Hernández Nieves v. Rosario

DISSENTING OPINION OE

MB. OHIEE JUSTICE TBAVIESO, IN WHICH MB. JUSTICE TODD, JB., CONCUBS

For the reasons which I shall set forth in the course of this opinion, I feel bound to dissent from that rendered by the court in the instant case.

*293The facts upon which there is no controversy, are the following:

The plaintiff and his wife were traveling as passengers on an insured public automobile — “P.A. 85” — when, in consequence of the alleged negligence of the driver of the vehicle, the wife of the plaintiff, appellant herein, suffered serious injuries for which he claims compensation in the sum of $5,000. At the time the accident occurred, the automobile was being driven by the chauffeur and not by its owner, defendant Gregorio Cruz Rivera. The complaint alleges that, at the time of the accident, the car was insured with United States Casualty Co. of New York against liability for accidents caused by said vehicle to passengers or third persons, up to the sum of $1,000, in accordance with the provisions of Act No. 33 of April 14, 1941.

The insurance company in its answer denied the essentia] allegations of the complaint and set up as special defenses: (a) that the facts alleged were insufficient to constitute a cause of action; (b) that the policy covered only codefend-ant Gregorio Cruz Rivera, as owner of the vehicle; and (c) that the policy issued in favor of Gregorio Cruz Rivera contained, among others, the following special conditions:

“3. This policy shall he effective only while the insured vehicles are driven by their owners whose names are set forth in the attached rider.
“4. This policy shall not cover any accident occurring when the vehicles are driven by persons other than those named as owners in the attached rider, and no substitution of a driver shall be valid unless a written indorsement is issued by the general agents of the company.
“5. No substitution shall be made unless the ownership of the ear has changed and the vehicle is used by the new owner thereof as his tool of work, in accordance with the provisions of Act No. 33, approved April 14, 1941.”

The defendant company further alleged that Art. 3 of the Regulations for"the execution of said Act No. 33 imposes on the owner of an insured automobile the obligation to give *294to the agents of the company, within a period not exceeding 24 hours, notice of any accident in which any passenger may be injured; that complaince with that requisite is indispensable to compel the company to pay the indemnity agreed; that neither the insured nor any other person gave such notice to the defendant company, and the insurer learned of the accident for the first time when the complaint was filed; that at the time of the accident the automobile was not being-operated by its owner, the insured, as a tool of work; that the person who drove the vehicle at the time of the accident was not authorized by the G-overnment of Puerto Rico to operate motor vehicles; that there was no relationship, contractual or otherwise, between the plaintiff and the driver of the vehicle whereby the insurer would be bound to pay the indemnity claimed from it.

On motion of the defendant company, the lower court rendered judgment dismissing the complaint as to the insurer.

The appellant urges that the lower court erred in holding that the policy issued by the defendant company only covered accidents occurring while the vehicle was being driven by the person whose name was recorded as owner thereof in the Department of the Interior; in not considering the evidence regarding the circumstances in which the vehicle was being operated by a person other than its owner; and in rendering a summary judgment, erroneously applying Rule 56 of the Rules of Civil Procedure.

The only question to be considered and decided by us is whether a policy, issued under the conditions stated above, covers an accident which occurred while the insured vehicle was being driven by a person who did not own it nor was authorized to operate motor vehicles.

Section 10 of the Act to regulate the operation of motor vehicles, approved April 13, 1916, as amended by Act No. 33 of April 14, 1941, provides that “the automobile operated by its owner as a public carrier, if the owner personally drives *295it and he does not own, hold, or control other motor vehicles used in the transportation of .passengers for pay, shall he considered his tool of work, and as such, shall not pay any fee, nor shall the owner thereof pay any fee for operating or driving said automobile.” Said Section further provides as follows:

