Olsen v. Moore

• Decision Date: 28 November 1972
• Docket Number: Nos. 119--123,s. 119--123
• Parties: Gordon OLSEN, Appellant, v. Thomas MOORE et al., Respondents, Bruno Janikowski et al., Defendants. Betty M. URBAN et al., Appellants, v. BADGER STATE MUTUAL CASUALTY CO., et al., Respondents, General Casualty Co. of Wisconsin, et al., Defendants, Charles Maier & Son Co., Impleaded Defendant-Respondent. Betty L. BORMANN, Individually and as Admx. of the Estate of Donald K. Bormann, Appellant, v. Thomas MOORE et al., Respondents, Bruno Janikowski et al., Defendants. Bruno JANIKOWSKI, Appellant, v. Thomas MOORE et al., Respondents. Nancy L. RAUWALD, Appellant, v. BADGER STATE MUTUAL CASUALTY CO. et al., Respondents. 1
• Court: Wisconsin Supreme Court

Page 236

202 N.W.2d 236

56 Wis.2d 340

Gordon OLSEN, Appellant, v. Thomas MOORE et al., Respondents, Bruno Janikowski et al., Defendants.

Betty M. URBAN et al., Appellants, v. BADGER STATE MUTUAL CASUALTY CO., et al., Respondents, General Casualty Co. of Wisconsin, et al., Defendants, Charles Maier & Son Co., Impleaded Defendant-Respondent.

Betty L. BORMANN, Individually and as Admx. of the Estate of Donald K. Bormann, Appellant, v. Thomas MOORE et al., Respondents, Bruno Janikowski et al., Defendants.

Bruno JANIKOWSKI, Appellant, v. Thomas MOORE et al., Respondents.

Nancy L. RAUWALD, Appellant, v. BADGER STATE MUTUAL CASUALTY CO. et al., Respondents.¹

Nos. 119--123.

Supreme Court of Wisconsin.

Nov. 28, 1972.

Ray T. McCann, Milwaukee, for Betty M. Urban, and others; Leonard L. Loel, Milwaukee, of counsel.

Dahms & Brewer, Oconomowoc, for Betty L. Bormann.

Herro, Snyder & Chapman, Oconomowoc, for Bruno Janikowski.

Gibbs, Roper & Fifield, Milwaukee, for Nancy L. Rauwald.

Borgelt, Powell, Peterson & Frauen, Milwaukee, for Thomas Moore and Badger State Mutual; Kurt H. Frauen and Richard D. Hicks, Milwaukee, of counsel.

Arnold, Murray & O'Neill, Milwaukee, for Charles Maier & Son.

WILKIE, Justice.

Two issues are raised on this appeal:

1. Was the impact between the Moore automobile and the Rauwald automobile a separate 'occurrence' from the impact between the Moore and Janikowski autos within the terms of the policy of insurance?

2. As a matter of law, was Thomas Moore acting within the scope of his employment at the time of this incident?

1. One v. two 'occurrences.' The contract of insurance issued by Badger State Mutual Casualty Company provided the following limits of liability in its declarations:

"Premiums Limits of Liability Coverages

--------- --------------------------- --------------------------

$22.50 ($10,000.00 each person Bodily injury liability

($20,000.00 each occurrence " " "

$12.50 $10,000.00 each occurrence Property damage liability"

Although the word 'occurrence' is not defined in the policy, the limits of the company's liability are elaborated upon:

'Limits of Liability. The limit of bodily injury liability stated in the declarations as applicable to 'each person' is the limit of the company's liability for all damages, including damages for care and loss of services, arising out of bodily injury sustained by one person as the result of any one occurrence; the limit of such liability stated in the declarations as applicable to 'each occurrence' is, subject to the above provision respecting each person, the total limit of the company's liability for all such damages arising out of bodily injury sustained by two or more persons as the result of any one occurrence.'

Appellants' essential position is that Thomas Moore's negligent driving resulted in two accidents or 'occurrences' rather than one. Appellants submit one occurrence or collision occurred when the Moore auto hit the Rauwald auto and another separate and distinct occurrence resulted when the Moore automobile collided with the Janikowski auto. This would result in raising Badger State Mutual's maximum exposure to $40,000.

The question of whether a collision of one automobile with two or more other automobiles constitutes one or several accidents or occurrences has not before been decided by this court. ² The problem has been dealt with in several other jurisdictions. There is a split in authority on this question which the commentators say is due to a split in the theoretical approach of viewing the problem. ³ 'An influential majority' of jurisdictions have utilized what has come to be known as the 'cause theory' approach in analyzing whether one or more accidents or occurrences have occurred. ⁴ This approach was initially adopted in this country in Hyer v. Inter-Insurance Exchange, ⁵ and is best summarized in Truck Insurance Exchange v. Rohde, ⁶ involving an auto driving on the wrong side of a highway and successively hitting, with individual 'thuds,' three motorcyclists. In Truck Insurance Exchange v. Rohde the Washington Supreme Court held only one accident or occurrence had occurred and stated:

'. . . Proximate cause is an integral part of any interpretation of the words 'accident' or 'occurrence,' as used in a contract for liability insurance which indemnifies the insured for his tortious acts. . . .

