Sellers v. Allstate Ins. Co.

• Citation: 113 Ariz. 419,555 P.2d 1113
• Decision Date: 09 September 1976
• Docket Number: No. 12562--PR,12562--PR
• Parties: Gerald D. SELLERS, Doris Sellers, Danny Sellers, a minor, Timothy Sellers, a minor, Barbara Sellers, a minor, by and through their Guardian ad Litem, Gerald D. Sellers, Appellants, v. ALLSTATE INSURANCE COMPANY, Appellee. . In Banc
• Court: Supreme Court of Arizona

Page 1113

555 P.2d 1113

113 Ariz. 419

Gerald D. SELLERS, Doris Sellers, Danny Sellers, a minor, Timothy Sellers, a minor, Barbara Sellers, a minor, by and through their Guardian ad Litem, Gerald D. Sellers, Appellants, v. ALLSTATE INSURANCE COMPANY, Appellee.

No. 12562--PR.

Supreme Court of Arizona. In Banc.

Sept. 9, 1976.

Matz & Jurkowitz by Theodore Matz, Phoenix, for appellants.

Robbins, Green, O'Grady & Abbuhl by Robert H. Green, Harriet C. Babbitt, Phoenix, for appellee.

STRUCKMEYER, Vice Chief Justice.

This is an action brought by George and Doris Sellers for themselves and on behalf of their minor children against Jerry Collison to recover damages suffered in an automobile accident. After trial in the Superior Court, a judgment was entered for $830,000 in the Sellers' favor. They caused a writ of garnishment to be served on appellee Allstate Insurance Company. After a tender of issue in which Allstate denied any liability, a summary judgment was granted to Allstate and the Sellers appealed. The Court of Appeals affirmed. We accepted review. Opinion of the Court of Appeals, 25 Ariz.App. 482, 544 P.2d 699 (1976) vacated and judgment of the Superior Court reversed.

Jerry and Evelyn Collison married approximately two months prior to the automobile accident out of which this litigation arose. At the time of the accident, Jerry Collison was driving a 1957 Cadillac which he had owned prior to marriage. Evelyn Collison owned a 1964 Chrysler automobile, insured by Allstate Insurance Company, which was in a garage undergoing repairs on the day of the accident. The accident occurred when Jerry Collison was driving the Cadillac on his way to the Lowboy Lounge in Phoenix, Arizona, to have a beer and cash a check. It was his intention after leaving the lounge to pick up his wife at her place of work and drive her home.

The Sellers' position is that the policy of insurance issued by Allstate Insurance Company to Evelyn Collison covering the Chrysler automobile also covered Jerry Collison and the Cadillac at the time the accident happened:

The Allstate policy provides:

'The following persons are insured

1. The named insured with respect to the owned * * * automobile; * * *.'

It defines certain of the relevant terms in this manner:

"named insured' means the individual named on the Supplement Page, and his spouse if a resident of the same household; * * *

'owned automobile' means the vehicle described on the Supplement Page, and, as defined herein, any replacement automobile, any additional automobile, any temporary substitute automobile, * * * owned by the named insured;

'replacement automobile' means any other private passenger or utility automobile of which the named insured acquires ownership, provided it replaces the owned automobile;

'additional automobile' means an additional private passenger or utility automobile of which the named insured acquires ownership, provided notice of its delivery be given to Allstate within the policy term then current, or if delivery is within 30 days before the end of such term, then within 30 days after delivery;

'temporary substitute automobile' means any automobile, including a trailer, while temporarily used as a substitute for the owned automobile or trailer when withdrawn from normal use because of its breakdown, repair, servicing, loss or destruction; * * *'

It is evident that Allstate's policy covered Jerry Collison as Evelyn Collison's husband while he was driving her Chrysler And any replacement, additional or temporary substitute automobile within the definitions of the policy.

The Sellers urge that the Cadillac was an automobile temporarily substituted for Evelyn Collison's Chrysler.

The Arizona Court of Appeals has previously explained and defined the significance of substitute automobile provisions in insurance policies:

'The purpose of the substitution provision is to extend coverage temporarily and automatically, without the payment of an additional premium, to the insured to protect him when he uses a vehicle not specified in the policy in place of the specified vehicle he intended normally to use but did not because of its withdrawal from use for a reason stated in the policy. Lloyds America v. Ferguson, 116 F.2d 920 (5th Cir. 1941); Hemphill v. Home Ins. Co., 121 Ga.App. 323, 174 S.E.2d 251 (1970); Lewis v. Bradley, 7 Wis.2d 586, 97 N.W.2d 408 (1959). A substitute automobile within the meaning of the policy is one actually but only temporarily used in place of the specified automobile, i.e., for the same use the insured car would have been used except for its withdrawal from all normal use and while such withdrawal is because of its breakdown, repair, servicing, loss or destruction. In other words, it is a vehicle put in place of another.' Fulton v. Woodford, 17 Ariz.App. 490, 498 P.2d 564 (1972).

In the present case, on weekdays Evelyn Collison normally drove to and from work in the Chrysler automobile. The accident occurred on Tuesday. If Jerry Collison had driven his wife home in his Cadillac after she finished work, in a sense it would have been a substitute for her Chrysler because it would have furnished her transportation. But in actual practice, at the time when the accident occurred Jerry Collison in driving to the Lowboy Lounge was using the Cadillac on a personal mission of his own and for his personal convenience. Since Jerry Collison normally drove the Cadillac, he was not using it as a temporary substitute for his wife's Chrysler in trips for his personal convenience. Cf. Strozewski v. American Family Mutual Insurance Co., 46 Wis.2d 123, 174 N.W.2d 550 (1970).

The Sellers argue that the 'additional automobile' clause which is very similar in effect to the newly acquired automobile clause, the so-called 'automatic insurance' clause, provides a legal basis for coverage of the accident. See 12 Couch on Insurance 2d § 45:173 (1964). It is their position that the additional automobile clause applies because Evelyn Collison acquired an ownership interest in the Cadillac automobile under Arizona's community property laws. While ownership is not defined in the policy, the ownership of such additional automobile by the named insured means such ownership as the ordinary person would contemplate by that term. Hopkins v. Martinez, 73 N.M. 275, 387 P.2d 852 (1963). Equitable ownership is included:

'For the purpose of coverage, it is sufficient that the insured had equitable ownership of the designated vehicle, using the term 'equitable owner' in the sense of one having a rightful actual dominion and control over the automobile, although lacking the legal title thereto.' 12 Couch on Insurance 2d § 45:177 (1964).

In Arizona, the status of property as to whether community or separate is established at the time of marriage. Assets which are the separate property of one spouse before the...