U.S. Fidelity & Guaranty Co. v. Western Fire Ins. Co.

• Decision Date: 13 February 1970
• Court: United States State Supreme Court — District of Kentucky
• Parties: UNITED STATES FIDELITY & GUARANTY COMPANY, Appellant, v. The WESTERN FIRE INSURANCE COMPANY et al., Appellees. The WESTERN FIRE INSURANCE COMPANY, Appellant, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Appellee.

Page 491

450 S.W.2d 491

UNITED STATES FIDELITY & GUARANTY COMPANY, Appellant, v. The WESTERN FIRE INSURANCE COMPANY et al., Appellees.

The WESTERN FIRE INSURANCE COMPANY, Appellant, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Appellee.

Court of Appeals of Kentucky.

Feb. 13, 1970.

Marshall B. Woodson, Jr., Robert L. Durning, Jr., and Woodson, Barker & Durning, Louisville, for United States Fidelity & Guaranty Co.

A. J. Deindoerfer, Raymond O. Harmon, William P. Swain, Boehl, Stopher, Graves & Deindoerfer, Louisville, for Western Fire Ins. Co.

Henry V. B. Denzer, Hogan, Taylor, Denzer & Bennett, Louisville, for State Farm Mut. Automobile Ins. Co.

CULLEN, Commissioner.

The controlling issue in this case is whether, under the attendant circumstances, a bodily injury sustained by a passenger in a moving automobile when accidentally shot by a pistol being loaded by another passenger was an injury 'arising out of the * * * use' of the automobile within the meaning of an automobile liability insurance policy held by the owner of the automobile. The circuit court held that the injury did come within the policy and the main appeal herein questions the correctness of that holding.

Jasper Smith of Louisville owned an automobile which he permitted his daughter, Sandra, to take with her to college in Richmond, Kentucky. One spring day Sandra, her fiance Robert Casey, a girl named Marcia Brown and a boy named William Loveall commenced a journey in the automobile seeking a place in the country where they could stop and get out and William would demonstrarte his marksmanship with the pistol. Robert was driving. Sandra was in the right front seat, Marcia in the left rear seat and William in the right rear seat. William had the pistol in his possession unloaded. As the automobile traveled along the highway William took some bullets from his pocket and began to load the pistol. Marcia protested that he should not load the pistol in the car. That she was right in protesting was evidenced by the fact that the pistol immediately discharged, firing a bullet into Sandra's back. There is a stipulation in the record that neither the operation nor any movement of the automobile caused the accident, nor did any condition of the highway contribute to the accident.

Sandra sued William for damages for personal injuries. William's father had a 'homeowner's' insurance policy with the Western Fire Insurance Company, which covered liability of members of the family for personal injuries caused by them to other persons except in 'the ownership, maintenance, operation, use, loading or unloading of automobiles * * *.' Despite its contention that its policy did not provide coverage because the shooting was in the 'use' of an automobile, Western undertook the defense of Sandra's suit. Eventually Western settled the suit for $4,500. Western's total outlay, including attorney's fees and costs, amounted to $5,972.60.

The action here on appeal was brought by Western against United States Fidelity and Guaranty Company, and State Farm Mutual Automobile Insurance Company, seeking to recover from them the amount of Western's outlay in the settlement of Sandra's suit against William. U.S.F. & G. had issued a policy to the owner of the automobile (Sandra's father) which covered the liability of any person using the automobile with the consent of the named insured, for bodily injury 'arising out of the ownership, maintenance or use' of the automobile. Western's theory was that William was using the automobile (as a passenger) and that the discharge of the pistol arose out of the use. State Farm had issued a policy to William's father, covering liability of members of his family using an unowned automobile, for bodily injury caused by accident 'arising out of the ownership, maintenance or use' of such automobile. However, State Farm's policy, as to use of an unowned automobile, provided coverage only as 'excess over other collectible insurance.' Western's theory as to State Farm is that if for some reason U.S.F. & G. should be held not liable, State Farm would be liable under its coverage of 'use' of an unowned automobile.

The trial court held that the discharge of the pistol arose out of the use of the Smith automobile within the meanings of the exclusion clause of Western's policy and the coverage clause of U.S.F. & G.'s policy, wherefore the liability for the accident rested on U.S.F. & G. Judgment was entered accordingly, awarding Western recovery against U.S.F. & G. for Western's outlay in the settlement of Sandra's claim. The judgment dismissed Western's claim against State Farm because the latter had obligated itself only for 'excess' coverage and none had been sought above that provided by U.S.F. & G.

U.S.F. & G. has appealed as against Western, maintaining that the trial court erred in holding it liable under...