Title: NAT. FARMERS U. PROP. & CAS. CO. v. Western Casualty and Surety Company

State: utah

Issuer: Utah Supreme Court

Document:

577 P.2d 961 (1978) NATIONAL FARMERS UNION PROPERTY AND CASUALTY COMPANY, Plaintiff and Appellant, v. WESTERN CASUALTY AND SURETY COMPANY, Defendant and Respondent. No. 15317. Supreme Court of Utah. March 31, 1978. D. Gary Christian and James R. Blakesley, of Kipp & Christian, Salt Lake City, for plaintiff and appellant. Glenn C. Hanni and R. Scott Williams of Strong & Hanni, Salt Lake City, for defendant and respondent. MAUGHAN, Justice: Plaintiff insurer initiated this action seeking contribution from defendant insurer as a co-insurer.[1] Both parties moved for summary judgment, defendant's motion was granted. Plaintiff appeals seeking judgment in its favor. The judgment of the trial court is affirmed. *962 Plaintiff issued a liability policy covering the Weber County Sheriffs Mounted Posse, on their drill grounds. The policy provided under the liability provision: Brent G. Story, Captain of the Sheriff's Posse, as an executive officer, was an insured under plaintiff's policy. Captain Story was also an insured under his homeowner's policy, which was issued by defendant. This policy provided: Defendant's homeowner's policy excluded coverage for personal liability by specific exclusion 1(e), which provided: This policy does not apply: Plaintiff alleged that on June 15, 1972, the Sheriffs Mounted Posse of Weber County was conducting a practice drill on its grounds near Harrisville in Weber County. Prior to, during, and after the drill the main gate from the posse grounds to the highway was left open. Brent G. Story, as Captain of the posse, knew or should have known the gate was left open from the time the first posse member entered, until after the last posse member left. Plaintiff further alleged Brent G. Story, as Captain, was negligent in his failure to supervise the activities of the posse members on the grounds of the organization and was negligent in his failure to close the main gate or see to it the gate was closed during drills, so horses could not escape from the posse grounds. At approximately 9:30 p.m. while some of the members of the posse were still drilling, a horse owned by one Cheney, escaped from the grounds, by running through the open gate and onto the highway. It was there struck by a vehicle in which Arthur E. Haggen, Jr. was a passenger. Mr. Haggen sustained serious, permanent injuries, and he filed an action, including as defendants, Cheney, Story, and the Posse. After the answers of the defendants had been filed and some discovery undertaken, plaintiff, as the liability insurance carrier for the posse settled the case. Before settling, plaintiff sought contribution from the insurance carriers of the other defendants. The carrier for Cheney, the owner of the horse, contributed 25 percent of the settlement. Defendant, the homeowner's (Story's) insurance carrier refused contribution, and in the instant action plaintiff seeks contribution in an amount proportionate to the total coverage of the companies to the total settlement made, viz., 25 percent. Defendant denies liability under the homeowner's policy on the ground the exclusion 1(e) is applicable, viz., the policy does not apply to bodily injury arising out of any premises, owned, controlled or rented by the insured, Story, other than the insured premises (Story's home). Both parties agree that the posse's property, where the drill was conducted, was not an insured premises under defendant's policy. Their point of contention is whether there was "an injury arising out of any premises"; so that the exclusion is applicable rather than the general liability provision. Plaintiff contends the incident the horse-automobile collision did not arise out of any premises, but occurred strictly by the negligent manner in which Story controlled the posse. In other words, there was no causal nexus between the accident and Story's control, if any, over the property. The accident can be attributed solely to Story's failure to control the posse. *963 Defendant responds that the injury involved was the result or occurred, because of a condition of the uninsured premises an open gate. For the exclusion to apply all that is required is some causal connection between the condition of the uninsured premises and the injuries involved. Defendant contends that if there be any liability, it was because of Story's failure to close the gate at the drill grounds through which the horse escaped. Plaintiff so recognized the open gate as the basis of Story's liability in the allegations in its complaint. The clause has frequently been interpreted in automobile liability policies. The words import a concept of causation; there must be a causal nexus between an accident or injury and the ownership, maintenance or use of a vehicle.[4] The principle is illustrated in Hartford Accident and Indemnity Company v. Civil Service Employees Insurance Company.[5] Jackson v. Lajuanie[7] has a strong similarity to the instant action. Jackson, while a customer in a gasoline service station operated by defendant, Lajuanie, suffered a serious gunshot wound in the chest. A pistol belonging to an employee of defendant was in the station. Lajuanie, believing the pistol to be loaded with blanks, fired it at plaintiff as a prank. Lajuanie had a liability policy covering the garage premises. He also had a homeowner's policy, and one of the issues before the court was whether an exclusionary clause of the homeowner's policy precluded coverage for this accident. The homeowner's policy did not apply: *964 The court observed the homeowner's policy did not apply to any act in connection with any premises, except the home, which are owned, rented, or controlled by Lajuanie. Therefore, the homeowner's insurance carrier argued that if Jackson were injured by an act "in connection with" the service station, exclusion (a)(3) was applicable and the insurance carrier was not responsible. The court stated: The active force leading to injury in plaintiff's complaint was an escaping horse. The term "escape" connotes a removal from a geographical location caused by a loss of control by the one responsible for confinement. To confine the animal to the drill field, there was an enclosure around the uninsured premises. Captain Story's alleged negligence was his failure to close the gate and thus prevent the escape. The alleged acts arose from, originated, and were connected with the uninsured premises, and the exclusion in his homeowner's policy was applicable. Since defendant's policy did not cover the risk involved, the other points raised by plaintiff are moot. ELLETT, C.J., and CROCKETT, WILKINS and HALL, JJ., concur. [1] Allegedly, each had issued a liability policy which insured the same party, upon the same subject matter, and assumed the same risk. 8 Appleman, Insurance Law and Practice, § 4911, p. 378. [2] Rouse v. Greyhound Rent-A-Car, Inc. (U.S.C.A. 5th, 1975) 506 F.2d 410, 414. [3] Lawver v. Boling, 71 Wis.2d 408, 238 N.W.2d 514, 518 (1976). [4] Vanguard Insurance Co. v. Cantrell, 18 Ariz. App. 486, 503 P.2d 962 (1973); also see Baca v. New Mexico State Highway Department, 82 N.M. 689, 486 P.2d 625 (1971). [5] 33 Cal. App. 3d 26, 32, 108 Cal. Rptr. 737, 741 (1973). [6] Also see 12 Couch On Insurance 2d, § 45:56, pp. 146-147; § 45:61, pp. 150-151. [7] 270 So. 2d 859 (La. 1972).