Opinion
32784.
DECIDED FEBRUARY 18, 1950. REHEARING DENIED MARCH 24, 1950.
Complaint on automobile policy; from Macon City Court — Judge Baldwin. September 19, 1949. (Application to Supreme Court for certiorari.)
Jesse W. Bush, John B. Harris Jr., for plaintiff.
Turpin Lane, Smith, Partridge, Field, Doremus Ringel, Ogden Doremus, for defendant.
Under a policy insuring a "new" automobile chassis, valued at $5782.30, and "its equipment and other equipment permanently attached thereto," for a two-year period for a premium of $110, the coverage did not include a concrete mixer of the value of $4000 installed upon the chassis shortly after the issuance of the policy.
DECIDED FEBRUARY 18, 1950. REHEARING DENIED MARCH 24, 1950.
R. O. Moore, trading as Glynn Construction Company, brought in the City Court of Macon an action against the American Insurance Company, the petition alleging the following: On June 30, 1947, the defendant issued to the plaintiff policy No. A100086, covering an automobile described therein as a 1947 International, model IKB-9-F, chassis 1311, motor number TR401-3701, a copy of which policy was in the possession of the defendant. The said automobile was purchased by the plaintiff for the express purpose of using it to deliver ready-mixed cement, and the plaintiff attached to the said automobile the usual type body used in the delivery and transportation of ready-mixed cement and which was commonly called a "cement mixer." The said policy was issued by Carley Zell, president, Zell Insurance Agency Inc., of Glynn County, Georgia, as a duly appointed and authorized agent of the defendant, acting within the scope of his agency and authority in issuing the policy for and on behalf of the defendant. At the time the policy was issued to the plaintiff the said agent understood that the truck was being purchased by the plaintiff for the express purpose of being used to deliver ready-mixed cement and that the said cement-mixer body would be attached to the automobile. On June 10, 1948, the said automobile rolled down an embankment in Hitchiti National Forest, Jones County, Georgia, and turned over, the said collision or upsetting causing considerable damage to the automobile. At the time of the accident the cement mixer was welded and bolted to the frame of the automobile and was permanently attached thereto. After the accident it was necessary to use a cutting torch to remove the mixer body from the frame of the automobile. The vehicle was then taken to Al Schlosser Equipment Company, Decatur, Georgia, where an estimate of necessary repairs to the mixer body was made in the amount of $5312.78, as shown by an itemized exhibit attached to the petition and made a part thereof. The damage to the automobile, other than the cement-mixer body, was repaired by Baker-Maddox Company, Macon, Georgia, at a cost of $779. The accident was immediately reported to the defendant, who appointed Crawford Company, insurance adjusters, Macon, Georgia, its agent to negotiate with the plaintiff a settlement of his claim. The defendant offered to pay the plaintiff $679, representing the cost, less $100, of repairing the automobile damage, except the damage to the cement mixer, growing out of the said accident, but declined to pay for any damage to the cement mixer on the ground that the said item of damage was not covered by the policy. In October, 1948, the defendant paid to the plaintiff the said $679, such payment being agreed by the parties to be without prejudice to any claim the plaintiff might have for damage to the cement mixer. The said cement mixer was purchased by the plaintiff from the Ingram Construction Company, Jacksonville, Florida, at a cost of $4000, and after the accident it had a market value of $100. The defendant has refused to pay this claim for the alleged reason that the item was not covered by the policy. The policy was in full force and effect on the date of the loss and expressly and unequivocally covers the said item of loss. The material part of the policy, being a part of Condition 10 of the policy, provides as follows: "Automobile defined. . . Except where specifically stated to the contrary, the word `automobile' wherever used in this policy shall mean the motor vehicle, trailer, or semi-trailer described in this policy. The word `automobile' shall also include its equipment and other equipment permanently attached thereto." At the time of the loss the said mixer was permanently attached to the said automobile. The prayer was for judgment for $3000 and costs and for process. The defendant filed an answer denying liability.
