State Farm Mut. Auto. Ins. Co. v. Central Sur. & Ins. Corp.
| Decision Date | 04 April 1966 |
| Docket Number | No. 24448,24448 |
| Citation | 405 S.W.2d 530 |
| Parties | STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, a Corporation, Respondent, v. CENTRAL SURETY AND INSURANCE CORPORATION, a Corporation, Appellant. |
| Court | Missouri Court of Appeals |
This suit is based on plaintiff's right to subrogation against defendant. The case was tried to the court on an agreed statement of facts and resulted in judgment for plaintiff in the sum of $10,144.26. Defendant appealed.
Plaintiff, engaged in the automobile insurance business, in Missouri, issued its policy to Roberta E. Spargur, of Kansas City, Missouri, insuring her against liability for personal injuries inflicted by or through the operation of her 1952 Chevrolet passenger automobile described therein. The contract became effective July 14, 1955, and was in full force at all times material herein. The extent of personal injury liability covered by the policy was $15,000.00 for any one peron. That feature of the policy was extended to cover anyone operating the automobile with Miss Spargur's consent.
On February 25, 1961, while this automobile was being operated by Mr. Kilby F. Johns, with the consent of Miss Spargur, and while its ownership was vested in Miss Spargur, it struck and injured a Mr. Scoggins, a pedestrian, on a Kansas City street. Mr. Scoggins sued Johns and plaintiff settled and satisfied that claim for personal injuries in the amount of $11,500.00. In defending and settling said claim it incurred expenses, in addition to that amount, in the sum of $1,678.52.
Miss Spargur authorized Johns to use her automobile, above described, since she owned another and newer automobile which she had acquired. From that time forward, Mr. Johns kept the automobile in his possession and paid all expenses thereon, including licenses, repairs, and gasoline. He was using it when he became an employee of Jenkins Music Company. Immediately after Johns was employed, in 1958, Jenkins caused to be issued to Mr. Johns a certificate of insurance issued by defendant, naming therein Jenkins and Johns as insureds. The Chevrolet automobile herein mentioned was described in that certificate. The coverage was for $50,000.00, for personal injuries suffered by any one individual in any one accident. That certificate did not insure against any loss or damage to the automobile itself, in any manner. All premiums had been paid thereon and it was current when this casualty occurred.
Johns testified to the effect that, after the accident occurred, he was sued and summons was served on him; that he notified defendant; that its agent contacted him and investigated the circumstances; that he told Johns that the loss would be adjusted and settled; that, later, defendant declined to pay the claim or to defend the suit; that it notified him to contact plaintiff, that plaintiff was primarily liable for the loss, up to $15,000.00; and that defendant would only be liable for any excess over and above $15,000.00, (the suit was for $40,000.00), within the limits of its coverage. Johns then notified plaintiff of the casualty and plaintiff assumed the defense of the suit, with defendant's full knowledge. Defendant refused to participate in the defense in any way, taking the position that plaintiff, alone, was liable to the full extent of its coverage, and that defendant was liable only for the excess, if any, over and above plaintiff's liability under its policy. It is agreed that the sum paid by plaintiff herein, including attorney fees and other expenses, is reasonable. Plaintiff says it is entitled to recover fifty/sixty fifths of that amount on the theory that defendant should pay its pro rata share of the loss based on the total coverage. The sum adjudged to plaintiff against defendant is correct and in accord with that theory, if plaintiff is entitled to recover under its theory of liability.
The evidence is to the effect that neither party knew the other had issued a policy covering this automobile, prior to the loss; but plaintiff knew that Johns was operating the vehicle while working for Jenkins, with Miss Spargur's consent; and defendant had been told, through Jenkins, that there was other insurance on the car. Defendant now, weakly, contends that it is not liable under any theory because Johns was not operating the vehicle, at the time the accident occurred, on any business connected with Jenkins. When defendant first denied liability it was on the theory that it was liable under its policy only after liability under plaintiff's policy was exhausted. It is a general rule of law that, having denied liability for a stated reason, an insurer may not, later assert a different one. McCarty v. United Insurance Company (Mo.App.), 259 S.W.2d 91, 94; Carroll v. Union Marine Insurance Company (Mo.App.), 249 S.W. 691, 692; Ash Grove Lime & Portland Cement Company v. Southern Surety Company, 225 Mo.App. 712, 39 S.W.2d 434, 441; Goffe v. National Surety Company, 321 Mo. 140, 9 S.W.2d 929, 938.
Defendant issued its certificate, describing this car, and both Jenkins and Johns are named therein. The language of the certificate does not limit defendant's liability except as to amounts it is to pay in case of loss, and as to coverages, to wit:
"Bodily injury liability. . each person, $ 50,000.00
"Bodily injury liability. . each occurrence, 100,000
"Medical payments. . each occurrence, 10,000.00
"Medical payments. . each person, 1,000.00;"
Furthermore, after the casualty occurred, defendant did not cancel the policy but merely increased Johns' premium and the policy remained in effect until Johns left Jenkins employ. Defendant's contention that it is not liable because the automobile was not being used in connection with Jenkins' business when the casualty occurred is denied.
Mr. Johns testified to the effect that, immediately after he became an employee of Jenkins, Mr. Limbacher, his supervisor, told him that he would be required to take out an insurance policy on the automobile; that Johns told him that the vehicle was already insured; that Limbacher stated, over the telephone, that he must have a company policy and requested him to furnish a description of the car that he was driving; that, he, Johns, on the following day, furnished the description of the Chevrolet as it appears in the certificate of insurance; that he, at no time, signed an application form, nor did he ever see the certificate which was issued to Jenkins by defendant. He stated that he was sent a card which bears the following on its face:
AUTOMOBILE INSURANCE
JENKINS MUSIC COMPANY
(signed) Kilby F. Johns
Write your name here
AC 224214
Write your policy No. here
3--25--61
expiration date here
This card when properly signed, will identify you to representatives of the Company for performance of the services to which you are entitled under your policy, including payment of the cost of Bonds for Release of Attachment and Bail Bonds, as provided in your policy.
MANN-KLINE
Kansas City, Missouri
The back of this card contains only data which should be furnished to defendant in case the insured vehicle should be involved in an occurrence that might give rise to a claim for damages.
Defendant's chief contention is, as it was before plaintiff paid the claim for damages, that it is not liable on its policy except as an 'excess' insurer, and that plaintiff's total expenditure was less than its liability under its policy. We confess to some difficulty in fully understanding the logic of this contention, as presented. It seems to be based on a theory that, since the certificate issued to Johns under the master policy issued to Jenkins, AC224214, referred to the automobile as being 'owned' and since it was not, in fact 'owned' by Johns, as that term is defined in the master policy, some less coverage, other than full 'primary' coverage, exists. Such contention may not be based on the fact this is a temporary substitute automobile because it is the automobile described as insured. Defendant refers, in its brief herein, to definitions of an 'owned' automobile, and of a 'non-owned' automobile, as the same appear in the master policy. Such definitions or differentiations do not appear in certificate C102060 issued for and covering Johns. Johns testified to the effect that he never saw either the certificate or the master policy; that he was...
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