Anderson v. State Farm Mutual Automobile Insurance

CAMERON, Justice.

On 3 January 1980, a summary judgment was granted in favor of defendant State Farm Mutual Automobile Insurance Company in an action to recover for injuries suffered in an automobile accident. The Court of Appeals affirmed. Anderson v. State Farm Mutual Automobile Insurance Company, 133 Ariz. 483, 652 P.2d 556 (1982). Paul Anderson and Dusty Ellington, plaintiffs below, filed a petition for review by this court. We have jurisdiction pursuant to A.R.S. § 12-120.24.

We must answer only one question: Does an automobile collision which occurs when a hit-and-run driver propels a second vehicle into the plaintiffs’ car satisfy the “physical contact” requirement of plaintiffs’ “uninsured motorist” insurance coverage?

The facts necessary to a determination of this appeal are as follows. While stopped at a traffic light, Dusty Ellington’s vehicle was “rear-ended” by a Purolator Courier van. Ellington and his passenger, Paul Anderson, suffered personal injuries. The evidence indicates that the Purolator van had been struck and pushed into Ellington’s car by a third vehicle, which had sped away from the scene of the accident before anyone could identify it or the driver. It is undisputed that the third vehicle never came in direct contact with Ellington’s car.

Anderson and Ellington filed a claim with State Farm Mutual Automobile Insurance Company under the uninsured motorist provision of State Farm’s policy. Under the policy, an uninsured motor vehicle includes a hit-and-run automobile. A hit-and-run automobile is defined by the policy as

“ * * * an automobile which causes bodily injury to an insured arising out of physical contact of such automobile with the insured or with an automobile which the insured is occupying at the time of the accident * * * ”

and the identity of the operator or owner of such “hit-and-run automobile” cannot be ascertained. When State Farm denied coverage, Anderson and Ellington filed suit against State Farm, as well as Purolator Courier Company and the driver of the Pu-rolator van. The trial court granted summary judgment in favor of State Farm.

The Court of Appeals affirmed, finding that there had been no physical contact between the hit-and-run vehicle and Ellington’s car that would trigger the uninsured motorist provisions of the policy. The Court of Appeals reasoned that the requirement of physical contact was a matter of private contract. Since the provision did not violate public policy, the court declined to modify it. Balestrieri v. Hartford Accident & Indemnity Insurance Company, 112 Ariz. 160, 540 P.2d 126 (1975). Judge Sarah Grant dissented, urging that the majority had not adequately addressed the question of whether there had been physical contact between the vehicles which would satisfy the requirement of the policy. She concluded that where there is indisputable evidence that a third vehicle existed and caused the collision, indirect impact qualifies as “physical contact” within the terms of the policy. Because we agree with the dissent, we granted plaintiffs’ petition for review of the Court of Appeals decision and opinion.

The standard provision for coverage in an accident involving a hit-and-run vehicle requires that the injury result from “physical contact” of the hit-and-run vehicle with the insured or with the vehicle the insured was occupying at the time of the accident. R.G. Notman, A Decennial Study of the Uninsured Motorist Endorsement, 43 Notre Dame Lawyer 5 (1967); 25 A.L.R.3d 1299 (1969). The requirement of physical contact was designed to prevent fraudulent claims, such as when a driver fabricates a hit-and-run car to collect insurance for an accident actually caused by his own negligence. A. Widiss, A Guide to Uninsured Motorist Coverage, 1981 Supplement, § 2.41. In Balestrieri v. Hartford Accident & Indemnity Insurance Company, supra, we upheld the physical contact requirement in private insurance contracts, finding that it was not in derogation of Arizona’s uninsured motorist statute nor void as against public policy. In Balestrieri, supra, we pointed out that even though insurance carriers are required to include uninsured motorist coverage in the motor vehicle liability policies they write, A.R.S. § 20-259.01, hit- and-run coverage is a matter of contract between the insurance company and its insured. We also held that the requirement of physical contact is not an unreasonable limitation on uninsured motorist coverage. Balestrieri v. Hartford Accident & Indemnity Insurance Company, supra. However, we did not, in Balestrieri, determine what was “physical contact” under the policy.

The vast number of factual situations in which injury is caused by an unidentified vehicle has lead jurisdictions to interpret “physical contact” in very different ways. For example, the Court of Appeals of Indiana found that a rock which was thrown from the wheels of an unidentified vehicle and struck the windshield of a car, killing the passenger, was enough to constitute physical contact. The court reasoned there was a “substantial nexus between the hit- and-run vehicle and the intermediate object” and that the transmitted force was “continuous and contemporaneous” and concluded that there was physical contact within the meaning of the policy. Allied Fidelity Insurance Company v. Lamb, 361 N.E.2d 174, 178 (Ind.App.1977). On the other hand, the Court of Appeals of New York found no physical contact in the impact of snow and ice which dislodged from an unidentified tractor-trailer and struck the plaintiff’s car, shattering the windshield and injuring the plaintiff. The court acknowledged that physical contact need not be direct, but held that it must originate in collision. Its rule therefore excluded objects cast off or cast up by the unidentified vehicle. Smith v. Great American Insurance Company, 29 N.Y.2d 116, 324 N.Y.S.2d 15, 272 N.E.2d 528 (1971).

