without a jury, found that Homette was covered under the policy, and ordered, adjudged and decreed that Liberty assume the defense of Homette in the suit filed by decedent's widow, to further pay to the extent of its policy limits any judgment which may be recovered in said action, to reimburse American for all costs and expenses it incurred in the investigation and defense of said cause of action, and to pay all costs incurred in this declaratory judgment action.
Judgment modified, and as modified, affirmed.
This appeal involves the construction of a relatively new clause now appearing in automobile combination comprehensive insurance policies. This clause has been prescribed by the State Board of Insurance under the provisions of Article 5.06 of the Texas Insurance Code. It limits the liability for persons additionally insured under the terms of the omnibus clause. The Supreme Court has not yet construed this clause.
Liberty and Homette agree that the sole issue in this appeal is whether or not Homette is a 'borrower' of the Plywood truck which was being unloaded by Homette.
That portion of the insurance policy here involved provides as follows:
'PERSONS INSURED
'Each of the following is an insured under this insurance to the extent set forth below: . . .
'(c) any other person while using an owned automobile or a hired automobile with the permission of the named insured, provided his actual operation or (if he is not operating) his other actual use thereof is within the scope of such permission, but with respect to bodily injury or property damage arising out of the loading or unloading thereof, such other person shall be an insured only if he is:
'(1) a lessee or borrower of the automobile, or
'(2) an employee of the named insured or of such lessee or borrower; . . ..'
Liberty assigns only one point of error which follows:
'The trial court erred in entering judgment that Liberty Mutual Insurance Company is obligated under its policy of insurance sold to U.S. Plywood to assume the defense and all of the expenses incident thereto of Homette Corporation in cause number 213--26869--74, styled Carol Jean Dragoo et al. v. Homette Corporation on the docket of the 213th District Court of Tarrant County, Texas, and to pay any judgment which may be recovered therein pursuant to said policy, since the undisputed facts and those found by the court establish as a matter of law that Homette Corporation is not an insured, named or otherwise, under the terms of the policy.'
American and Homette agree that the facts stated in Liberty's brief are correct but disagree only over the interpretation of the court's Finding of Fact No. 9. Therefore, under Rule 419, T.R.C.P., the court accepts the facts detailed in Liberty's brief.
The evidence reflects that Plywood manufactures and sells a product called 'Novadek,' which consists of large panels of plywood.
On March 28, 1973, Billy Don Dragoo, an employee of Plywood, drove his employer's truck loaded with 'Novadek' to the unloading area of Homette. The 'Novadek' had been purchased by Homette from Plywood. It was the custom and practice for Plywood to deliver 'novadek' to its customer, Homette. Homette had express or implied permission to unload the plywood. Dragoo then removed from the stacks of plywood a nylon webbing that had held the plywood to the bed of the truck, and was standing beside the truck rolling up the nylon when he was fatally injured. Dragoo was not assisting in the unloading of the truck nor directing the unloading thereof. Once the unloading began Homette was using the truck for its own business and not for any purpose in which Plywood was interested.
After Dragoo had removed the tie-downs, the two employees of Homette, using a forklift, were in the process of unloading the plywood when some of it fell upon Dragoo crushing him. Dragoo was standing on the ground, opposite the side of the truck from which the forklift was being operated. The plywood had a tendency to slide if it was jostled or jarred.
The court found all the facts and concluded all the law necessary to support its judgment. Its Finding of Fact No. 9 is as follows:
'At no time during the proceedings did any employees of Homette Exercise any control over the Movements of Mr. Dragoo or the truck; . . ..' (Emphasis added.)
In its conclusions of law, the court determined the policy here in question had been issued and afforded coverage to U.S. Plywood and that the truck here in question being unloaded was an 'owned automobile' as to Plywood, and Homette was a 'borrower' and user of the truck for the purpose of unloading it. Its other conclusions are:
'3. That the death of Dragoo occurred while 'unloading' the truck, and that the 'user' was not an employee of U.S. Plywood, neither was the 'user' a 'lessee';
'4. The user at the time of the unloading was a 'borrower' within the meaning of the policy;
'5. Since the truck in question was being 'unloaded' by employees of Homette and was 'borrowed' by them for that purpose, Defendant Liberty Mutual's policy affords coverage to Homette and its employees;
The parties to this appeal agree if in unloading the truck on its premises, Homette was either a borrower or a lessee of the truck, then Homette is an insured; otherwise, it is not. The restriction in the omnibus clause removed every unloader from coverage except those who were either lessees or borrowers of the automobile or their employees, and the named insured of a nonowned automobile.
In construing or interpreting an insurance policy, the rule is well-established that ambiguities are to be found liberally in favor of the insured and strictly against the insurer. Ramsay v. Maryland Am. General Ins. Co., 533 S.W.2d 344 (Tex.Sup., 1976); Life Ins. Co. of North America v. Spradlin, 526 S.W.2d 625 (Tex.Civ.App., Fort Worth, 1975, ref., n.r.e.). This is especially true in dealing with exceptions and words of limitation (Ramsay v. Maryland Am. General Ins. Co., supra) or when the terms are of uncertain import or reasonably susceptible to double construction (Life Ins. Co. of North America v. Spradlin, supra). However, words must be given their usual and accepted meaning, absent evidence of intent to the contrary. Pan American Insurance Co. v. Cooper Butane Co., 157 Tex. 102, 300 S.W.2d 651 (1957); Fox v. Thoreson, 398 S.W.2d 88 (Tex.Sup., 1966).
Liberty takes the position that before Homette could be a lessee or borrower it must have paid or promised to pay a consideration for the lease or loan of the truck. No separate delivery charge was made to Homette for the delivery. However, it is undisputed that by custom and usage Plywood, as a part of the consideration for the sale of the plywood to Homette, delivered its product to the plant of Homette and gave Homette permission to use the truck for the purpose of unloading it. Here the truck was stopped for unloading at a place satisfactory with Homette. The trial court impliedly found that Homette had the right to control the truck for unloading purposes even though it did not exercise its right to control the movements of Dragoo or the truck on this occasion.
We next examine the meaning of 'borrower' and 'lessee' and the distinction in the meaning of these two words.
In the absence of evidence to the contrary we must hold the parties to the insuring contract intended the words 'borrower' and 'lessee' be given their usual, ordinary, popular, and plain grammatical meaning, unless it definitely appears that the intention of the parties would thereby be defeated. Fox v. Thoreson, supra; Pan American Insurance Co. v. Cooper Butane Co., supra; 13 Tex.Jur.2d (1960 Ed.), Contracts, Sec. 135, p. 312, Determining meaning of terms and phrases.
Black's Law Dictionary (1968 Ed.) defines a 'borrower' as 'He to whom a thing is lent at his request.' Ballentine's Law Dictionary (1969 Ed.) defines it as 'One who borrows,' and defines 'borrow' as 'To obtain upon loan from the owner or other person having the right of disposition.' Webster's Third International Dictionary (1964 Ed.) defines 'borrower' as 'one that borrows,' and defines 'borrow' as 'to receive temporarily from another, implying or expressing the intention either of returning the thing received or of giving its equivalent to the lender; obtain the temporary use of.' The Oxford English Dictionary (1970 Ed.) defines a 'borrower' as 'One who takes a thing on security or on credit.'
'Lessee' is defined in Black's Law Dictionary as And 'lease' is a 'Grant of use and possession,...
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