Cobbins v. General Accident Fire & Life Assurance Corp.

Mr. JUSTICE STAMOS,

concurring:

While I concur with the determination in the majority opinion, I do so for the reasons assigned below.

The threshold issue raised by General Accident is whether the complaint states a cause of action embraced by Hazard 4 (Products-Completed Operations) of the policy and thereby renders applicable the exclusion expressed in (c), (2) of Exclusions.

As noted in the majority opinion, the complaint does not state a cause of action for “products liability” in the classic legal sense. Therefore, the Products-Completed Operations clause is inoperative if our interpretation of that clause limits its applicability to “products liability” actions. Such an interpretation is not compelled by the wording of the clause itself. Hazard 4 is not entitled, “Products Liability”; nor does the phrase appear anywhere within the clause. Also, coverage is not expressly restricted to action stemming from defective products.- A number of courts have accordingly interpreted similar Products-Completed Operations clauses literally, i.e., that the clause is applicable whenever a plaintiff has aUeged injury or damages from a product, regardless of whether a “products liability” theory has been advanced. (Tidewater Associated Oil Co. v. Northwest Cas. Co. (9th Cir. 1959), 264 F.2d 879; Blohm v. Glens Falls Ins. Co.,. 231 Ore. 410; Inductotherm Corp. v. New Jersey Mfrs. Cas. Ins. Co., 83 N.J. Super 464.) Conversely, I find other courts which have interpreted Products-Completed Operations clauses broadly and “common sensically” and have attempted to recognize the probable intentions of the parties by invoking that clause only where a classic “products liability” cause of action has been alleged. (McGinnis v. Fidelity & Cas. Co. of New York, 80 Cal.Rptr. 482; Lessak v. Metropolitan Cas. Ins. Co. of New York, 168 Ohio St. 153; St. Paul Fire & Marine Ins. Co. v. Coleman (8th Cir. 1963), 316 F.2d 77; Thibodeaux v. Parks Equipment Co., 140 So.2d 215.) This split of authority was discussed at length in Kennedy. The Products Hazard Exclusion in California (1970), 21 Hastings L.J. 1383, 1390, 1391, 1396.

I find the reasoning of those cases more compelling which interpret a Products-Completed Operations clause as a “products liability” clause. Two of the cases cited above, McGinnis v. Fidelity & Cas. Co. of New York, supra, and Lessak v. Metropolitan Cas. Ins. Co. of New York, supra, are factually similar to the case at bar and hold that a Products-Completed Operations clause is inapplicable to a cause of action resembling that advanced by plaintiff. I find one other case directly on point, Hagen Supply Corp. v. Iowa Nat’l Mut. Ins. Co. (8th Cir. 1964), 331 F.2d 199; while its holding is contrary, I do not find its reasoning persuasive.

For the foregoing reasons I agree that the complaint at bar does not state a cause of action within the Products-Completed Operations clause and that the products exclusion does not apply.

The remaining issue raised by General Accident is whether the complaint alleges a cause of action which is covered by Hazard 1 (Premises-Operations) of the policy, thus obligating General Accident to defend. The policy extends coverage if the following three requirements are met: 1) plaintiff incurred bodily injury; 2) the bodily injury was caused by accident; 3) the bodily injury arose out of the following hazard as recited in the policy: “The ownership, maintenance or use of the premises, and all operations necessary or incidental thereto.”

There is no dispute that plaintiff sustained bodily injury. General Accident also does not deny that the injury resulted from an accident — the ignition of plaintiff’s clothes by the sparkler he purchased; nor does General Accident suggest that the alleged negligent sale of the sparklers was anything but an operation incidental to the use of the premises. On its face, therefore, the policy appears to extend coverage and to guarantee a defense for the cause of action advanced. General Accident has not contended in its pleadings or briefs that its refusal to defend can be justified by the location of the “accident” — away from the insured’s premises. Such a contention would find support neither in the policy nor in legal precedent. (See St. Paul Fire & Marine Ins. Co. v. Coleman, supra, p. 80-81, and Lessak v. Metropolitan Cas. Ins. Co. of New York, supra, p. 158.) I conclude that the cause of action alleged by plaintiff in the case at bar fell within the language of the Premises-Operations clause.

I therefore concur that it was error for the trial court to allow General Accident’s motion for summary judgment, but for the foregoing reasons. I agree that the cause should be remanded with directions.