Physical contact was found in Inter-Insurance Exchange of the Automobile Club of Southern California v. Lopez, 238 Cal. App.2d 441, 47 Cal.Rptr. 834 (1965), where a hit-and-run vehicle struck another ear, which crossed the median and hit the plaintiff’s oncoming car. The Court of Appeals of California reasoned that this was a direct application of force which qualified as physical contact. The court drew a parallel to common law tort, under which an unwanted touching by the defendant or an article set in motion by the defendant (“trespass vi et armis”) was distinguishable from injury caused by colliding with an object already in place (“trespass on the case”). The court concluded that the former, direct contact, which included injury from any intermediate object, was physical contact within the meaning of the statute. The Court of Appeals of New York reached a similar conclusion in Motor Vehicle Indemnification Corporation v. Eisenberg, 18 N.Y.2d 1, 271 N.Y. S.2d 641, 218 N.E.2d 524 (1966), where a vehicle crossed the median and hit the insured’s car after being struck by a hit-and-run driver. The court found this accident to be equivalent to actual contact, since the car crossing the median was merely an involuntary intermediary. The court indicated that the same principle would operate to extend coverage if a hit-and-run car were to strike a telephone pole and push it onto another car; or if a hit-and-run vehicle struck a motorcycle whose rider was thrown onto a passer-by. See also Springer v. Government Employees Insurance Company, Inc., 311 So.2d 36 (La.1975), for a proximate cause analysis of injury caused by a car that crossed the median. A number of courts have been faced with a “chain reaction” situation where an intermediate vehicle transmits the impact from a hit-and-run car to the insured’s car. Citing sources as diverse as Sir Isaac Newton and the Restatement (2d) of Torts, courts have held that the interference of an intermediate object does not negate physical contact. Lord v. Auto-Owners Insurance Company, 22 Mich.App. 669, 177 N.W.2d 653 (1970); Latham v. Mountain States Mutual Casualty Company, 482 S.W.2d 655 (Tex.App. 1972); Ray v. DeMaggio, 313 So.2d 251 (La. 1975); Johnson v. State Farm Mutual Automobile Insurance Company, 70 Wash.2d 587, 424 P.2d 648 (1967); see also the discussion in Inter-Insurance Exchange of the Automobile Club of Southern California v. Lopez, supra.

As these cases illustrate, courts have not read the requirement of physical contact as an unambiguous limitation of liability. Rather, the trend is to construe “physical contact” broadly in order to effectuate the purposes of uninsured motorist protection. J.A. Appleman, Insurance Law and Practice, § 5095.25; Notman, A Decennial Study of the Uninsured Motorist Endorsement, supra; Inter-Insurance Exchange of the Automobile Club of Southern California v. Lopez, supra; Motor Vehicle Accident Indemnification Corporation v. Eisenberg, supra.

In the instant case, it is evident that there was a vehicular collision with the hit-and-run car, and that the force of the unidentified car hitting the Purolator van was the cause of the collision between the van and the plaintiff’s car, from which the injuries resulted. Under these circumstances, we have no difficulty concluding that the injuries were the result of physical (albeit indirect) contact with the hit-and-run vehicle. Where force has been exerted from an unidentified vehicle through an intermediate object and where this fact may be verified in such a way to provide safeguards against fraud, we find that the physical contact requirement of the policy has been satisfied. See Allied Fidelity Insurance Company v. Lamb, supra; Motor Vehicle Accident Indemnification Corporation v. Eisenberg, supra. In the instant case, the insurance contract did not clearly express an intention to exclude indirect contact cases from coverage. We have stated:

“Where the language employed [in insurance policies] is unclear and can be reasonably construed in more than one sense, an ambiguity is said to exist and such ambiguity will be construed against the insurer.” Sparks v. Republic National Life Insurance Co., 132 Ariz. 529, 534, 647 P.2d 1127, 1132 (1982). See also Allied Fidelity Insurance Company v. Lamb, supra.

State Farm contends, however, that this interpretation is contrary to the principles of Balestrieri v. Hartford Accident & Indemnity Insurance Company, supra. Although in Balestrieri we discussed various interpretations of the standard hit-and-run provision, we stated that:

“The legal issue presented for our decision is narrow and can be precisely phrased — whether the ‘physical contact’ requirement in the ‘hit-and-run’ provision of the automobile liability insurance policy here under consideration is in derogation of the Arizona “uninsured motorist statute and is void as against public policy.” Balestrieri v. Hartford Accident & Indemnity Insurance Company, supra, 113 Ariz. at 161, 540 P.2d at 127.

Balestrieri did not decide the question that faces us today of what constitutes “physical contact.” It was clear in Balestrieri that there was no physical contact — the plaintiff swerved to avoid an unidentified car and struck a light pole. In other words, it was a “miss-and-run” case in which there was no collision by the unidentified vehicle on which a claim of “physical contact” could be based. In contrast, the instant case was a chain reaction in which the hit-and-run ve-hide actually struck another car and propelled it into the plaintiffs’ car. The holding in Balestrieri does not preclude us from finding that “physical contact” occurred in the instant case.

Reversed and remanded for further proceedings consistent with this opinion.

HOLOHAN, C.J., GORDON, V.C.J., and HAYS, J., concur.