“The owner of an automobile who operates it as a public carrier and receives the benefit of exemption from the payment of the fee because said automobile is considered a tool of work, shall pay the-sum of twenty-nine (29) dollars a year .... Said sum of twenty-nine dollars shall be covered into a special fund in the Treasury of Puerto Eico and shall be applied by the Treasurer' of Puerto Eico to pay the premium on an insurance policy covering the accidents caused by said vehicle to passengers traveling thereon, and to third persons, and to that end the Treasurer of Puerto Eico shall pay the said sum of twenty-nine dollars to the insurer who upon a public call for bids . . . offers the best terms apd is awarded the contract . . .
“No public carrier which has obtained the benefits of the exemption herein established may travel over the roads of Puerto Eico unless it has paid the said sum ' for such insurance policy. The Treasurer of Puerto Eico shall issue a certificate of such payment which shall be posted on a conspicuous part of the automobile.” (Italics ours.)

Two purposes were sought by the lawmaker in enacting the above-quoted provisions, to wit: (1) To grant to the owner of an automobile, when he personally drives it as a tool of work and operates it as a public carrier, exemption from the payment of any fee for the operation of the vehicle; and (2) in consideration of such exemption, to impose upon the owner of the vehicle the obligation to pay the necessary sum for satisfying the premium on an insurance policy covering the accidents caused by said vehicle.

There is involved, therefore, an insurance contract entered into between the owner of a public service vehicle and the insurer, in favor and for the- benefit of any passenger or pe*296destrian who might he injured in consequence of an accident caused by the vehicle. The involuntary or compulsory character of the insurance is shown by the statute itself, which provides in effect that the vehicle can not travel over the public roads of Puerto Rico unless its owner has paid the sum necessary for obtaining the insurance policy.

The statute under consideration does not provide, either expressly or impliedly, that the policy shall cover only those accidents occurring while the owner of the vehicle is personally driving the same. It is the policy herein which so provides under the special conditions already mentioned. Are those conditions binding upon the person injured where, as in the present case, there is involved a compulsory or involuntary insurance? Let us see.

In Rondón v. Aetna Casualty & Surety Co., 56 P.R.R. 418, a policy had been filed by a public carrier “to answer for any compensation awarded to any person injured as the result of an accident due to the carelessness of the public carrier or its employees.” The insurer alleged that the carrier had violated the conditions of the policy because at the time of the accident the vehicle was being operated by a person who lacked the age and the license required by law, thus relieving the insurer from all liability under the policy.1 The evidence showed that at the time of the accident the driver of the vehicle had no license and had not attained the age of 16 years required by law for obtaining such a license; and that the policy expressly' provided that the company would not be liable while the automobile was driven by any person under the age of sixteen years. The district court gave judgment for the insurer, declaring that the defenses set up by the latter against the insured were valid as against the person injured. This court reversed the judgment of the court a quo and overruled its own decision in a former appeal between *297the same parties (46 P.R.R. 593), holding, in accordance with the decisions of state courts,2 that where the insurance is compulsory, that is, where the policy has been issued in compliance with a statute requiring the filing of such policy before the insured can obtain a license to engage in the transportation of passengers for pay, the policy can not contain any provisions except those authorized by the statute, so as to affect any person suffering damages caused by the insured vehicle.

Section 10 of the Act to regulate the operation of motor vehicles, supra, imposes on the public carrier the obligation of paying the premium on an insurance policy covering the accidents caused by the vehicle, as a condition precedent to its right to travel over the highways of Puerto Rico. We fail to' find in said Section or in any other place in the Act, any provision to the effect that the policy required by the statute shall protect the passenger or the pedestrian only if the owner of the vehicle was driving it at the time of the accident. It is true that in the policy issued in the instant case there was set forth, as a special condition, that the policy “shall not cover any accidents occurring when the vehicles are being driven by persons other than those named as owners in the attached rider,” unless the substitution has been authorized by the general agents of the company. But that condition is not binding upon the injured person. As was said in Gillard v. Manufacturers’ Casualty Ins. Co., supra:

“Whatever other provisions the filed policy contains may be good as between the insurer and the insured auto bus owner, and may impose upon the latter certain duties and obligations . . ., for breach of which the insurer can maintain an action; but such provisions cannot deprive an injured person of the remedy given by the statute, nor can they in any way abridge the rights granted by the statute to such injured person .... The sole beneficiary of the statute is the person injured. The insured person is the only one *298who can sue under the policy, and cite the statute in support of the action. The injured person’s rights in the policy of insurance are original and primary, not derivative and secondary.”

