Otto v. Farmers Ins. Co.

Decision Date08 August 1977
Docket NumberNo. KCD,KCD
PartiesJames Joseph OTTO, Plaintiff-Appellant, v. FARMERS INSURANCE COMPANY, Defendant-Respondent. 28240.
CourtMissouri Court of Appeals

William Brandecker, Jr., Ronald E. Smull, Brandecker & Smull, Columbia, for plaintiff-appellant.

Hamp Ford, G. Bernard Esser, III, Knight & Ford, Columbia, for defendant-respondent.



Plaintiff (hereinafter referred to as insured), under the uninsured motorist coverage of his automobile insurance policy, brought suit against defendant (hereinafter referred to as insurer) for bodily injuries sustained as the result of a vehicular collision with an uninsured motorist. The trial court sustained insurer's motion for summary judgment, and insured has appealed.

Rule 74.04(c) provides that summary judgment "shall be rendered forthwith if the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that any party is entitled to a judgment as a matter of law." On appeal, appellate courts are obliged to review the record in the light most favorable to the party against whom summary judgment was rendered and determine whether a genuine issue of fact exists. Wood v. James B. Nutter & Co., 416 S.W.2d 635, 636 (Mo.1967); O'Leary v. McCarty, 492 S.W.2d 124, 129 (Mo.App.1973); and Weber v. Les Petite Academies, Inc., 490 S.W.2d 278, 280 (Mo.App.1973).

The various pleadings, depositions, admissions and affidavits on file form a reservoir of facts which must be explored in order to determine whether summary judgment in favor of insurer properly lies in this case. As gleaned therefrom, the following facts stand undisputed. Insurer issued to insured a policy of automobile insurance (same was attached to insured's petition as an exhibit and incorporated therein by reference) with an effective date of February 12, 1971 and an expiration date of August 12, 1971. Therein, insured was the "named insured" and the "described automobile" was a 1967 Austin Healey. Liability, uninsured motorist, medical, comprehensive and collision coverage were afforded by the policy. Insured paid insurer the required premium for all coverages. On or about April 23, 1971, insured sold his 1967 Austin Healey and did not acquire a replacement automobile during the remainder of the policy period. However, insured purchased a Yamaha 250 motorcycle and, on May 7, 1971, in Columbia, Missouri, while operating said motorcycle, was involved in collision with a 1965 Pontiac operated by Wilbur Dewey, Jr. The motorcycle never became an insured motor vehicle under the policy.

Insured, absent insurer's written consent to do so, brought suit against Dewey for damages, and, on June 15, 1972, obtained a judgment against Dewey in the amount of $17,500.00 for personal injuries. Copies of the summons and petition regarding the suit against Dewey were never forwarded to insurer by insured. Believing Dewey to be an uninsured motorist, insured, within a few days after the accident, and prior to filing suit against Dewey, inquired of and was told by the agent from whom he purchased the policy of insurance that any injuries sustained in the collision with Dewey were not within the purview of the uninsured motorist coverage afforded by the policy because insured was riding and operating a motorcycle at the time. According to the agent, he informed insured, after consultation with insurer, that no coverage existed under the uninsured motorist provision of the policy. In the petition filed and served on insurer, insured pleaded that Dewey was an uninsured motorist; in its answer, insurer pleaded that it was "without knowledge or information sufficient to form a belief as to the truth" of said allegation.

Notwithstanding the undisputed facts heretofore set forth, insured contends on appeal that insurer was not entitled to summary judgment as a matter of law. As the trial court gave no hint as to the reason or basis for granting summary judgment in favor of insurer, insured on appeal addresses the purported impropriety of the trial court's doing so in the context of the four grounds advanced by insurer at the trial level. Insurer on appeal seeks to validate the summary judgment rendered in its favor on the same four grounds. The four grounds relied upon by insurer at the trial level, all of which are inversely restated as points relied upon by insured in his brief, relate to separate policy provisions, each of which will be set forth and disposed of seriately.