Upon the trial the evidence for the plaintiff was substantially as follows:
W. H. Willis testified: "I formerly operated the Moore-Willis Concrete Company in Bibb County. I was working with Moore-Willis Concrete Company on June 10, 1948, when a truck with a mixer body belonging to Mr. R. O. Moore was rolled down an embankment in Jones County. I went out to the scene of the accident. . . It did damage to the tractor and the body of the truck. Mr. Moore owned that truck at the time of this loss. The truck was in the possession of Moore-Willis Concrete Company. We owed Mr. Moore for it. We were in the process of buying it on a rental-to-buy basis. We did not have a written agreement with respect to that rental-to-buy arrangement, but we had a verbal agreement. We were working on a contingent basis, inasmuch as if the business went through and was successful we would eventually own the truck after we paid all the payments on it. The business did not go through. . . We didn't have title to it [the truck]. . . The monthly rental payments that we were making was $275 a month. Prior to this loss, I had an opportunity to observe this mixer and tell how it was placed upon the chassis of the automobile. It was bolted and welded to the frame of the truck. After this accident I had an opportunity to observe how the mixer body was removed from the automobile. It was cut aloose with an acetylene torch. . . I did not explain to them in detail [Crawford Company, adjusters] the agreement that we had about the truck, but I told them it was Mr. Moore's truck. . . They said the mixer itself was not covered; only the truck was covered. . . This list of parts that I have in my hand is an estimate of Al Schlosser Equipment Company at Decatur. . . I think these prices are consistent with the charges in this area for that type work. . . As to how much it [the mixer] was sold for, he said that the salvage was only worth about $100 as junk. I think something in the neighborhood of $3000 would be the fair value of the mixer before the collision. . . I got that equipment from Mr. Moore in September of 1947, just before we started to operating here. . . I believe he bought it some time in July, 1947. . . We were incorporated here in August and started to operate the business in September, and it was then that I arranged with Mr. Moore to bring this equipment up here."
R. O. Moore testified: "I live in Brunswick, Georgia. I am in the ready-mixed concrete business down there. Some time in June of 1947 I bought a 1947 International chassis for the purpose of mounting this five yard mixer on. . . It was used on a road job before and was sitting there idle at Brunswick. I think it had been idle about five or six months. I'm not positive about that, however. I thought I might keep it in this new enterprise that was just being established in Macon. I bought this mixer from Ingram Concrete Company, Jacksonville, Florida, and paid $4000 for it. I used it in that road job about six months, and when the road job was finished I set it up idle. I took it off the Ford truck because it was too big for the ford to handle. . . I bought that $4700 chassis that was mounted on it for the purpose of using it up here. This body and mixer was mounted under my supervision. It was mounted on the truck and welded on it. It was permanently attached to it. . . When I bought this truck I took out insurance upon it with Mr. Zell, Zell Insurance Company. At the time I bought the truck and took out the insurance on it I explained to Mr. Zell that that mixer was to be mounted on that particular truck inasmuch as it was the only kind of business I was in. I told him I intended to send it to Macon after it was mounted and deliver it to the Moore-Willis Concrete Company up here. He had previously been told I was starting this business up here. He knew I had an interest in Moore-Willis Concrete Company, and I told him I was buying the chassis and mounting the mixer on it for the express purpose of sending it up here. I told him that at the time I took the policy out. . . I notified him the day I sent it up here. As to what kind of arrangement I had with Moore-Willis with reference to the use of this truck, we had a verbal monthly arrangement whereby if the business here paid off and was a success I was to eventually deed him the truck after it was completely paid for. We had no written agreement. . . I was paying for the insurance premiums monthly. After I sent this equipment to Macon and after I notified Mr. Zell the equipment was being used in Macon I continued to pay insurance premiums to him. He accepted those payments. . . I did not tell Mr. Zell that I was renting this truck to Moore-Willis Inc. I told him I had sent it up here to be used here. . . As to the value of this mixer at the time it was destroyed in Jones County . . I figure it would be worth about $3000 or thereabout. . . After getting full knowledge of this arrangement they [Crawford Company, adjusters] paid me for the damage to my cab. . . They paid for this damage to the cab with the understanding that if the mixer was part of the truck or equipment within the meaning of that policy I had a right to make a claim for it and sue it. . . The only reason it wasn't paid was because this was not equipment within the meaning of the