United States Fidelity and Guaranty Company v. Trussell

• Decision Date: 13 August 1962
• Docket Number: Civ. A. No. 1168.
• Court: U.S. District Court — Western District of Virginia
• Parties: UNITED STATES FIDELITY AND GUARANTY COMPANY, Plaintiff, v. Janet TRUSSELL et al., Defendants.

208 F. Supp. 154

UNITED STATES FIDELITY AND GUARANTY COMPANY, Plaintiff, v. Janet TRUSSELL et al., Defendants.

Civ. A. No. 1168.

United States District Court W. D. Virginia, Roanoke Division.

August 13, 1962.

Robert E. Glenn, of Eggleston, Holton, Butler & Glenn, Roanoke, Va., for U. S. Fidelity & Guaranty Co.

Bentley Hite, Christiansburg, Va., for Janet Trussell and Thomas Trussell.

John H. Locke, of Gentry, Locke & Rokes, Roanoke, Va., for Thomas S. Brookfield, Southern Houseware Service, Inc., and Lumbermens Mutual Casualty Co.

Carroll D. Rea and Geo. Scott Shackleford, Jr., of Hazlegrove, Shackleford & Carr, Roanoke, Va., for Radford Auto Exchange, Inc.

W. H. Jolly, of Kime & Jolly, Salem, Va., for Harleysville Mutual Casualty Co. A. M. Harman, Jr., Pulaski, Va., and Howard C. Gilmer, Jr., of Gilmer, Harman & Sadler, Pulaski, Va., for Home Finance Co. of Pulaski and Travelers Ins. Co.

William B. Poff of Woods, Rogers, Muse & Walker, Roanoke, Va., for Clinton Kanode, Charles Sayers, T/A Kanode Motor & Fidelity & Casualty Co. of N. Y.

DALTON, Chief Judge.

This declaratory judgment action was heard on a stipulation of facts agreed to by all parties involved. Essentially, the controversy arises out of a series of transactions relating to a 1955 Chevrolet Sedan, which allegedly became involved in an accident on December 30, 1960, while being driven by one of the defendants, Thomas Trussell. In that accident Thomas Brookfield, another of the defendants, allegedly sustained serious personal injuries for which he has instituted an action in the Circuit Court of Montgomery County, Virginia, against Thomas Trussell, which action is set for trial in October, 1962.

The issue before this Court is the determination of which of the parties involved in this suit shall be responsible in whole or in part for any liability incurred by Thomas Trussell as a result of the alleged accident.

The facts of the case are as follows:

During the month of May, 1960, Radford Auto Exchange, Inc., one of the defendants, purchased a 1955 Chevrolet Sedan from Kenny Ross Chevrolet, Inc., in Pittsburgh, Pennsylvania. A Commonwealth of Pennsylvania certificate of title to this automobile was assigned and delivered from Kenny Ross Chevrolet, Inc., to Radford Auto Exchange, Inc. An agent of Radford Auto Exchange took possession of the automobile in Pittsburgh, the place of transfer, and brought the vehicle to the place of business of Radford Auto Exchange in Montgomery County, Virginia.

On or about May 24, 1960, Radford Auto Exchange undertook to sell the 1955 Chevrolet to Eugene B. Bowman under a conditional sales contract. A Reassignment by the Registered Dealer was executed by Radford Auto Exchange to Eugene B. Bowman, and Bowman executed an application for certificate of title. These papers were never forwarded to the Division of Motor Vehicles of the Commonwealth of Virginia, but at some time subsequent, probably during June, 1960, the papers, including the Pennsylvania title, were delivered to Bowman. The conditional sales contract was for value received assigned by Radford Auto Exchange to Home Finance Company, a finance company of Pulaski, Virginia, engaged, among other things, in financing automobiles.

Bowman defaulted on his payments on the automobile, and the automobile was repossessed from him by agents of Home Finance Company who took possession of the car with the consent of Bowman in Winston-Salem, North Carolina. At the time of taking possession of the automobile, the agents of Home Finance Company obtained from Eugene Bowman his signature on a Release and Request for Private Sale and a Power of Attorney. Bowman advised the agents of Home Finance Company that the title papers were at his home and that they might obtain them from his wife. The agents of Home Finance Company went to the Bowman home in Winston-Salem, North Carolina, where Mrs. Bowman searched for the papers but was unable to locate them. This repossession took place on November 23, 1960. The title papers were not obtained from Bowman until some time after January 20, 1961, well after the accident.

The automobile, upon repossession, was returned to the lot of Home Finance Company in Pulaski, Virginia, where it was stored for a short period. During the early part of December, 1960, the 1955 Chevrolet was delivered by Home Finance Company to Kanode Motor Company, a party defendant, in Blacksburg, Virginia, for the purpose of resale. No title papers to the car had been acquired by Home Finance at that time, and consequently none were delivered to Kanode Motor Company with the car.

