State Farm Mutual Automobile Insurance Co. v. Pennington
| Decision Date | 26 March 1963 |
| Docket Number | No. LR-62-C-79.,LR-62-C-79. |
| Citation | 215 F. Supp. 784 |
| Parties | STATE FARM MUTUAL AUTOMOBILE INSURANCE CO., Plaintiff, v. John W. PENNINGTON and Robert Howell Summerville, Defendants. |
| Court | U.S. District Court — Eastern District of Arkansas |
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Jacob Sharp, Jr., Little Rock, Ark., for plaintiff.
J. B. Milham, Benton, Ark., for defendant John W. Pennington.
Ted Boswell (of Hall, Purcell & Boswell), Benton, and Frances Holtzendorf, Little Rock, Ark., for defendant, Robert Howell Summerville.
This is an action for a declaratory judgment of nonliability under an automobile liability policy issued by plaintiff insurance company to one Andrew Summerville. On June 25, 1960, the vehicle described in the policy, while being driven by the defendant, John W. Pennington, with permission of the named insured, Andrew Summerville, was involved in an accident as a result of which the defendant, Robert Howell Summerville (hereinafter Summerville), sustained injuries. At the time of the accident Summerville was riding in the vehicle being operated by John W. Pennington.
Plaintiff is an Illinois corporation, authorized to do business and doing business in Arkansas, and both defendants are citizens of this State. The amount in controversy exceeds $10,000, exclusive of interest and costs. Thus, federal jurisdiction is present.
After the accident Summerville filed suit against the defendant Pennington in the Circuit Court of Saline County, Arkansas, to recover damages on account of the injuries resulting from the accident. Since at the time of the accident Pennington was operating the vehicle with the permission of the named insured, Pennington was an insured within the meaning of the omnibus clause of the policy, and the insurance company was called upon to defend the suit and to pay up to its policy limits any judgment which Summerville might obtain against Pennington. The insurance company defended the action under a reservation of rights, and Summerville recovered judgment against Pennington in the sum of $18,000, no part of which has been paid.
Before Summerville had taken any steps against Pennington to collect the State court judgment, plaintiff commenced this action in this Court to secure a declaratory judgment to the effect that it is under no legal duty to pay any part of the Circuit Court judgment.1
In his separate answer Summerville denies that plaintiff is entitled to the relief sought, and, as noted, Summerville has filed a counterclaim for $10,000, plus statutory penalty and attorney's fee.2 Pennington has also answered the complaint denying that plaintiff is entitled to relief, and by way of counterclaim asks that it be declared that plaintiff is liable under its policy. Pennington also seeks to recover a penalty and attorney's fee.
The cause has been tried to the Court without a jury, and this memorandum opinion incorporates the Court's findings of fact and conclusions of law.
As the case was finally submitted, the only basis upon which plaintiff contends that it is not liable under its policy is Exclusion (g) (2) appearing in that instrument, which exclusion provides that the policy's liability coverage does not extend to "bodily injury to the insured or any member of the family of the insured residing in the same household as the insured." It is the position of plaintiff that Pennington, the insured, and Summerville, the injured party, were at the time of the accident members of the same family and residing in the same household.
The burden of establishing that contention by a preponderance of the evidence is upon the plaintiff, and at the trial plaintiff assumed that burden. While different inferences may perhaps be drawn from the evidentiary facts, there is very little, if any, dispute about the facts themselves.
John W. Pennington is the son of Ollie Pennington and Verna Mae Pennington, nee Summerville, who reside in the Traskwood community in Saline County. The defendant Summerville is the brother of Verna Mae Pennington and the brother-in-law of Ollie Pennington. Hence, Summerville is the maternal uncle of John W. Pennington.
For a number of months prior to the happening of the accident John W. Pennington, and his wife, and Summerville had been residing in the Ollie Pennington house at Traskwood. That house, which contains two rooms and a kitchen, was occupied not only by John W. Pennington, his wife, and Summerville, but also by the elder Penningtons. In addition, there were living in the house Joyce Freeman and Betty Pennington, sisters of John W. Pennington, Marshall Pennington, a brother of John W. Pennington, and Wesley Pennington, a small son of John W. Pennington by a former marriage.
The evidence discloses that John W. Pennington, his wife, and child moved into the Ollie Pennington home in November or December 1959. Prior to that time John W. Pennington and his family had lived in an apartment in the City of Benton, Arkansas, which is not far from Traskwood, and John W. Pennington and his father were both employed by the Owosso Furniture Manufacturing Co. in Benton. The occasion for John W. Pennington's moving in with his mother and father was that he had been laid off from his job at Benton and was no longer able to pay rent on the apartment. John W. Pennington, the wife, and the child remained continuously in the Ollie Pennington home until a few days after the accident, and then moved out.
For several years prior to the fall of 1959 Summerville had resided in California. It seems that during that period of time he was a married man, but when he came back to Arkansas in 1959 he and his wife had separated. Although Summerville's father resided a short distance from the Pennington home, Summerville did not move in with his father, but, as indicated, he moved in with his sister and brother-in-law, arriving at about the same time that John W. Pennington moved in. It appears further that before going to California Summerville resided at least for a time with his sister and brother-in-law.
Ollie Pennington who remained employed by Owosso after John W. Pennington was laid off was the principal and practically the entire source of support for the nine persons dwelling in his house. Neither John W. Pennington nor Summerville paid the elder Pennington or were called upon by him to pay any sums for room or board, although they may have made small financial contributions to the extent that they were able. Both John W. Pennington and Summerville did some work around the house and yard. The women did the housework.
Summerville's father operated a small farm, and Summerville was working for him on shares when the accident occurred. Summerville testified that it had been his intention prior to the accident to turn over to his brother-in-law the bulk of his income from the crop as compensation for his board and lodging, but it is clear that if he in fact entertained such an intention, it was purely voluntary on his part since Ollie Pennington was making no charge for his accommodations and his support.
As indicated, the question which the Court must determine is whether in view of the facts above stated Summerville and John W. Pennington were members of the same family, dwelling in the same household.
When definitions of the words "family" and "household" contained in dictionaries and legal encyclopedias are examined, it is apparent at once that those words have no fixed or precise meaning. They may mean one thing in one context and something quite different in another context. The Court is concerned with their meaning as they appear in an exclusion clause contained in a policy of automobile insurance, which clause was inserted for the purpose of protecting the insurance company from liability collusively imposed. Tomlyanovich v. Tomlyanovich, 239 Minn. 250, 58 N.W.2d 855, 50 A.L.R.2d 108; State Farm Mutual Automobile Insurance Co. v. James, 4 Cir., 80 F.2d 802.
The Supreme Court of Arkansas apparently has had no occasion to construe or apply a family or household exclusion clause appearing in a liability insurance policy, and Arkansas cases discussing the meaning of "family" or "household" in other contexts are of little real value here. See Central Manufacturers Mutual Insurance Co. v. Friedman, 213 Ark. 9, 209 S.W.2d 102, 1 A.L.R.2d 557; Yadon v. Yadon, 202 Ark. 634, 635, 151 S.W.2d 969; Harbison v. Vaughan, 42 Ark. 539; Greenwood & Son v. Maddox & Toms, 27 Ark. 648.3
With no ruling or particularly instructive Arkansas cases to serve as a guide, it becomes the duty of the Court to determine as best it can how the Supreme Court of Arkansas would construe the exclusion in question and how that Court would apply it to the facts shown by the record. In making that determination reference must be made to underlying principles of Arkansas insurance law and to the decisions from other jurisdictions in which the question has been presented.
It is a well settled principle of Arkansas law that ambiguous terms in an...
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