Liggans R.V. Center v. John Deere Ins. Co.

• Decision Date: 11 January 1991
• Citation: 575 So.2d 567
• Parties: LIGGANS R.V. CENTER v. JOHN DEERE INSURANCE COMPANY. 89-1580.
• Court: Alabama Supreme Court

Page 567

575 So.2d 567

LIGGANS R.V. CENTER v. JOHN DEERE INSURANCE COMPANY.

89-1580.

Supreme Court of Alabama.

Jan. 11, 1991.

Curtis Wright of Dortch, Wright & Russell, Gadsden, for appellant.

John S. Morgan of Inzer, Suttle, Swann & Stivender, Gadsden, for appellee.

JONES, Justice.

The defendant, Liggans R.V. Center, appeals from a summary judgment entered in favor of John Deere Insurance Company, the plaintiff in this declaratory judgment action. We affirm.

On September 29, 1989, a woman and a man (apparently a mother and her son) visited Liggans R.V. Center in Gadsden, Alabama, and looked at the recreational vehicles ("R.V.'s") offered there for sale, telling a Liggans salesman that they had recently sold their R.V. and wished to purchase another. The couple told the salesman that they were interested in a 1983 Allegro motor home, and they discussed with the salesman the financial details of their possibly purchasing this R.V. The unidentified couple then left, saying that the man had to keep a dental appointment but that they would be back to complete the purchase.

When the couple returned to Liggans, they obtained permission to drive the Allegro motor home to the shop of a local mechanic to have it inspected. The couple left a Chevrolet Blazer vehicle at Liggans and said that they would return the motor home by 3:00 or 3:30 that afternoon. The couple did not return, and they have never been found or identified. The Chevrolet Blazer was determined to have been stolen from Georgia, and the Allegro motor home was later found demolished in Georgia.

In effect at the time the Allegro motor home was taken was a policy of insurance issued to Liggans by John Deere. The policy provided what is known as "garagekeeper's insurance," which covers loss from specified causes. The policy specifically provided, in pertinent part, as follows:

"GARAGE COVERAGE FORM

"Various provisions in this policy restrict coverage. Read the entire policy carefully to determine rights, duties, and what is and is not covered.

"....

"A. COVERAGE

"1. We will pay for 'loss' to a covered 'auto' or its equipment under:

"....

"b. Specified causes of loss coverage caused by:

"....

"(2) Theft.

"B. EXCLUSIONS

"....

"3. False pretense. We will not pay for 'loss' to a covered 'auto' caused by or resulting from:

"a. Someone causing you to voluntarily part with it by trick or scheme or under false pretenses."

Liggans made a claim against the policy for the loss of the 1983 Allegro motor home. John Deere denied coverage, relying on the exclusion for loss due to false pretenses found at Section IV.B.3. of the policy. John Deere also filed a declaratory judgment action in the circuit court, (1) contending that the language of the insurance policy was clear and unambiguous and that the exclusion for false pretenses did not violate public policy, (2) asking for a judicial declaration of the "rights, duties, obligations, status, and legal relation" of John Deere and Liggans under the policy, and (3) seeking a judicial determination that John Deere was not obligated under the insurance policy to pay Liggans for the loss of the motor home.

In its answer, Liggans denied that the language of the policy was clear and unambiguous and claimed that because the word "theft" was not defined in the insurance policy, the applicable definition was that found in Alabama's Criminal Code, specifically Ala.Code 1975, § 13A-8-2, wherein "theft" is defined so as to include a taking by false pretenses. Thus, Liggans maintained, John Deere was obligated to pay for the loss of the motor home due to the "theft" by the unidentified couple.

John Deere moved for summary judgment and filed a brief in support of its motion, and also filed the affidavit of Thomas R. Harsh, a claims examiner for John Deere. In response, Liggans filed a document entitled "Legal Authorities Of Defendant In Opposition To Plaintiff's Summary Judgment Motion," which contained summaries of the cases upon which Liggans relied to support its position. Attached to this document were copies of the cases in their entirety.

