U-Haul Company of Southern California, Inc. v. State Farm Mutual Automobile Insurance

California Court of Appeal Aug 14, 1975 No. Civ. 35338Published

Before: Draper

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Holding. The court held that an insurance policy's definition of a nonowned automobile as a four-wheel vehicle is not ambiguous and effectively excludes a six-wheel commercial truck, and that public policy does not mandate coverage for nonowned vehicles in ordinary automobile insurance policies.

Issues

Whether an insurance policy's definition of a nonowned automobile as a four-wheel vehicle is ambiguous and unenforceable regarding a six-wheel truck.
Whether public policy mandates that an ordinary automobile insurance policy must cover the insured when driving a nonowned vehicle.

Disposition. affirmed

Quotations verified verbatim against the opinion

“These repeated emphases upon the need to look to the definition, we conclude, remove any element of obscurity, concealment, or ambiguity which might otherwise be found.”

“The State Farm policy here involved is an “ordinary automobile insurance policy,” and thus its coverages are prescribed only by section 11580.1.”

Opinion

DRAPER, P. J.

This action in fact is a dispute between two insurers as to which must bear the loss sustained in a single accident. The named plaintiff is insured by Continental Casualty Company, which brought the action in the name of its insured.

One Datis Malone owned a two-door Toyota sedan, which defendant State Farm insured against public liability and property damage. Malone’s policy also covered him while using certain nonowned automobiles.

In the course of its normal truck rental business, U-Haul rented to Dolores Jackson a Ford truck 16 feet long and having 6 wheels. The truck was a commercial vehicle within the code definition (Veh. Code, § 260).

Ms. Jackson used the truck to transport her household furniture from Los Angeles to Fairfield. At her request, Malone drove the loaded truck for her, without compensation and solely as a matter of friendship. As

[668]

the truck driven by Malone neared the end of the journey, it collided with the automobile of O’Hara. The O’Haras filed action for damages for bodily injury and property damage against U-Haul, Malone, and others who were not connected with ownership or operation of the truck. The O’Haras’ action as against U-Haul and Malone was settled. Continental contributed $1,728, which is stipulated to be a fair and reasonable settlement. Continental also spent $1,013 for reasonable expenses and attorney’s fees in defense of the O’Hara action, defense of which for U-Haul and Malone had been tendered to and refused by State Farm. This action sought a declaration that Continental is entitled to recover these expenditures from State Farm. Judgment was for State Farm. U-Haul [Continental] appeals.

The State Farm policy on Malone’s Toyota extends to nonowned automobiles, but defines such an automobile as a “four-wheel land motor vehicle.” It contends that this limitation excludes the six-wheel truck driven by Malone at the time of the collision.

An exclusion in an insurance policy must be phrased in clear and understandable language.

(Migliore

U-Haul Company of Southern California, Inc. v. State Farm Mutual Automobile Insurance

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DRAPER, P. J.

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