Vernon v. Harleysville Mut. Cas. Co., 18197

• Decision Date: 14 April 1964
• Docket Number: No. 18197,18197
• Court: South Carolina Supreme Court
• Parties: Charles VERNON, Respondent, v. HARLEYSVILLE MUTUAL CASUALTY COMPANY, Respondent, and American Security Insurance Company, Appellant.

Page 841

135 S.E.2d 841

244 S.C. 152

Charles VERNON, Respondent, v. HARLEYSVILLE MUTUAL CASUALTY COMPANY, Respondent, and American Security Insurance Company, Appellant.

No. 18197.

Supreme Court of South Carolina.

April 14, 1964.

Leatherwood, Walker, Todd & Mann, Greenville, for appellant.

Sol E. Abrams, Haynsworth, Perry, Bryant, Marion & Johnstone, Greenville, for respondent.

MOSS, Justice.

This action is one under the 'Uniform Declaratory Judgments Act', Section 10-2001 et seq., 1962 Code of Laws. It is brought by Charles Vernon, a respondent herein, against Harleysville Mutual Casualty Company, a respondent herein, and American Security Insurance Company, appellant herein, seeking a declaratory judgment to determine which of the two insurance companies, or if both are primarily responsible for a judgment obtained by him against an uninsured motorist.

Charles Vernon, a used car dealer, was the owner of a 1960 Plymouth automobile. On July 11, 1962, one Thomas D. Johnson went to the place of business of Vernon to purchase an automobile. Vernon delivered to Johnson the aforesaid Plymouth automobile and permitted him to test drive the same with a view to purchasing it. While Johnson was operating this automobile he was in collision with an automobile operated by one William Morgan, an uninsured motorist, resulting in damage to said plymouth automobile. Vernon brought suit against Johnson and Morgan for damages to the Plymouth automobile and obtained a judgment against the said Morgan for $1,543.00 actual damages. It is agreed that the Plymouth automobile was damaged through the negligence of the uninsured motorist and that Johnson was not negligent in any respect in the operation of the Plymouth automobile.

Harleysville had issued a liability policy to Vernon containing an uninsured motorist endorsement, with a $200.00 deductible provision with respect to property damage, by which it agreed:

'To pay all sums which the insured * * * shall be legally entitled to recover as damages from the owner or operator of an uninsured automobile because of:

'(b) injury to or destruction of (1) an automobile * * * owned by the named insured * * *'

It is further provided in said policy that:

'With respect to property damage, the insurance afforded under this endorsement shall be excess insurance over any other valid and collectible insurance against such property damage.'

American had issued a collision insurance policy to Thomas D. Johnson and agreed with its insured:

'To pay for loss caused by collision to the owned automoile or to a non-owned automobile * * *'

It was further provided in said policy, under the 'other insurance' provision, that as to a non-owned automobile the coverage provided by said policy 'shall be excess insurance over any other valid and collectible insurance.' The policy defines a 'non-owned automobile' as a private passenger automobile not owned or furnished for the regular use of either the named insured or any relative of said insured.

It is the position of Harleysville that the insurance provided by American is 'other valid and collectible insurance against the property damage for which claim has been made by' Vernon and that Harleysville's policy is excess insurance to that provided in the American policy. American contends that its policy does not provided coverage to Vernon nor is there any contractual obligation between the parties and the uninsured motorist law is not applicable to its policy. It further contends that if coverage is afforded, it is excess to that provided by Harleysville.

This case came on for trial before the Honorable James H. Price, Jr., Judge of the Greenville County Court and, by agreement, was tried without a jury. The Trial Judge held that American was primarily liable for the payment of the judgment secured by Vernon against the uninsured motorist. We quote from his order the following:

'I, therefore, find that American Security Insurance Company insured the automobile in question and is primarily liable for the judgment of the plaintiff in the amount of $1,543.00 less the deductible of $50.00. I further hold that Harleysville Mutual Casualty Company also afforded coverage to the plaintiff which was excess coverage. If for any any reason it should be determined that American Security Insurance Company was not primarily liable, then such primary responsibility becomes that of Harleysville less, however, the $200.00 deductible.'

American has appealed from the aforesaid order and asserts that its policy does not provide coverage to the respondent.

The liability policy issued to Vernon by Harleysville included an uninsured motorist endorsement as was mandatorily required by the Uninsured Motorist Act, Section 46-750.14, 1962 Code of Laws. The Unitsured Motorist Act came into being by legislative enactment as a result of public concern over the increasingly important problem arising from injuries and damage inflicted by motorists who are uninsured and financially irresponsible. Its purpose was to provide financial recompense to innocent persons who receive bodily injury, property damage and to the dependents of those who lose their lives through the wrongful conduct of uninsured motorists. The Act provided that the endorsement shall contain a provision requiring the insurer to pay to the insured 'all sums which he shall be legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle', not exceeding $5,000.00 coverage for injury to or destruction of the property of the insured, but authorizing an exclusion of the first $200.00...