Schmidt v. Luchterhand

• Citation: 62 Wis.2d 125,214 N.W.2d 393
• Decision Date: 05 February 1974
• Docket Number: No. 297,297
• Parties: Reuben SCHMIDT, Plaintiff-Appellant, v. Roger LUCHTERHAND et al., Defendants-Appellants, Thresherman's Mut. Ins. Co., Defendant-Respondent, P. A. Radocy & Sons, Inc., Defendant.
• Court: United States State Supreme Court of Wisconsin

Page 393

214 N.W.2d 393

62 Wis.2d 125

Reuben SCHMIDT, Plaintiff-Appellant, v. Roger LUCHTERHAND et al., Defendants-Appellants Thresherman's Mut. Ins. Co., Defendant-Respondent P. A. Radocy & Sons, Inc., Defendant.

No. 297.

Supreme Court of Wisconsin.

Feb. 5, 1974.

Schellinger & Doyle, Milwaukee, Lee F. Calvey, Milwaukee, of counsel, for plaintiff-appellant.

Bradford & Gabert, Appleton, for appellant Luchterhand.

Fulton, Menn & Nehs, Peter S. Nelson, Appleton, of counsel for American Family Ins.

Kluwin, Dunphy, Hankin & McNulty, Milwaukee, for respondent.

CONNOR T. HANSEN, Justice.

This appeal presents the following issues:

1. Whether the American Family Mutual Insurance Company's policy afforded coverage to this incident?

2. Whether Threshermen's Mutual Insurance Company's policy afforded coverage to this incident?

3. Is the issue of waiver and estoppel properly before this court on this appeal?

AMERICAN FAMILY POLICY

On this appeal, American takes the position that their policy of insurance did not cover the use of the hoist at the time of the accident.

In 1967, Luchterhand purchased a business from Gary Rogenbach, the nature of which was erecting and servicing advertising signs. The purchase included a 1962 GMC truck. Attached to the truck was the Mighty Lift Hoist involved in this incident. The hoist was mounted in the middle of the rear portion of the truck. The value of the hoist was approximately three times the value of the truck.

When Luchterhand purchased the business, he consulted Eugene Zeuske, an insurance agent in Shawano, as to the type of insurance that had previously been carried on the vehicle. Zeuske had been in the insurance business a number of years, and knew both Rogenbach, the former owner, and Luchterhand. Rogenbach had carried a standard automobile policy on the truck, issued by American. Zeuske arranged to have the same type of policy issued to Luchterhand. Under this policy of insurance, American provided automobile liability insurance with a $25,000 limit.

Shortly thereafter, Lutcherhand also purchased a general liability policy, with limits of $10,000, from Threshermen's. This insurance contract was also purchased through Zeuske.

The accident involving Schmidt occurred on December 19, 1969, and it is admitted that both policies were in full force and effect at this time.

Part I of this policy provided in pertinent part, as follows:

'1 Coverages A and B--Bodily Injury and 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:

'Coverage A--Bodily injury, sickness or disease, including death at any time resulting therefrom, sustained by any person, caused by accident and arising out of the ownership, maintenance or use of the automobile;

'. . ..' (Emphasis supplied.)

Therefore, in considering the appeal of American, it is necessary to determine whether the injuries sustained by the plaintiff were caused by an accident arising out of the use of the 1962 GMC truck.

The boom of the hoist is raised by means of hydraulic power supplied by a compression unit with a 12-volt car starter and centrifugal pump. The starter of the compression unit derives its power from the truck battery. The operator stands on the bed of the truck and presses the starter and this raises the boom to the desired position by means by hydraulic fluid. Once the boom has been raised to its desired position the starter is released and there is no more electrical energy or any source of mechanical energy provided by the truck. This very limited use of the truck's battery is the only connection the hoist has with the truck unit. With the boom extended, objects (trusses) can be moved by use of a winch and cable apparatus which is operated entirely by hand. A metal cable extends through the hoist, and by attaching a crank handle to various winch points at the lower end of the boom, the operator utilizes various size gears to raise or lower objects of different sizes.

On the day of the accident, Luchterhand had driven his truck to the construction site and positioned it in such a way that the boom could raise the various trusses into place. Luchterhand had turned off the engine of his truck some two or three hours before the accident occurred. The work of raising the trusses was accomplished by means of manually operating the hoist. Thus, the truck was not being used as a vehicle at the time of the accident. The only thing being used was the hoist, and the accident resulted from the use of that device.

There are a number of factors which lead us to conclude that the injuries sustained by the plaintiff were not caused by an accident arising out of the use of the 1962 truck, and, therefore, the automobile liability insurance contract issued by American did not afford coverage to the plaintiff.

The basic policy issued by American is identified as a national standard automobile policy.

