No. 13776 INTHE SUPREME COURT OF THE STATE OF MONTANA 1977

ALPHA REAL ESTATE DEVELOPMENT, INC., Plaintiff and Appellant,
-vsAETNA LIFE & CASUALTY COMPAPTY, Defendant and Respondent.
Appeal from: District Court of the Fourth Judicial District, Honorable Edward T. Dussault, Judge presiding. Counsel of Record: For Appellant: Jordan, Sullivan and Baldassin, Missoula, Kontana Lee Jordan argued, Missoula, Montana For Respondent: Garlington, Lohn and Robinson, Missoula, Montana Gary Graham argued, Missoula, Montana

Submitted: September 22, 1977 Decided: 

# oci 1371

rl

# - G * 

# VJq Filed: bLi 6% I,,Mr. Justice John Conway Harrison delivered the Opinion of the Court:
This 

### is an appeal from an order of the district court, Missoula County, granting summary judgment todefendant. Plaintiff Alpha Real Estate Development, Inc

# . (Alpha) brought an action against 

### its insurance carrier, Aetna Life and Casualty Company (Aetna) to recover on a certain insurance policy for the theft of a commercial carpet cleaner. Aetna moved for summary judgment on the ground the policy expressly excluded coverage for theft of such equipment. By 

### its order of February 

### 3, 1977, the districtcourt granted Aetna's motion. Alpha appeals. A commercial carpet cleaner valued at$1400 to $1500, owned and utilizedby Alpha in the maintenance of 

### its apartment building, was stolen on or about June 

### 7, 1975. The carpet cleaner was used exclusively toclean and maintain thehallway carpet in the apartment building. Atthat time, Alpha was covered by a property insurance policy issued by Aetna. Following the loss, Alpha submitted a claim toAetna for reimbursement due tothe loss of the carpet cleaner. The claim
was denied on the ground the cleaner was not an "integral part of a building or structure" covered by the policy, and as such,
was expressly excluded from theft coverage by the terms of the policy. 

### The pertinent portion of the policy, Form MLB-101, provided: "I. INSURING AGREEMENT "This policy insures against allrisks of direct physical loss to Coverage A 

# - Building(s)

# , subject to the provisions and stipulationsherein and in the policy 

### of which 

### this,- form ismade a part."11. PROPERTY COVERED

"When the insurance under this policy covers buildings, such insurance shall also cover all additions and extensions attached thereto; all fixtures, machinery and equipment constituting 

### a permanent part of and pertaining to the service of thebuilding; materials and supplies intended for use inconstruction, alteration or repair of the buildings, yard fixtures; personal property of the insured as landlord used for the maintenance or service of the described buildings

# **

# *.

"VI

# .EXCLUSIONS ''This policy does not insure under this form against:

"D. Loss caused by:

5 theft (including but not limited toburglary and robbery) of any property which atthe time of loss 

### isnot an integral part of a building or structure 

# ** *." Atthe hearing on the motion for summary judgment, Aetna argued the carpet cleanerwas not an "integral part of a building or structure1'such that 

### its theftwas expressly excluded by Clause VI

## ,D. 

## ,5 of Aetna'

### s Form MLB-101. The district court granted summary judgment for defendant Aetna. Thus, the determinative inquiry 

### iswhether the district court was correct in granting summary judgment to defendant
on the basis of the language of the insuring agreement. Alpha's position is that the carpet cleaning machine was
an "integral part" of the structure of the insured apartment building, and isexpressly covered under the general provision, Clause 11. PROPERTY COVERED as "personal property of the insuredas landlord used for the maintenance or service of the described buildings':. The policy, it 

### is contended, is ambiguous in 

### its terms as, on the one hand, it provides for wide coverage, including fixtures and nonfixture maintenance equipment, but
on the other hand negates such coverage in the case of the loss of such items due to theft. When a contract 

### is thus ambiguous, the ambiguity should be resolved in the insured's favor. Aetna'

### s argument refutes the positions taken by Alpha and asserts, inessence, that the contract 

### is plain and clear upon 

### its face in excludingnonintegral items of personal property, such as a commercial carpet cleaner, from theft coverage. An "integral part" it 

### ismaintained, 

### is something akin toa fixture, such as a heating device, a door, a water pump, etc. There being nothing for the court toconstrue, the district court was correct in granting summary judgment. We do not cite, nor have we been able tofind, any case authoritywhich precisely defines the term "integral part" in the context of the dilemma presented by this case. The insurance contract itselfnowhere defines the term. The situation is further cloudedby the fact the clause of general coverage refers to "fixtures" and various items of personalty, such as construction, service, and maintenance equipment. The sole reference tothe phrase "integral part" appears in the exclusionary clause. The general and exclusionary clauses, read together, 9ielda contractual ambiguity necessitatingjudicial construction. Indeed, the district court appears tohave recognized the ambiguity engendered by the contractual language in

