Maryland Cas. Co. v. Iowa Nat. Mut. Ins. Co., 11488
| Decision Date | 16 May 1972 |
| Docket Number | No. 11488,11488 |
| Citation | 5 Ill.App.3d 384,283 N.E.2d 27 |
| Parties | The MARYLAND CASUALTY COMPANY, a Corporation, Plaintiff-Appellant, v. The IOWA NATIONAL MUTUAL INSURANCE COMPANY, a Corporation, et al., Defendants-Appellees. |
| Court | United States Appellate Court of Illinois |
Vance I. Kepley, Reno, O'Byrne & Kepley, Champaign, for plaintiff-appellant.
John E. Gambill, Allen & Korkowski & Associates, Rantoul (James R. Blunk, Senior Law Student), for defendants-appellees.
This is an action brought under the provisions of Section 57.1 of the Civil Practice Act by Maryland Casualty Company, the appellant, against the Iowa National Mutual Insurance Company and others for a declaration of its rights and duties under a certain insurance policy. Various other requests for declaratory relief were filed by the defendants and at the close of all the evidence the trial judge, by way of directed verdicts, made certain rulings which are the basis of this appeal. The facts established at the trial are essentially undisputed. It is the application of those facts to certain well-defined rules of law that has engendered this appeal.
On July 21, 1968, Robert E. Smythe of Hoopeston, Illinois, was the owner of two automobiles, one of these automobiles was a 1968 Buick Skylark titled in Robert Smythe and his wife, Mae, and covered by a policy of liability insurance issued by the plaintiff Maryland Casualty Company (hereinafter referred to as Maryland Casualty) wherein Robert Smythe was the named insured. This policy contained the following provision, commonly referred to as an 'omnibus clause':
Persons Insured: Under the liability and medical expense coverages the following are insured:
(a) with respect to an owned automobile
(2) any other person using such 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. . . .
Living with Mr. Smythe on the date in question was his twenty year old son, Thomas. Although Thomas did not own an automobile, he was allowed to use either of the family automobiles whenever he desired and had driven the 1968 Buick on three or four occasions prior to July 21, 1968.
During high school, Thomas had had the use of an automobile owned by his father. On one particular occasion in his senior year Thomas had either loaned this particular automobile to a fellow student or had left the keys in it with the result that a classmate named Charles Knight drove the automobile. When Mr. and Mrs. Smythe learned of this incident they warned Thomas in specific language never to allow anyone other than a member of the family to use a family automobile. Prior to July 21, 1968, this was the only occasion on which Mr. Smythe specifically instructed his son never to allow non-family members to drive a family automobile. On redirect examination, Mr. Smythe testified as follows:
Brien's questions he just read from awhile ago, when you said, Tom--when you said Tom was to use his own common sense?
However, an exception to this rule was granted for a friend of the Smythe family, Clem Miller. Clem Miller was a young man who had known the Smythe family since he was 4 or 5 years old. A frequent visitor in the Smythe home, Clem was treated as 'one of the family' and was allowed to drive the Smythe family automobiles.
While he was a student at Southern Illinois University in Carbondale, Illinois, Thomas had become friends with two young men whose names were William Horton and John Higgins. Horton lived in Rankin, Illinois, and he and Thomas often drove back and forth to school together. The evidence revealed that the only time Horton had ever been in the Smythe home was on one occasion when he had brought Thomas home from Carbondale. On this occasion he was in the Smythe home for approximately five minutes and met Thomas' father, Robert, and his brother. At that time there was no conversation between Horton and Robert Smythe relative to Horton's use of an automobile owned by the Smythe family. Furthermore, Horton had never met Mrs. Smythe and had never driven an automobile owned by the Smythe family before July 21, 1968.
