Nationwide Mut. Ins. Co. v. Mast

• Decision Date: 28 July 1959
• Citation: 52 Del. 127,2 Storey 127,153 A.2d 893
• Parties: , 52 Del. 127 NATIONWIDE MUTUAL INSURANCE COMPANY, Plaintiff, v. Lawrence MAST and Amon Miller, Henry Miller and Irvin Miller, doing business as Miller Brothers of Harrington, Delaware, and Benjamin Stanford, Defendants.
• Court: Delaware Superior Court

Page 893

153 A.2d 893

2 Storey 127, 52 Del. 127

NATIONWIDE MUTUAL INSURANCE COMPANY, Plaintiff, v. Lawrence MAST and Amon Miller, Henry Miller and Irvin Miller, doing business as Miller Brothers of Harrington, Delaware, and Benjamin Stanford, Defendants.

Superior Court of Delaware, New Castle County.

July 28, 1959.

James L. Latchum and C. W. Berl, Jr. (of Berl, Potter & Anderson), Wilmington, for plaintiff.

Jackson Raysor (of Tunnell & Raysor), Georgetown, for defendants Lawrence Mast and Miller Brothers.

Edmund N. Carpenter, II (of Richards, Layton & Finger), Wilmington, for defendant Benjamin Stanford.

CHRISTIE, Judge.

The pertinent facts giving rise to this action are undisputed.

On June 18, 1957, Nationwide Mutual Insurance Company entered into an automobile liability policy, being Policy No. 52-592-783, with Lawrence Mast to cover a 1955 Ford Stake Body Truck then owned by Mast.

The policy contained a bodily injury coverage clause which read as follows:

'Coverage F--Bodily Injury Liability--(automobile) To pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of bodily injury, sickness or disease, including death at any time resulting therefrom, sustained by any person, caused by accident and arising out of the ownership, maintenance or use of the automobile.'

Insuring Agreement V(a)(4) of the policy provided:

'Newly Acquired Automobile--an automobile, ownership of which is acquired by the Named Insured or his spouse if a resident of the same household, if (i) it replaces an automobile owned by either and covered by this policy, or the company insures all automobiles owned by the Named Insured and such spouse on the date of its delivery, and (ii) the Named Insured or such spouse notifies the company within thirty days following such delivery date; but such notice is not required under coverages E, F and division 1 of coverage G if the newly acquired automobile replaces an owned automobile covered by this policy * * *'

The policy also contained an exclusion stated in the following words:

'Exclusions--Automobile--This Policy Does Not Apply:--(c) under coverages E and F, while the automobile is used for the towing of any trailer owned or hired by the Insured and not covered by like insurance in this company; or while any trailer covered by this policy is used with any automobile owned or hired by the Insured and not covered by like insurance in the Company * * *'

On or about July 24, 1957, Mast acquired ownership and possession of a 1946 Kentucky flat bed trailer.

On September 11, 1957, Mast acquired ownership and possession of a 1949 G.M.C. truck tractor.

Mast retained ownership and possession of the Ford Stake Body, the Kentucky trailer and the G.M.C. Tractor until October 20, 1957, when he delivered the Ford Stake Body to Simpson Ford, Inc. of Harrington, Delaware for repossession by Maryland Credit, of Easton, Maryland, under a conditional sales contract.

On October 28, 1957, Mast was engaged by Miller Brothers of Harrington, Delaware, to do a hauling job. He drove his G.M.C. Tractor and Kentucky Trailer to the Millers' plant in Harrington where the trailer was loaded with switch ties for delivery to Koppers Company, Inc., in Newport, Delaware. Mast drove the ties to Newport, and as they were being unloaded by Benjamin Stanford, an employee of Koppers, and others, some of the ties fell and injured Stanford.

Stanford commenced a suit in the Superior Court for New Castle County (C.A. No. 479, 1958) on April 30, 1958, against Millers and Mast for personal injuries arising from the accident above mentioned. Nationwide entered an appearance for Mast in that suit, under reservation of right.

On October 29, 1957, Mast for the first time notified Nationwide of the acquisition and ownership of the G.M.C. Tractor and the Kentucky Trailer and asked Nationwide to transfer the coverage of the existing policy (No. 52-592-783) from the Ford Stake Body Truck to the said tractor and trailer. Favoring Mast's request, Nationwide, that same day, cancelled Policy No. 52-592-783 and issued Policy No. 52-592-889, covering the G.M.C. Tractor and the Kentucky Trailer.

Subsequently, on August 26, 1958, Nationwide brought this action for a declaratory judgment, seeking an adjudication that it is not under any obligation to defend Mast or to pay any damages recovered against him.

The central issue in this case is whether the tractor-trailer rig involved in the accident was a replacement for the insured vehicle within the meaning of clause V(a)(4)(i) of the insurance policy.

'Replace' is thus defined:

'3 * * * b. To provide or produce a substitute or equivalent in place of (a person or thing) * * *' II Shorter Oxford English Dictionary 1706 (3rd Ed. Reprint 1947).

There is no evidence that the word 'replacement' has a meaning peculiar to the insurance field, or that the parties intended any different meaning, so the ordinary meaning must govern.

A clear case of replacement occurs when an old vehicle is disposed of, and a new vehicle of equivalent use is substituted. The problem here narrows to the effect of temporary retention of the old vehicle, after the new vehicle has been procured.

5A Am.Jur., Automobile Insurance, § 85, p. 83, speaks as follows on the point:

'One of the primary questions to be...