Part IV of the American Family policy provided a description of what the parties intended by the use of the term automobile. It said in pertinent part:

'IV Automobile Defined, Trailers, Farm Machinery and Equipment, Private Passenger Automobile, Two or More Automobiles, Including Automatic Insurance

'a. Automobile. Except with respect to coverage Cb. and except where stated to the contrary, the word 'automobile' means:

'(1) Described Automobile--the motor vehicle or trailer described in this policy;

'(2) . . ..

'(3) . . ..

'(4) . . ..

'(5) . . ..

'The word 'automobile' also includes under coverage D, E, F, G and H its equipment and other equipment permanently attached thereto.'

The motor vehicle described in the policy is an '8 62 GMC TRUC 850.'

The policy expressly states that the definition of the word automobile is expanded to include the equipment 'permanently attached thereto' only for the purpose of coverage under D, E, F, G and H. However, none of the coverage provided by paragraphs D, E, F, G and H applies to personal injury claims by others. Paragraphs D, E, F, and G apply to collision, fire, theft and other damage to the vehicle. Paragraph H covers emergency road service. Thus, the policy did not intend to provide absolute coverage for personal injury caused by the equipment permanently attached to this motor vehicle.

As stated in Westerman v. Richardson (1969), 43 Wis.2d 587, 592, 168 N.W.2d 851, 853:

'Of course, in interpreting and construing the policy, the ultimate objective is to ascertain the true intention of the parties. . . .' (Citing Home Mut. Ins. Co. v. Insurance Co. of North America (1963) 20 Wis.2d 48, 51, 121 N.W.2d 275; Inter-Insurance Exchange v. Westchester Fire Ins. Co. (1964), 25 Wis.2d 100, 104, 130 N.W.2d 185.)

Moreover, a practical construction is most persuasive in ascertaining the intention of the parties. Inter-Insurance Exchange v. Westchester Fire Ins. Co., supra, p. 104, 130 N.W.2d 185; Home Mut. Ins. Co. v. Insurance Co. of North America, supra, 20 Wis.2d pp. 51, 52, 121 N.W.2d 275. In McPhee v. American Motorists Ins. Co. (1973), 57 Wis.2d 669, 676, 205 N.W.2d 152, 156, this court recently explained as follows:

'. . . An insurance policy must be construed in accordance with the principal that the test is not what the insurer intended its words to mean but what a reasonable person in the position of an insured would have understood the words to mean. While this court will not, under the guise of strict construction against the insurer, rewrite a policy, whatever ambiguity exists in a policy of liability insurance must be resolved in favor of the insured.'

The described automobile in the policy was the 'motor vehicle' listed in the policy. Words used in insurance contracts '. . . are to be given the common and ordinary meaning which they have in the minds of the average layman. . . .' Solberg v. Metropolitan Life Ins. Co. (1971), 50 Wis.2d 746, 753, 185 N.W.2d 319, 322, citing Mittelsteadt v. Bovee (1960), 9 Wis.2d 44, 100 N.W.2d 376, and Charette v. Prudential Ins. Co. (1930), 202 Wis. 470, 232 N.W. 848. Item 2 in the policy simply referred to a '(19)62 GMC TRUC' and identified it by model number. Part IV of the policy provided that this described 'motor vehicle' was the automobile receiving coverage. An ordinary meaning of the term 'motor vehicle' as it is applied to this 1962 truck would not include the permanently attached hoist as it was being used at the time of the accident. Neumann v. Wisconsin Natural Gas Co. (1965), 27 Wis.2d 410, 134 N.W.2d 474; Smedley v. Milwaukee Automobile Ins. Co. (1961), 12 Wis.2d 460, 107 N.W.2d 625; and Norton v. Huisman (1962), 17 Wis.2d 296, 116 N.W.2d 169, are persuasive authority that referring to this 1962 truck as a motor vehicle would not be commonly understood as indicating an intent to include the hoist as it was being used in the instant case.

The plaintiff, in Smedley v. Milwaukee Automobile Ins. Co., supra, had sustained injuries caused by the negligent operation of a hydraulic crane which was mounted on a Mack truck and was being used to raise and lower steel girders into place. The Milwaukee Automobile Insurance Co. had issued an automobile liability policy to the insured who had injured the plaintiff with his crane. However, the insurance company claimed that it could not be made a party under the direct-action-statute (sec. 260.11, Stats.) because the crane at the time of the accident was stationary was not used for the purpose of locomotion, and was not a motor vehicle. The court explained the nature of the crane as follows:

'The hydraulic crane is mounted on a special base on a Mack truck chassis for the purpose of locomotion but when in use the unit is stationary. The crane has its own power separate from the motor of the truck and consists of the hydraulic mechanism for lowering and raising a boom and its line. The boom is some 35 feet long and I beams are lifted by the process of placing a steel cable choker around the...