'. . . There was but one proximate, uninterrupted, and continuing cause which resulted in all of the injuries and damage. We are of the opinion that the contract contemplated that the terms, 'accident' and 'occurrence,' included all injuries or damage within the scope of the single proximate cause.. . .' ⁷

A like result also occurred in Saint Paul-Mercury Indemnity Co. v. Rutland, ⁸ wherein a truck collided with a train causing its derailment and damage to 16 railroad cars belonging to 14 different owners, their contents and the railroad company roadbed. The Fifth Circuit Court of Appeals had initially sustained the insured's contention that there were as many accidents as insureds. ⁹ After motion for reargument was granted a new panel of judges reversed the original decision and stated:

'The only limit expressed in the policy for automobile property damage liability is the disputed phrase '$5,000.00 each accident.' It can hardly be denied that when ordinary people speak of an 'accident' in the usual sense, they are referring to a single, sudden, unintentional occurrence. They normally use the word 'accident' to describe the event, no matter how many persons or things are involved.

'. . .

'. . .

'. . . we think it clear that the word 'accident' as used in the disputed phrase was intended to be construed from the point of view of the cause rather than the effect.' ¹⁰

A small number of jurisdictions subscribe to the 'effect theory' of liability. The origin of this view of the words occurrence or accident is found in an early English case, South Staffordshire Tramways Co. v. Sickness & Accident Assurance Asso. Ltd., ¹¹ wherein it was contended that each injury caused to a passenger on a tramcar which overturned constituted one accident. In this case the court stated:

'. . . If several persons were injured, I think, upon the true construction of this policy, there were several accidents.' ¹²

This holding was first adopted in this country in a decision of the Federal Court of Appeals for the Fifth Circuit, Anchor Casualty Co. v. McCaleb, ¹³ and subsequently in several other jurisdictions. ¹⁴ None of these cases involves automobile accidents. Anchor Casualty involved a blown oil well which caused eruptions intermittently over two days. Each eruption caused quantities of oil, gas distillate, sand and mud to be deposited on the property of surrounding land owners. The court of appeals held that the term 'each accident' was to be viewed from the point of view of the person whose property was injured. The court in Anchor extensively relied upon the definition of 'accident' found in Bouvier's Law Dictionary, which defines an accident as an event which "is unusual and unexpected by the person to whom it happens." ¹⁵

At least one author regards this theory as falsely premised. It is suggested in Long's treatise on liability insurance that courts must look at the policy's provision relating to the upper limits of liability ('. . . the total limit of the company's liability for all such damages arising out of bodily injury sustained by two or more persons as the result of any one occurrence .' (See page 238, supra.) According to Long, it is 'unparalleled nonsense' to assert that two or more persons might ever be injured in one accident if each injury equals one accident. ¹⁶

The issue thus before this court is whether an 'accident' or 'occurrence' in a liability insurance policy providing stated limits of liability 'per accident' or 'per occurrence,' should be viewed from the perspective of cause or effect. If viewed from the point of view of a cause, it would appear that a single, uninterrupted cause which results in a number of injuries or separate instances of property damage is yet one 'accident' or 'occurrence.' If, however, that cause is interrupted or replaced by another cause the chain of causation is broken and more than one accident or occurrence has taken place. Liberty Mutual Ins. Co. v. Rawls, ¹⁷ a case cited by appellants for their proposition that two rather than one accident occurred herein, fits into the cause theory of liability. The Fifth Circuit Court of Appeals in Rawls did find that two accidents had occurred when the insured's vehicle struck two successive automobiles. The reason two accidents occurred was due to the fact that the insured had not lost control of his vehicle after he hit the first auto. He had been traveling at a high rate of speed and was being pursued by two deputy sheriffs. After striking the first auto, the insured continued for approximately 30 to 300 feet and two to five seconds. While the insured's auto veered across the median strip and struck the second vehicle head on, the court found no evidence that the insured had ever lost control. The court noted, in concluding, that such a result could have been reached under either the cause theory or the effect theory.

The facts here are distinctly different from those in Rawls. Here Thomas Moore's vehicle struck both vehicles almost instantaneously. Witness Robert Perlick testified that he was in a car approximately six car lengths behind the Rauwald and Janikowski automobiles. He testified to the effect that the Moore auto crossed over the median strip, over the left lane and struck the first auto in the right lane; that the Rauwald auto was thrown into the ditch and the Moore car was deflected into the high-speed lane where it collided with the second (Janikowski) auto. On cross-examination Perlick testified that the collisions occurred almost instantaneously. According to Perlick, the whole incident occurred in less than a...