National Indem. Co. v. Liberty Mut. Ins. Co.

• Decision Date: 22 July 1974
• Docket Number: No. 57643,No. 2,57643,2
• Citation: 513 S.W.2d 461
• Parties: NATIONAL INDEMNITY COMPANY, a corporation, Plaintiff-Respondent, v. LIBERTY MUTUAL INSURANCE COMPANY, a corporation, Defendant-Respondent, Commercial Union Insurance Company of New York et al., Defendants-Appellants
• Court: Missouri Supreme Court

Page 461

513 S.W.2d 461

NATIONAL INDEMNITY COMPANY, a corporation, Plaintiff-Respondent, v. LIBERTY MUTUAL INSURANCE COMPANY, a corporation, Defendant-Respondent Commercial Union Insurance Company of New York et al Defendants-Appellants.

No. 57643.

Supreme Court of Missouri, Division No. 2.

July 22, 1974.

Motion for Rehearing or to Transfer to Court En Banc Denied

Sept. 9, 1974.

Gray, Friedman & Ritter, Charles E. Gray, St. Louis, for plaintiff-respondent.

Hocker, Goodwin, Koenig, Gibbons & Fehlig, John M. Goodwin, Edward K. Fehlig, St. Louis, for respondent Liberty Mutual Insurance Company.

Evans & Dixon, Eugene K. Buckley, St. Louis, for appellants Commercial Union Ins. Co. of New York and R. H. Mooney and Associates, Inc.

Cox & Moffitt, William A. Moffitt, Jr., John B. Busch, St. Louis, for said defendants-appellants.

FINCH, Judge.

This is a declaratory judgment action seeking a determination as to which, if any, of several insurance policies provide coverage for Elmer C. Rinderknecht and R. H. Mooney and Associates, Inc. in connection with a suit seeking damages of $90,000 filed by defendants Wilbert J. and Alvera R. Thomassen. The amount in controversy is $90,000, the amount sued for by the Thomassens. Travelers Indemnity Co. v. Bohn, 460 S.W.2d 642 (Mo.1970). We have jurisdiction based on the amount involved since this appeal was taken prior to January 1, 1972. Sec. 477.040 ¹; Mo. Const., Art. V, §§ 3, 31(4), V.A.M.S.

The Thomassens' suit rose out of a collision on July 12, 1968 between the Thomassen vehicle and a 1964 Chevrolet operated by Rinderknecht, a salaried insurance claims adjustor of Mooney, while he was on business for that company. The trial court held that none of the three insurance companies provide liability coverage for Rinderknecht applicable to the Thomassens' suit and that only Commercial Union Insurance Company of New York (Commercial Union) has coverage for Mooney. We affirm that holding except that we conclude that National Indemnity also covers Mooney. For that reason we reverse and remand for entry of a new judgment.

Critical to resolution of the matter of coverage is the determination of whether Rinderknecht was owner of the 1964 Chevrolet which he was operating at the time of the accident. The trial court held that he was the owner but that determination is attacked on appeal. We first consider that issue.

The Chevrolet came into Rinderknecht's possession on May 13, 1968 when he and his minor son Lawrence went to Valley Ford Sales, Inc. (Valley Ford) to purchase and automobile. The car was for use of Lawrence but since he was a minor, Rinderknecht accompanied him for the expressed purpose of executing all necessary documents. In addition, whereas Rinderknecht previously had worked for an employer where he used a company car, Mooney required that he furnish his own transportation. He had been using Larry's Ford automobile in his new job and since the Ford was being traded in on the new purchase, it was Rinderknecht's intention to use it in his new employment with Mooney until such time as he acquired an automobile for his own use.

It was Rinderknecht's plan to finance the balance of the purchase price after receiving credit for the Ford which was traded in on the purchase. Accordingly, he signed a retail installment sales contract and security agreement, which provided for a purchase price, including time price differential, of $2,048 which was to be paid in 30 monthly installments of $68.28 each.

Rinderknecht testified that on May 13, 1968 he signed several papers including the installment sales contract but that he did not remember signing an original application for title. He also testified that he did not receive or see the assigned title certificate to the 1964 Chevrolet. However, there was evidence indicating that the title certificate was assigned and that Rinderknecht signed various copies of an application for title because the transcript discloses that on May 16, Florissant Loan & Finance Company (Florissant Loan), which purchased the Rinderknecht contract from Valley Ford, received from Valley Ford a signed copy of the installment sales contract, the duly signed and notarized title certificate and two executed duplicate copies of an application for title signed by Rinderknecht. On that same day Florissant Loan paid the balance of the sales price to Valley Ford. It then forwarded the endorsed certificate of title, the security agreement and the lienholder's copy of application for title to the department of revenue in order to perfect its lien on the Chevrolet. Subsequently, on June 11, 1968 Florissant Loan received notice of perfection of its lien.

