Lloyds America v. Ferguson

• Decision Date: 17 January 1941
• Docket Number: No. 9690.,9690.
• Citation: 116 F.2d 920
• Parties: LLOYDS AMERICA et al. v. FERGUSON et al.
• Court: U.S. Court of Appeals — Fifth Circuit

116 F.2d 920 (1941)

LLOYDS AMERICA et al. v. FERGUSON et al.

No. 9690.

Circuit Court of Appeals, Fifth Circuit.

January 17, 1941.

Charles L. Neely, of Memphis, Tenn., for appellants.

Phil Stone, of Oxford, Miss., for appellees.

Before FOSTER, HUTCHESON, and McCORD, Circuit Judges.

HUTCHESON, Circuit Judge.

Appellee M. L. Dunlap, under the name Dunlap Bus Lines, operated a passenger bus line between Clarksdale and Oxford, Mississippi. Prior to beginning operations, she, as required by Section 7124,¹ Mississippi Code, 1930, filed with the Mississippi Railroad Commission a public liability or indemnity policy of insurance issued to her as operator of Dunlap Bus Lines by Lloyds America and procured from the commission a certificate of convenience and necessity for the operation of the bus line.

Appellee Ferguson, while a passenger on the Dunlap Bus Line between Clarksdale and Oxford, received injuries for which he sued, and obtained judgment for $5,000 against M. L. Dunlap as operator of Dunlap Bus Lines. This suit was brought by appellant Lloyds America for a declaration that the coverage of the policy it had issued did not extend to the injuries Ferguson had received.

The claim was that the policy insured "the motor vehicles described in the policy and any motor vehicle substituted therefor, but no additional vehicles", and that the vehicle in which Ferguson was riding was neither a motor vehicle described in the policy nor one substituted therefor, but an additional motor vehicle.

The district judge hearing the case without a jury determined and declared that the coverage of the insurance did extend to Ferguson's injuries and that plaintiff was liable to pay the judgment.

This declaration and the judgment following were based upon the conclusions (1) that the taxicab in which Ferguson was riding was a substituted motor vehicle within the terms of the policy, and (2) that the policy must be read as though there was written in it the terms of Code Section 7124, requiring a transportation company seeking a certificate to file with the commission a public liability or indemnity insurance policy "covering injuries and damages accruing to persons or property, arising out of its operations as such transportation company", and so read, the coverage extended to Ferguson's claim.

Lloyds America, its attorneys in fact and its receiver, have appealed, insisting here that these conclusions which form the basis of the declaration and judgment, are without support in fact and in law, and that the declaration and judgment based on them may not stand. Appellees as earnestly insist that the judgment was right and may not be disturbed. We agree with appellees.

The facts stipulated and without dispute may be briefly stated. Appellee M. L. Dunlap, under the name of Dunlap Bus Lines, obtained a certificate of convenience and necessity and operated a bus line for carrying passengers between Clarksdale and Oxford, Mississippi. Before beginning operations, she, as required by the statute, filed the policy in question with the Mississippi Railroad Commission and obtained its endorsement² thereon.

Two automobiles, one a Plymouth, capacity not stated, were described in the policy.

On March 29, 1938, W. H. Ferguson bought a ticket at Rosedale, Mississippi, for transportation over the Delta Transportation Lines to Clarksdale and over the Dunlap Bus Lines to Batesville, Mississippi. The Plymouth bus, which ordinarily made that run, was undergoing repairs on that day and a seven-passenger Packard belonging to M. L. Dunlap had been sent from Batesville, the headquarters of Dunlap Bus Lines, and was being used. The agent for Dunlap Bus Lines at Clarksdale, seeing that the seating capacity of the Packard had been fully taken up without providing for all the passengers, hired from the 999 Taxicab Company of Clarksdale, Mississippi, one of its taxicabs, a Ford car, for the Dunlap Bus Lines, to transport the passengers holding tickets on that line, there for travel to Batesville, Mississippi. Ferguson first got into the Packard. Then being told by Dunlap's driver to get into the Ford, he did so and it was while riding in that car, on his way to Batesville, as a passenger of the Dunlap Bus Lines that he received the injuries for which he sued M. L. Dunlap and obtained the judgment, to avoid payment of which this suit was filed.

Appellant makes some, but not much, point of the fact that the Ford car was a taxicab owned and operated by a licensed taxicab company, and that the use of the cab, to transport Ferguson, was in effect the same as though arrangements had been made with the railroad company or an independent bus line to honor Ferguson's ticket and by an independent operation, complete the carriage. But no arrangements for independent carriage were made with the taxicab company and this contention will not do. What was done by the agent of the bus lines, and all that was done by him, was to rent or hire a car for operation by the lines, so that for the operation the car was to all intents and purposes its own car and it was responsible as though it were its own.

Appellant stands most firmly, however, on the proposition that the policy and the commission endorsement specifically limited its liability to the two described automobiles, and any vehicles substituted therefor, and specifically excluded its liability for additional motor vehicles; and that upon the undisputed evidence the taxicab was not a motor vehicle substituted for the Plymouth, but was an additional...