Part II of said policy, designated "COVERAGE C/ Benefits for Bodily Injury Caused by Uninsured Motorists", reads, in part, as follows: "To pay all sums which the owner or operator of an uninsured motor vehicle would be legally responsible to pay as damages to the insured because of bodily injury sustained by the insured, caused by accident, and arising out of the ownership, maintenance or use of said uninsured motor vehicle; provided that: (1) insurance under Coverage A ("Liability Insurance") of this policy must be in effect at the time of such accident . . . ." Insurer argues that since it stands undisputed that insured sold his 1967 Austin Healey (the "described automobile" in said policy) prior to the accident with the purported uninsured motorist and never acquired another automobile during the policy period, no "liability insurance" was or could be in effect at the time said accident occurred. Insurer summarily concludes that insured's sale of the 1967 Austin Healey, prior to the accident, coupled with the fact that insured did not acquire a replacement automobile, terminated the liability coverage. Hence, no "insurance under Coverage A" of said policy was "in effect at the time of such accident . . . ." Although insured concedes that liability coverage under the policy did not extend to his Yamaha motorcycle, he vigorously contends that liability coverage thereunder was still in effect even though inapplicable to the accident in question.

Part I of said policy, designated "COVERAGES A and B/ Liability Insurance", reads, in part, as follows: "To pay all damages the insured becomes legally obligated to pay because of: (A) bodily injury to any person, and/or (B) damage to property arising out of the ownership, maintenance or use, including loading or unloading, of the described automobile or a non-owned automobile." By the terms of the policy, liability coverage was not limited to insured's 1967 Austin Healey, the "described automobile", as it also extended to a "non-owned automobile" as defined in said policy. The proviso, supra, relied upon by insurer is cast in terms of liability coverage being "in effect at the time of the accident" not in terms of being applicable to the accident. Even though insured no longer owned the "described automobile", or a "newly acquired automobile" as defined in the policy, liability coverage, albeit limited in scope by certain prescribed policy provisions, was nevertheless still in effect at the time of the accident with the uninsured motorist in view of coverage extended to qualified "non-owned automobiles". State Farm Mut. Automobile Ins. Co. v. Western Casualty & Surety Co., 477 S.W.2d 421 (Mo. banc 1972). See also Equity Mutual Insurance Company v. Riley, 475 S.W.2d 416 (Mo.App.1971). In Freeport Motor Casualty Co. v. Tharp, 338 Ill.App. 593, 88 N.E.2d 499, 500-01 (1949), where an insurer attempted to disclaim liability coverage because the insured had previously sold and no longer owned an automobile at the time he was involved in an accident while driving an automobile owned by a third party, the court bluntly held as follows: "We find no precedent for a conclusion that the coverage afforded by the policy was terminated by the sale of the automobile by the insured . . . (and) . . . (w) e find nothing in the language of the policy which terminates the coverage . . .". The policy proviso immediately heretofore discussed afforded no basis to support the summary judgment.


Part II of said policy ("COVERAGE C Benefits for Bodily Injury Caused by Uninsured Motorists") contains the following exclusion: "This policy does not apply under Part II . . . (3) to bodily injury to an insured while occupying an automobile or 2 wheel motor vehicle (other than an insured motor vehicle) owned by a named insured or any relative resident in the same household, or through being struck by such vehicles . . . ." The uncontroverted facts disclose beyond peradventure that insured was clearly within this policy exclusion as he was riding a motorcycle which he owned which was not an insured motor vehicle at the time of the accident with the alleged uninsured motorist. Insured seeks to obviate application of the above exclusion on the ground that it impermissibly limited his uninsured motorist coverage in contravention of the public policy reflected by Section 379.203, RSMo Supp. 1973. Insurer, understandably, contends that the policy exclusion is valid and controlling and does not offend public policy.

Insurer's contention has certain initial momentum by reason of Barton v. American Family Mutual Insurance Co., 485 S.W.2d 628 (Mo.App.1972). In Barton, under facts very similar to those at hand, this court held that a substantially similar policy exclusion was valid and enforceable and denied recovery to the insured therein under his uninsured motorist coverage. A two-pronged attack was made upon the policy exclusion in Barton: (1) that it never effectively became a part of the policy in question; and (2) that it was ambiguous. The validity of the exclusionary clause vis-a-vis Section 379.203, supra, and the public policy which prompted its enactment was not in issue. For that reason, Barton v. American Family Mutual...

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