New York Cas. Co. v. Lewellen

• Decision Date: 30 October 1950
• Docket Number: No. 14156.,14156.
• Parties: NEW YORK CAS. CO. v. LEWELLEN et al.
• Court: U.S. Court of Appeals — Eighth Circuit

184 F.2d 891 (1950)

NEW YORK CAS. CO. v. LEWELLEN et al.

No. 14156.

United States Court of Appeals Eighth Circuit.

October 30, 1950.

Robert A. Brown, Jr., St. Joseph, Mo. (Brown, Douglas & Brown, St. Joseph, Mo., on the brief), for appellant.

Lewis F. Randolph, St. Joseph, Mo. (Price Shoemaker, St. Joseph, Mo., on the brief), for appellee, Richard Stallard.

Before GARDNER, Chief Judge, and WOODROUGH and RIDDICK, Circuit Judges.

RIDDICK, Circuit Judge.

The appellant, New York Casualty Company, issued its policy of automobile liability insurance to one John I. Sutton as the named insured, in which it agreed under Coverages A and B to pay on behalf of the insured all sums which the insured should become obligated to pay by reason of liability imposed by law for damage for bodily injuries caused by accident arising out of the ownership, maintenance, or operation of a certain Studebaker truck, and to defend any action against insured asserting such liability, the limit of appellant's liability under Coverage A being $15,000 and under Coverage B, $5,000.

The policy of insurance contained the usual omnibus clause: "The unqualified word `insured' wherever used in coverages A and B * * * includes the named insured and * * * also includes any person while using the automobile and any person or organization legally responsible for the use thereof, provided the actual use of the automobile is with the permission of the named insured. * * *"

With respect to Coverages A and B the policy provides: (1) that any person who had secured a judgment in an action against the insured should be entitled to recover under the policy to the extent of the insurance afforded by it; and (2) that the insurance afforded by the policy should comply with the provisions of the motor vehicle financial responsibility law of any State applicable thereto to the extent of the coverage and limits of liability required by such law. The policy of insurance is a Missouri contract. The Motor Vehicle Safety Responsibility Act of Missouri provides that all policies of automobile liability insurance issued pursuant to the Act shall "insure the person named therein and any other person using or responsible for the use of said motor vehicle * * * with the express or implied permission of said insured." 18 Mo.R.S.A. § 8470.29.

While the policy was in force a collision occurred between the Studebaker truck driven by Lewellen, an employee of the named insured, and another motor vehicle driven by Stallard. Stallard brought an action in a Missouri State Court against the named insured and Lewellen to recover $25,000 for injuries sustained by him in the collision.

Appellant brought this action in the Federal District Court against Lewellen and Stallard under the Declaratory Judgment Act, 28 U.S.C.A. § 2201. Appellant alleged that at the time of the collision Lewellen was not driving the truck covered by the policy of insurance with the permission or with the knowledge or consent of the named insured, Sutton, and that it was not obligated to defend the action brought by Stallard against Lewellen or to pay any judgment in the action in favor of Stallard and against Lewellen. It asked a declaration to that effect, alleging an actual existing controversy between appellant and each of the defendants in the action, Lewellen and Stallard, because of Lewellen's demand that appellant defend the action against him and pay any judgment which Stallard might recover in it.

Lewellen did not answer the complaint nor appear in the action as a party. Stallard answered, admitting the issuance and terms of the policy as alleged, and asserting that at the time of the collision involved in the action in the State court against Lewellen the Studebaker covered by the policy was being operated by Lewellen with the consent and permission of the named insured, and that Lewellen was covered by the policy. On trial in the District Court without a jury the court found that Lewellen at the time of the collision was driving the Studebaker truck with the named insured's consent. This appeal is from the judgment of the District Court denying appellant's petition for the requested declaration.

We conclude that the pleadings were sufficient to show an actual controversy between appellant and both Lewellen and Stallard within the jurisdiction of the District Court. Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 U.S. 270, 273, 274, 61 S.Ct. 510, 85 L.Ed. 826; Columbian Nat. Life Ins. Co. v. Foulke, 8 Cir., 89 F.2d 261; U. S. Fidelity & Guaranty Co. v. Pierson, 8 Cir., 97 F.2d 560; Western Casualty & Surety Co. v. Beverforden, 8 Cir., 93...