Old Colony Insurance Company v. Anderson

• Decision Date: 11 June 1957
• Docket Number: No. 5552.,5552.
• Parties: OLD COLONY INSURANCE COMPANY, Appellant, v. W. R. ANDERSON, d/b/a Duke Anderson Drilling Company, Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

246 F.2d 102 (1957)

OLD COLONY INSURANCE COMPANY, Appellant, v. W. R. ANDERSON, d/b/a Duke Anderson Drilling Company, Appellee.

No. 5552.

United States Court of Appeals Tenth Circuit.

June 11, 1957.

Clarence P. Green, Oklahoma City, Okl. (Walter D. Hanson, Oklahoma City, Okl., was with him on the brief), for appellant.

Gus Rinehart, Oklahoma City, Okl., for appellee.

Before BRATTON, Chief Judge, and HUXMAN and MURRAH, Circuit Judges.

MURRAH, Circuit Judge.

This appeal involves coverage for damages to appellee's drilling unit under appellant's "Scheduled Property Floater Policy" insuring the appellee against, among other things, "direct loss of and/or damages to" the drilling unit "by: (f) collision, derailment or overturning of land conveyances while the insured property is being transported thereon on land."

The undisputed facts are that while the insured drilling unit was being transported on a truck, and the truck was checking its speed on a curve, the boom chains broke, causing the unit to slide off the truck and onto the ground where it struck or collided with another truck on the roadside. The truck did not collide with any object, nor did it overturn. Indeed, the only collision was that of the drilling unit with the ground and the parked truck on the roadside after it had left the truck on which it was being transported.

Upon a consideration of these facts, the trial court held that "The damage to the plaintiff's drilling rig was the result of a collision within the meaning of the policy"; and that the policy "therefore, covered the loss sustained by the plaintiff." This appeal is from a judgment for the insured, appellee.

The court's conclusions are based on the concept that the policy was "intended to and did insure plaintiff's drilling equipment against damage by collision while in transit on a land conveyance." Otherwise stated, the contract was intended to provide coverage for damages to cargo caused by collision, whether the means of conveyance was involved or not.

Considered apart from the promptings of the trial court, and the cases which seem to support its interpretative reasoning, we should have no difficulty construing the insuring clause as not assuming the peril which caused the loss. For, to us, the insuring language of the policy unambiguously assumes the risk of loss or damages to the drilling unit caused by a collision of the truck upon which it was being transported when the loss occurred, and does not assume the risk of damage caused by the collision or overturning of the cargo alone. Doubt comes only with contrariety in the cases.

The first case which seems to support the trial court's reasoning is Wheeler v. Globe & Rutgers Fire Ins. Co., 125 S.C. 320, 118 S.E. 609, 611. There, the policy insured cargo against damage "While being transported by any conveyance by land or water — stranding, sinking, collision, burning or derailment of such conveyance." While the driver of the insured automobile was attempting to board a ferry boat for the purpose of being transported across the river, the automobile in some way fell from the ferry and sank. The court thought the words of coverage ambiguous, and resolving the ambiguity in favor of the insured, held in effect that the true intent and meaning of the policy was to provide coverage for damages to the cargo while it was being transported; and that the words, "stranding, sinking, collision, burning or derailment of such conveyance" were only enumerations of the manner or the means by which the loss could occur. In a subsequent case (Johnson v. Glens Falls Ins. Co., 131 S.C. 253, 127 S.E. 14, 15, 40 A.L.R. 993), the same court, considering the identical insuring clause, arrived at a diametrically different conclusion under only somewhat slightly different facts. There, while the insured automobile was being transported by ferry across the river, it suddenly moved forward under its own power and plunged into the river. The writer of the majority opinion in the latter case (who dissented in the former) thought the policy "plainly and without the slightest ambiguity" showed "that the perils insured against were the stranding, sinking, collision, burning, or derailment of the conveyance in which the automobile was being transported at the time of the injury"; that "The conveyance was a ferry boat; the evidence shows that the ferry boat was not stranded; it...