Smith v. M. F. A. Mut. Ins. Co.

• Decision Date: 09 June 1960
• Docket Number: No. 22982,22982
• Citation: Smith v. M. F. A. Mut. Ins. Co., 337 S.W.2d 537 (Mo. App. 1960)
• Parties: Russell L. SMITH, Doing Business as Lee Bottle Gas and Heating Company, Plaintiff-Respondent, v. M. F. A. MUTUAL INSURANCE COMPANY, A Corporation, Defendant-Appellant.
• Court: Missouri Court of Appeals

Page 537

337 S.W.2d 537

Russell L. SMITH, Doing Business as Lee Bottle Gas and Heating Company, Plaintiff-Respondent, v. M. F. A. MUTUAL INSURANCE COMPANY, A Corporation, Defendant-Appellant.

No. 22982.

Kansas City Court of Appeals, Missouri.

June 9, 1960.

Motion for Rehearing or Transfer to Supreme Court Denied

June 29, 1960.

Strop & Strop, St. Joseph, for appellant.

Dale & Potter, St. Joseph, for respondent.

BROADDUS, Judge.

This is an action based upon an insurance policy. From a judgment in favor of plaintiff for the sum of $3,580, defendant appealed.

On February 25, 1958, defendant M. F. A. Mutual Insurance Company, issued to plaintiff its insurance policy covering plaintiff's 1954 1 H C truck until August 25, 1958. The policy contained the following provision:

'MFA Mutual will pay for direct and accidental loss of or damage to the owned automobile except loss caused by collision between it and another object, or by its upset, but including breakage of glass and loss caused by missiles, falling objects, fire, theft, explosion, earthquake, windstorm, hail, water, flood, vandalism, riot or civil commotion.'

It also contained the next quoted provision, to-wit:

'Bottled Gas.

'In consideration of the premium charged, it is agreed that the insurance provided in this policy does not cover nor include any loss, damages, injuries or death caused by bottled or compressed gas, whether known as Butane or Propane gas or by any other name, while the same is in or upon or being transported or conveyed in or by the insured vehicle or while same is being loaded or unloaded therein or therefrom.'

There is no dispute as to the facts. The truck involved was propelled by propane gas and was adapted solely as a bulk propane gas truck. Attached to the truck was a metal tank having a capacity of 1212 gallons.

On August 13, 1958, plaintiff took the truck to a garage in St. Joseph operated by Mr. Lloyd Roberts. Mr. Roberts, in plaintiff's presence, 'checked all connections' and, as a result of that inspection, found that 'there were no leaks'. Between five and six o'clock that afternoon the truck was driven from the garage to plaintiff's office located at 66 1/2 Railroad Avenue in St. Joseph. A photograph offered in evidence shows that the office is in the front part of plaintiff's house. The next morning between nine and ten o'clock, the truck was taken to 'Car Town' on 169 Highway and 841 gallons of Propane gas were put in the tank. Plaintiff testified that at that time 'there were no leaks.' Thereupon plaintiff's son drove the truck away and: 'He started up the Belt Highway to go to Industrial City to deliver some gas and he got up there at about Pacific Street and the truck started smoking and the solenoid valve burned out of it.' Plaintiff stated that the solenoid valve on the truck was located beneath the vaporizer, which in turn 'is on the motor' at the 'front end of the truck;' that he 'went and bought a new one (valve) and put it on.' This was done between eleven and twelve o'clock. The truck was then taken directly to plaintiff's home and parked.

At about 4:30 p. m. on the same day (August 14, 1958) a loud roaring noise was heard coming from the truck and a white vapor surrounded it immediately before it became ignited. The vapor came from the liquid propane gas with which the truck was, as we have stated, then loaded. The vapor was ignited by fire but the source of the fire was not directly shown, except that it came from the front part of the truck, or from plaintiff's office or shed. Propane gas, in liquid form, will not burn but, upon contact with air, will vaporize and the vapor is then highly inflammable and will explode and burn if it comes in contact with a spark or flame. This vapor exploded with a 'poof' and burned an area of sixty feet around the truck, entirely consuming the truck.

The truck was equipped with a 'popoff valve' which was located at the top of the tank and at the back end of the truck. Plaintiff testified that the purpose of the 'popoff valve' is to release any excess pressure in the tank. When asked: 'Is there a certain temperature at which this popoff valve pops off?' he answered: 'The temperature don't get not enough around here to pop one off. They are set at 250 pounds of pressure.' Later on he was asked: 'Have you testified as to the heat within the tank in order to cause that popoff valve to go off?' His answer was: 'The gas had to get heated up enough to make 250 pounds of pressure before it will pop off.' The testimony was that during the period that the truck burned this popoff valve opened from time to time.

