Case Name: Lillian DANIELS, Plaintiff in Error, v. L. C. SCOTT, Sr., d/b/a Scottie's Butane and Propane Company, L. C. Scott, Jr., and Hercules Casualty & Insurance Company, Defendants in Error
Court: Oklahoma Supreme Court
Jurisdiction: Oklahoma
Decision Date: 1959-04-07
Citations: 340 P.2d 223
Docket Number: No. 37946
Parties: Lillian DANIELS, Plaintiff in Error, v. L. C. SCOTT, Sr., d/b/a Scottie’s Butane and Propane Company, L. C. Scott, Jr., and Hercules Casualty & Insurance Company, Defendants in Error.
Judges: HALLEY, JOHNSON, JACKSON, IRWIN and BERRY, JJ., concur.
Reporter: Pacific Reporter 2d
Volume: 340
Pages: 223–235

Head Matter:
Lillian DANIELS, Plaintiff in Error, v. L. C. SCOTT, Sr., d/b/a Scottie’s Butane and Propane Company, L. C. Scott, Jr., and Hercules Casualty & Insurance Company, Defendants in Error.
No. 37946.
Supreme Court of Oklahoma.
April 7, 1959.
Dissenting Opinion June 9, 1959.
Rehearing Denied June 9, 1959.
Bailey & Whitlock, Norman, Priest & Belisle, Oklahoma City, for plaintiff in error.
Foliart, Hunt & Shepherd, Oklahoma City, Homer Cowan, Norman, for defendants in error.
Duke Duvall & DeVier Pierson, Oklahoma City, amici curiae.

Opinion:
DAVISON, Chief Justice.
This is an action brought by Lillian Daniels against L. C. Scott, Sr., doing business as Scottie's Butane and Propane Company (hereinafter referred to as Scott, Sr.) and L. C. Scott, Jr. (hereinafter referred to as Scott, Jr.) and Hercules Casualty and Insurance Company, a corporation (hereinafter referred to as Hercules Company) to recover damages for personal injuries received by her as a result of an explosion of propane gas.
The defendant, Scott, Sr., is registered with and has a permit from the State Liquefied Petroleum Gas Administrator for the distribution and sale of propane gas, and the defendant, Hercules Company, is his insurance carrier, and defendant, Scott, Jr., is alleged to be the agent and servant of Scott, Sr.
In her petition plaintiff alleged that in 1951 Scott, Sr., installed a propane tank at the home of plaintiff's mother-in-law and serviced and filled the tank thereafter; that on September 8, 1956, the mother-in-law requested Scott, Sr., to replenish the supply of propane in the tank; that Scott, Jr., made the delivery late in the evening of that day. The petition contains several allegations of negligence in the installation of the tank and the manner in which it was filled and particularly that it was filled too full; that the plaintiff was present at the home of her mother-in-law the next day and that at about 12:30 p. m. of said date the outside temperature had increased causing the liquid gas to expand and spray from the tank and upon plaintiff and the house; that the gas ignited and exploded, seriously injuring and burning the plaintiff.
As to the defendant, Hercules Company, it is alleged that said defendant in accordance with the provisions of Section 420.4, Title 52 Oklahoma Statutes (1955 Session Laws) issued and filed with the said State Liquefied Petroleum Gas administrator a certificate of insurance covering the operations of Scott, Sr.; that the filing of the certificate of insurance was a required condition precedent to the issuance of a Registration Permit to Scott, Sr., and made Hercules Company jointly liable with Scott, Sr. Copies of the Certificate of Insurance and of the Liability Policy were attached to the petition.
