Flying Tiger Lines, Inc. v. Truck Insurance Exchange

Opinion

CHRISTIAN, J. Pacific Intermountain Express Company, a corporation (hereinafter PIE) appeals from a judgment determining that it is not entitled to indemnity from Flying Tiger Lines, Inc. (hereinafter Flying Tiger) in the event that PIE is required to bear the loss occasioned by an injury to a PIE employee caused by the negligence of a Flying Tiger employee.

The injured PIE employee, Ramirez, was struck by boxes which fell while a Flying Tiger employee was loading Ramirez’s PIE truck. PIE was insured by Truck Insurance Exchange (hereinafter Truck), and Flying Tiger was insured by Eagle Star Insurance Company (hereinafter Eagle Star). Ramirez commenced an action against Flying Tiger, alleging that the injury was caused by the negligence of its employee. Flying Tiger in turn brought the present action against Truck, seeking a declaration that Truck, PIE’s insurer, owed an obligation to Flying Tiger under the “loading and unloading” provision of PIE’s policy. Truck cross-complained for a declaration of liability against Flying Tiger’s insurer, Eagle Star. PIE intervened seeking a declaration that it should be indemnified by Flying [134]Tiger for any amount which PIE would be required to expend as a result of any judgment in favor of Ramirez.

PIE’s claim for indemnification is based on the fact that, if Ramirez secures a judgment against Flying Tiger, and if Flying Tiger is held to be insured under PIE’s policy with Truck, any loss up to $50,000 which Truck might pay will ultimately fall on PIE under a “Retrospective Premium Determination Agreement,” which is part of PIE’s policy with Truck. The agreement provides that PIE’s premium is to be increased by the amount of each paid claim up to $50,000 (with qualifications not here pertinent). Prior to trial, Flying Tiger and Truck entered into a stipulation which established, in part, that Flying Tiger and its employee were covered under both the Truck and Eagle Star policies.

The court determined that PIE was not entitled to indemnity from Flying Tiger, on the theory that PIE’s anticipated liability had not been imposed by law, but had been instead voluntarily assumed under the terms of its insurance contract with Truck. PIE appeals.

Appellant concedes that equity should take little interest in the assignment of a loss as between two insurance carriers, because “to the public it makes little difference which of two insurers is ultimately held responsible for a particular loss.” (Pacific Indem. Co. v. Liberty Mut. Ins. Co. (1969) 269 Cal.App.2d 793, 796 [75 Cal.Rptr. 559]; see also Wilshire Ins. Co. v. Transit Cas. Co. (1967) 248 Cal.App.2d 719, 724 [54 CaL.Rptr. 861].) But, PIE argues, it may ultimately be required to pay the entire amount of the Ramirez judgment, because section 16451 of the Vehicle Code designates Flying Tiger and its employee as additional insured parties under the Truck policy.1