Court Opinion

ID: 9618537
Source: CourtListenerOpinion
Date Created: 2023-08-22 05:13:41.146329+00
Date Added: 2024-06-11T18:04:30.539727
License: Public Domain

HALL, Justice
(dissenting):
I am of the opinion that this case should be reversed both on procedural grounds as well as on the merits.
Allstate lacks standing to bring this lawsuit in its present form. Its complaint seeks the interpretation of an insurance contract between Brookfield Products and USF&G, specifically, the validity of an exclusion clause. Allstate is neither a party to the contract nor an assignee. An injured *334party is a stranger to the tortfeasor’s insurance contract and hence, has no legal interest in the enforcement of that contract nor a right to sue thereon.1 Since Parcell (the injured party) is a stranger to the Brook-field-USF&G contract, then, a fortiori, Allstate is also a stranger to the contract inasmuch as its rights are derivative in nature.2
As to Brookfield’s cross-complaint against USF&G, I deem it injudicious for the Court to invalidate the exclusion-a provision of the insurance contract entered into by the parties at arm’s length. Having agreed to the exclusion, Brookfield should be barred from challenging its validity. At the very least, equitable estoppel should apply. In Migliaccio v. Davis,3 this Court ruled as follows:
* * * Equitable estoppel or estoppel in pais is the principal [sic] by which a party who knows or should know the truth is absolutely precluded, both at law and in equity, from denying or asserting the contrary of, any material fact, which, by his words or conduct, affirmative or negative, intentionally or through culpable negligence, he has induced another, who was excusably ignorant of the true facts and who had a right to rely upon such words and conduct, to believe and act upon them thereby, as a consequence reasonably to be anticipated, changing his position in such a way that he would suffer injury if such denial or contrary assertion were allowed.4
In the instant case, it is undisputed that USF&G had the absolute right to cancel the insurance policy upon proper notice at any time, for any reason. On Brookfield’s affirmative representation that Pulliam had been transferred to the warehouse and would not thereafter drive the insured vehicles, USF&G continued to provide liability coverage. Notwithstanding Brookfield’s representations, Pulliam was permitted to continue driving company vehicles. Because of the misrepresentation or concealment of the fact that Pulliam was still driving, Brookfield and Pulliam should be estopped from asserting that the exclusionary endorsement is invalid, void or unenforceable.
In light of the foregoing, I believe that the summary judgment should be reversed without ever reaching the merits of the decision. Nevertheless, my analysis of the case on its merits also dictates reversal.
The majority opinion improperly interferes with the constitutional freedom of contract, traditionally treated as being both a liberty and a property right5 protected by due process.6 The United States Supreme Court has stated that the freedom to contract is the essence of freedom from undue restraint on the right to contract.7 It is an inherent and inalienable right,8 which is guaranteed to every citizen.9 Every man has the right freely to deal, or refuse to deal, with his fellow man,10 and this Court should refrain from upsetting that right in the instant case.
The contract entered into explicitly excluded coverage for vehicles driven by Pul-*335liam. Apparently, the exclusion of coverage for poor risk drivers is a common practice in the industry. In its answers to interrogatories, Allstate admitted the following:
... under certain circumstances of a bad loss history or routine driver’s license check showing that there is an adverse driving record on a driver, which renders the risk undesirable, the company gives the named insured notice that he has an option to renew the policy, excluding the driver, or to secure other insurance.
Brookfield voluntarily entered into the exclusion agreement. It knew that if Pul-liam drove Brookfield vehicles, insurance coverage was excluded.11 Nevertheless, it proceeded to allow Pulliam to drive, thereby exposing itself to liability. To hold USF&G responsible for Pulliam’s accident is, in my estimation, grossly unfair and without support in the law.
It is not important to recognize that what is involved here are not “no-fault” benefits,12 but, rather, uninsured motorist provisions of a liability policy, which is governed generally by the Safety Responsibility Act.13 As acknowledged by the majority, the omnibus requirements found in the Act apply only to policies required to be “certified.” 14 This principle has been adopted by a vast majority of jurisdictions and has been explained as follows:
The rationale of these cases is that the safety responsibility laws do not provide for compulsory motor vehicle liability insurance; that they are prospective in in-tendment, operate in futuro and are based upon the philosophy that every dog is allowed by the law one free bite; that such laws apply only to a second accident and not to a first accident; that there is no requirement that the owner or operator of a motor vehicle carry a policy of liability insurance or that it contain any particular provisions unless and until the safety responsibility law has been invoked by the occurrence of some event resulting in the order of a state official that security be deposited or that proof of financial responsibility be made; that the policy must be a “required” policy before the provisions of the safety responsibility law are to be incorporated therein.15
The security provisions contained in Utah’s No-Fault Act relating to liability appear to be consistent with similar provisions contained in Utah’s Safety Responsibility Act16 which has previously been interpreted by this Court.
I would reverse.
CROCKETT, C. J., concurs in the dissenting opinion of HALL, J.

. Utah Farm Bureau Insurance Company v. Chugg, 6 Utah 2d 399, 315 P.2d 277 (1957); see also, Ammerman v. Farmers Insurance Exchange, 19 Utah 2d 261, 430 P.2d 576 (1967).

. See generally 44 Am.Jur.2d, Insurance, § 1820.

. 120 Utah 1, 232 P.2d 195 (1951).

. Quoting 19 Am.Jur., Estoppel, § 34.

. Sol Block & Griff v. Schwartz, 27 Utah 387, 76 P. 22 (1904); see generally 16A Am.Jur.2d, Constitutional Law, § 592.

. Constitution of the United States, Fifth and Fourteenth Amendments and Constitution of Utah, Article I, § 7.

. Standard Oil Co. v. United States, 221 U.S. 1, 31 S.Ct. 502, 55 L.Ed. 619 (1911); see also, constitutional provisions against impairment of contracts, Constitution of the United States, Article I, § 10, and Constitution of Utah, Article I, § 18.

. Frisbie v. United States, 157 U.S. 160, 15 S.Ct. 586, 39 L.Ed. 657 (1895).

. Bayside Fish Flour Co. v. Gentry, 297 U.S. 422, 56 S.Ct. 513, 80 L.Ed. 772 (1936).

. Federal Trade Comm. v. Raymond Bros.-Clark Co., 263 U.S. 565, 44 S.Ct. 162, 68 L.Ed. 448 (1924).

.Brookfield told Pulliam of the exclusion and, on each occasion that he drive company vehicles, warned him to be “extra careful” because he was not covered by insurance.

. Although not at issue here, USF&G concedes that had Pulliam been injured as a result of the automobile accident, he would have been entitled to the no-fault benefits under the policy.

. U.C.A., 1953, 41-12-21.1.

. Western Casualty and Surety Co. v. Transamerica Insurance, 26 Utah 2d 50, 484 P.2d 1180 (1971); Utah Farm Bureau Insurance Co. v. Chugg, supra, footnote 1.

. Miller v. State Farm Mutual Automobile Insurance Company, 204 Kansas 694, 466 P.2d 336 (1970), quoting Gabler v. Continental Casualty Company, 295 S.W.2d 194 (Mo.App.1956).

. Statutory provisions are to be construed as consistent whenever possible. See Monson v. Hall, Utah, 584 P.2d 833 (1978).