All defendants filed general demurrers and motions to strike from the petition all allegations and reference to Hercules Company and liability insurance. The lower court sustained the motions to strike and held that Hercules Company could not be joined as a defendant. The lower court found in effect that in view of the ruling on the motions to strike that the demurrers were moot but did sustain the demurrer of Hercules Company. Plaintiff appeals from the above ruling and urges that joinder of Hercules Company was proper under the provisions of Section 420.4, Title 52 O.S. (1955 Session Laws) Liquefied Petroleum Gas Act, when construed in the light of decisions of this court construing Title 47 O.S.1951 § 169 of the Motor Carrier Act and construing city ordinances requiring public liability and property damage insurance coverage as a condition precedent to the issuance of a permit to operate a taxicab.
It is our opinion that plaintiff's contention is correct and that Hercules Company was properly joined as a defendant and that the lower court erred in sustaining the motions of defendants striking the name of Hercules Company and allegations of insurance from the petition.
Pertinent portions of Section 420.4, Title 52 O.S. (1955 Laws) are as follows:
"(g) Except as herein otherwise provided, all transporters, distributors or retailers of LPG in this State required to be registered under this Act, shall file with the Administrator a certificate, or certificates, showing that Public Liability and Property Damage Insurance coverage, with limits of not less than $10,000 — $20,000 for bodily injury and limits of not less than $10,-000 for property damage, has been issued, and is in full force and effect, covering the plant, equipment and motor vehicles used in such business, and the operations thereof.
"(h) Insurance under this Section shall be kept and remain in force during the lifetime of the operation of the business covered. Except as herein otherwise provided, no registration permit shall be issued hereunder until said certificate, or certificates, showing that the required insurance coverage is in force, is filed with the Administrator, nor shall such insurance coverage be cancelled or terminated unless written notice of such cancellation or termination is given to the Administrator. Nothing herein contained shall be deemed or construed to require Products Liability Insurance coverage.
"(i) Notwithstanding any other provisions hereof, the Administrator is hereby empowered and authorized, upon proof of or a satisfactory showing that any person, firm or corporation is financially able to pay or satisfy any judgment, claim or demand against such person, firm or corporation to which the aforesaid insurance applies, to waive the above insurance coverage requirements; provided, however, that the Administrator may, in his discretion, in lieu of said certificate, or certificates, require the deposit with the Administrator of securities, or satisfactory indemnity bond, in an amount and of a kind designated by the Administrator, to secure the liability of such person, firm or corporation to pay any such judgment, claim or demand, but not in excess of the limits herein-above set forth; "
The Certificate of Insurance furnished by Hercules Company to the Administrator recites in part:
"The policy to which this endorsement is attached is a bodily injury liability and property damage liability policy, and is hereby amended to assure compliance by the insured with the applicable statutes of the State of Oklahoma and the pertinent rules and regulations of the State Liquefied Petroleum Gas Administrator as respects public liability and property damage insurance required of the insured under the applicable statutes of Oklahoma, covering the plant, equipment, and operations of the assured
The insurance policy furnished by Hercules Company meets the required minimum amounts of liability coverage set forth in the law. In view of our holding herein and prior decisions of this court there is no need to set forth the other provisions of the Certificate of Insurance or the terms of the insurance policy.
This court has never passed upon the question of whether the cited portions of the Liquefied Petroleum Gas Act authorize or permit joinder, of the insurance carrier as a defendant with the registered liquefied gas distributor or retailer in an action for damages for personal injuries arising from the alleged negligence of such distributor or retailer in the operation of his business. To answer this question requires resort to decisions of this court and other courts construing statutes and ordinances containing similar provisions requiring the furnishing of public liability and property damage insurance as a condition of engaging in some regulated business operation.
This court has held in a number of cases that the insurance company furnishing liability insurance coverage to a motor carrier in compliance with the requirements of Title 47 O.S.1951 § 169, was properly joined as a party defendant with the motor carrier in an action for damages for personal injury arising from the negligence of the motor carrier. It is recognized that the language in this respect is more explicit in the Motor Carrier Act than in the Liquefied Petroleum Gas Act.