policy. . . I made payments right on up until June of this year. [Here the witness identified the policy taken out on June 30, 1947.] . . At the time I was buying the policy I made him [Mr. Carley E. Zell] a full disclosure as to what I intended to do with it. [At this point counsel for the defendant stipulated that the premiums were paid.] . . That same week that the policy was taken out we mounted the mixer onto the truck. . . My corporation up here, Moore-Willis, was incorporated some time in August. I think it was about two months after this policy was taken out, and the middle of September I sent the equipment up here to Moore-Willis. . . I had an agreement with the Moore-Willis Company up here to use this equipment on a rental-to-buy basis. I was paying on the chassis at that time around $193.50 a month, including insurance and everything. Then when I sent the equipment up here with the mixer on it Moore-Willis, the corporation, was to pay me $275 a month for twenty-four months. At the end of twenty-four months it was to be the corporation's equipment. . . I didn't have this policy until this wreck happened, and then I got the policy. It was in his office [Mr. Zell's]. I just left it there. I can't say as to when it was that the American Insurance Company refused to pay me for the mixer. As I understand, I was paid for the damage to the chassis, but I couldn't be sure as to whether it was some time in October of that year. It was after the wreck. I think $779 was the amount of the claim for the damage to the chassis, and I made claim for that about the first of October. . . After I made the claim for the damage to the chassis, with the understanding that I could without any prejudice at all, then I was paid for that, and then liability was denied on the equipment. . . At the time I took the truck back he was either eight or ten months behind in his payments. He had it around eighteen months. So he paid about eight months and was behind eight months. That particular piece of equipment would rent for around $800 or $850 per month. . . At the time I took out this policy I told Mr. Carley E. Zell that this truck was going to be used in Macon on a rental basis. I did not go into the details of the arrangement with him except just that way. The day the truck left Brunswick Mr. Zell was notified for my own protection. . . As to the nature of my arrangement with Moore-Willis about the use of this equipment — I had the right to use it any time I wanted to. I never conveyed title to them. During the period of this rental I had it back down there at one time and used it for special jobs. . . Just as a matter of convenience I left it [the policy] at Mr. Zell's office. . . I did not ask him [Mr. Zell] in so many words I wanted an endorsement on this policy saying that I was leasing it to Moore-Willis Company. I did not request any endorsement. I just told him what I was going to do with it."
The policy, which was in evidence, covered an automobile described as a 1947 International, model IKB-9-F, chassis 1311, serial number T. R. 401-3701. The policy was dated June 30, 1947, and was for a two-year period. It showed the chassis as being "new," bought in June, 1947, and being of the value of $5782.30 with an encumbrance of $4655.11, $204.61 of which was due on June 3, 1949, and the balance in 23 instalments of $193.50 each. The coverage here involved was "Collision or upset," the limit of liability being stated as "Actual cash value less $100," and the premium being shown as $110.
The policy contained the following provision: "Except where specifically stated to the contrary, the word `automobile' wherever used in this policy shall mean the motor vehicle, trailer or semi-trailer described in this policy. The word `automobile' shall also include its equipment and other equipment permanently attached thereto."
Under the item of "Exclusions" it was provided: "This policy shall not apply . . (b) under any of the coverages where the automobile is subject to any bailment lease, conditional sale, mortgage or other encumbrance, not specifically declared and described in the policy."
It was provided in item 11 of "Conditions" that "Notice to any agent or knowledge possessed by any agent or by any other person shall not effect a waiver or a change in any part of this policy or estop the company from asserting any right under the terms of this policy, nor shall the terms of this policy be waived or changed, except by endorsement issued to form a part of this policy."
In item 15 of "Conditions" it was provided that "By acceptance of this policy the insured agrees that the statements in the declaration are his agreements and representations, that this policy is issued in reliance upon the truth of such representations and that this policy embodies all agreements existing between himself and the company or any of its agents relating to this insurance."
Upon the conclusion of the evidence for the plaintiff the defendant made a motion for nonsuit on the grounds that (a) the concrete mixer was not included in the coverage of insurance, (b) proofs of loss had not been introduced or sought from the company and (c) the insured had violated the provision of the policy against a bailment-lease. The court granted a nonsuit, and the exception here is to that judgment.
