National American Ins. Co. v. Insurance Co. of North America

• Citation: 140 Cal.Rptr. 828,74 Cal.App.3d 565
• Court: California Court of Appeals Court of Appeals
• Decision Date: 23 September 1977
• Parties: NATIONAL AMERICAN INSURANCE COMPANY et al., Plaintiffs, Cross-Defendants and Respondents, v. INSURANCE COMPANY OF NORTH AMERICA, Defendant, Cross-Complainant, Cross-Defendant and Appellant, California State Automobile Association Inter-Insurance Bureau, Defendant, Cross-Complainant, Cross-Defendant and Respondent, Craig Ronald Bacharach et al., Defendants, Cross-Complainants and Respondents, Home Insurance Company et al., Cross-Complainants, Cross-Defendants and Respondents, Central Mutual Insurance Company, Cross-Defendant and Respondent. Civ. 38978.

Page 828

140 Cal.Rptr. 828

74 Cal.App.3d 565

NATIONAL AMERICAN INSURANCE COMPANY et al., Plaintiffs, Cross-Defendants and Respondents, v. INSURANCE COMPANY OF NORTH AMERICA, Defendant, Cross-Complainant, Cross-Defendant and Appellant California State Automobile Association Inter-Insurance Bureau, Defendant, Cross-Complainant, Cross-Defendant and Respondent Craig Ronald Bacharach et al., Defendants, Cross-Complainants and Respondents Home Insurance Company et al., Cross-Complainants, Cross-Defendants and Respondents Central Mutual Insurance Company, Cross-Defendant and Respondent.

Civ. 38978.

Court of Appeal, First District, Division 1, California.

Sept. 23, 1977.

Hearing Denied Nov. 30, 1977.

Barfield, Barfield, Dryden & Ruane, Robert E. Dryden, San Francisco, Michael J. Murray, Eureka, for appellant Ins. Co. of North America.

Hauerken, St. Clair, Zappettini & Hines, Edward J. McFetridge, San Francisco, for plaintiffs Nat. American Ins. Co., et al.

Staiger, Yank, Molinelli & Preston, Frank E. Preston, San Francisco, Steven Alan Beilock, Oakland, Carroll, Burdick & McDonough, San Francisco, for respondents Cal. State Auto. Ass'n etc., and Zurich Ins. Co.

Low, Ball & Lynch, Raymond Coates, San Francisco, for respondent Premier Ins. Co.

Russ, Tarkington & Daniels, Chris A. Tarkington, San Francisco, for respondent United Pacific Ins. Co.

ELKINGTON, Associate Justice.

National American Insurance Company (hereafter 'National') and Guy Kevin Perry commenced an action for declaratory relief against Insurance Company of North America (hereafter 'INA') and others, in which action several other insurance companies were later joined. INA has appealed from the judgment which was thereinafter entered. We have concluded that the appeal is without merit. Our several reasons follow.

The facts of the case are without controversy. Four teen-age boys, Perry, Bacharach, Seymour and Stalun, decided to enter upon 'an 'egging expedition', i.e., throwing eggs at residences' and other targets that presented themselves. To accomplish their purpose they bought some eggs and occupied an automobile permissibly driven by Bacharach. They 'egged' various homes and vehicles and persons, from vantage points within and without the automobile. In the course of the escapade and from the vehicle, Perry 'filpped' an egg at a pedestrian, one Nelson. The car, and thus the egg, were traveling at a speed of about 40 miles per hour at the time. Nelson was struck in an eye causing loss of sight of that organ. He thereafter commenced an action for damages against the four boys.

INA had written a policy of automobile liability insurance with limits of $300,000 on the automobile driven by Bacharach, and each of the four boys was an insured thereunder. By its policy INA promised to pay on behalf of its insured 'all sums which the insured shall become legally obligated to pay as damages because of . . . bodily injury . . . caused by an occurrence (which 'means an accident') and arising out of the . . . use . . . of any automobile, . . .'

Perry was also an insured under a homeowner's liability policy with $100,000 limits written by National. The other boys were covered by insurance policies with companies other than INA and National.

INA disclaimed any liability in relation to Nelson's injuries on the theory that the injuries and hence the liability therefor, did not arise out of the Use of the insured automobile. For that reason it also rejected the defense of the Nelson action tendered by each of the boys. Perry was defended in the action by National, and the others by their respective insurance carriers.

In Nelson's action the case was given the jury on the issue of negligence. On that theory they returned a verdict against Perry in Nelson's favor for $105,500, but found in favor of the other boys.

In the instant declaratory relief action the several insurance companies of the case sought adjudication of their respective rights and obligations in respect of the Nelson action and judgment, and the occurrence upon which they were founded. The right of Nelson to payment of his judgment was unaffected by the action; it was paid in some manner by the parties, under a stipulation that an adjustment would later be reached in accordance with the final judgment of the declaratory relief action.