Around July 28, 1968 Rinderknecht received a letter from the department of revenue informing him that the original of his application for title to the 1964 Chevrolet had not been received and that until it was received, no new certificate in his name could be issued. A photostatic of the copy of the application on file in the motor vehicle office was shown on that communication. Rinderknecht testified that he and his son then made various calls to Valley Ford seeking the original application for title, but that it was not received from Valley Ford until September when he went by and picked it up. He then forwarded it and the sales tax to the department of revenue and thereafter a new title certificate to the Chevrolet was received from the department.

On the basis of the foregoing evidence, the trial court made findings of fact in which it recited that it found that Rinderknecht purchased the 1964 Chevrolet from Valley Ford pursuant to an installment sales contract; that financing of that contract was arranged by Valley Ford through Florissant Loan on the date of sale with the knowledge and consent of Rinderknecht; that Rinderknecht at the time of the purchase signed an installment contract and an application for title; that at said time Valley Ford endorsed and notarized the title certificate to the 1964 Chevrolet with the name of Elmer C. Rinderknecht shown as assignee; and that Valley Ford then delivered to Florissant Loan the assigned title certificate, a copy of the installment sales contract and two duplicate signed copies of the application for title to be used by the lienholder to secure its lien. The court found that within a few days after receiving the papers from Valley Ford, Florissant Loan paid the balance of the purchase price to Valley Ford and then forwarded the endorsed certificate of title, the security agreement and the lienholder's copy for application for title to the motor vehicle department and had its lien perfected. The court held that Valley Ford had complied substantially with § 301.210 ² by endorsing the certificate of title to Rinderknecht, notarizing the same and, with the knowledge and consent of Rinderknecht, delivering it for financing purposes to Florissant Loan. The court concluded that the subsequent failure of Rinderknecht to file an application for title and to pay the requisite sales tax in order to obtain a new certificate of title did not affect the transfer of ownership from Valley Ford to Rinderknecht and, hence, that on or after May 13, 1968 the 1964 Chevrolet was owned by Rinderknecht.

Section 301.210, the statute which governs the sale and transfer of motor vehicles, had been strictly construed and enforced by the courts of Missouri. This court has held that unless the previously issued certificate of title is properly assigned and acknowledged by the seller and delivered to the buyer, the attempted sale of a used car passes no title even though accompanied by full payment and delivery of physical possession of the automobile to the purchaser. State Farm Mutual Automobile Insurance Co. v. MFA Mutual Insurance Co., 485 S.W.2d 397 (Mo.banc 1972).

In this case there is no real question but that on May 13, 1968 Valley Ford, the dealer, signed and acknowledged at the appropriate place an assignment of the Chevrolet title certificate to Rinderknecht. Rather, appellants say that there was no delivery of that certificate to Rinderknecht and hence there was no passage of title. The evidence shows that instead of physically delivering the assigned certificate to Rinderknecht Valley Ford delivered it (along with a copy of the installment sales contract and copies of an application for title signed by Rinderknecht) to Florissant Loan, the company which was financing the purchase. The question presented is whether such delivery constitutes a sufficient compliance with the requirements of § 301.210.

We conclude that the trial court was correct in holding that what occurred constituted a sufficient delivery to comply with the provisions of § 301.210 and that as a result Rinderknecht did become owner of the 1964 Chevrolet. We do so because § 301.620 ³ provides that if the owner (in this case the purchaser) creates a lien on his automobile, he immediately shall cause the certificate of title (as well as an application to show the lien thereon) to be delivered to the lienholder which then shall forward same to the director of revenue. In this case, if the assigned title certificate had been handed physically to Rinderknecht by Valley Ford, it would have been Rinderknecht's obligation forthwith to deliver same to Florissant Loan. What occurred, as summarized in the paragraphs following, shows that the objectives of §§ 301.210 and 301.620 were accomplished.

The evidence shows that Valley Ford assigned the title certificate to Rinderknecht, acknowledged that assignment and then mailed the assigned title certificate along with other necessary papers to Florissant Loan so as to enable it to perfect the lien on the automobile as against Rinderknecht as owner. It is clear from the evidence that Rinderknecht and his son went to Valley Ford with a specific intent to purchase a motor vehicle for the son and to borrow money to accomplish that result. Since Rinderknecht had...