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2008-MO-034 - Integon General Insurance v. Shine

THIS OPINION HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 239(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Supreme Court


Integon General Insurance Corporation, Appellant,

v.

George Jacob Shine, Kenneth G. Lane, Kenny Campbell, Neil R. Campbell, Jr. and Dorothy Merritt, as Personal Representative of the Estate of Jonah C. Merritt, Defendants,

of whom:

Kenneth G. Lane, Kenny Campbell, Neil R. Campbell, Jr., and Dorothy Merritt, as Personal Representative of the Estate of Jonah C. Merritt are Respondents.


Appeal from Dillon County
 James E. Lockemy, Circuit Court Judge


Memorandum Opinion No. 2008-MO-034
Heard June 24, 2008 – Filed August 4, 2008  


REVERSED


C. Mitchell Brown, William C. Wood, Jr., and A. Mattison Bogan, all of Nelson, Mullins, Riley & Scarborough, of Columbia, for Appellant.

A. Glenn Greene, Jr., of Greene and Huggins, of Dillon, Robert Francis McMahan, Jr., of Harris and Graves, of Columbia, and William Jones Rivers, III,  of Schurlknight and Rivers, of Florence, for Respondent.


PER CURIAM:  Appellant appeals an order finding coverage under its policy for an accident which occurred while its insured (driver) was operating a truck belonging to driver’s father.  We hold that coverage is barred by an exclusion in the policy, and reverse.

FACTS

Driver’s father owned the truck which was furnished for driver’s mother’s use.  Driver, who was expressly forbidden to drive the truck by his parents, nevertheless took it and picked up the respondents.  When mother became aware that driver had taken the truck, she called him and ordered him to immediately bring it back to his parents’ house.  The accident occurred after this phone call.

Appellant brought this declaratory judgment action against driver, the surviving passengers, and the estate of the passenger who died as a result of the wreck.  Appellant made a number of arguments why its policy did not provide coverage under these circumstances.  The circuit court found against appellant on each issue.  We find it necessary to address only one.

ISSUE

Did the circuit court err in holding that exclusion 18 did not apply so as to bar coverage under appellant’s policy?

ANALYSIS

Appellant issued a policy to driver insuring driver’s Buick automobile.  The circuit court held first that father’s truck qualified as a temporary substitute vehicle under section 9c of the policy.  This section defines “Your Insured Auto” to include:

Any auto not owned by you while you are temporarily driving it as a substitute for any other auto described in this definition because of its withdrawal from normal use due to breakdown, repair, servicing, loss or destruction.

It is uncontested that the automobile insured under appellant’s policy was inoperable at the time driver took his father’s truck.  Moreover, the circuit court held that before a vehicle could qualify as a “Your Insured Auto,” it must be operated with permission.  The circuit court held that mother, a named insured under the truck’s policy, had given driver permission to drive the truck when she ordered him to return it.[1]

The circuit court concluded that insurer could not rely on exclusion 18 which eliminates coverage for:

18.  Bodily injury or property damage while using an auto without or beyond the scope of the owner’s expressed or implied permission.

The circuit court reasoned the exclusion was ambiguous because it only excludes coverage for non-permissive use of an “auto” and does not specifically address whether it also applies to a vehicle meeting the policy’s definition of “Your Insured Auto.”  The circuit court again concluded that mother had given driver permission to drive the truck within the meaning of exclusion 18.

Appellant argues that under the exclusion the question is whether the owner of the automobile gave permission.  It contends there is simply no evidence that the truck’s owner, driver’s father, gave driver express or implied permission to take the truck.  In fact, the only evidence is that father explicitly prohibited driver, both verbally and in the truck’s policy, from operating the vehicle.  Appellant argues, and we agree, that whether mother gave permission is irrelevant as its policy requires the auto be driven with the owner’s consent.  Insurer next contends there is no ambiguity in exclusion 18’s reference to “auto” without also specifically referencing “Your Insured Auto.”  We agree.  Under the definitions of the policy, all “Your Insured Autos” are “autos” but not all autos are “Your Insured Autos.”

The term “auto” in exclusion 18 means “a land motor vehicle or trailer designed for travel on public roads,”[2] and necessarily includes those autos which also meet the limited definition of “Your Insured Auto.”  There is no ambiguity in exclusion 18.  Furthermore, even assuming mother gave driver permission to operate the truck, that permission does not vitiate exclusion 18 which requires the owner’s (i.e. father’s) permission.  The circuit court erred in failing to find exclusion 18 applies so as to deny coverage to respondents under the policy issued by appellant to driver.

CONCLUSION

The order finding appellant’s policy provided coverage to the respondents is

REVERSED.

TOAL, C.J., MOORE, WALLER, PLEICONES and BEATTY, JJ., concur.


[1] Whether mother’s instruction constituted permission is not necessary to our resolution of this case, but we are doubtful of this conclusion.

[2] This is the driver’s policy’s definition of “auto.”