Penley v. Gulf Ins. Co.
| Decision Date | 03 May 1966 |
| Docket Number | No. 40069,40069 |
| Citation | 1966 OK 84,414 P.2d 305 |
| Parties | Paul H. PENLEY, d/b/a Penley Oil Company, Plaintiff in Error, v. GULF INSURANCE COMPANY, a Texas Corporation, and Travelers Indemnity Company, a Connecticut Corporation, Defendants in Error. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court
1. In construing an insurance contract, its terms and words, if unambiguous, must be accepted in their plain, ordinary and accepted sense.
2. When an insurance policy covers the ownership, maintenance, operation and use, including loading and unloading of a vehicle on designated premises, the insurer is not liable for damages resulting from an accident involving such vehicle away from the premises designated in the policy.
3. Although an intentional or willful tort would negative the existence of an accident, an act attributable solely to negligence may be an accident.
4. The phrase 'including loading and unloading' in an insurance policy is a phrase of extension and it expands the term 'use' of the vehicle beyond its connotation otherwise so as to bring within the policy some acts in which the vehicle itself does not play a part.
Appeal from the Common Pleas Court of Oklahoma County; Dwain D. Box, Judge.
Plaintiff in error commenced proceedings to recover judgment under two separate insurance policies, issued by defendants in error. The trial court sustained the separate demurrers of defendants in error and this appeal challenges the correctness thereof. Affirmed as to Travelers Indemnity Company; reversed as to Gulf Insurance Company.
Schwoerke, Schwoerke & Palmer, by Harry R. Palmer, Jr., Oklahoma City, for plaintiff in error.
Monnet, Hayes, Bullis, Grubb & Thompson, by John T. Edwards, Oklahoma City, for defendant in error, Travelers Indemnity Co.
Alex Cheek, B. R. Davis, Cheek, Cheek & Cheek, Oklahoma City, for defendant in error, Gulf Ins. Co.
Paul H. Penley, d/b/a Penley Oil Company, referred to as plaintiff, commenced proceedings against Travelers Indemnity Company and Gulf Insurance Company to recover judgment on separate insurance policies issued by the defendant companies, hereinafter referred to respectively as Travelers and Gulf.
Plaintiff alleged two causes of action; one against Travelers, with whom plaintiff had a liability policy covering 'Premises-Operations'; and the other cause against Gulf with whom plaintiff had a commercial-use vehicle liability policy. The trial court sustained the separate demurrers of Travelers and Gulf and plaintiff challenges the correctness thereof in this appeal.
Although the liability, if any, of Travelers and/or Gulf, must be based upon the specific provisions of each policy, the same facts form the basis for the alleged liability under both policies. The pertinent facts as alleged by plaintiff may be summarized as follows:
On September 11, 1959, while the two policies were in force and effect, plaintiff received an order for diesel fuel for a motor grader from a customer. Plaintiff's employee made this delivery in a partitioned tank truck, one side containing regular gasoline and one side containing diesel fuel. The employee mistakenly put regular gasoline in the motor grader instead of diesel fuel and the motor grader was damaged when it was run with the gasoline instead of diesel fuel. The customer sued plaintiff for the resulting damages and Travelers For clarification, the pertinent provisions of each policy, the contentions relating thereto, and our consideration and determination thereof will be discussed under separate propositions, i.e., Action against Travelers, and Action against Gulf.
and Gulf both denied their policies covered the operation and refused to pay the damages or defend pliantiff in said action. Plaintiff undertook his own defense and the customer recovered a judgment against him. Plaintiff then commenced this action against Travelers and Gulf for re-imbursement under the terms of the policies.
Plaintiff contends that Travelers' policy covered property damage on All his operations and he was insured against damages resulting from operations on his premises as well as damages resulting from delivering and unloading his products off his premises.
Travelers contends its policy specifically excluded accidents involving vehicles, including loading and unloading, occurring away from plaintiff's premises, and the amended petition alleges the accident or occurrence took place away from said premises.
Travelers' policy contained the following provisions:
'Coverage B--Property Damage Liability.
'To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of injury to or destruction of property, including the loss of use thereof, caused by accident and arising out of the hazards hereinafter defined.'
And under the 'Definition of Hazards' we find:
The exclusions are set out on page 3 of said policy, and are in pertinent part as follows:
'This policy does not apply:
'(a) Under division 1 of the Definition of Hazards, and under Coverage C, to the ownership, maintenance, operation, use, loading or unloading of * * * automobiles if the accident occurs away from such premises or the ways immediately adjoining, * * *.'
The premises covered by Travelers' policy is specifically designated as 2627 W. Reno, Oklahoma City, Oklahoma. Plaintiff alleged that the negligent act of placing regular gasoline in the motor grader instead of filling the motor grader with diesel fuel, occurred at Northwest Thirty-Fifth and Ann Arbor Streets.
In the case of Citizens Casualty Co. of N.Y. v. L. C. Jones Trucking Co., 238 F.2d 369, Tenth Circuit (Okla.), the court had the occasion to consider two insurance policies. The National policy covered:
'The ownership, maintenance or use of the premises, and all operations during the policy period which are necessary or incidental thereto.'
It also contained an exclusion provision which stated the policy does not apply to:
'* * * (3) automobiles or the loading or unloading thereof except upon premises owned, rented or controlled by the named insured and ways immediately adjoining within the territory * * *.'
The Circuit court affirmed the trial court and held that:
'The accident occurred during operation of the truck, on premises not owned, rented or controlled by Jones and was not within the coverage of the National policy.'
Plaintiff alleged that the negligent acts which caused the resulting damages occurred away from the premises specifically designated in Travelers' policy. Since such policy did not apply to the loading or unloading of the tank car, except upon said designated premises, the plaintiff failed to bring himself within the terms and coverage of Travelers' policy. We therefore affirm
the trial court in sustaining Travelers' demurrer to plaintiff's amended petition.
Plaintiff contends that his employee's negligent acts, though unintentional, caused and precipitated the damage to the diesel motor and such was an accident; and that he had property damage coverage which included loading and unloading under the ownership, maintenance or use proviso of Gulf's policy which was written on a 'commercial' basis.
Gulf contends that the alleged negligent acts of plaintiff's employee in placing gasoline instead of diesel fuel in the motor grader, did not result in damages 'caused by accident'; and that the resulting damages did not arise out of the primary 'use' of plaintiff's insured tank truck during the unloading process as the 'loading and unloading' provision is construed in a vehicle liability policy.
Under the terms of Gulf's policy, Gulf agreed to pay all sums which the insured became legally obligated to pay as damages 'caused by accident and arising out of the ownership, maintenance or use of the automobile'. Plaintiff's truck was written or covered for 'business, pleasure and commercial use'. The term 'commercial use' was defined as use principally in the business or occupation of the insured. The policy reflects that the business of insured was 'Distributor Continental Oil Company'.
In construing an insurance contract, its terms and words, if unambiguous, must be accepted in their plain, ordinary and popular sense. See United States Fidelity & Guaranty Co. v. Briscoe, 205 Okl. 618, 239 P.2d 754.
In Rothman v. Metropolitan Casualty Insurance Company, 134 Ohio St. 241, 16 N.E.2d 417, 117 A.L.R. 1169, the court had occasion to consider provisions similar to those in the Gulf policy as to whether the resulting injuries were 'caused by accident'. In that case the court said:
* * *
* * *.'
Gulf argues that the act of plaintiff's employee was voluntary and the damage was the natural result of the act; that even though the result may have been unforeseen and unintended, there is no coverage for damage caused by the mistake or error of the employee.
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