After a hearing on the motion, the trial court entered a summary judgment for John Deere, holding that there was no genuine issue of material fact and that John Deere was entitled to a judgment as a matter of law. In its order, the trial court stated that the facts were without dispute and set out a synopsis of the facts as provided hereinabove. The trial court then went on to hold as follows:

"III. LEGAL FINDINGS

" '[W]hether or not a written contract is ambiguous is a question of law for the trial court.' Upton v. Mississippi Valley Title Ins. Co., 469 So.2d 548, 553 (Ala.1985). Absent some overriding public policy or statutory provision, insurance companies enjoy the same freedom of contract as individuals. If the language contained in the contract is unambiguous, the policy must be enforced as written. Id.

"In determining whether the language of a contract is ambiguous, courts construe the words according to 'the interpretation ordinary men would place on the language used therein.' Quick v. State Farm Mutual Ins. Co., 429 So.2d 1030, 1033 (Ala.1983). The words are given the meaning that 'persons with a usual and ordinary understanding' would place on the words. Cashatt v. State Farm Mutual Ins. Co., 510 So.2d 831, 833 (Ala.Civ.App.1987).

"The provision in question is not construed in isolation, but the policy must be construed as a whole, looking to [the language within] its four corners. See Upton, supra, at 469 So.2d 555. If the language of an insurance policy is found to be ambiguous, that ambiguity must be resolved in favor of the insured. However, unambiguous policies must be enforced as written. Best v. Auto-Owner's Ins. Co., 540 So.2d 1381 (Ala.1989).

"IV. COURT'S CONSTRUCTION OF THE CONTRACT

"[Here, the trial court sets out the portions of the insurance policy quoted above.]

"Construing the policy as a whole, and particularly the provision set out above, this court finds that the language of the contract is clear and unambiguous when the words are assigned their 'usual and ordinary' meanings. Defendant's argument that the insurance company is obligated to compensate it [because] the loss which has occurred here is covered because [, says Defendant,] 'Theft by False Pretense' has been merged into theft as theft is defined at Ala.Code 1975, § 13A-8-2 is rejected.

"First, since Defendant parted only with possession, the offense under the common law would have been termed ... 'Larceny by Trick.' See St. Paul Fire & Marine Ins. Co. v. Veal, 377 So.2d 962 (Ala.1979).... Secondly, definitions under the criminal law have no special application to the law of insurance. In fact, it has been stated that presumptions in tort and criminal law have no application to the interpretation of language used in insurance policies. Alabama Farm Bureau Mutual Cas. Ins. Co. v. Dyer, 454 So.2d 921 (Ala.1984). Thirdly, since the words of the contract are to be given their 'usual and ordinary' meaning, a definition based on technical terms or legalese would not be appropriate. While definitions under the criminal law are some authority and can serve as a guide to interpretation, such definitions are not controlling for the purposes of construing the language found in an insurance policy.

"In the absence of a definition contained in the policy, and/or overriding public policy, or statutory provision, the words mean what an 'ordinary person' would believe those words would mean. No overriding public policy or statutory provision was shown by Defendant to apply in this case. Having so stated, this court finds as a matter of law that the language employed by Plaintiff in its insurance policy is clear and unambiguous. The policy before the court clearly excludes from its coverage a loss resulting from circumstances such as those presented in this case.

"V. CONCLUSION

"There being no genuine issue of material fact before the court, the merits of this case are fully adjudicated. It is ORDERED, ADJUDGED, and DECREED that judgment is rendered for Plaintiff on its Rule 56 motion. Under the terms of the contract, Plaintiff has no obligation to compensate or indemnify Defendant for any damages it may have suffered due to the loss of the Allegro [motor home]."

Without necessarily agreeing with the totality of its holdings, we affirm the judgment of the trial court.

On appeal, Liggans presents the issue whether the trial court erred in granting John Deere's motion for summary judgment,...