Devine v. Aetna Casualty & Surety Company , 19 N.C. App. 198 ( 1973 )

198 S.E.2d 471 (1973) 19 N.C. App. 198

Helen DEVINE
v.
The AETNA CASUALTY & SURETY COMPANY.

No. 7228SC712.

Court of Appeals of North Carolina.

August 22, 1973. Certiorari Denied November 1, 1973.

Joseph C. Reynolds, Asheville, for plaintiff-appellant.

Roberts & Cogburn by Landon Roberts, Asheville, for defendant-appellee.

Certiorari Denied by Supreme Court November 1, 1973.

PARKER, Judge.

By stipulation of the parties, jury trial was waived and the trial court made findings of fact, to which no exceptions were noted. Indeed, the record on appeal as docketed in this Court contains no exceptions whatever. For this reason questions argued in appellant's brief concerning admissibility of evidence and concerning sufficiency of the evidence to support certain of the trial court's findings of fact are not properly before us for review. "An assignment of error will not present a question unless it is based upon an exception set out in the case on appeal and numbered as required by Rule 21. Exceptions which appear for the first time in the assignments of error will not be considered." City of Kings Mountain v. Cline, 281 N.C. 269, 188 S.E.2d 284. Plaintiff's appeal, however, is itself an exception to the judgment and to any matter appearing on the face of the record proper and presents for review the question whether error of law appears on the face of the record. Stancil v. Stancil, 255 N.C. 507, 121 S.E.2d 882. This includes the question whether the facts found or admitted support the trial court's conclusions of law and the judgment entered pursuant thereto. 1 Strong, N.C. Index 2d, Appeal and Error, § 26. We hold that they do.

Aetna's liability to plaintiff, if any exists, must be found in the terms of its insurance policy issued to Phillips. By this policy Aetna agreed to pay on behalf of Phillips all sums, up to the policy limits, which he should become legally obligated to pay as damages because of bodily injury sustained by any person "arising out of the ownership, maintenance or use of the owned automobile or any non-owned automobile." The words "owned automobile" and "non-owned automobile" are defined in the policy, and the question presented by this appeal becomes whether, under the facts found or admitted, the Cadillac driven by Phillips on 22 October 1967, the date on which the collision occurred which caused plaintiff's injuries, was on that date within the policy definition either of an "owned automobile" or a "non-owned automobile." We first examine whether the Cadillac can properly be considered an "owned automobile" as that term is defined in the policy. Under the heading "Definitions," the policy provided:

"``owned automobile' means

"(a) a private passenger, farm or utility automobile described in this policy for which a specific premium charge indicates that coverage is afforded,

"(b) a trailer owned by the named Insured,

"(c) a private passenger, farm or utility automobile ownership of which is acquired by the named Insured during the policy period, provided

"(1) it replaces an owned automobile as defined in (a) above, or

"(2) the Company insures all private passenger, farm and utility automobiles owned by the named Insured on the date of such acquisition and the named Insured notifies the Company during the policy period or within 30 days after the date of such acquisition of his election to make this and no other policy issued by the Company applicable to such automobile, or

"(d) a temporary substitute automobile;"

Clearly, the Cadillac cannot be considered an "owned automobile" within the definitions contained in subparagraphs (a) and (b) above; it was not an automobile described in the policy for which a specific premium charge indicated that coverage was afforded nor was it a trailer. Further, the evidence presented in this case was not sufficient to support a finding that the Cadillac was "a temporary substitute automobile" so as to bring it within the definition of an "owned automobile" under subparagraph (d) above. The policy expressly defines the words "temporary substitute automobile" as follows:

"``temporary substitute automobile' means any automobile or trailer, not owned by the named Insured, while temporarily used with the permission of the owner as a substitute for the owned automobile or trailer when withdrawn from normal use because of its breakdown, repair, servicing, loss or destruction;"

The burden was on the plaintiff in this case to present evidence sufficient to show coverage of the Cadillac under defendant's policy, 19 Couch on Insurance 2d, § 79:351, and the trial judge expressly found that there was "no evidence that the 1964 Cadillac automobile being driven by Elmer Phillips on October 22, 1967, was being used as a substitute for a described vehicle which was withdrawn from normal use because of break-down, repairing, servicing, loss or destruction." There remains only the definition contained in subparagraph (c) above, which we now examine.

