Mid-Century Ins. Co. v. Liljestrand, MID-CENTURY

• Decision Date: 22 December 1980
• Docket Number: MID-CENTURY,No. 79SC192,79SC192
• Citation: 620 P.2d 1064
• Parties: INSURANCE COMPANY and Farmers Insurance Group (Mid-Century being one of the Farmers group of companies), Petitioners, v. Tony LILJESTRAND, Respondent.
• Court: Colorado Supreme Court

Page 1064

620 P.2d 1064

MID-CENTURY INSURANCE COMPANY and Farmers Insurance Group

(Mid-Century being one of the Farmers group of

companies), Petitioners, v. Tony LILJESTRAND, Respondent.

No. 79SC192.

Supreme Court of Colorado, En Banc.

Dec. 22, 1980.

DeMoulin, Anderson, Campbell & Laugesen, Richard W. Laugesen, Denver, for petitioners.

Weltzer & Worstell, Louis A. Weltzer, Denver, for respondent.

ERICKSON, Justice.

We granted certiorari to review the opinion of the court of appeals in Chavez v. Zanghi, Philip Liljestrand, Tony Liljestrand v. Mid-Century Insurance Company and Farmers Insurance Group, 42 Colo.App. 417, 598 P.2d 152 (1979). We reverse and remand the case to the court of appeals with directions to reinstate the judgment of the trial court.

Different parties were before the trial court and the court of appeals than appear before us for certiorari review. The sole issue before us on review is Tony Liljestrand's claim that he was covered by legal liability insurance provided by Farmers Insurance Group (Farmers). The trial court entered judgment declaring (1) that Farmers was not obligated to defend Tony Liljestrand in an action for personal injuries arising out of a motor vehicle collision, and (2) that Farmers did not provide liability insurance on a 1968 Ford Galaxie. The court of appeals reversed the district court and determined that Farmers provided liability insurance to Tony Liljestrand on the 1968 Ford Galaxie.

The Insurance issues are tied to a telephone call from Philip Liljestrand to Jerry Sprinkle, the Farmers agent, and the interpretation of the provisions of a Farmers automobile policy issued to Philip Liljestrand, Tony Liljestrand's father. On June 4, 1976, Philip Liljestrand renewed his automobile liability insurance coverage on a 1964 Chevrolet pickup truck. Tony Liljestrand claims that his father told the Farmers agent that the policy was being renewed because title to the pickup truck had been transferred to him. At the time that the automobile insurance policy was issued to Philip Liljestrand for the pickup truck, Tony Liljestrand was emancipated and living away from the family home. It was also stipulated that Tony Liljestrand's driver's license was suspended and that he could not lawfully operate a motor vehicle.

In July 1976, Tony Liljestrand sold the pickup truck, and acquired a 1968 Ford Galaxie from Anthony Zanghi. Thereafter, on August 13, 1976, while Tony was driving the 1968 Ford Galaxie, he collided with another vehicle, causing injuries which brought about a claim for damages, and his subsequent claim against Farmers for failing to provide him with liability insurance. The collision occurred within thirty days after Tony Liljestrand acquired the 1968 Ford Galaxie. After the collision he notified Farmers of the claim which had been made against him and asserted coverage on the theory that the automobile which he was driving was a "newly acquired automobile."

The trial court found that the Farmers agent had actual knowledge that the pickup truck was titled in the name of Tony Liljestrand. His knowledge was imputed to Farmers, and the trial court concluded that if Tony Liljestrand had been driving the pickup truck, Farmers would have been estopped to deny insurance coverage.

The trial court concluded, however, that the Farmers policy was issued in the name of Philip Liljestrand and that Tony Liljestrand was not a "named insured" in any policy issued by Farmers. The trial court's findings of fact, conclusions of law and order state:

"The policy provides coverage to only the named insured for a 'newly acquired vehicle.' A newly acquired vehicle is one which replaces the previously covered vehicle, if such change is reported to Farmers within thirty days. It could be argued that the 1968 Ford Galaxie replaced the 1964 Chevrolet pickup, but it could never successfully be argued that Philip Liljestrand, the named insured, was the owner of the 1968 Ford Galaxie.

"Therefore, the Court finds that the 1968 Ford Galaxie did not qualify as a newly acquired vehicle under the terms of the policy, and Tony Liljestrand was not insured by Farmers Insurance Group while he was driving the 1968 Ford.

"IT IS THEREFORE ORDERED that judgment enter declaring that Farmers Insurance Group is not obligated to defend Tony Liljestrand in any claim against him as a result of the accident which took place on August 13, 1976, and that Farmers Insurance Group did not provide insurance to Tony Liljestrand in connection with his driving of the 1968 Ford Galaxie."

An appeal was taken and at a preargument conference in the court of appeals, an abbreviated record was agreed to which complicates review of the issues. As the case is postured, both parties assert that the record before us is incomplete and fails to include matters which we should consider in determining the issues. At the preargument conference in the court of appeals, the parties stipulated:

(1) That the evidence supports the findings of fact made by the trial court;

(2) That the accident with the Galaxie happened within thirty days of the acquisition of the Galaxie;

(3) That Tony Liljestrand was not licensed to drive the automobile at the time the insurance policy was issued to his father or any other time prior to the accident, said license having been suspended.

The court of appeals determined that the Farmers agent deliberately caused the policy to be renewed in Philip Liljestrand's name after being advised by Philip Liljestrand that the reason for renewal was that Tony Liljestrand owned the 1964 Chevrolet pickup truck. The court of appeals concluded that Farmers was estopped to deny legal liability coverage to Tony Liljestrand because the 1968 Ford Galaxie was a newly acquired automobile under the terms of the policy. Our reversal of the court of appeals centers on the provisions of the automobile insurance policy and the findings of fact and conclusions of law of the trial court. ¹

The controlling definitions and provisions of the Farmers policy are:

"DEFINITION OF NAMED INSURED. If the named insured in Item 1 of the Declarations...