Pacific Automobile Ins. Co. v. Commercial Casualty Ins. Co. of New York

• Court: Utah Supreme Court
• Writing for the Court: Larson, Chief Justice.
• Citation: Pacific Automobile Ins. Co. v. Commercial Casualty Ins. Co. of New York, 108 Utah 500, 161 P.2d 423 (Utah 1945)
• Decision Date: 06 August 1945
• Docket Number: 6826
• Parties: PACIFIC AUTOMOBILE INS. CO. v. COMMERCIAL CASUALTY INS. CO. OF NEW YORK

161 P.2d 423

108 Utah 500

PACIFIC AUTOMOBILE INS. CO. v. COMMERCIAL CASUALTY INS. CO. OF NEW YORK

No. 6826

Supreme Court of Utah

August 6, 1945

Appeal from District Court, Third District, Salt Lake County; C. E Henderson, Judge.

Action by Pacific Automobile Insurance Company against Commercial Casualty Insurance Company of New York to recover amount of claim for personal injuries against the Fisher Brewing Company, which was insured by both plaintiff and defendant and paid by plaintiff. Judgment for plaintiff, and defendant appeals.

Reversed.

Irvine Skeen & Thurman, of Salt Lake City, for appellant.

Zar E Hayes and Arthur H. Nielsen, both of Salt Lake City, for respondent.

Larson, Chief Justice. McDonough, Turner, and Wade, JJ., concur. Wolfe, Justice (concurring).

OPINION

Larson, Chief Justice.

The facts agreed to by the parties are as follows: The Fisher Brewing Company had a policy of insurance with plaintiff to protect it against liabilities imposed upon it by law for damages sustained on account of the acts of its employees arising out of the ownership or use, including the loading and unloading of the trucks of insured. The Brewing Company also had a policy of insurance with defendant to protect it against liabilities imposed by law except liabilities arising out of the ownership or use or the loading or unloading of the trucks.

At the time of the accident in question, employees of the Brewing Company were delivering beer to a restaurant. They parked at the curb, took the kegs of beer off of the truck and placed them on the sidewalk. One of the employees then went in through the building and opened a manhole or trap door in the sidewalk, through which the kegs of beer were lowered into the basement of the building by means of an elevator. While the beer kegs were being taken into the basement, one Dayton, a blind man, walking along the sidewalk, fell into the open manhole. Plaintiff paid Dayton's claim against the Brewing Company and then filed suit against the defendant to recover the sum so paid. Judgment in the district court was in favor of plaintiff. Defendant appeals. The question for determination is: Under the policies of insurance here involved, was the lowering of the kegs into the basement a part of the process of unloading the truck?

Defendant argues that the accident occurred during the unloading of the truck and therefore could not be covered by the provisions of its policy. The so-called "loading and unloading" clauses in insurance contracts have been frequently considered and construed by the courts and various rules have been stated. Practically all authorities are agreed that in such insurance contracts the phrase "including loading and unloading" is a phrase of extension. It expands the expression "the use of the truck" somewhat beyond its connotation otherwise so as to bring within the policy some acts in which the truck does not itself play any part. It deals with a period when the truck itself is at rest, but the goods are being moved onto or off the truck. American Oil & Supply Co. v. United States Casualty Co., 18 A.2d 257, 19 N. J. Misc. 7. So, too, in policies insuring only actual operation, a phrase "excepting therefrom loading and unloading" is a phrase of limitation, and serves the purpose of apprising the parties that the word "use" in such policy is to be held to a narrow construction so it will not be construed to cover liabilities from acts in which the truck was not directly connected with the process from which the accident resulted. Stammer v. Kitzmiller, 226 Wis. 348, 276 N.W. 629. Other courts have held that policies covering the "ownership, maintenance, operation and use" of trucks, but in which policy there was no reference to "loading" or "unloading" should be so construed that the word "use" would include and cover loading and unloading operations. Luchte v. State Automobile Mutual Ins. Co., 50 Ohio App. 5, 197 N.E. 421; Panhandle Steel Products Co. v. Fidelity Union Cas. Co., Tex. Civ. App., 23 S.W.2d 799. A study of the cases reveals that courts have used various rules or stated various tests in determining the situations or territory to be covered by "loading and unloading" clauses.

