Case Title: State Farm Mutual Automobile Ins. Co. v. Latham

Citation: 249 So. 2d 375

Docket Number: 46240

State: mississippi

Court: Mississippi Supreme Court

Date: 1971-06-07T00:00:00Z

Document:
249 So. 2d 375 (1971) STATE FARM MUTUAL AUTOMOBILE INSURANCE CO., Defendant-Appellant, v. Mrs. Janelle C. LATHAM, Plaintiff-Appellee. No. 46240. Supreme Court of Mississippi. June 7, 1971. Lipscomb, Barksdale, Steen & Caraway, Jimmy B. Reynolds, Jr., Jackson, for defendant-appellant. Roy Noble Lee, Tom S. Lee, Forest, for plaintiff-appellee. PATTERSON, Justice: The State Farm Mutual Automobile Insurance Company appeals from a judgment of the Circuit Court of Scott County in favor of Mrs. Janelle C. Latham in the sum of $5,000. The facts, which are not in controversy, are as follows: On February 19, 1965, State Farm issued an insurance policy to Kelly N. Latham and his wife, Janelle C. Latham. This policy contained death benefits, pertinent here, in these terms: On March 21, 1968, while the policy was in effect, Kelly N. Latham was killed in an automobile accident enroute to his work. At the time he was driving a 1968 Chevrolet pickup truck owned by Forest Constructors, Inc., his employer. This vehicle, which was furnished to plaintiff's decedent for his use, was registered with the Motor Vehicle Comptroller's office as a commercial vehicle. Though against the policy of Forest Constructors, Inc., for the pickup truck to be used except in work-related activities, it was nevertheless, with the knowledge of the company, often used for personal purposes by Kelly N. Latham. From these facts the trial court, sitting without a jury, concluded that the provisions of Insuring Agreement IV, Death Benefits, were applicable and entered its judgment in favor of the insured. State Farm contends on appeal that the trial court erred in finding that the pickup truck was not a commercial vehicle and excluded under the terms of the policy. The exclusion relied upon is: The term, "commercial automobile" in the above provision is defined by Section 6(b) of the declarations of the policy as follows: The issue before the Court is whether the vehicle which the appellee's husband occupied at the time of his death was a "commercial automobile" as defined in the policy. There is no question but that the vehicle was being used for a commercial purpose at the time of the accident. The use of the vehicle is not dispositive, however, of the issue since the policy expressly defines "commercial automobile" with reference to the coverage in question. The policy definition, being that agreed upon by the contracting parties, must be accepted and applied. The decisive issue is the application of the definition to the vehicle in question. It must be determined whether the vehicle is the counterpart of the definition set forth in the policy. If it comes within the definition, coverage is excluded; if it does not, the policy affords coverage; or if the definition is susceptible of more than one meaning so that the vehicle may or may not come within the classification, then it is ambiguous and coverage is afforded through the legal theory that the policy should be construed most strictly against the insurer and in favor of the insured. Aetna Life Ins. Co. v. Evins, 199 So. 2d 238 (Miss. 1967); American Hdw. Mutual Ins. Co. v. Union Gas Co., 238 Miss. 289, 118 So. 2d 334 (1960); *377 Lumbermen's Mutual Casualty Co. v. Broadus, 237 Miss. 387, 115 So. 2d 130, 74 A.L.R.2d 1248 (1959); and Southern Home Ins. Co. v. Wall, 156 Miss. 865, 127 So. 298 (1930). We repeat the definition in the policy: We note the policy does not contain a statement in its exceptions delineating the business occupation of the named insured. In the absence of such statement the general exclusion afforded by Paragraph "B" of Insuring Agreement IV would prevail, we think, as the policy definition of a commercial automobile. This paragraph employs only the term "commercial automobile" without further qualification. At best this definition is general and subject to many interpretations. The distinction between an automobile used principally for pleasure and a pickup truck used principally for commercial purposes, though fairly obvious when viewed generally, becomes more elusive and less certain of definition when the family automobile is put to use in conveying objects necessary to a business, or when the pickup truck used generally around a farm or other commercial enterprise during the work days of the week becomes the family recreational vehicle over the weekend. Though we believe the varied constructions placed upon "commercial automobile" are indicative of an ambiguity, and particularly so since the business occupation of the insured was not stated so that the point might be clarified, we do not decide this case upon that basis. We will assume, for the purpose of this opinion, since the answer of State Farm avers that the decedent was employed by Forest Constructors, Inc., that this was his principal occupation. We are of the opinion, nevertheless, that the definition of a commercial vehicle set forth in Section 6(b) is uncertain or ambiguous when it is contrasted with the use to which the truck was generally put. The facts are that the pickup truck was furnished to the decedent by his employer for the principal purpose of going to and returning from his work. The further facts are, however, that the truck was often used for the personal purposes of the employee. The policy definition restricts a commercial vehicle to one used principally in the business occupation of the insured including occasional personal use. A literal construction of this definition would exclude, in our opinion, a vehicle that was often used for pleasure. We are unable to determine at what point a deviation from the principal use and an increasing personal use would transform the vehicle's classification from commercial to pleasure. The cases cited are not too enlightening since they were decided upon different factual situations. The case most analogous to the present one is Bauerle v. State Farm Mutual Automobile Insurance Company of Bloomington, Illinois, 153 N.W.2d 92, 96 (N.D. 1967). The Court there in considering an insurance policy containing identical exclusionary language held that a pickup truck which was used principally on a commercial farm and procured for that purpose was excluded under the policy. It stated: We note that the vehicle there was "sometimes used for pleasure." This factor obviously influenced the decision as the Court stated later in its opinion: If the "incidental" or "sometimes used" in Bauerle were supplanted with "often used" for pleasure and non-economic purposes, the Court logically could have found the exclusionary clause was not applicable. We do not mean to indicate that the Court would have done so. We do think, however, that the present facts afford a clear distinction from those before the North Dakota Court and that the persuasive force of its opinion is diminished by these facts. The remaining cases cited by the appellant from other jurisdictions have greater distinction than the above and we do not belabor them since each case of this nature, the application of definitive terms to a factual situation, must be determined upon a case-to-case basis. In American Hardware Mutual Insurance Company v. Union Gas Company, 238 Miss. 289, 293-294, 118 So. 2d 334, 335 (1960), a case involving an exclusionary clause, we adopted the general rule announced in 29 Am.Jur., Insurance, section 264: We then decided that the words "in streets or highways" were ambiguous due to the large number of differing interpretations of their meanings and reaffirmed the former decisions of the Court in this language: See also Great American Insurance Co. v. Bass, 208 Miss. 436, 44 So. 2d 532 (1950); Evana Plantation, Inc. v. Yorkshire Insurance Co., 214 Miss. 321, 58 So. 2d 797 (1952), as well as Maryland Casualty Company of Baltimore, Md. v. Beckham, 163 Miss. 836, 839, 143 So. 886 (1932), with reference to whether a vehicle was being used by the insured so as to come within *379 the policy exclusionary paragraph, wherein we stated: We conclude that the clause "including occasional use for personal purposes" when applied to the admitted fact of "often used" for personal purposes, creates an ambiguity or uncertainty and that this uncertainty created by the language of the insurer must be resolved against it and in favor of the insured, and particularly so since the definition sought to be imposed by the insurer would defeat the purpose of the policy if followed. Affirmed. All Justices concur.