We fail to see, any reason why the doctrine laid down in the case of Rondón v. Aetna Casualty & Surety Co., supra, should not he applied to the case at bar. There, as here, the owner of the insured vehicle, in violation of certain conditions of the policy not required by the statute, permitted the car to be driven by a person who held no license for operating motor vehicles. In requiring the insurance of public service,automobiles, the lawmaker intended to give to the persons who travel on said vehicles and also to pedestrians an unqualified assurance that they will receive compensation for any damages caused to them by the negligence of the public carrier, or of the persons entrusted by the latter with the operation of the vehicles. That guaranty can not and should not be impaired or affected in any way by any conditions which the insurer and the insured may deem advisable to include in the insurance contract- in order to govern the relations between the contracting parties. A breach of those conditions will doubtless give a right of action to the insurer as against the insured; but it can not be set up so as to deprive the injured person of the protection afforded to him by the statute.

The fundamental error of the opinion of the court clearly appears in the following paragraph:

“There are a number of differences between Act No. 33 and a typical compulsory insurance statute. (Citing authorities.) First— under the latter the ear owner has no option; he must obtain an insurance policy. But under Act No. 33 an owner may or may not pay twenty-nine dollars into the insurance fund as he chooses. Instead of paying the twenty-mine dollars, he may pay the regular license fee and operate as a public carrier without insurance. ’ ’

It is indisputable that an owner of an only automobile, which he operates as a tool of work, can not be compelled to submit to the provisions of Act No. 33 cited. He may, if he chooses, avail himself of the benefits of said Act or devote *299himself to the business of transportation of passengers by paying the license fees fixed by the laws in force. But it seems equally indisputable that when the owner of the vehicle has exercised that option and has come under the benefits of Act No. 33 — exemption from payment of license fees and possibly exemption from attachment of the automobile by reason of its being considered a “tool of work” — from that moment, compulsorily and without any option whatsoever, the obligation to pay the sum of $29 a year to cover the premium “on an insurance policy covering the accidents caused by said vehicle” to the passengers or third persons, •falls upon him. The situation can be compared to that of a person admitted to the practice of law. Nobody can compel such person to practice as a notary. The lawyer may or may not, at his option, practice the notarial profession. But if he chooses to practice it, then he is compelled to furnish a bond as provided by law. The same can be said of the owner of one or more busses. He can travel freely over the public roads and streets, without being bound to insure the vehicle. But if he chooses to devote his vehicles to the public service of transportation of passengers, then the unavoidable obligation to take an insurance policy before he can devote himself to that business falls upon him.

That the insurance to which § 10 of Act No. 33, supra, refers is- compulsory is shown by the clear and conclusive provision that “no public carrier which has obtained the benefits of the exemption herein established may travel over the roads of Puerto Rico unless it has paid the sum of such insurance policy.” And as evidence that the provisions of the Act have been complied with and that the vehicle legally travels by the roads, the law provides that the automobile must carry in a conspicuous part thereof a certificate of payment issued by the Treasurer.

It is true that Act No. 33 does not specify which shall be the coverage of the insurance policy. It only provides that the owner of an automobile which has availed himself of the *300benefits of the Act shall pay the sum of $29 a year and that said sum “shall be covered into a special fund in the Treasury of Puerto Rico and shall be applied by the Treasurer of Puerto Rico to pay the premium on an insurance policy covering the accidents caused by said vehicle.” The court is of the opinion that the fact that the statute does not specifically fix the coverage of the policy is sufficient to take off the compulsory character of the insurance, leaving the victim of an accident subject to all the defenses which the insurance company might bring against the owner of the vehicle for his breach of the conditions of the policy. We respectfully think that the court has incurred in error since it did not take into account the clear and evident purpose of the lawmaker.

