Southern Home Ins. Co. v. Burdette's Leasing Service, Inc., 20419
| Decision Date | 06 May 1977 |
| Docket Number | No. 20419,20419 |
| Citation | 234 S.E.2d 870,268 S.C. 472 |
| Parties | SOUTHERN HOME INSURANCE COMPANY, Respondent, v. BURDETTE'S LEASING SERVICE, INC., Appellant. |
| Court | South Carolina Supreme Court |
Julius B. Aiken and George F. Townes, Greenville, for appellant.
John E. Johnston, Leatherwood, Walker, Todd & Mann, Greenville, for respondent.
This appeal grows out of an order of Greenville County Court holding that the defendant, Burdette's Leasing Service, Inc., must reimburse the plaintiff, Southern Home Insurance Company, in the amount of $12,000. This amount represents a portion of a $42,000 settlement paid by Southern Home to George Ashmore, who was injured while Tommy Lee was driving one of Burdette's leased motor vehicles.
Burdette's owns more than 25 motor vehicles and is engaged in the business of renting them to the public. It rented a motor vehicle to Messrs. Griffin and Howard (lessees) for the use of their employee, Lee. At the time of the accident in which Lee injured Ashmore, Southern Home had in force its automobile liability insurance policy naming Griffin and Howard as insured and extending coverage to Lee. The policy contained the standard "other insurance" provision found in automobile liability insurance policies which provide in part as follows:
". . . (U)nder coverage A (bodily injury liability) and B (property damage liability) the insurance with respect to temporary substitute automobiles under Insuring Agreement IV or other automobiles under Insuring Agreement V shall be excess insurance over any other valid and collectible insurance."
Claim was made by Ashmore against Griffin and Howard and against Lee, for bodily injury and property damage arising out of the accident caused by the negligence and recklessness of Lee. Demand was made upon Burdette's (a self-insurer) to furnish a defense to Griffin and Howard and to Lee, and to pay any judgment up to $10,000 for personal injury and up to $5,000 for property damages. The demand was refused by Burdette's.
Southern Home entered a defense and settled Ashmore's claim by paying $40,000 for personal injury, plus $2,000 for property damages. It has been stipulated that the amount was reasonable and if Southern Home is entitled to any judgment against Burdette's, the amount should be $10,000 for personal injuries, plus $2,000 for property damages.
The South Carolina Motor Vehicle Financial Responsibility Act (§ 46-701, et seq., Code of Laws of South Carolina (1962)) provides the means by which a motor vehicle owner may prove his ability to respond to a judgment. This is usually accomplished by the procurement of a motor vehicle liability policy. The statute requires that the policy cover not only operation by the named insured, but also operation by ". . . any person who uses with the consent, express or implied, the motor vehicle to which the policy applies." Section 46-709 of the Code provides that owners of more than 25 vehicles may qualify as self-insurers. It reads as follows:
Burdette's qualified as a self-insurer under this Code provision and, accordingly, at the time of the accident there was no liability insurance policy covering the operation of the motor vehicle driven by Lee, with Burdette's as the named insured.
Burdette's attempted to minimize and/or avoid its responsibility under the Act by inserting in its lease agreement with Griffin and Howard a provision as follows:
The theory of Southern Home's case, as set out in its complaint, is that Burdette's as a self-insurer, is obligated to provide to the public the...
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