### its mder granting summary judgment.


### -4-Therefore our discussion startswith the proposition the contract in question contains a patent ambiguity. We focus on the language of the exclusionary clause in the light of the general provisions. InTerry v. National Farmers Union Life Ins. Co., 138Mont. 333, 356 P.2d 975 (1960), the Court stated: "We keep inmind that in construing an exclusion policy, in case of uncertainty, every doubt should be resolved in favor of the insured, and the policy should be construed strictlyagainst the insurer company. 

# * ** Otherwise stated a contract of insurance 

### willbe construed strictlyagainst the insurer and liberally in favor of the insured. 

# *

# * *I1 138Mont. 339. See also: Johnson v. Equitable Insurance Co., 142Mont. 128, 381 P.2d 778 (1963);Holmstrom

### v. Mutual Benefit Health & Accident Ass'n., 139Mont. 426, 364 P.2d 1065 (1961). Further, it 

### isuncontroverted that in construction of
a contract a particular clause of a contract 

### is subordinate to the general intent of the contract. Section 13-716, R.C.M. 1947. For a general discussion of this rule see: 

### 17A

### C.J.S. Contracts, 

### 59 294(b), 295(f)

# . Both of the rules find applicabilityhere. The conclusion to be drawn from a reading of the general provision isthat service and maintenance equipment, including an item such as
a commercial carpet cleaner, istobe grouped together with fixtures and the buildings themselves for purposes of coverage. We find such language governs the interpretation and defines the parameters of the term "integral part" in the exclusionary clause. Hence, the carpet cleaner was covered as an "integral part1'of the apartment building. To ratify defendant Aetna's position would be to limittheft coverage to items virtually incapable of being stolen.This Court in the case of St. Paul Fire & Marine Ins. Co. 

### v. Thompson, 150Mont. 182, 187, 

### 433 P.2d 795, adopted the test for interpreting this contract: 

# "*

# ** Again, looking to the Kansas rule which we have adopted, we find that, 'the test isnot what the insurer intended thewords of the policy tomean but what a reasonable person in the position of an insured would understand them tomean.

## '" If an insurer desires to limit its coverage incertain areas, it should employ language clearly and precisely outlining such restrictions

# . Johnson v. Equitable Insurance Co

# ., supra. The order granting summaryjudgment 

### is reversed and the cause 

### is remanded for proceedings in accordance with this opinion.

We Concur:Mr. Justice Frank I. Haswell, dissenting: I would affirm the district courtjudgment. The theme of the majority opinion 

### is that the insurance policy 

### is ambiguous and doubts concerning 

### itsmeaning must be resolved in favor of the insured. Inmy view the policy coverage 

### is unambiguous, clear and certain leaving no room forjudicial construction of 

### its terms. The policy contains a specific exclusion for theft. The operative language of this exclusion reads: "EXCLUSIONS. This policy does not insure

# ** * against

# *** loss caused by

# * * *theft

# *** of any property which

# * *

# * isnot an integral part of a building or structure

# *

# * *.It As I see it, a carpet cleaner simply cannot be considered
a part of a building or structurewithout doing violence to the plain meaning of the English language. The descriptive adjective "integral" further expands the exclusion, but inno
sense transforms a carpet cleaner into an "integral part of
a building or structure". In common usage, the language cannot be tortured to achksuch meaning in my opinion. Nor can an ambiguity be created by reading together the general coverage clause and the specific exclusion inmy judgment. As in allinsurance policies excluding certain perils, the general coverage clause 

### is stated inbroad terms and the exclusionary clause specifically excludes those perils forwhich insurance 

### isnot purchased. Thus the insurance policy here 

### isneither internally inconsistent nor ambiguous in

### its terms, and there 

### isno basis in law for interpreting the contract against the insurer.

### This Court cannot rewrite a newpolicy under the guise of judicialconstructioncontrary to that expressed in the policy agreed upon and purchased by the insured. Johnsonv. 

### Metropolitan Life Insurance Co., 107Mont. 133, 83 P.2d 922 For these reasons, 

### I respectfullydissent.

Justice.

Mr. Justice Daniel J. Shea dissenting: 

### Iagreewith the foregoing dissent of Mr. Justice Frank 

### I. Haswell.