Purdy v. Commercial Union Ins. Co.

• Decision Date: 08 June 1970
• Docket Number: 2678 of 1968
• Citation: 50 Pa. D. & C.2d 230
• Parties: Purdy v. Commercial Union Insurance Company of New York
• Court: Pennsylvania Commonwealth Court

50 Pa. D. & C.2d 230

Purdy v. Commercial Union Insurance Company of New York

No. 2678 of 1968

Common Pleas Court of Allegheny County, Pennsylvania

June 8, 1970

Jon L. Friedman, for plaintiffs.

Robert W. Murdoch, for defendant.

OPINION

Motion for summary judgment.

SILVESTRI J.

Defendant, Commercial Union Insurance Company of New York, has filed a motion for summary judgment under Pa. R. C. P. 1035. Defendant and plaintiffs are in substantial agreement regarding the facts of this case.

Plaintiffs were named as insureds under a homeowner's policy of insurance issued by defendant. On February 19, 1968, plaintiff, Robert Purdy, was in Chicago, Ill., on a business trip when a suitcase containing certain items of his personal property was taken from his rented, unattended automobile.

A claim was made by plaintiffs under the policy, which claim was denied by defendant.

Plaintiff filed this lawsuit against defendant for the value of the personal property which was taken from his car. Defendant has set forth in new matter a defense predicated upon the following provision of the homeowner's policy covering exclusions for theft of property away from the homeowner's described premises:

" This policy does not apply as respects this peril to loss away from the premises of: (a) property while in any dwelling or premises thereof, owned, rented or occupied by an insured, except while an insured is temporarily residing therein; (b) property while unattended in or on any automobile, motorcycle or trailer, other than a public conveyance, unless the loss is the result of forcible entry either into such vehicle while all doors and windows thereof are closed and locked or into a fully enclosed and locked luggage compartment, of which entry there are visible marks upon the exterior of said vehicle." (Italics supplied.)

Plaintiffs admitted, in reply to this new matter, that " there were no visible marks of the forcible entry upon the exterior of said vehicle," but denied that such marks were required to be shown for plaintiffs to recover or that the said policy provision is an enforceable exclusion from coverage.

Plaintiffs contend that their insurance policy was not a freely negotiated contract, but rather a contract of adhesion, ^[1] and further, that the " exterior marks" clause is not a risk limitation and is contrary to public policy.

Defendant, on the other hand, rests its case on the alleged clear and unambiguous terms of the contract itself, and asserts that the exclusion here involved clearly establishes a condition precedent to recovery, which was admittedly not met in this case.

The insurance policy here involved, attached to plaintiffs' complaint as exhibit B, is a nine-page, double-column document. The insuring clause for the property here involved appears on the fifth page of this contract, as follows:

" Coverage C. -- Unscheduled Personal Property . . . 2. Away from premises: This policy also covers unscheduled personal property as described and limited, while elsewhere than on the premises, anywhere in the world, owned, worn or used by an insured or at the option of the Named Insured, owned by a guest while in temporary residence of, and occupied by an Insured or owned by a resident employee while actually engaged in the service of an Insured and while such property is in the physical custody of such residence employee or in a residence temporarily occupied by an Insured. Property pertaining to a business is not covered.

" The limit of this Company's liability for such property while away from premises shall be an additional amount of insurance equal to 10% of the amount specified for Coverage C, but in no event less than $ 1,000."

Also listed on the fifth page of this insurance contract are " Perils Insured Against." These provisions carry over to the sixth page of the contract, where the exclusion in question appears. Both of these provisions herein mentioned are in the usual very small, difficult-to-read type, typical of the entire nine-page policy.

It is our opinion that where an insurance policy is sold to an ordinary individual it is a " contract of adhesion." The effect of this, " where one of the parties is in a disadvantageous bargaining position because the provisions are standardized and stereotyped" ^[2] is to construe the contract most narrowly against the writer.

In the case of Eastcoast Equipment Company v. Maryland Casualty Company, 207 Pa.Super 383, 218 A.2d 91 (1966) (per curiam opinion affirming on the opinion of the lower court reported at 38 D. & C.2d 499), footnote 10, the Pennsylvania Superior Court points out that " An insurance policy, is, in general nature, a 'contract of adhesion,' where the purchaser has no bargaining power, and thus the policy must be construed strictly against the insurer." In connection with this footnote, the court states in the text of its opinion the following:

" Were this case between an individual who purchased the policy through a subway advertisement, e.g., and a giant insurance company, there might be good reason to construe the clauses very strictly, and in case of the slightest doubt, against the insurer. The policy behind this rule is sound: the insurer wrote the policy and the individual purchaser is concerned primarily with monetary benefits. Concern with definitional clauses and exclusions is minimal; therefore, if they do become material, they should be strictly construed against the insurer.

" There would be little purpose in hewing to legal platitudes with no application, where one large corporation and one large insurance company, both advised by competent legal counsel, do business with each other. ^[3]

" This is not to say that the interpretation of...