Pacific Indem. Co. v. Truck Ins. Exchange

• Citation: 269 Cal.App.2d 420,74 Cal.Rptr. 793
• Court: California Court of Appeals
• Decision Date: 05 February 1969
• Parties: PACIFIC INDEMNITY COMPANY, a corporation, et al., Plaintiffs and Appellants, v. TRUCK INSURANCE EXCHANGE and Elmer R. Beard, Defendants and Respondents. Civ. 23762.

Page 793

74 Cal.Rptr. 793

269 Cal.App.2d 420

PACIFIC INDEMNITY COMPANY, a corporation, et al., Plaintiffs and Appellants, v. TRUCK INSURANCE EXCHANGE and Elmer R. Beard, Defendants and Respondents.

Civ. 23762.

Court of Appeal, First District, Division 4, California.

Feb. 5, 1969.

Maloney, Chase, Fisher & Hurst, John R. Maloney, Charles Negley, San Francisco, for appellants.

Clark, Heafey & Martin, Chris G. Gasparich, Oakland, for respondents.

DEVINE, Presiding Justice.

This appeal is one of the many contests, now familiar to the courts, between insurance companies concerning liability arising from an accident in the loading of a vehicle.

Facts

The parties signed an agreed statement of facts. The owner of a logging truck and trailer, Elmer R. Beard, drove his truck and trailer to the premises of the R. C. Miller Logging Company, a co-partnership. Earl and Esther Brittain were the copartners. With the permission of Beard, logs were loaded on the truck and trailer by employees of the logging company named Luton, Winkler and Roden. While Beard was tightening the binder chain for the purpose of securing the logs, the peaker log rolled off, struck and injured Beard.

Beard brought an action against the Brittains, Luton, Winkler and Roden. These persons, who were defendants in Beard's personal injury action, are plaintiffs with Pacific Indemnity Company in the present cause. Pacific Indemnity had issued to the Brittains, doing business as the logging company, a comprehensive liability policy in the amount of $250,000 for damages because of bodily injury sustained by any person on their premises or arising out of the use of a nonowned vehicle (such as the Beard owned truck). The policy, however, did not afford any coverage to Luton, Winkler or Roden for any liability on their part.

Defendant Truck Insurance Exchange had issued to defendant Beard in California a motor vehicle liability policy in the amount of $100,000 for damages because of bodily injury sustained by any person, caused by accident and arising out of the ownership, maintenance or use of Beard's truck and trailer.

Plaintiff Pacific Indemnity Company gave notice to defendant Truck of the accident and injury to Beard and claimed coverage of the individual plaintiffs, the Brittains, Luton, Winkler and Roden, under Truck's policy with respect to any liability to Beard and defense of any lawsuit brought by him. Truck undertook an investigation of the occurrence.

Following the filing of the action by Beard, plaintiffs tendered to defendant Truck the defense of the action and made demand upon Truck that it assume their defense and acknowledge an obligation under its policy to indemnify them against any liability they might have to defendant Beard, subject to the $100,000 monetary limit of such policy. Truck rejected the tender and demand, and denied that coverage under its policy extended to the plaintiffs Brittain, Luton, Winkler and Roden. Plaintiff Pacific Indemnity undertook the defense of its named insureds, Earl and Esther Brittain, and also provided a courtesy defense to plaintiffs Luton, Winkler and Roden under a reservation of rights.

Since this action became at issue, the negligence action brought by Beard was settled out of court for $8,000, which was paid to Beard by plaintiff Pacific Indemnity on behalf of plaintiffs Earl and Esther Brittain. Pacific Indemnity also paid the sum of $1,338.82 as expenses in investigating and defending the Beard action. The amounts are admitted to be reasonable.

Nature of the Case and Its Disposition by the Trial Court

The present suit is for declaratory judgment. The trial court decided that the two policies, Pacific Indemnity's and Truck Insurance Exchange's, purport to be excess insurance each over the other; that the excess clauses are repugnant to each other and must be deemed to provide pro rata insurance against the loss. Pacific Indemnity, therefore, is obliged by the judgment to pay 250/350ths of the $8,000 and Truck Insurance Exchange, 100/350ths thereof. A like disposition was made of the expenses and various calculations, and awards of interest were made.