The plaintiff in error insists, among other things, that the nonsuit here was unauthorized on the theory, as urged by the defendant in error, that the insurance policy did not cover the concrete mixer which was placed upon the insured chassis after the issuance of the policy. The policy was what is usually termed an automobile policy. An automobile usually consists, not merely of a chassis and engine, but also of some sort of body in which one may ride. In the present case the insurer saw fit to define the "automobile" which it was insuring and provided that "except where specifically stated to the contrary, the word `automobile' wherever used in this policy shall mean the motor vehicle, trailer or semitrailer described in the policy." The motor vehicle described in the policy was a 1947 International, model IKB-9-F, chassis 1311, serial number T. R. 401-3701. It follows, therefore, that the vehicle here insured was not one with any sort of body or concrete mixer superimposed upon it, but was merely a chassis. But it was also provided that the word "automobile," which here meant a chassis, "shall also include its equipment and other equipment permanently attached thereto." Manifestly this language refers to equipment which was an integral part of the chassis and also other equipment permanently attached thereto, whether an integral part or not. The inquiry arises: Does the language last mentioned refer to "other equipment permanently attached thereto" at the time of the issuance of the policy or would it embrace such equipment as might thereafter be permanently attached thereto? Of course, such a policy of insurance is merely a contract of indemnity. Atlantic Steel Co. v. Hartford Fire Ins. Co., 39 Ga. App. 680 ( 148 S.E. 286). The insurer assumes a risk with respect to the property insured and indemnifies the insured for loss sustained. The value of the "new" chassis here insured was shown in the policy as $5782.30, and the coverage was, among other things, for "Collision or upset." The premium was $110. While policies of insurance are, under repeated decisions of the appellate courts of this State, to be construed most favorably to the insured where ambiguity exists, nevertheless where only one reasonable construction can be had the courts will apply that construction as a matter of law. So construing the clause in question, "its equipment and other equipment permanently attached thereto," it would be taxing credulity too severely to say that the insurance company, for a premium of $110, was not only insuring the chassis and its equipment, then valued at $5782.30, but was leaving the door wide open for the installation of other equipment at some uncertain time in the future, no matter how elaborate and costly, and obligating itself to pay for any loss by reason of collision or upset. To make the application more definite in the present case, such a construction would mean that for a premium of $110, based on a valuation of $5782.30, the company was agreeing to indemnify the insured for loss, by reason of collision or upset, in an amount representing the combined value of the chassis and its equipment at the time of the issuance of the policy and the concrete mixer subsequently installed upon the chassis, and of the value of $4000, or a total liability of $9782.30. To attach to the language such a meaning would be to extend it beyond what is fairly within its terms and to impute to the insurer an intention which is not even implied.
In an exhaustive search we have found no case exactly in point. Counsel furnish none. We are cited by counsel for the defendant in error to Boston Ins. Co. v. Wade, 203 Miss. 469 ( 35 So.2d, 523), where it was held that a collision policy did not cover a wood body placed on a truck after issuance of the policy. However, the limit of liability was "Actual cash value, less $50," and it was stipulated "Actual cost when purchased, including equipment, $1673.11" and "new." It is obvious, therefore, that the equipment which was included in the coverage was that which with the truck was of the stated cost of $1673.11, and, hence, no after-acquired equipment was insured. Candidly, the question is not so simple here. We are dealing, not only with "its equipment," but also with "other equipment permanently attached thereto," and are confronted with the question whether the "other equipment permanently attached thereto" means equipment permanently attached at the time of the issuance of the policy or any equipment which might in the future be permanently attached to the chassis, regardless of its value, and without any increase in the amount of the premium. For these reasons the cited case is not exactly decisive, but, as hereinbefore stated, we hold that "equipment permanently attached thereto" means equipment permanently attached at the time of the issuance of the policy.
But it is urged by counsel for the plaintiff in error that the agent of the insurance company was told that the insured expected to use the chassis in Macon, Georgia, rather than in Brunswick, Georgia, where it was then located, and that he would put a concrete mixer upon it, and that in fact within a week he did so. It is not claimed, however, that the agent was told that the plaintiff wanted the $4000 concrete mixer insured along with the $5782.30 chassis and its equipment, for which only a premium of $110 was charged, and the statement of the plaintiff can not have the effect of requiring a construction different from that which we apply. It is true that he left the policy with Mr. Zell, the agent, but not for the purpose of correcting it to include the concrete mixer. He testified: "Just as a matter of convenience I left it at Mr. Zell's office."
Since, for the reasons above stated, we hold that the court did not err in granting a nonsuit, it is unnecessary to consider other grounds urged by the defendant in error.
Judgment affirmed. MacIntyre, P. J., and Townsend, J., concur.