Some courts apply the "coming to rest" rule or doctrine. Briefly stated, that rule is that "unloading" includes the process of removing or lifting the article from the truck up to the point where the article is first set down or ceases in the movement which took it from the truck. This doctrine is well stated in Stammer v. Kitzmiller, supra, a case very similiar to the one at bar. There the employees had finished putting the beer into the purchaser's basement and were having the sales slip signed by the purchaser at the time the party injured fell into the unguarded manhole. Under two policies of insurance similar to the ones here involved, the question arose. Speaking of the loading and unloading clause, the court said [226 Wis. 348, 276 N.W. 629, 631]:

"* * * [it] does not carry the liability of the insurer beyond what may be described as the natural territorial limits of an automobile and the process of loading and unloading it. When the goods have been taken off the automobile and have actually come to rest, when the automobile itself is no longer connected with the process of unloading, and when the material which has been unloaded from the automobile has plainly started on its course to be delivered by other power and forces independent of the automobile and the actual method of unloading, the automobile then may be said to be no longer in use. * * * where, as here, the merchandise had been removed from the truck and considerable time had elapsed after anything was done which could reasonably be said to be connected with the actual unloading, there is no difficulty in limiting the responsibility of the insurer who covers loading and unloading operations. * * * While the open hatchway may have been a convenience in the process of further delivery of the goods, it was not, under the facts with which we are dealing, included in the process of unloading the truck. * * *" (Italics and bracket added.)

By the same process of reasoning, "loading" would cover only the operation from the ground, platform or hand truck or dolly onto the truck after the goods had been brought to the truck, and arranging the goods in the truck.

Some cases applying this doctrine have expressed the view that the terms "loading" and "unloading" are not to be limited or controlled by place or distance but by the fact of a continuous and uninterrupted movement of the articles in getting them onto or off from the truck. Under this view "loading" covers the period of time and events beginning when the articles are started in movement which movement is not interrupted or broken by rest or pauses until the articles are placed in or on the truck. So, too, under these cases "unloading" includes all events commencing when the articles are started in movement to take them from the truck and ending the first time such movement stops, or is interrupted by the articles being brought to a stationary position. A case so applying the doctrine of what we may call the continuous passage or movement rule is St. Paul Mercury Indemnity Co. v. Standard Accident Ins. Co., 216 Minn. 103, 11 N.W.2d 794, 796. In that case furniture was being moved from one building to another, three crews of men being used. One crew moved the furniture out and placed it upon the truck, another packed it in the truck and at destination unpacked and moved it to the tail-gate of the truck, and a third crew took the furniture from the truck, placed it on the sidewalk and then carried it from the truck up a ramp into the building. The injury occurred through a defect in the ramp. The Court said:

"The 'use' of an automobile ceases when the goods have been removed therefrom and * * * subsequent handling and transportation constitute ordinary delivery to the customer in the course of the insured's business. * * * Our conclusion is that the goods were unloaded in the instant case when they were removed from the truck and placed upon the sidewalk and that unloading did not include the subsequent handling and transportation of the same from the sidewalk into the building. * * *"

A similar holding was given in Jackson Floor Covering, Inc. v. Maryland Cas. Co., 117 N. J. L. 401, 189 A. 84, wherein it was said that an automobile policy did not cover transportation of goods after removal from the insured vehicle to complete delivery thereof to the customer either by manual carriage by the driver, either along or with the aid of a helper, or by use of some other kind of conveyance, such as a hand truck.

Other courts have adopted what may be called the complete operation rule. Tersely, this includes as "loading" or "unloading" the entire process involved in the movement of the articles from the place where insured's employees find the articles which are to be moved by truck, to the place where the employees of insured turn them over to the party to whom they are to make delivery. This rule is well stated by the Montana court in State v. District Court, 110 Mont. 250, 100 P.2d 932, 934, a case differing from the instant one only in the fact that the person injured was standing on the door of the manhole when it was raised. The court said:

"We hold that under the facts here presented the unloading of the truck was a continuous operation from the time the truck came to a stop and the transportation ceased until the barrel of beer was delivered to the customer. The unloading of the truck cannot be said to have been accomplished when the barrel of beer was placed upon the sidewalk. As well might it be argued that the loading of the truck...