Court Opinion

ID: 9725249
Source: CourtListenerOpinion
Date Created: 2023-08-26 11:37:10.269243+00
Date Added: 2024-06-11T18:25:12.954596
License: Public Domain

ROBERTS, J.
(dissenting) The facts underlying the controversy between the parties to this action are without material dispute. Plaintiff issued a liability policy to George and Darleen Bechard which included coverage against loss or damage from liability for bodily injury and property damage in connection with the operation of a Chevrolet truck. Attached to the policy is a rider or endorsement by the terms of which insurer agreed to pay accidental death and disability benefits. The endorsement contains the following exclusion clause: "This insurance does not apply: (a) to bodily injury or death sustained in the course of his occupation by any person while engaged (1) in duties incident to the operation, loading or unloading of, or as an assistant on, a public or livery conveyance or commercial automobile, or (2) in duties incident to the repair or servicing of automobiles;". The endorsement defines the term "commercial automobile" to mean "a motor vehicle of the truck type".
The insured, George Bechard, was killed while driving and operating in the course of his occupation the Chevrolet truck described in the policy. It is undisputed that insurer under the terms of the policy was excepted from liability for an accidental death of the character here involved. Defendant contends, however, that plaintiff insurer because of certain representations made by its agent is estopped from denying liability and asserting a de*251fense under the quoted exclusion clause and is obligated to pay to her as the surviving wife the amount of the death benefit specified in the endorsement.
The general rule is that the doctrine of waiver or estoppel is not available to extend the coverage of an insurance policy or bring within its coverage a risk expressly excluded. The author of an annotation in 113 A.L.R. 857, citing numerous cases, concludes:
"It is well settled that conditions going to the coverage or scope of the policy, as distinguished from those furnishing a ground for forfeiture, may not be waived by implication from conduct or action, without an express agreement to that effect supported by a new consideration. This rule may be, as it often is, otherwise stated that the doctrine of waiver may not be applied to bring within the coverage of the policy risks not covered by its terms, or risks expressly excluded therefrom. (It will be noted, as above indicated, that the courts have also generally held, where the question has been considered, as appears from the statement - of the individual cases, that the doctrine of estoppel could not be relied on to extend the coverage of the policy.)"
See also 45 C.J.S. Insurance § 674; 29A Am.Jur., Insurance, §§ 1014, 1135; 16 Appleman, Insurance Law and Practice, § 9090.
The court in Miller v. American Eagle Fire Ins. Co., 253 N.Y. 64, 170 N.E. 495, considering application of the rule, observed:
"The insurance company may be strictly held to its policy; its contract may even be liberally construed in favor of the policyholder, but the losses which it has specifically excluded cannot be brought within the insurance by a ruling of the courts. The contract which the parties have made limits the power of the courts. The law can declare a liability based upon the contract, but it has no power to make a contract."
The policy provision with which we are here concerned excluding specified risks from coverage is not a condition the breach *252of which would work a forfeiture, but is an exception and hence the doctrine of waiver which relieves against forfeiture has no application. An estoppel arises whereby conduct or acts a party has been induced to alter his position or to do that which he would not otherwise have done to his prejudice. Ziegler v. Ryan, 66 S.D. 491, 285 N.W. 875 and cases cited. The question of law is whether the evidence makes out a case of estoppel.
The trial court in an exhaustive memorandum states its reasons for the declaratory relief granted the plaintiff. The following excerpts are particularly pertinent:
"The court is of the opinion that any conversations that took place after the death of George Bechard between Max Horsley and defendant and Max Horsley and Morris Bechard and Alfred Bechard were immaterial to any of the issues in this case as they could not possibly add to, diminish, or alter the facts and circumstances surrounding the writing of the automobile policy here in litigation. * * *
"In the case before this court for decision there is no evidence of fraud, deceit, or errors of any kind on behalf of the plaintiff insurance company. There is no evidence that the insurance contract was not written by the company exactly as ordered by the Agent Horsley. The death and disability endorsement appears to be a standard printed coverage endorsement used by the company to furnish a limited death and disability coverage to the public for a small premium. Its terms are not vague or complicated and its 'Exclusion' provisions are clear and explicit. Such coverage was only a minor portion of the coverages in the automobile policy constituting the entire insurance contract between the parties."
Defendant relies on decisions to the effect that an insurer is estopped from taking advantage of an exclusion clause where insured relies on an agent to supply specific coverage and which, the insurer fails to provide and which the agent mistakenly represents was contained in the policy. In Ivey v. United National Indemnity Company, 9 Cir., 259 F.2d 205, which is relied upon to a: *253great extent by defendant, insured relied on his insurance agent to obtain an extension of the coverage of an automobile liability policy to include liability for property damage in connection with his business and representations were made by the agent that renewal of the policy would cover such business. The court holding that the insurance company must be held bound under the circumstances to give the protection contracted for said: "Now, if Knudsen, as broker, was the agent and representative of the insured, representations made to him would have the same effect as if made to Dr. Ivey. At any rate he passed to Dr. Ivey the information received from the company that he had the coverage. We know of no reason why Knudsen could not be the broker for Ivey in procuring the required coverage and also the agent for the insurance company in delivering the policy to appellant after its execution." The Ivey case is clearly distinguishable from the present case in that the policy of insurance contracted for was different from that actually written.
The responsibility of plaintiff insurer was limited to the representations and agreements of its agent Horsley which were made within the limits of his authority. Actual authority being absent, defendant relies upon apparent authority of the agent. If the statements volunteered by the agent of plaintiff company in the letter of May 27, 1958, transmitting the endorsement come within the category of a construction of the contents of the policy, it does not appear that the policy is ambiguous or susceptible of two constructions or that defendant and her husband relying on such construction were induced to alter their position or to do that which they would not otherwise have done to their prejudice. In so far as it appears from the record, it was no part of the agent's duty to construe or interpret the terms of the policy. "To create an estoppel the representation relied on must be a statement of a material fact, and not a mere expression of opinion." 31 C.J.S. Estoppel § 79, p. 288. The same rules apply to insurance companies as are applied generally in agency. Insured was in possession of the policy and had the opportunity to read it. The means of deriving information upon which to form a judgment was open to him and there is no claim of fraudulent or deceitful conduct on the part of agent Horsley. The circular which was received in evidence did not purport to give com*254píete details of death and disability coverage. By this means, policyholders were invited to consult agents of plaintiff insurance company as to additional coverage avaliable to policyholders. It is unreasonable to give to the circular the efficacy claimed by defendant. It was never intended to be relied upon as stating the terms of death and disability coverage and to become a part of the contract of insurance.
The facts herein are not comparable to those appearing in Ziegler v. Ryan, supra. The insurer in that case assumed and conducted the defense of an action against the insured with knowledge of facts taking the accident outside the coverage of the policy and without disclaiming liability or giving notice of a reservation of the right to deny liability. The controlling factors in that case were the inconsistent positions taken by insurer and prejudice of insured's rights by its conduct. The insured was led to believe and understand that defense of noncoverage would not be asserted and to his prejudice insured relinquished all control of the defense of the action against him. The essential elements of estoppel therein established are not present in the instant case.
Defendant is claiming in this action a benefit for which her husband did not contract and the evidence in my opinion falls far short of proving an estoppel precluding plaintiff insurer from setting up the defense of noncoverage. It is my conclusion that the action of the trial court in entering declaratory judgment for the plaintiff was correct. I would affirm the judgment.
RENTTO, J., concurs.