In the Motor Carrier case of Temple v. Dugger, 164 Okl. 84, 21 P.2d 482, 486, we said:
"Therefore, under the language of the statute, inasmuch as the insurance was required as a condition precedent to the defendants' right to operate a motorbus, and also in view of the fact that the purpose of the policy was to adequately 'protect the interest of the public' and 'to bind the obligors thereunder to make compensation for injuries to persons and loss of or damage to property resulting from the operation of such motor carrier,' the joinder of the insurance company and bus company was proper."
See also Jacobsen v. Howard, 164 Okl. 88, 23 P.2d 185, 187.
"When a motor carrier files with the Corporation Commission a liability insurance bond as a prerequisite to the issuance to it of a certificate of convenience and necessity, and thereby procures the issuance of such a certificate by the Corporation Commission, neither it nor its liability insurance bondsmen may successfully contend that its bond limits the liability imposed by the statute except as to amount. When it files its liability insurance bond with the Corporation Commission, the provisions of the statute are read into and become a part of that bond."
" Under the statute the liability insurance bond maker is liable for the injuries resulting from the operation of the motor carrier, not by reason of its bond, but by reason of the statute, after it has filed its bond."
The holdings in these cases were reaffirmed in subsequent decisions of this court, including Wray v. Garrett, 185 Okl. 138, 90 P.2d 1050, wherein we stated the motor carrier and liability insurance bondsman were jointly liable and a joint action may be maintained against them; and Enders v. Longmire, 179 Okl. 633, 67 P.2d 12, that the motor carrier and his bondsmen by filing such bond are estopped from asserting any defense alleged to be allowable under the bond in contravention to the liability created by the statute; and see also All American Bus Lines v. Saxon, 197 Okl. 395, 172 P.2d 424 and Jones v. Eppler, Okl., 266 P.2d 451, 48 A.L.R.2d 333, reaffirming decisions of this court permitting joinder in this fact situation.
In Graves v. Harrington, 177 Okl. 448, 60 P.2d 622, there was first presented to us for decision the question of joining, as defendants in a personal injury action, the operator of a taxicab and the insurance company furnishing his liability insurance policy under a city ordinance regulating the operation of taxicabs. The city ordinance required the filing of an insurance policy conditioned the applicant would pay for damages to person and property caused by his negligence. It was conceded the joinder was permissible under the rule of law announced in Temple v. Dugger, supra, but the correctness of the decisions in the Dugger case and in Jacobsen v. PIow-ard, supra, was questioned. We rejected these contentions and reaffirmed our decisions in the Dugger and Jacobsen cases and found that the rule of law therein announced, when applied to the provisions of the city ordinance, permitted joinder of the taxicab operator and his insurance carrier.
In Safeway Cab Co. v. McConnell, 181 Okl. 612, 75 P.2d 884, 885, joinder of the cab company and its insurance carrier was approved. The city ordinance in question required, as a condition precedent to issuance of a license to operate a taxicab, the filing of an insurance policy with the city clerk,
" 'providing insurance coverage for each and every taxicab owned, operated or leased by the applicant with a maximum liability of $5000 for the injury or death of any one person in any one accident, regardless of whether the taxicab was being driven by the owner, his servant, agent or lessee.' "
The similarity of this quoted portion of the ordinance to the language of the Liquefied Petroleum Gas Act is obvious. The ordinance contained additional provisions as to the required content of the insurance policy which the insurance company urged distinguished the case from prior decisions and made joinder improper. These additional provisions are not present in the case now before us for decision. Citing Temple v. Dugger, Jacobsen v. Howard, Enders v. Longmire, supra, and other cases, we held joinder of the cab company and its insurance carrier proper and said:
" . The general purpose of the ordinance, viewed in its entirety, is protection to the public, not to the taxicab company. "
The decisions in Safeway Cab Co. v. McConnell and Graves v. Harrington, supra, were approved in Subscribers at Casualty Reciprocal Exchange v. Sims, Okl., 293 P.2d 578.
