Travelers Ins. Co. v. Buckeye Union Cas. Co.

• Decision Date: 20 December 1961
• Docket Number: No. 36821,36821
• Citation: 95 A.L.R.2d 1114,18 O.O.2d 52,178 N.E.2d 792,172 Ohio St. 507
• Parties: , 95 A.L.R.2d 1114, 18 O.O.2d 52 TRAVELERS INS. CO., Appellant, v. BUCKEYE UNION CASUALTY CO. et al., Appellees.
• Court: Ohio Supreme Court

Page 507

172 Ohio St. 507

178 N.E.2d 792, 95 A.L.R.2d 1114, 18 O.O.2d 52

TRAVELERS INS. CO., Appellant, v. BUCKEYE UNION CASUALTY CO. et al., Appellees.

No. 36821.

Supreme Court of Ohio.

Dec. 20, 1961.

Syllabus by the Court.

1. A policy of automobile indemnity insurance is to be construed in the light of the subject matter with which the parties are dealing and the purpose to be accomplished, and the language used must be given its ordinary and commonly accepted meaning. (Bobier v. National Casualty Co., 143 Ohio St. 215, 54 N.E.2d 798, approved and followed.)

2. 'Loading,' as used in such insurance policy begins at the time the insured or his agents or servants connected with the truck receive the article and, as part of a continuing operation, place it upon the truck; and 'unloading' ceases when the article is taken from the truck by such persons and, as part of a continuing operation, is delivered to the customer or to a place designated for delivery. (Bobier v. National Casualty Co., 143 Ohio St. 215, 54 N.E.2d 798, approved and followed.)

3. Where an injury is caused by the claimed negligence of a third party who is not connected with the truck, who has no legal relationship to the named insured and who under normal circumstances would not be using the truck of the named insured, it must first appear, before the liability provisions of the policy become applicable, that such third party was in the actual use of the truck at the time of the injury, with the express or implied permission of the named insured.

4. 'Loading' and 'unloading' are but component parts of the overall 'use' contemplated by such an insurance contract and do not therefore become determinative of the question of liability unless or until the party charged with negligence is shown to have been actually using the truck so as to qualify as an 'insured' within the definition of that term as used in the policy.

This is an appeal from a judgment of the Court of Appeals (112 Ohio App. 386, 173 N.E.2d 173) affirming a declaratory judgment rendered in favor of the defendants by the Court of Common Pleas of Franklin County. The action was begun by The Travelers Insurance Company, appellant herein and hereinafter referred to as Travelers, against The Buckeye Union Casualty Company, hereinafter referred to as Buckeye, and John Keiser, appellees herein.

One R. T. McCracken was the owner of a tank truck, the operation of which was insured by an automobile liability policy issued by Buckeye. Keiser was a truck driver employed by McCracken. The pertinent provisions of the policy issued by Buckeye to McCracken were as follows:

'Declarations

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'Item 5. The purposes for which the automobile is to be used are business, pleasure and commercial.

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'(c) Use of the automobile for the purposes stated includes the loading and unloading thereof.

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'The Buckeye Union Casualty Company * * * agrees with the insured, named in the declarations made a part hereof * * * subject to the limits of liability, exclusions, conditions and other terms of this policy:

'Insuring Agreements

'I. Coverage A--Bodily injury liability--To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury, sickness or disease, including death at any time resulting therefrom, sustained by any person, caused by accident and arising out of the ownership, maintenance or use of the automobile.

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'III. Definition of 'insured.' With respect to the insurance for bodily injury liability and for property damage liability the unqualified word 'insured' includes the named insured and also includes any person while using the automobile and any person or organization legally responsible for the use thereof, provided the actual use of the automobile is by the named insured or with his permission. The insurance with respect to any person or organization other than the named insured does not apply: (a) to any person or organization, or to any agent or employee thereof, operating an automobile repair shop, public garage, sales agency, service station or public parking place, with respect to any accident arising out of the operation thereof, but this exclusion does not apply to a member of the same household as the named insured; (b) to any employee with respect to injury to or sickness, disease or death of another employee of the same employer injured in the course of such employment in an accident arising out of the maintenance or use of the automobile in the business of such employer.' $The Gulf Refining Company, hereinafter referred to as Gulf, operated a bulk station from which diesel fuel was sold. Gulf was insured by a policy of premises liability insurance issued by Travelers. The policy insured Gulf against liability for damages resulting from bodily injury, sickness or disease, including death caused by accident. It covered the use of owned, hired and nonowned automobiles, and such use was defined as including 'the loading and unloading thereof.' However, Travelers' policy also provided that if Gulf had other insurance against a loss covered by Travelers' policy, the liability should be borne proportionately, and, further, that the insurance under Travelers' policy in case of loss from use of a nonowned automobile should be excess insurance over any other valid and collectible insurance available to Gulf.