In the declaratory relief action the superior court took judicial notice that the judgment in the Nelson action was based upon negligence and found, in effect, that Perry's liability thereon arose 'out of (his) use' of the automobile driven by Bacharach and insured by INA. The court thereupon entered its judgment declaring that INA was liable for the entire Nelson judgment, as well as for reimbursement to the other insurance carriers for their reasonable expenses in presenting defenses for their, and INA's, insureds. INA's instant appeal is from that judgment.

I. INA contends that its automobile liability insurance policy extended no coverage to any of the participants in the occurrence at issue.

The policy's 'Coverage C,' as relevant, provided:

'The Company will pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of . . . bodily injury . . . to which this insurance applies, caused by an occurrence and Arising out of the . . . use . . . of any automobile, and the Company shall have the right and duty to defend any suit against the Insured seeking damages on account of such bodily injury or property damage, even if any of the allegations of the suit are groundless, false or fraudulent, . . .' (Emphasis added.)

INA argues that, as a matter of law, Nelson's injury did not arise Out of the use of the automobile driven by Bacharach.

It is now established in California that the language of a Coverage clause such as is found in INA's policy, i.e., 'arising out of the . . . use . . . of the insured automobile,' has 'broad and comprehensive application, and affords coverage for injuries bearing almost Any causal relation with the vehicle.' (State Farm Mut. Auto. Ins. Co. v. Partridge, 10 Cal.3d 94, 100, 109 Cal.Rptr. 811, 815, 514 P.2d 123, 127.) Such "use" need not amount to a "proximate cause" of an accident for coverage to follow; only some 'minimal causal connection between the vehicle and an accident' is required. (Id., p. 100, fn. 7, 109 Cal.Rptr. p. 815, 514 P.2d p. 127.)

We look to the uncontroverted evidence, in determining whether there was some 'minimal causal connection' between the vehicle occupied by the four boys, and the occurrence resulting in Nelson's injury.

Bacharach testified that he and his companions would probably not have gone 'egging' without the vehicle. He said, 'I don't think we could have covered as much ground as we did without a . . . vehicle.' And Perry and discussed with the others the use of an automobile to transport themselves while 'egging'; in deciding to flip the egg at Nelson, factors considered by him were that he was 'in a traveling motor vehicle,' and that the vehicle was a means of a 'quick escape' after the egg was thrown. And most significant is the obvious inference that the principal cause of Nelson's grievous injury, in addition to such forward motion as was caused by the 'flipping' of the egg, was the approximately 40-mile-per-hour speed initially imparted to it by the automobile's forward motion.

The trial court found, among other things, that the liability incurred by Perry resulted from his 'negligent conduct' and an 'accident,' that at least in part it resulted from 'auto related' conduct, and that the 'act of Perry in flipping the egg from the moving vehicle, which struck Nelson, was a use of said vehicle.' These findings, we opine, were supported by substantial evidence. (See Green Trees Enterprises, Inc. v. Palm Springs Alpine Estates, Inc., 66 Cal.2d 782, 784--785, 59 Cal.Rptr. 141, 427 P.2d 805.) It follows that the requisite 'minimal causal connection' between the vehicle and the accident was established in the superior court.

We have considered the many out-of-state authorities relied upon by the parties, and relating to liability under similar automobile insurance policy 'coverage clauses' for injuries from objects thrown from moving vehicles. While there is unquestionably a diversity of judicial opinion, a common thread of reason will be discerned. Such a throwing, the cases appear to hold, is not Necessarily the use of an automobile; it may or may not be, according to circumstances. Where there is found a sufficient causal relationship between the throwing and consequent injury, and the ordinary use for which the vehicle was intended, such a liability will attach. But where No sufficient causal relationship appears there will be no liability. Applications of this rationale seem appropriate. In Valdes v. Smalley, Fla.App., 303 So.2d 342, following a fight between teen-age groups one of them, while using an automobile in looking for reinforcements, was pelted with rocks by the other. While the vehicle was traveling at the rate of about 40 miles per hour one of its occupants threw a beer mug at an adversary, killing him. Finding, among other things, that 'driving the auto at a high rate of speed . . . no doubt greatly contributed to the velocity of the mug,' the court concluded that 'the accident originated from and was causally connected with the use of the automobile,' and that an automobile insurance policy's coverage clause applied. An opposite result was reached in Government Employees Insurance Company v. Melton, D.C., 357 F.Supp. 416 (affd., 4 Cir., 473 F.2d 909), where in the otherwise proper use of a motor vehicle one of its occupants, in order to dispose of an empty soft drink bottle, tossed it from the car inadvertently causing injury to another. Relying upon authority holding that the basis of "decision was the presence or absence of a Proximate causal connection between the injury and the operation or use of...