Pollard v. Safeco Insurance Company

On Petition to Rehear

McAMIS, P. J.

State Automobile Mutual Insurance Company has filed a petition to rehear on a number of grounds. The first is that we failed to give effect to a provision of its policy, identical with that of Safeco, excluding coverage on “a non-owned automobile used in an automobile business of the insured”.

This exclusionary clause was held applicable as to Safeco because, in view of the practice of Pollard, the named insured under that policy, to accommodate customers b3^ rendering services similar to that involved in this case, the Ford was being used in the “automobile business” as defined by the policy.

Pollard paid the premium and was the named insured under Safeco’s policy. As we pointed out in our original *593opinion snob exclusionary clauses are sustained as reasonable and binding on the insured “because of the increased hazard growing out of the use of non-owned cars by such establishments while in their legal custody. ’ ’ It would be grossly unfair to the insurer to hold that an insured engaged in the automobile business could take out a policy on his privately owned and operated car and then on the basis of the same small premium claim protection for any and all non-owned automobiles used in such business. Policies of that nature providing general coverage for such businesses carry a much higher premium rate.

We think it would be equally unfair and a strained and unnatural construction of the policy to hold that although the operation of the car was for the benefit of the named insured and her permittee this clause applies because the permittee at the time the car became involved in an accident happened to be engaged in the garage business. In our opinion, to so hold would be wholly foreign to the purpose to be ascribed to the parties and amount to a strict construction and application in favor of the insurer, contrary to the familiar and often applied rule that insurance policies are to be liberally construed and applied to carry out the manifest purpose of the policy.

It is insisted we erred in finding that Mrs. Hamilton knew the car was being regularly parked at Pollard’s garage. Mrs. Hamilton so testified although, it is true, she later attempted to limit this knowledge to a later time. The point is really immaterial. The basis of our holding was not that the named insured could foresee who would drive the car for the purpose of having it repaired or what the nature of the repairs would be but that in the *594normal course of its daily use some repairs were to be expected and that in event such repairs became necessary the repairman might drive the car as an incident thereof.

It is next insisted that we erroneously held “by implication” that Mrs. Hamilton had not expressly forbidden her daughter, the real owner of the car, to allow anyone else to drive it. We did not deal with this question because we can not assume that such admonition was intended to apply to a situation like that involved here where the operation of the car was not for the benefit and pleasure of such third person but in connection with a normal and expected operation incident to the general daily and unrestricted use of the car. As we said in our original opinion, these circumstances distinguish the present case from cases where the original permittee turns the operation of the car over to some third person for the latter’s pleasure and benefit.

Other questions made in the petition are covered in our original opinion and need not be further considered.

Cooper, J., and Taylor, Special Judge, concur.