McKissick v. Auto-Owners Ins. Co., AUTO-OWNERS
| Decision Date | 01 April 1983 |
| Docket Number | AUTO-OWNERS |
| Citation | 429 So.2d 1030 |
| Parties | Bobby J. McKISSICK, Frances S. McKissick, Gerald O. Gray and Norma B. Gray v.INSURANCE COMPANY. 82-64. |
| Court | Alabama Supreme Court |
George H. Howell of Howell, Sarto & Howell and Kenneth J. Shinbaum and W. Clarence Atkeison, Prattville, for appellants.
William P. Sawyer of Weiss & Sawyer, Montgomery, for appellee.
The legal question presented here is one of first impression in the state insofar as we can determine, and that question is whether a "corporate veil" can be pierced in order to trigger an exclusion of coverage in an automobile liability insurance policy.
This question arises out of a declaratory judgment action in which the trial court found the policy exclusion applied; therefore, the court found that the carrier was relieved of any duty or obligation to provide a legal defense for the insured or pay any judgment rendered against its insured. The controversy originated out of an automobile accident involving the insured and an employee of the closely held corporation of which the insured was the president and controlling stockholder.
The specific facts are as follows: appellant Bobby J. McKissick operated a contracting business under the name County Line Builders, Inc. McKissick is the president of County Line Builders. He owned 98 per cent of the outstanding shares of stock, and admitted to controlling the daily operation of the business. No minutes of any shareholder or director meetings of County Line Builders appear in the record. Neither does any positive evidence appear in the record that McKissick commingled the corporation's funds with his own personal funds. The business's headquarters are in Prattville.
Following Hurricane Frederic's devastation of the Mobile area, McKissick went to the port city and engaged in construction repair work. County Line Builders did work in Mobile during the late fall of 1979 and into the early days of January 1980. While in Mobile, McKissick drove a 1973 Dodge van on various construction repair jobs. The evidence shows that County Line Builders owned the van. During the time period County Line Builders did work in Mobile, McKissick travelled between the gulf and his home in Prattville.
On January 5, 1980, McKissick drove to Mobile in a 1979 Ford Thunderbird. Auto-Owners Insurance Company, the appellee, insured the Thunderbird. The policy named McKissick's wife, Frances McKissick, the car's owner, as the primary insured. The policy also covered McKissick.
Gerald Gray accompanied McKissick to Mobile. County Line Builders employed Gray at various times and he had worked with McKissick for the company in the Mobile area.
The facts surrounding the accident are as follows: McKissick and Gray went to Mobile in the Thunderbird in order to bring the Dodge van back to Prattville, but when they arrived in Mobile, they discovered that the van needed repairs. In fact, the van was so much in need of repairs that it was impossible for them to drive the van. In order to get the van back to Prattville, McKissick decided to tow it behind the Thunderbird automobile.
McKissick and Gray hooked a chain between the rear of the Thunderbird (the insured automobile) and the front end of the van. On the return trip, McKissick drove the Thunderbird, and Gray sat in the van, and they proceeded north with Gray guiding the van behind the Thunderbird. At some point along Interstate 65, a tire on the van blew out. When McKissick saw, in his rear view mirror, the tire blow, he slammed on the automobile's brakes; the van then crashed into the Thunderbird and turned over. Gray was thrown from the flipping van.
Auto-Owners Insurance, insurer of the Thunderbird, filed a declaratory judgment action in the circuit court of Autauga County, in which it alleged that the policy on the Thunderbird did not cover any damages or injuries arising from the accident. The company cited the following portions of its policy as controlling on the issue of its coverage:
neither expected nor intended from the standpoint of the insured and arising out of the ownership, maintenance or use, including the loading or unloading thereof, of the automobile.
After the filing of the declaratory judgment action, Gerald Gray filed a motion to intervene and also an intervenor's complaint. He alleged that if the trial court found Auto-Owners Insurance was not obligated to provide coverage, then the uninsured motorist benefits...
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