On December 17, 1960, Kanode Motor Company agreed to sell and Thomas Trussell agreed to purchase the Chevrolet Sedan. As a part of this transaction, Thomas Trussell delivered to Kanode Motor Company a 1947 Pontiac registered in the name of Janet Trussell, his daughter. Thomas Trussell and Janet Trussell resided in the same household. A form bill of sale was completed by Kanode Motor Company setting forth the terms of the transaction and stating that the car was "Sold to Thomas Trussell". License plates on the 1947 Pontiac were transferred to the 1955 Chevrolet and a receipt was issued by Kanote Motor Company to Thomas and Janet Trussell for the transfer fee. The title papers to the Pontiac were not delivered to Kanode Motor Company, and, of course, no title papers were delivered by Kanode to Trussell since Kanode had none to deliver. However, on December 21, 1960, Home Finance Company received a check for $325.00 and conditional sales papers on the Chevrolet from Kanode Motor Company.

Thomas Trussell obtained possession of the 1955 Chevrolet on December 17, 1960, and was in possession on December 30, 1960. On that date he was operating the 1955 Chevrolet on his way to work at the Radford Arsenal near Radford, Virginia, when he was allegedly involved in an accident wherein Thomas Brookfield, a party defendant in this suit, allegedly sustained serious personal injuries which he alleges to have been caused by the negligence of Thomas Trussell in his operation of the 1955 Chevrolet. At the time of this accident the title papers of the 1955 Chevrolet were still in the possession of Eugene Bowman in Winston-Salem, North Carolina, and at the time no title papers for the vehicle had been filed or registered with the Virginia Division of Motor Vehicles.

Thomas Trussell, some time on or after December 19, 1960, and on or before January 6, 1961, requested the agent of United States Fidelity and Guaranty Company, Leonard L. Brown Insurance Agency, Blacksburg, Virginia, to endorse United States Fidelity and Guaranty Company's policy of insurance to show a change of vehicles. For the purposes of this opinion it is not necessary to determine the exact date that such a request was made, but the evidence of Mrs. Hill, an employee of the Brown Insurance Agency, fixes the date of the request as January 6, 1961, which the Court adopts as the best evidence of the date requesting a transfer of the policy. It is known for certain that on January 6, 1961, United States Fidelity and Guaranty Company issued a "Change in Automobile Policy Endorsement" to a policy which it had issued to Janet Trussell on the 1947 Pontiac, transferring the insurance to the 1955 Chevrolet Sedan.

During the latter part of the month of January, 1961, Home Finance Company obtained the title papers from Eugene Bowman and delivered them to Kanode Motor Company. A Reassignment by Registered Dealer, signed in blank by Radford Auto Exchange, was delivered to Charles Sayers, Kanode Motor Company, during January, 1961. This document, executed at the request of Mr. Sayers, one of the owners of Kanode Motor Company, who was concerned with straightening out the "sale" to Thomas Trussell, was the second of its kind issued by Radford Auto Exchange, the first having been made out to Eugene Bowman. The issuance of such a second Reassignment by Registered Dealer was of course illegal. Sayers filled in the form showing transfer to Kanode Motor Company inserting and using the date of December 10, 1960. A Reassignment by Registered Dealer was then executed by Kanode Motor Company to Janet Trussell and all of these papers together with the Pennsylvania registration papers were received by the Division of Motor Vehicles on February 6, 1961.

The plaintiff herein, the United States Fidelity and Guaranty Company, insured Janet Trussell under a family automobile liability policy with the following coverages which are pertinent to this controversy: Bodily injury liability, $15,000 each person and $30,000 each occurrence; property damage liability, $5,000 each occurrence.

Defendants Clinton Kanode and Charles Sayers, partners trading as Kanode Motor Company, are insured under an "Automobile Dealer and Repair Shop, Storage Garage and Service Station Policy" issued by the defendant, The Fidelity and Casualty Company of New York. The pertinent coverages are bodily injury liability, $50,000 each person and $100,000 each accident; property damage liability, $10,000 each accident.

Defendant Home Finance Company is insured by a "Comprehensive Automobile Liability Policy" issued by The Travelers Insurance Company. The coverages being: bodily injury liability, $500,000 each person and $1,000,000 each accident; property damage liability, $25,000 each accident.

Defendant Southern Houseware Service, Incorporated, employed Thomas Brookfield and suffered property damage in the alleged accident.

Defendant Lumbermens Mutual Casualty Company provided workmen's compensation insurance coverage for Southern Houseware Service, Incorporated, as of December 30, 1960, and has filed a lien notice for the benefits paid to Brookfield.

The Harleysville Mutual Insurance Company, a defendant, provided liability and uninsured motorist coverage for the vehicle which Brookfield was operating at the time of the accident giving rise to this controversy. In view of the...