Tri-State Ins. Co. v. Sing

• Court: Arkansas Court of Appeals
• Writing for the Court: ROGERS
• Citation: Tri-State Ins. Co. v. Sing, 850 S.W.2d 6, 41 Ark.App. 142 (Ark. App. 1993)
• Decision Date: 17 March 1993
• Docket Number: No. CA,TRI-STATE,CA
• Parties: INSURANCE CO., Appellant, v. Perry SING, et al., Appellees. 92-363. . Division I

Page 6

850 S.W.2d 6

41 Ark.App. 142

TRI-STATE INSURANCE CO., Appellant, v. Perry SING, et al., Appellees.

No. CA 92-363.

Court of Appeals of Arkansas Division I.

March 17, 1993.

J. Rodney Mills, Fort Smith, for appellant.

David L. Rush, Paris, Hal Davis, Fort Smith, Ernie Witt, Ozark, for appellees.

ROGERS, Judge.

The appellant, Tri-State Insurance Company, appeals from an order declaring that it was obligated under a contract of insurance to provide a defense for appellees Perry Sing and Big Cat, Inc., in a lawsuit brought against them. On appeal, appellant claims error in the chancellor's ruling, contending that Sing was not an insured under the policy and that no coverage existed based on an exclusion contained in the policy. We agree that appellant had no duty to defend under the insurance policy in question, and reverse.

On the morning of May 7, 1990, appellee Perry Sing, while driving his own vehicle, was involved in an automobile accident in which Kathy Conley, the driver of the other car, was killed. As a consequence of the accident, Ms. Conley's estate pursued a wrongful death action against Sing and appellee Big Cat, Inc., Sing's employer. It was alleged in the complaint that Sing's negligence was imputed to Big Cat based on the allegation that the accident occurred during the course and scope of Sing's employment. Appellees made demand on appellant to provide them with a defense in the lawsuit, claiming that the duty to defend arose out of two policies of insurance issued by appellant to Big Cat. One of the policies was a commercial automobile policy which listed coverage for eleven scheduled vehicles, while the other was a general commercial liability policy. Appellant thereafter filed this declaratory action contending that it had no duty to defend appellees under either policy. The chancellor found that appellant was not obligated to provide appellees with a defense pursuant to the automobile policy since Sing's vehicle was not one of those listed for coverage. The chancellor determined, however, that appellant owed the duty to defend both Sing and Big Cat under the commercial liability policy.

Appellant's first argument is that the chancellor erred in finding that Sing was an insured under the policy. This argument is based on the provision in Section II of the policy defining an "insured" as:

(a) Your employees, other than your executive directors, but only for acts within the course and scope of their employment by you.

It is the appellant's contention that Sing was not an insured because the evidence reflects that he was not acting in the course and scope of his employment when the accident occurred.

As its second issue, appellant contends that the chancellor's decision was in error because coverage was excepted under the "automobile exclusion" contained in the policy. On this point, appellant relies on the provision which states that coverage does not extend to:

(g) "bodily injury" or "property damage" arising out of the ownership, maintenance, use or entrustment to others of any aircraft, auto or watercraft owned or operated by or rented or loaned to any insured. Use includes operation and loading or unloading.

The law governing an insurer's duty to defend is well-settled. As a general rule, the pleadings against the insured determine the insurer's duty to defend. Insurance Co. of North America v. Forrest City Country Club, 36 Ark.App. 124, 819 S.W.2d 296 (1991). The duty to defend is broader than the duty to pay damages and the duty to defend arises where there is a possibility that the injury or damage may fall within the policy coverage. Commercial Union Ins. Co. of America v. Henshall, 262 Ark. 117, 553 S.W.2d 274 (1977).

We find it unnecessary to address appellant's first argument questioning whether Sing was an insured under the policy. Even assuming that Sing was an...