State Auto. Cas. Underwriters v. Ruotsalainen, 10155

• Decision Date: 15 September 1965
• Docket Number: No. 10155,10155
• Citation: 81 S.D. 472,136 N.W.2d 884
• Parties: STATE AUTOMOBILE CASUALTY UNDERWRITERS, a corporation, Plaintiff and Appellant, v. Clifford RUOTSALAINEN, David Raymond Lee, Donna Jones, Special Administratrix of the Estate of Cecil Jones, Deceased, Big 'D' Oil Co., a corporation, and Andrew Policky, d/b/a Big 'D' Oil Co., Defendants and Respondents.
• Court: South Dakota Supreme Court

Page 884

136 N.W.2d 884

81 S.D. 472

STATE AUTOMOBILE CASUALTY UNDERWRITERS, a corporation Plaintiff and Appellant, v. Clifford RUOTSALAINEN, David Raymond Lee, Donna Jones Special Administratrix of the Estate of Cecil Jones Deceased, Big 'D' Oil Co., a corporation, and Andrew Policky, d/b/a Big 'D' Oil Co., Defendants and Respondents.

No. 10155.

Supreme Court of South Dakota.

Sept. 15, 1965.

Rehearing Denied Nov. 12, 1965.

Davenport, Evans, Hurwitz & Smith, Ellsworth E. Evans, Robert C. Heege, Sioux Falls, S. D., for plaintiff and appellant.

Molstad & Walker, Hermon B. Walker, Sturgis, S. D., Reynolds & Hughes, Sundance, Wyo., Overpeck, Hamblin & Mueller, Walter Mueller, Belle Fourche, S. D., for defendants and respondents.

RENTTO, Judge.

On August 30, 1962, the defendant Lee, an employee of the defendant Ruotsalainen, a contractor engaged in road building, was driving a gravel truck owned by his employer and towing a two-wheel trailer also owned by him. The trailer was originally a house trailer, but had been converted by remodeling into a tool trailer and used on various road jobs to store tools and supplies needed on these projects. It is referred to in the evidence as a 'Dot' trailer. On the day in question the truck and trailer were being driven from a job site in Wyoming to a new base of operations in South Dakota.

Near Spearfish in Lawrence County, South Dakota, the left wheel of the trailer became detached and collided with a propane delivery truck owned by the defendant Andrew Policky operating as Big 'D' Oil Company and driven by his employee Cecil Jones. The employee was injured in the collision and died shortly thereafter. The special administratrix of his estate commenced an action against Ruotsalainen and Lee seeking recovery for his wrongful death. The owner of the propane delivery truck which was damaged in the collision is contemplating a suit against these two defendants to recover for the injury to his truck.

Plaintiff on July 22, 1962, had entered into a contract with the defendant Ruotsalainen insuring him against legal liability arising out of the ownership, maintenance or use of certain motor vehicles, which policy was in effect at the time of the accident. The insurance company, taking the position that its policy afforded Ruotsalainen no protection in the described circumstances, on February 21, 1963 brought this action for a declaration that it was under no legal obligation to defend the suit brought against Ruotsalainen and Lee or to pay any judgment recovered against them therein. Its contention is that the trailer involved is not within the coverage of its policy.

Pursuant to stipulation of counsel the matter was submitted to the court for trial without a jury on August 30, 1963. The court found against the contentions of the insurance company and entered judgment determining that the policy involved covered the insured in the operation of his gravel truck and in the towing of the tool trailer from which the wheel became detached. This appeal is from that judgment.

The following findings and conclusions of the trial court are basic to its decision:

'FINDINGS OF FACT

'V.

'That on or about the 22nd day of July, 1962, the Plaintiff, through its general Agent, Alvin Heggelund, at Hayti, South Dakota, entered into an insurance contract Exhibit 2 with the Defendant, Clifford Ruotsalainen, whereby Plaintiff insured the said Defendant, Clifford Ruotsalainen, against legal liability arising out of the ownership, maintenance, use or operation of certain motor vehicles; and, that said insurance contract was in full force and effect at all times material herein.

'VI.

'That prior to the 22nd day of July, 1962, the Plaintiff, through its Agents, Alfred Steffenson and Norvid Steffenson, at the City of Lake Norden, South Dakota, entered into an insurance contract with the Defendant, Clifford Ruotsalainen, wherein and whereby Plaintiff insured said Defendant, Clifford Ruotsalainen, against legal liability arising out of the ownership, maintenance, use or operation of certain motor vehicles; and, that while such insurance contract was in full force and effect and prior to the 22nd day of July, 1962, the Defendant, Clifford Ruotsalainen, inquired of Plaintiff's Agents, Alfred Steffenson and Norvid Steffenson, as to whether or not the said 'Dot' Trailer was covered by said insurance contract and that he, the Defendant, desired said trailer to be covered.

'VII.

'That in response to the inquiry made of Plaintiff's Agents, Alfred Steffenson and Norvid Steffenson, the two made a trip to Plaintiff's offices in Sioux Falls, South Dakota, to determine this question, and upon their return they advised and informed the insured, Clifford Ruotsalainen, that he had coverage on said trailer so long as it was pulled behind a motor vehicle owned by the insured.

'VIII.

'That prior to the expiration of the policy issued by the Plaintiff, through the Steffenson Agency, the Defendant, Clifford Ruotsalainen, transferred his business transactions to a bank at Hayti, South Dakota, and transferred his insurance business to another Agent of the Plaintiff, namely, to Alvin Heggelund of Hayti, South Dakota.

'IX.

'That at the time Alvin Heggelund, as Agent of the Plaintiff, wrote the insurance contract here in question which was written on or about the 22nd day of July, 1962, he, the said Agent of the Plaintiff, advised the Defendant, Clifford Ruotsalainen, that he had the same coverage as in the previous insurance contract issued through the Steffenson Agency with the additional substitution of some new trucks and did further specifically advise and assure the said Defendant, upon inquiry, that the said 'Dot' Trailer was fully covered when being towed behind a motor vehicle owned by the insured, and that agent Heggelund had knowledge of the existence of, and manner of use, of said Dot Trailer.

'X.

'That the Defendant, Clifford Ruotsalainen, relied upon such representations so made by the Agents of the Plaintiff and upon such representations believed that the said 'Dot' Trailer was covered when towed behind motor vehicles owned by him.

'CONCLUSIONS OF LAW

'I.

'That an insurance company which in its policy has written generally broad coverages may be estopped to defend by reason of an exclusionary clause...