Truck Ins. Exchange v. Hanson
| Decision Date | 13 March 1953 |
| Docket Number | No. 32208,32208 |
| Citation | 254 P.2d 494,42 Wn.2d 256 |
| Court | Washington Supreme Court |
| Parties | TRUCK INS. EXCHANGE, v. HANSON et al. |
Claude K. Irwin, Pullman, J. D. McMannis, Colfax, Neill & Aitken, Pullman, for appellants.
Hamblen, Gilbert & Brooke, Spokane, for respondent.
Emil Hanson, sixteen years of age, arranged to purchase a pickup truck from Byron Cook. His father was required to cosign a note for the purchase price and a chattel mortgage to secure the payment thereof.
Cook, the seller, had a policy of public liability insurance on the truck at the time of the sale. The agent of the insurance company, learning of the sale, approached the father, while he was transacting business with a customer in his tailor shop, and solicited the transfer of the Cook policy to the father, and assumed all of the facts pertinent to such a transfer. He knew his company would not write a policy on a truck owned by a minor.
The policy here in question is one of public liability insurance protecting the father against any judgment secured against him arising out of the ownership, maintenance or use of the truck in question.
On July 9, 1950, Emil and his minor sister, Audrey, were in a serious accident near Pullman, Washington. Audrey was driving the truck. Joyce Marshall was severely injured. Joyce Marshall and her husband, Lloyd, commenced an action against Emil Hanson, his sister, and his father and mother. The defense of the action was tendered by the father to the plaintiff herein. It declined to assume the defense unless Emil Hanson and his father would sign a nonwaiver agreement under which it would retain the right to deny coverage under the policy.
Plaintiff then brought this action for a declaratory judgment to invalidate the policy upon the grounds of fraud.
The trial court found that the father did not intentionally misrepresent any fact, and, hence, that no fraud was established. However, the trial court held the policy invalid upon the ground that the father did not have an insurable interest in the truck.
The defendants appeal, and assign that ruling as error.
The policy in question is not a policy of collision insurance on an automobile. Under its terms, no payments are to be made to the father by reason of any injury or damage to the truck. It is, therefore, immaterial whether he had a financial interest in it or not. The contingency against which the father is insured under the terms of the policy, is liability to third persons arising out of the ownership, maintenance or use of the truck. It is axiomatic that any one has financial interest in protecting himself against liability arising out of the use of any instrumentality.
The rule is well stated in 6 Blashfield, Cyclopedia of Automobile Law & Practice (Perm.ed.) 537, § 3873, as follows 'The rule requiring possession by the insured of an insurable interest in the property forming the subject matter of the insurance, which prevails generally in casualty insurance, is not applicable to liability indemnity policies.
'The character of the insurance is quite different from insurance, against injury or loss, of the property insured by fire, theft, collision, or the like, where the insured is required to have some real interest in the property insured; in the case of liability insurance the risk and hazard insured against is not the injury or loss of the property named in the policy, but against loss and injury caused by the use of the property therein named, for which the insured might be liable, and the right of the insured to recover does not depend upon his being the holder, in fact, of either a legal or equitable title or interest in the property, but whether he is primarily charged at law or in equity with an obligation for which he is liable.'
In Davis v. California Highway Indemnity Exchange, 118 Cal.App. 403, 5 P.2d 447, 448, the rule is stated in this manner:
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