Title: AETNA INSURANCE CO v CAMERON

State: montana

Issuer: Montana Supreme Court

Document:

NO. 81-221 IN THE SUPREBE COURT OF THE STATE OF MONTANA AETNA INSURANCE COMPANY, Plaintiff and Appellant, VS. EARL CAMERON d/b/a CAMERON TRUCK REPAIR and SUHR TRANSPORT and GENE LENZ, d/b/a GENE LENZ CONSTRUCTION, ~efendants and Respondents. Appeal from: District Court of the Eleventh Judicial District, In and for the County of Flathead. Honorable Nat Allen, Judge presiding. Counsel of Record: For Appellant: Warden, Christiansen & Johnson, Kalispell, Montana For Respondents: Murray, Kaufman, Vidal and Gordon, Kalispell, Montana E . Eugene Atherton, Kalispell, Montana Filed: Submitted on briefs: July 9, 1981 Decided: September 15, 1981 Y U' Clerk M r . J u s t i c e Frank B. Morrison, Jr., delivered t h e Opinion of t h e Court. P l a i n t i f f , Aetna Insurance Company (Aetna), appeals from an order and judgment of the D i s t r i c t Court which denied i t s motion f o r summary judgment and granted summary judgment t o the respondents. I n i t s complaint Aetna asked f o r a d e c l a r a t o r y judgment construing a cargo insurance p o l i c y issued t o t h e respondent E a r l Cameron, a self-employed hauler of heavy equipment. The policy insured goods hauled by Cameron a g a i n s t " d i r e c t physical l o s s o r damage caused by: . . . 5. Accidental c o l l i s i o n of carrying conveyance with any o t h e r v e h i c l e o r object" b u t excluded coverage f o r : ". . . j . Loss o r damage caused by t h e v e h i c l e coming i n c o n t a c t with any portion of t h e roadbed, curbing, r a i l s o r ties of railways; "k. Loss o r damage caused d i r e c t l y o r i n d i r e c t l y by t h e load o r any p o r t i o n thereof o r t a r p a u l i n covering thereon coming i n t o c o n t a c t with any o t h e r o b j e c t unless the carrying v e h i c l e a l s o c o l l i d e s with such o b j e c t . . ." O n November 2 , 1979, Cameron w a s hauling a f o r k l i f t owned by respondent Gene Lenz from K a l i s p e l l , Montana, t o Columbia F a l l s , Montana. Before reaching i t s d e s t i n a t i o n , t h e f o r k l i f t mast s t r u c k a r a i l r o a d overpass causing extensive damage t o t h e f o r k l i f t . The c o l l i s i o n between t h e f o r k l i f t and t h e overpass caused t h e t r a i l e r t o swerve and s t r i k e t h e overpass supports. The i s s u e r a i s e d by t h i s appeal i s whether t h e damage r e s u l t e d from a p e r i l insured a g a i n s t under the policy. There a r e no disputed genuine i s s u e s of m a t e r i a l f a c t . Aetna contends t h e damage was n o t covered f o r t h r e e reasons. F i r s t , t h e primary coverage required a t l e a s t two occurrences i n t h e proper sequence before coverage e x i s t e d : (1) t h e carrying conveyance o r t r a i l e r must i n i t i a l l y c o l l i d e with an o b j e c t , and ( 2 ) t h e c o l l i s i o n between the t r a i l e r and o b j e c t must d i r e c t l y cause t h e physical damage o r l o s s t o the cargo. A c o l l i s i o n between t h e cargo and a f o r e i g n ob- j e c t which i s t h e d i r e c t cause of t h e damage i s not, argues a p p e l l a n t , within t h e insured p e r i l . Second, the overpass formed p a r t of t h e railway roadbed, t h e r e f o r e , exclusion ( j ) of the policy precludes coverage. L a s t l y , t h e accident w a s covered by exclusion ( k ) . Appellant contends t h a t t h e conveying v e h i c l e d i d n