On July 21, 1968, a Saturday, Thomas Smythe took the 1968 Buick Skylark owned by his father and drove to a party in Boswell, Indiana. At the party he met both William Horton and John Higgins. Horton had a pick-up truck that was owned by his father, Donald Horton, and John Higgins had driven to the party in his own automobile, a 1964 Chevrolet Impala 'SS'. During the course of the party Smythe told Horton that 'they' had a new automobile, referring to the 1968 Buick. This was the first time Horton had learned that the Smythe family possessed this particular automobile. Called as an adverse witness at the trial by counsel for Maryland Casualty, Horton was asked whether or not Thomas had told him who the automobile belonged to and he replied as follows:
At some point during the evening these three young men agreed to meet at a gasoline station in Hoopeston, Illinois, and then proceed to Danville for something to eat. There was also some conversation about trading automobiles for this trip. Smythe had driven Higgins' Chevrolet around Boswell earlier in the evening and testified that he liked to drive this automobile because he wanted to impress some young ladies. Accordingly, Higgins asked Horton if he could drive Horton's pick-up truck to Hoopeston and Horton granted him permission to do so. Shortly after Higgins left, however, Horton changed his mind about going to Danville and asked Smythe to stop Higgins and ask him to return the truck. Smythe then got in Higgins' Chevrolet and caught up with him about two miles outside of Boswell. Higgins refused to drive back to the party and proceeded on to Hoopeston.
When the party was over both Horton and Smythe prepared to leave for Hoopeston. Smythe got into the Higgins vehicle and Horton got into the Smythe Buick. Smythe's testimony indicated that he did not engage in any conversation with Horton about which automobile to drive. Horton, on the other hand, testified that when they left the party Smythe told him that he wanted to drive Higgins' Chervolet and that Horton should drive the Buick to Hoopeston. At no time during the evening did Smythe ever inform either Horton or Higgins that his father had instructed him never to allow anyone other than a family member to operate the automobile. On the way to Hoopeston, Horton was involved in a collision with another automobile. As a result of that collision a personal injury suit was filed against Horton in the Circuit Court of Vermillion County by Charles B. McElhaney and Harold E. Morlan.
While the Vermilion County suit was pending, Maryland Casualty instituted this declaratory judgment action in the Circuit Court of Champaign County naming as defendants Iowa National, William Horton, Charles B. McElhaney and Harold E. Morlan. At the time of the collision in question William Horton's father was insured by a policy of liability insurance issued by Iowa National which contained the following language:
Persons insured: Under the liability and medical expense coverage, the following are insureds:
(2) any relative, but only with respect to a private passenger automobile or trailer, provided his actual operation or (if he is not operating) the other actual use thereof is with the permission, Or reasonably believed to be with the permission, of the owner and is within the scope of such permission, and
(3) any other person or organization not owning or hiring the automobile, but only with respect to his or its liability because of acts or omissions of an insured under (b)(1) or (2) above. (Emphasis added).
In its complaint, Maryland Casualty prayed for a determination that it was not obligated under its policy with Robert Smythe to defend or indemnify William S. Horton from the suit filed against him by Charles B. McElhaney and Harold E. Morlan. William Horton filed an answer denying the allegations of Maryland Casualty's Complaint and requested the Court to declare his rights as an insured under the policy issued by Iowa National. The other named defendants also answered the complaint and sought a declaration that between Maryland Casualty and Iowa National, one company be declared the primary insurer of William S. Horton and one company the excess insurer.
At the close of all the evidence the trial judge entered directed verdicts declaring that as a matter of law Maryland Casualty was the primary insurer of William Horton and Iowa National was the secondary or excess insurer. Both Maryland Casualty and Iowa National have appealed from these rulings.
Initially, we note that the standard the trial court was required to follow in determining whether or not to direct a verdict is the 'Pedrick Rule' enunciated by the Supreme Court as follows:
In our judgment verdicts ought to be directed and judgments n.o.v. entered only in those cases in which all of the evidence, when viewed in its aspect most favorable to the opponent, so overwhelmingly favors movant that no contrary verdict based on that evidence could ever stand. Pedrick v. Peoria & Eastern R.R. Co., 37 Ill.2d 494, 510, 229 N.E.2d 504, 513--514 (1967).
With this in mind, we are of the opinion that the trial court erred in directing...
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