The Appeal

Pacific Indemnity Company, the Brittains and their three employees appeal, but of course, the party on the plaintiffs side really interested is Pacific Indemnity. It is Pacific's contention that the entire amount of the loss and expenses should be borne by Truck Insurance. Truck concedes that although its policy does not specify 'loading,' the words 'use of the vehicle' include loading operations; that the injury to Beard falls within the terms of its policy; and that the employees of the Brittains are additional insureds under the Truck Insurance policy. These concessions simply accord with well-defined law. (Campidonica v. Transport Indemnity Co., 217 Cal.App.2d 403, 406--407, 31 Cal.Rptr. 735.) Truck Insurance contends that the law justifies the prorating

which was done by the trial judge.

Whether Liability of the Logging Company (The Brittains) Was Vicarious or Direct

It is important to determine whether the allegations of Beard's complaint in the personal injury action charge facts which, if proved, would impose liability on the Brittains under the doctrine of respondeat superior, or whether they also charge a direct liability on the part of the Brittains for negligence of their own because, as will be explained more fully below, the distinction has to do with the insurance coverage.

We conclude that the charges of negligence made against the Brittains were made on the proposition of respondeat superior and not on the theory that the Brittains were independently negligent. Our reasons are these:

1. The charging allegations of the Board complaint are specific in their reference to the activities of particular employees of the logging company. These allegations are:

'That on said last named date the defendants BRUCE LUTON, WINIFRED WINKLER, RAY RHODES, GEORGE TRAIN, JOHN SANDERSON, and JOHN DOE were and each was employed by all of the defendants herein, other than themselves, in the performance of their business as loggers, and on said last named date said BRUCE LUTON, WINIFRED WINKLER, RAY RHODES, GEORGE TRAIN, JOHN SANDERSON, and JOHN DOE were conducting logging operations and the harvesting of timber for their co-defendants with the knowledge, permission and consent thereof, and as their servants, agents, and employees in conducting their business as aforesaid at the place aforesaid.

* * *

* * *

'That at said time and place, and in the loading of logs on plaintiff's truck by defendants, and without fault or negligence on the part of plaintiff, said logs were negligently, carelessly, and improperly loaded by defendants, and were not well balanced or secured so that said logs were stable on said truck of plaintiff without binders, and as a result of the negligence of defendants as aforesaid one of said logs fell upon and injured plaintiff.'

There is not a single allegation of an act or omission directly laid to the employers. Respondent Truck Insurance presently, and in the trial court, has proposed that it is possible that the negligence of which Beard complains included such matters as failure to maintain safe condition of the premises and of the implements used in the log loading, failure to supervise and control the loaders' operations, and failure to determine that the loaders were competent. But these matters are totally absent from the Beard complaint. Of course, there is a general statement that the proximate cause of plaintiff's injury was that of the negligence 'of defendants and each of them,' but even this is immediately qualified in the complaint by the words 'as aforesaid.'

2. If the basis of liability, as charged by Beard, were supervisory or executive responsibility of the logging company, as respondents suggest was possible (even though these matters were not pleaded by Beard), it would seem that by the investigation of the accident, which the court found Truck Insurance made before it rejected the tender of defense, these matters would have been discovered. If so, these subjects ought to have been proposed for the agreed statement of facts. If appellants rejected these proposed items from the agreed statement, the subject could have been submitted to the trial judge by evidence over and above the agreed statement.

3. In the trial court, appellants earnestly attempted to have findings made which would cover the suggestions put forth by respondents, as described above. The court did not make such findings, no doubt because the learned trial judge depended on the decision in Standard Accident Insurance Co. v. Hartford Accident and Indemnity Co., 206 Cal.App.2d 17, 23 Cal.Rptr. 424 (which is discussed below), and did not deem it necessary to make a distinction between facts which would impose vicarious liability on the Brittains and any facts which might charge them with direct responsibility.

Again in this court, appellants have proposed that if there is any doubt upon the subject, evidence be taken to show the true basis of liability. This, however, we think is unnecessary.

4. Finally, we note considerable similarity between this case and that of Pleasant Valley etc. Assn. v. Cal-Farm Insurance Co., 142 Cal.App.2d 126, 298 P.2d 109, in which it was noted (p. 136) that in the complaint in the personal injury action which gave rise to the insurance case and in the agreed statement of facts, there was silence as to any acts or omissions on the part of the employer, except those attributed to him by the acts of the particularly named employee.

From all of the above, we conclude that, considering the facts which have been put before us and the failure of respondents to show that there is any real and not merely imaginary omission therefrom, the responsibility that was charged against the employers, the Brittains, was a vicarious and not a direct one.

Result of Finding Liability to Be...