Defendant offered no evidence. It admitted that the value of the truck was $3,580; that request for payment was made and refused. The trial court held defendant liabie. Both parties here contend that the policy is clear and unambiguous. Plaintiff says it clearly provides coverage of loss by fire and that there is no dispute, under the evidence, but that the loss so occurred. Defendant says the policy clearly exempts from coverage loss caused by propane gas and that, without question, the loss was caused by propane gas.

Defendant agreed to pay for loss or damage 'caused' by fire; but it provided in the policy that it would not pay for any loss caused by propane gas.

There is no question but that, under the first quoted provision of the policy defendant would be liable for the loss, were the second provision not included in the policy as the truck was consumed by flames. True, the flames arose from the vaporized propane gas, but they were ignited by fire 'from the front part of the truck or the office.'

It is conceded that propane gas will not burn in its liquid state, nor in its gaseous state either, unless it comes into contract with fire. How, then could this loss have been 'caused' by bottled or compressed gas? Fire came into contract with the gas, converted the gas itself into fire. While there is no direct evidence as to what caused the fire, it was not caused by bottled or propane gas.

The burden of proof on the issue of the cause of the fire is not on plaintiff. The defendant has that burden, having pleaded the bottle gas exemption clause as an affirmative defense.

'It is well established that an insurance company defending on the ground of noncoverage and relying upon an exemption or exemption clause in the policy has the burden of proving the facts upon which such defense is based by a preponderance of the evidence.' 29A Am.Jur. 985.

Every element of plaintiff's case has been established, as a matter of law, by proof in the form of judicial admissions and from the pleadings, because: (1) defendant by its answer admitted the loss by fire during the term of the policy, due notice of loss, plaintiff's demand for payment and its refusal, and (2) defendant made record admission, before trial, that plaintiff's loss was in the amount claimed in the petition.

Therefore, plaintiff had made a prima facie case, submissible to the jury without any further evidence, and sufficient to support a judgment.

Thereafter, the burden was on defendant to introduce evidence in support of its affirmative defense under the bottle gas clause, and to show that propane gas caused the fire. Defendant never sustained that burden of proof as it introduced no evidence. The only evidence in the case was introduced by and on behalf of plaintiff which established his prima facie right to recover. Plaintiff's evidence contains no fact or circumstance from which any inference can be drawn that propane gas caused the fire.

In the absence of such evidence, the court was justified in directing judgment for plaintiff. Stephens v. Fire Ins. Co., 139 Mo.App. 369, 123 S.W. 63.

In the Stephens case plaintiff's furniture was destroyed by a fire and an explosion. In its answer the defendant insurance company set up the exemption clause in the policy that 'this company shall not be liable for loss caused by explosion of any kind unless fire ensues and in that event for the damage by fire only.'

The case was tried by both parties upon the same theory 'that if the fire preceded the explosion, and the explosion was an incident of the fire and was caused by it, the insured could recover the fire damage only. The evidence tended to show--and the fact was practically admitted by both litigants--that a serve explosion happened in the building, with probabilities that it occurred from natural gas in the basement directly under the apartment occupied by the plaintiff. The plaintiff offered no evidence tending to separate the damage done by the explosion from that done by the fire, and his recovery, so far as shown, is a general damage caused both by the explosion and the fire. The evidence clearly shows that a portion of the damage suffered resulted from the exploison, so that in this case, the defendant is not liable for any explosion damage unless the explosion occasioning such damage was preceded by a fire which caused it. The contested point in this case is, therefore, one of evidence--whether the explosion which wrecked and damaged plaintiff's furniture was preceded by a fire which caused it; for if it was not preceded by a fire, then the defendant is not liable for any damage, as the plaintiff offered no evidence of the amount of his damage done by fire subsequent to the explosion and there would be nothing upon which to base at verdict against the defendant.'

The court referred to the settled rule of law that when the assured has shown the execution of the contract, also the loss together with the amount thereof, the burden is on the insurer to prove that the loss is within the exception stated in the policy. The opinion said:

'The Superintendent of the Kansas Natural Gas Company testified that he had been familiar with the gas business since 1887. He was asked the following questions: 'Q. Will natural gas explode unless it comes in contact with flame previous? A. No, sir. Q. Then there...