On April 6, 1954, Keiser drove McCracken's tank truck to the Gulf bulk station to purchase a tank load of diesel fuel for McCracken. Keiser drove the truck onto the loading platform, stopped the truck, got out of the cab and climbed up onto the bed of the truck. He removed the cover from the opening in the tank. The station was equipped with movable overhead pipes for the filling of tank trucks, and an employee of Gulf moved a pipe toward the truck in order to fill it. As the pipe got near the truck a quantity of diesel fuel rushed out onto Keiser, causing him to lose his balance. He fell from the truck to the ground, sustaining personal injuries.

Thereafter, Keiser brought suit against Gulf in the federal District Court, claiming that his injuries were a result of the negligence of the Gulf employee and praying for $100,000 damages. It was the claim of Travelers, after Keiser's suit was brought, that Buckeye's policy covered Gulf because McCracken's truck was being loaded at the time of the accident.

The principal contentions of Travelers may be found in the two final paragraphs of the amended petition and the prayer thereof, reading as follows:

'Plaintiff further says that the injuries and damages claimed by Keiser arose out of the use of a nonowned automobile under the provisions of plaintiffs policy, and arose out of the use of said truck under the provisions of the policy of defendant, The Buckeye Union Casualty Company; that, according to the claims of defendant, John Keiser, Gulf Refining Company was legally responsible for the use of the truck, to wit, the loading thereof, and such use was by R. T. McCracken or with his permission; that accordingly Gulf Refining Company is an 'insured' under the policy of defendant, The Buckeye Union Casualty Company, and is entitled to coverage thereunder against the aforesaid claims of defendant, John Keiser; that the defendant, The Buckeye Union Casualty Company, is required to defend said case No. 4619 on behalf of Gulf Refining Company; and that the insurance afforded Gulf Refining Company under plaintiff's policy is excess insurance over the insurance available to Gulf Refining Company under the policy of defendant, The Buckeye Union Casualty Company.

'Plaintiff further says that it has requested defendant, The Buckeye Union Casualty Company, to assume its obligations to Gulf Refining Company under its aforesaid policy of automobile liability insurance, and undertake the defense of said case No. 4619, and to assume, up to the limits of its policy, the responsibility for any judgment that may be therein rendered against, or any settlement which in connection therewith may be made on behalf of, Gulf Refining Company; and that defendant, The Buckeye Union Casualty Company, has declined and refused to do so.

'Wherefore, plaintiff prays the declaratory judgment of this court that, with respect to the aforesaid claims of John Keiser, Gulf Refining Company is an insured under the policy of The Buckeye Union Casualty Company and is entitled to coverage thereunder; that the coverage afforded to Gulf Refining Company under the plaintiff's policy is excess over such coverage under the policy of defendant, The Buckeye Union Casualty Company; that The Buckeye Union Casualty Company is required to undertake the defense of said case No. 4619 on behalf of Gulf Refining Company and to assume, up to the limits of its policy, the responsibility for any judgment that may be therein rendered against, or any settlement which in connection therewith may be made on behalf of, Gulf Refining company * * *.'

The allowance of a motion to certify the record brings the cause to this court for review.

Wright, Harlor, Morris, Arnold & Glander, Columbus, for appellant.

Power, Griffith & Jones, Columbus, for appellee Buckeye Union Cas. Co.

Graham, Graham, Gottlieb & Johnston, Zanesville, for appellee John Keiser.

KERNS, Judge.

At the outset, it is clear that the provisions of the insurance policy issued to Gulf by Travelers could neither enlarge nor restrict the coverage of the policy issued by Buckeye to McCracken. We are only concerned, therefore, with the contract between Buckeye and McCracken, and in construing the latter contract it is fundamental, of course, that the intent of the parties thereto, when ascertained, will be controlling. In other words, did Buckeye and McCracken intend to protect Gulf when their contract was executed?

Provisions of insurance policies similar to those now under consideration have been the subject...