o t c o l l i d e with t h e same o b j e c t a s d i d the cargo thus making exclusion (k) operative. The respondents contend ambiguity e x i s t s r e q u i r i n g j u d i c i a l construction of t h e policy. Respondents r e l y upon ambiguity being construed a g a i n s t t h e insurance c a r r i e r . W e hold t h a t t h e general r i s k provision and exclusion ( k ) , a r e ambiguous when read together. The insured i s e n t i t l e d t o a favorable construction. Under t h e f a c t s of t h i s case, a reasonable i n t e r p r e t a t i o n of t h e policy provisions supports t h e judgment of t h e D i s t r i c t Court. Aetna has c i t e d numerous cases a r i s i n g from cargo c o l l i s i o n s where t h e c o u r t s have found no ambiguity, and have held t h a t t h e p l a i n meaning of t h e terms and d e f i n i t i o n s denied coverage f o r cargo c o l l i s i o n s . Hamilton Trucking Service, Inc. v. Automobile Ins. Co. (1951), 39 Wash.2d 688, 237 P.2d 781; Mendelsohn v. Automobile I n s . Co. (1935), 290 Mass. 228, 195 N.E. 104; T r i n i t y Universal I n s . Co. v. Robert P. Stapp Inc. (1963), 278 Ala. 209, 177 S.2d 102; Wolverine Insurance Company v. Jack Jordan Inc. (1957), 213 Ga. 299, 99 S.E.2d 95. Contrary a u t h o r i t y e x i s t s supporting l i b e r a l construction of s i m i l a r cargo r i s k provisions. C & J Commercial rivew way, Inc. v. F i d e l i t y & Guaranty F i r e Corp. (1932), 258 ~ i c h . 624, 2 4 2 N.W. 789; Gould Morris E l e c t r i c Co. v. ~ t l a n t i c F i r e Ins. Co. (1948), 229 N.C. 518, 50 S.E.2d 295; Jorgenson v. Girard F i r e & Marine I n s . Co. (1949), 229 Minn. 48, 38 N.W.2d 209. The cases c i t e d a r e n o t c o n t r o l l i n g under t h e f a c t s of t h i s case. None of t h e cases c i t e d involved an exclusionary provision r e l a t i n g t o cargo c o l l i s i o n s a s w e have here. Contracts of insurance a r e i n t e r p r e t e d i n l i g h t of a l l r e l e v a n t provisions. Alpha Real E s t a t e Dev. v. Aetna L i f e & C a s . Co. (1977), 174 Mont. 301, 570 P.2d 585. Here t h e general r i s k provision provided coverage f o r cargo l o s s caused by c o l l i s i o n of t h e carrying conveyance with an o b j e c t b u t the exclusion only denies coverage i n those in- stances where cargo i s damaged b u t the conveying v e h i c l e i s n o t i n c o l l i s i o n . The construction urged by Aetna would r e q u i r e s i n g u l a r focus on t h e general r i s k provision and l i t t l e o r no consideration of the meaning and e f f e c t of exclusion ( k ) , t h e only s p e c i f i c policy reference t o cargo c o l l i s i o n . The ambiguity here evident must be resolved a g a i n s t t h e c o n t r a c t ' s author. It appears t h a t coverage was intended i f t h e conveying v e h i c l e s t r u c k "such o b j e c t " . Here t h e conveying v e h i c l e s t r u c k a p o r t i o n of t h e overpass s t r u c t u r e thus s a t i s f y i n g policy provisions f o r coverage. Aetna argues t h a t t h e overpass was a p a r t of t h e railway roadbed and thereby excluded by subsection ( j ) . Exclusions and words of l i m i t a t i o n must be s t r i c t l y construed a g a i n s t t h e i n s u r e r . Northwestern Nat. Cas. Co. v. Phalen Mont. (1979) I - - , 597 P.2d 720r 36 St.Rep. 1115. An over- pass i s n o t commonly understood t o be roadbed; subsection ( j ) does n o t t h e r e f o r e exclude coverage. The judgment of t h e D i s t r i c t Court i s affirmed. We Concur: