Title: Jenkins v. Mayflower Insurance Exchange

State: arizona

Issuer: Arizona Supreme Court

Document:

93 Ariz. 287 (1963) 380 P.2d 145 Jackson JENKINS and Germaine Jenkins, husband and wife, Appellants, v. MAYFLOWER INSURANCE EXCHANGE, an Insurance corporation or business association, Appellee. No. 6893. Supreme Court of Arizona. En Banc. March 27, 1963. Rehearing Denied May 14, 1963. Udall & Udall and Goldbaum, Goetz & Diamos, Tucson, for appellants. Chandler, Tullar, Udall & Richmond, Tucson, for appellee. JENNINGS, Justice. Appellants were plaintiffs in a suit against defendant insurance company to collect a judgment previously obtained in a suit for personal injuries against insureds of the company. The case was submitted to the trial judge on a stipulated statement of facts and judgment was entered for the defendant. It is from this judgment that plaintiffs appeal. Plaintiffs were passengers in a car owned by defendants-insureds. The car was being driven by John Parrott, an airman in the U.S. Air Force. Defendants-insureds were also in the car and had directed Parrott to drive. As a result of Parrott's negligent driving, the car left the road and turned over. Plaintiffs were injured. The policy of insurance covering the car had a restrictive endorsement which read: The defendant company refused to defend the suit by plaintiffs against defendants-insureds on the ground that the driver Parrott was a member of the military services of the United States and that therefore, the injuries were not covered by the policy. They raise the same defense in the present suit to collect on the judgment obtained against their insured. Plaintiffs claim the restrictive endorsement is not binding on them because of certain provisions of the Financial Responsibility Law, A.R.S. § 28-1101 et seq. The policy of insurance provides: The Financial Responsibility Law defines motor vehicle liability policy as follows: In the trade, this provision is referred to as the "omnibus clause." If this provision has been made a part of the policy either by the policy provision or by operation of law, the defendant company is liable to the injured plaintiffs. The California Supreme Court, in Wildman v. Government Employees' Ins. Co., 48 Cal. 2d 31, 39, 307 P.2d 359, 364, refused to allow an insurance company to set up a restrictive endorsement as a defense and applied an omnibus clause substantially similar to A.R.S. § 28-1170, subd. B(2), as follows: And, again: And the California District Court of Appeals applied the principle announced in the Wildman case where an insurance company attempted to escape liability because of the existence of the same military exclusion endorsement which is the issue in this suit. Wheeling v. Financial Indemnity Company, 201 Cal. App. 2d 36, 19 Cal. Rptr. 879, 882. The defendant company, however, has raised a highly technical defense for which they cite much authority and which they claim distinguishes this case from the California cases. The argument goes as follows: 1. Section 28-1170, A.R.S., provides, in applicable part: *290 2. A "motor vehicle liability policy" is a term of art and has a different meaning from "automobile liability policy" or "policy of insurance." 3. A "motor vehicle liability policy" is only one which has been "certified" and thus the term can apply only after an insured has been involved in an accident. 4. The omnibus clause only is required in certified "motor vehicle liability policies." 5. This policy is not a "certified" policy and thus the omnibus clause is not made a part of the policy by the Financial Responsibility Law. In support of this argument, defendant cites Perkins v. Perkins, 284 S.W.2d 603 (Mo. App.); United States Fidelity & Guaranty Company v. Walker, 329 P.2d 852 (Okl.); McCann for Use of Osterman v. Continental Casualty Company, 8 Ill. 2d 476, 134 N.E.2d 302, prior opinion 6 Ill. App.2d 527, 128 N.E.2d 624; New Zealand Insurance Company v. Holloway, 123 F. Supp. 642 (D.C.La.); McCarthy v. Insurance Company of Texas, 271 S.W.2d 836 (Tex.Civ.App.); Hoosier Casualty Company of Indianapolis, Indiana, v. Fox, 102 F. Supp. 214 (D.C.Iowa); State Farm Mutual Automobile Ins. Co. v. Arghyris, 189 Va. 913, 55 S.E.2d 16. We concede that these cases support defendant's argument. But we have this day passed on the constitutionality of the Financial Responsibility Law and in doing so have held that driving an automobile is a right, not a privilege. Schecter v. Killingsworth, 93 Ariz. 273, 380 P.2d 136 (March 1963). Having so held, we by necessity defined what purpose the act had so as to justify the abridgment of that right. That purpose was stated as follows: And, again: And, again: Where the basis upon which this act has been declared constitutional is, "preventing financial hardship and possible reliance upon the welfare agencies," we cannot constitutionally *291 allow artful distinctions between "motor vehicle liability policy," "automobile liability policy" or "policy of insurance" to defeat the purpose of the act. To do so would make our opinion in Schecter v. Killingsworth, supra, a sham. We hold, therefore, that the omnibus clause is a part of every motor vehicle liability policy, by whatever name it may be called. Reversed with directions to enter judgment for the plaintiff. BERNSTEIN, C.J., UDALL, V.C.J., and STRUCKMEYER and LOCKWOOD, JJ., concur. [1] Secs. 28-1168 and 28-1169 provide that a certified motor vehicle liability policy is sufficient proof of financial responsibility to suspend the effect of the Financial Responsibility Law.