The propriety of the joinder of the insurer and insured under a policy of compulsory insurance in an action by an injured third person has been subject of numerous decisions and an extensive annotation thereon appears in 20 A.L.R. at page 1097.
Hercules also contends that the provision of its policy wherein it is stated:
" Nothing contained in this policy shall give any person or organization any right to join the company as a co-defendant in any action against the insured to determine the insured's liability."
precludes its joinder as a defendant. We do not agree. In Jacobsen v. Howard, supra, we held that the liability insurance bond could not limit liability imposed by law. In Enders v. Longmire, supra, it was urged a "no action" clause in the bond prevented joinder and we held this contention was foreclosed by our decision in the Jacob-sen case.
The Hercules Company further urges that the Liquefied Petroleum Gas Act does not make the furnishing of liability insurance compulsory, in that the administrator could in his discretion, upon proof of the financial responsibility of the applicant, waive the insurance coverage requirements or may, in his discretion, in lieu of the certificate of insurance, require the applicant to deposit securities or an indemnity bond, and cites in support thereof Beverly v. Elam, 196 Okl. 15, 162 P.2d 180. In the cited case we held that a class "C" motor carrier was not required to file an application for nor make a showing of convenience and necessity or procure a certificate thereof and file a public liability bond as required by class "A" and "B" carriers, and that the voluntary act of a class "C" carrier and its insurer in filing such bond did not render them jointly liable in a negligence action against the insured. To the same effect is our decision in Subscribers at Casualty Reciprocal Exchange v. Sims, supra, wherein a taxicabe operator and his insttrance carrier were held not to be jointly liable in an action for negligence where the insurance policy was filed with the city clerk pursuant to the requirements of a void city ordinance, since the joint liability arose only by operation of law and not by reason of the insurance policy itself.
We do not agree that the Certificate of Insurance and insurance policy was voluntarily furnished by Scott, Sr., in the case now before us.
Under the Liquefied Petroleum Gas Act, it was compulsory as a condition precedent to the issuance of a registration permit to Scott, Sr., that he file a Certificate of Insurance with the administrator, showing he had the required insurance coverage, or that he submit proof of financial responsibility satisfactory to the administrator or deposit securities or an indemnity bond satisfactory to the administrator, to pay any judgment, claim or demand to which the aforesaid insurance applied. Scott, Sr., elected to procure his registration permit by following the compulsory route of filing the Certificate of Insurance. The difference between the fact situation in the Elam and Sims cases and in the case now before us for decision is apparent.
The Hercules Company also filed a general demurrer to the petition of plaintiff. The lower court after sustaining the motions of the defendants to strike Hercules Company as a defendant and all reference in the petition to insurance then found as to the demurrer, that the same "if not moot, is sustained" and granted time to plaintiff to amend her petition. The plaintiff then perfected this appeal without amending her petition in any respect. The plaintiff did not elect to stand on her petition and the court did not take the customary act of dismissing the petition. Hercules Company has devoted a portion of its brief to the proposition that the petition did not state a cause of action against it and urges the alleged negligent acts of Scott, Sr., and Scott, Jr., fall within the division of the policy described as "Products — Completed Operations," but that insurance covering such division was not purchased. Hercules Company points out the law does not require such insurance coverage, inasmuch as it states, "Products Liability Insurance" is not required, and that these two terms are synonymous. In view however of our decision reversing the action of the lower court sustaining the motions to strike, which was a final order, and the uncertainty of the record relative to sustaining the demurrer, this court expresses no opinion in this respect, to the end that the lower court may take appropriate action with reference thereto or that plaintiff may amend her petition if she so desires.
The order of the lower court striking Hercules Company as a party defendant and all reference to insurance from the petition is reversed and the cause is remanded for further proceedings in accordance with the views expressed herein.
HALLEY, JOHNSON, JACKSON, IRWIN and BERRY, JJ., concur.
WILLIAMS, V. C. J., dissents.