Appellant contends that Phillips acquired ownership of the Cadillac on 25 September 1967, the date he paid Peoples Pontiac and took possession of the car. Phillips, however, did not obtain legal title to the Cadillac until 31 October 1967, nine days after the accident. Under New Jersey law, which is here controlling, there must be strict compliance with the statutory requirements regarding transfer of title before title to a vehicle can be said to be transferred for insurance purposes. Eggerding v. Bicknell, 20 N.J. 106, 118 A.2d 820; Velkers v. Glens Falls Insurance Co., 93 N.J.Super. 501, 226 A.2d 448. This is so even though payment of the purchase price precedes transfer of legal title. Eggerding v. Bicknell, supra. If it be conceded that subparagraph (c) requires only that ownership be acquired by the insured "during the policy period" and makes no requirement that such acquisition be completed prior to the occurrence of an accident, plaintiff still may not prevail; there was no showing that the Cadillac fell within either proviso contained in subparagraph (c)(1) or (2). In its findings of fact, the trial court expressly found that there was no evidence that the Cadillac "replaced a described vehicle in the policy," which fact plaintiff would have been required to establish in order to bring the Cadillac within the proviso of subparagraph (c)(1). Under the heading "Conclusions of Law," the trial court also found "[t]hat there is no evidence upon which the Court can find that the defendant insured all automobiles owned by Elmer Phillips on the date of acquisition or that Elmer Phillips notified the defendant during the policy period or within 30 days after the date of such acquisition of his election to make policy No. 26FA11312PC and no other policy applicable to such automobile." We note the New Jersey decisions to the effect that notice to the insurance company of acquisition of a newly acquired automobile is not a condition precedent to coverage and therefore failure to give notice does not forfeit coverage where the accident occurs during the notice period prescribed by the policy. Nat'l Union Fire Ins. Co. v. Falciani, 87 N.J.Super. 157, 208 A.2d 422; Carr v. State Farm Mut. Ins. Co., 115 N.J.Super. 103, 278 A.2d 239 (dictum); Annotation, 34 A.L.R. 2d 936, 944; 7 Blashfield, Automobile Law and Practice 3d, § 316.6. While under these authorities it may not have been necessary for plaintiff to show notice given by the insured to the company under the facts of the present case in order to establish coverage under the policy sued upon, this would not relieve plaintiff of showing compliance with the other requirement of subparagraph (c) (2) by offering evidence sufficient to obtain a factual finding by the trial court that the company insured all private passenger, farm and utility automobiles owned by Phillips at the date he acquired ownership of the Cadillac. Absent such evidence and finding, the Cadillac did not come within the proviso of subparagraph (c)(2). Again, the burden was upon the plaintiff to present evidence sufficient to convince the trial judge, as trier of the facts, that he should find those facts which would establish coverage of the Cadillac under the defendant's policy. This the plaintiff has failed to do.

Finally, we consider whether under the facts found or admitted the Cadillac came within the definition of a "non-owned automobile" for which liability insurance coverage was provided by the policy. The policy defines a "non-owned automobile" as follows:

"``non-owned automobile' means an automobile or trailer not owned by or furnished for the regular use of either the named Insured or any relative, other than a temporary substitute automobile;"

In this connection the trial judge found that there was no evidence that the Cadillac "was not furnished for his (Phillips') regular use but to the contrary that he had had continuous possession for his regular use with no restrictions from September 25, 1967, until it was repossessed by the First National Bank of Glassboro." Appellant's counsel contends that in making this finding the trial judge acted under a misapprehension of law as to what constitutes "regular use" of an automobile, stating in his brief that "[a]ll the cases involved in the term ``regular use' are concerned with an insured who is driving a motor vehicle provided the insured by his employer." No cases are cited in support of this contention, however, and the clause has been frequently invoked in cases involving family and other relationships in which no employer-employee situation was presented. Hartford Accident & Indemnity Company v. Hiland, 349 F.2d 376 (7th Cir. 1965); Pennsylvania T. & F. Mut. Cas. Ins. Co. v. Robertson, 259 F.2d 389 (4th Cir. 1958); Campbell v. Aetna Casualty and Surety Co., 211 F.2d 732 (4th Cir. 1954), and cases cited in Annotation, 86 A.L.R. 2d 937. In Hartford Accident & Indemnity Company v. Hiland, supra, a sister and brother, for purposes of their own, traded use of their cars. Prior to the time of this trade the brother had been returning to his sister's home about once a month and his sister told him on this occasion to return the car as soon as possible. Because of business and social obligations, however, the brother did not return his sister's car for approximately two months, at which time he was involved in an accident while driving it. The question presented was whether under these circumstances the sister's car had been furnished for the brother's "regular use." The definition of a "non-owned automobile" in the brother's policy in that case was identical with the definition above quoted from the policy in the case now before us. In that case the Court of Appeals for the Seventh Circuit held that the district court's finding that the brother had unrestricted use of the sister's car, based on the facts in the record, could only lead to the conclusion that the car was furnished for his "regular use," with the result that the sister's car was excluded from coverage under the brother's policy. The opinion in that case points out that "[w]hile the purpose for which the vehicle was supplied may be a relevant factor in determining whether it was for the insured's regular use, . . . the factor of motive bears no necessary relation to the risk assumed by the insurer under the policy, as do the factors of length and type of use. . . ." We find appellant's contention that "regular use" should be limited to the situation where the insured is furnished the vehicle by his employer supported neither by reason nor authority. The contract of insurance contains no such limiting language.

The clear import of the provision excluding coverage of another's automobile which is furnished the insured for his "regular use" is to provide coverage to the insured while engaged in only an infrequent or merely casual use of another's automobile for some quickly achieved purpose but to withhold it where the insured uses the vehicle on a more permanent and reoccurring basis. While each case must be decided on its own particular facts and circumstances, the trial court's finding in the present case that Phillips had had continuous possession of the Cadillac with no restrictions from 25 September 1967 until it was repossessed by the Bank sometime after the accident, fully supports the conclusion that it was furnished for his "regular use" and that it did not come within the policy definition of a "non-owned automobile" for which liability insurance coverage was provided.

Since plaintiff, who had the burden of proof, failed to establish facts sufficient to bring her case within coverage provided by defendant's policy, the judgment appealed from is

Affirmed.

CAMPBELL and MORRIS, JJ., concur.