Since the two fundamental purposes of the Act are to help, through the exemption of the payment of license fees, the great number of persons who are owners of an only automobile and to protect the victims of accidents caused by the vehicles through an insurance policy, the lawmaker desired to protect both by providing what was needed to obtain the greatest coverage possible with the $29, which the law compels every owner of a vehicle to pay. To this effect it provided that the $29 a year shall be paid to the Treasurer of Puerto Rico, to be covered into a special fund which shall be applied by the Treasurer to pay the premium of an insurance policy. In order to avoid that every owner of a vehicle should have to obtain any insurance he can find for a $29 premium and make possible the obtention of a greater coverage through group insurance of the vehicles, which are operated as public carriers under Act No. 33, the lawmaker provided for a global fund, constituted 'the Treasurer as agent of the owners of said vehicles, and imposed upon him the duty to use the special fund to obtain a policy from the insurer, who in a public call for bids, should oiler the best terms.

We can not agree with the findings of the court that the statute does not provide that the issuance of the policy shall *301be a condition precedent to the operation of the automobile over the public highways; and that all that the owner of the vehicle has to do is to pay the sum of $29, he being ipso facto authorized to devote himself to the business of transportation of passengers, without any concern of whether or not an insurance policy has been obtained. We have seen that the statute provides that no public carrier may travel over the roads of Puerto Eico unless he has paid said sum “for such insurance policy.” The sum of $29 is paid for a specific purpose; and it is paid to the Treasurer in his capacity as agent of the owners of the vehicles, in order that he, under the express provisions of the Act, invest the total sum received by him in obtaining the best policy he can in a public call for bids. In order that we can accept the findings of the court we would have to set up in the Act a new option, that is, that the Treasurer may or may not, at his option, obtain the policy; and we would have to hold that in both cases the owner of the vehicle is entitled to operate it over the roads, without concern to the protection which the law has desired to give to the passengers and pedestrians.

Nor can we accept as correct the construction given to the statute in the sense that the Treasurer is empowered by law to accept and include in the policy any condition which the insurance company might deem advisable to require, even if those conditions are in contravention of the express provisions of the statute. The ‘special conditions 3, 4, and b included in the policy in the instant case, supra, in which it is stipulated that the policy shall have effect only “while the insured vehicles are driven by their owners” and shall not cover any accident when the vehicles are driven by any other person, are in open conflict with the provisions of § 10 of Act No. 33, supra, which directs the Treasurer of Puerto Eico to apply the special fund “to pay the premium on an insurance policy covering the accidents caused by such vehicles.” The statute requires a policy which shall protect the passengers and pedestrians against accidents caused by any *302insured vehicle devoted to the transportation of passengers and neither limits nor permits limiting the liability of the insurer to those accidents occurring while the owner was driving the vehicle. We are of the opinion that neither the Treasurer of Puerto Rico nor this court is authorized to include in the policy required by the statute the limitations to the liability of the insurer contained in the above special conditions 3, 4, and 5.

We are of the opinion that where a vehicle, insured under the provisions of Act No. 33, causes injury to a passenger or pedestrian, the insurance company is liable to pay said damages, up to the amount of the policy obtained by the Treasurer, not only when the vehicle is driven by its owner, but also when it is driven by any other person with the consent of the owner and for his benefit, in the business of a public carrier.

For the reasons stated we are of the opinion that the summary judgment appealed from should have been reversed and the case remanded to the District Court of Bayamón for further proceedings.

González v. U. S. Casualty Co., 55 P.R.R. 646; Coleman v. New Amsterdam Casualty Co., 247 N. Y. 271; Hynding v. Home Accident Ins. Co., 214 Cal. 743; Nelson v. Ins. Co., 111 N. J. Law 345; see monograph, in 106 A.L.R. 516, 532.

Gillard v. Manufacturers’ Casualty Ins. Co., (N.J.) 104 A. 707; Gillard v. Manufacturers’ Ins. Co., 107 A. 446; Boyle v. Manufacturers’ Liability Ins. Co., 115 A. 383.