Court Opinion

ID: 9726471
Source: CourtListenerOpinion
Date Created: 2023-08-26 12:51:40.465081+00
Date Added: 2024-06-11T18:25:27.632931
License: Public Domain

SIMS, J.
I concur in all aspects of the opinion except for the analysis in part I. In my view, this case is governed by Texas law, a fact which does not affect the outcome.
“California has rejected the traditional mechanical solutions to choice-of-law problems and adopted foreign law . . . when it is appropriate in light of the significant interests in the particular case.” (Travelers Ins. Co. v. Workmen’s Comp. App. Bd. (1967) 68 Cal.2d 7, 11, fn. omitted [64 Cal.Rptr. 440, 434 P.2d 992]; see also Henderson v. Superior Court (1978) 77 Cal.App.3d 583, 592-593 [142 Cal.Rptr. 478]; Buskuhl v. Family Life Ins. Co. (1969) 271 Cal.App.2d 514, 521 [76 Cal.Rptr 602].) California adopts the analysis *121of the Restatement Second of Conflicts of Laws (the Restatement) in determining the appropriate law to apply in the interpretation of a contract. (1 Witkin, Summary of Cal. Law (9th ed. 1987) Contracts, §§ 37-43, pp. 77-82.)
Section 6 of the Restatement provides the general rules for determining the proper choice of law where a potential conflict arises. That section indicates that a court will follow the statutory directives of its own state with respect to the choice of law. California has such a statutory directive set forth in Civil Code section 1646, which states that “A contract is to be interpreted according to the law and usage of the place where it is to be performed; or, if it does not indicate a place of performance, according to the law and usage of the place where it is made.” Since the contract does not state one specific state of performance, section 1646 indicates it is to be interpreted according to the law of the state where it was made, i.e., under Texas law.
Even assuming arguendo that section 1646 does not control the choice of law in this case, when I analyze other factors set out in the Restatement, I reach the same conclusion.
Section 188 of the Restatement provides that where the parties have not chosen the applicable law governing the contract, the interpretation of that contract is to be “determined by the local law of the state which, with respect to that issue, has the most significant relationship to the transaction and the parties . . . [U] . . . [T]he contacts to be taken into account... to determine the law applicable to any issue include: [UJ(a) the place of contracting, [10(b) the place of negotiation of the contract, [10(c) the place of performance, [10(d) the location of the subject matter of the contract, and [10(e) the domicil, residence, nationality, place of incorporation and place of business of the parties.”
Section 188 provides that these contacts should be evaluated according to their relative importance to the particular issue. However, as the Restatement also notes in the comment to section 193, “The location of the insured risk will be given greater weight than any other single contact in determining the state of the applicable law provided that the risk can be located, at least principally, in a single state. Situations where this cannot be done, and where the location of the risk has less significance, include (1) where the insured object will be more or less constantly on the move from state to state during the term of the policy and (2) where the policy covers a group of risks that are scattered throughout two or more states. The importance of the risk’s principal location will also vary somewhat from case to case. It enjoys greatest significance when an immovable is involved, such as when *122the risk insured against is damage by fire to a particular building. In the case of chattels, the significance of the state of the risk’s principal location diminishes with the length of time that it can be anticipated the chattel will be in other states during the term of the insurance. Provided, however, that the risk will be in a particular state for the major portion of the insurance period, the risk’s principal location is the most important contact to be considered in the choice of the applicable law, at least as to most issues.” (Id., at com. (b), pp. 611-612, italics added.) The Restatement suggests examples of chattels “constantly on the move from state to state” as ships, trucks, airplanes and railroad cars. (Id., at com. (a), p. 610.)
Analyzing the contacts set forth in the Restatement reveals the following: Texas was both the place of contracting and the place of negotiation of this contract.
With respect to the place of performance, the contract clearly contemplated the principal location was the state of Texas, since the insurance contract states that the vehicles insured would be garaged principally at Billy Bob Jones’s house in Lubbock, Texas. Moreover, the contract indicates the 1980 Buick Regal would be driven a distance of five miles each way between the place where it was principally garaged and the driver’s place of work. Marie was listed in the policy as an additional driver residing in the home of the named insured, Billy Bob Jones.
The location of the subject matter of the contract (the car) was also contemplated by the parties to be in Texas. In contrast to the examples of chattels “constantly on the move from state to state” suggested in section 193 of the Restatement, such as commercial vehicles like ships, trucks, airplanes or railroad cars used to move freight or passengers for hire, the parties here contemplated that this car would operate principally in Texas. While the insurance contract sensibly provided for coverage outside of Texas, because a car can be driven outside the state, this isolated fact obviously cannot be used to conclude the principal place of performance and principal location of the contract’s subject matter would be outside Texas.
Finally, the insurance company has its place of business in Texas and Marie, at the time the contract was executed, lived with her then-husband Billy Bob in Texas.
I therefore conclude the important contacts between this insurance contract and Texas require the contract to be interpreted according to the laws of that state. (See generally, 1 Witkin, op. cit. supra, §§ 42-50, pp. 81-88.)
*123If Larry Cross is to be afforded coverage under the insurance policy issued to Billy Bob Jones, he must first come within the definition of a “covered person” under the policy language; in other words, he must first be found to be a person using “your covered auto” within the meaning of Texas law.
A Texas case dispositively discusses the pertinent contractual language and interprets the phrase “any person using your covered auto.” In Black v. BLC Ins. Co. (Tex.Civ.App. 1986) 725 S.W.2d 286, on facts materially similar to those at issue here and based upon identical insurance policy language, the Texas Court of Appeals held that coverage is not provided under these circumstances unless the named insured owns, possesses or controls the use of the automobile. (Id., at p. 288.)
In my view, we are bound to accept this interpretation of the insurance policy language under Texas law. Larry Cross is not a covered person under the insurance policy issued to Billy Bob Jones, since Billy Bob did not own, possess or control the use of the 1980 Buick Regal at the time of this accident. Because Larry Cross is not a “covered person” under the policy as construed by Texas law, I do not reach the question whether Billy Bob Jones retained a lawful insurable interest against liability arising out of use of the automobile under California law.