Gore v. South Carolina Insurance Company

205 S.E.2d 579 (1974) 21 N.C. App. 730

Mary Sue GORE
v.
SOUTH CAROLINA INSURANCE COMPANY.

No. 7420DC183.

Court of Appeals of North Carolina.

June 5, 1974.

Webb, Lee, Davis & Gibson by Woodrow W. Gunter, II and Hugh Lee, Rockingham, for plaintiff appellee.

Pittman, Pittman & Guice by Zoro J. Guice, Jr., and William G. Pittman, Rockingham, for defendant appellant.

VAUGHN, Judge.

Defendant contends that the court erred in concluding that Michael Gore was protected under the garage liability policy. Applicable coverage provisions of the policy included the following:

"Automobile Hazards:

1. All Automobiles:

(a) The ownership, maintenance or use of any automobile for the purpose of garage operations, and the occasional use for other business purposes and the use for non-business purposes of any automobile owned by or in charge of the named insured and used principally in garage operations. . . .

* * * * * *

Persons Insured: Each of the following is an insured under Part I, except as provided below:

* * * * * *

(3) With respect to the Automobile Hazard:

(a) any person while using, with the permission of the named insured, an automobile to which the insurance applies under paragraph 1(a) or 2 of the Automobile Hazards, provided such person's actual operations of (sic) (if he is not operating) his other actual use thereof is within the scope of such permission,

* * * * * *

None of the following is an insured:

* * * * * *

(iii) any person . . . other than the named insured with respect to any automobile (a) owned by such person. . ., or (b) possession of which has been transferred to another by the named insured pursuant to an agreement of sale;"

There is ample evidence that at the time of the accident Gore was operating an automobile owned by W & W Auto Sales which was insured under the policy, and that Gore was using the car within the scope of his permissive use. The trial court correctly determined that Michael Gore was an insured within the purview of sections 1(a) and 3(a) of the insurance policy. Compare Brinkley v. Insurance Co. and Transport Co. v. Insurance Co., 271 N.C. 301, 156 S.E.2d 225; Shearin v. Indemnity Co., 267 N.C. 505, 148 S.E.2d 560.

The policy's exclusionary clause (iii), on its face, excludes Gore as an insured because his possession of the automobile was pursuant to a conditional sales contract. The court, however, correctly concluded that the clause was rendered inapplicable by the provision contained in G. S. § 20-279.21(b)(2):

"(b) Such owner's policy of liability insurance:

* * * * * *

(2) Shall insure the person named therein and any other person, as insured, using any such motor vehicle . . . with the express or implied permission of such named insured . . . against loss from the liability imposed by law for damages arising out of the ownership, maintenance or use of such motor vehicle. . . ."

Even though G.S. § 20-279.1 defines "owner" as a person holding legal title of a motor vehicle or as a conditional vendee in the event the vehicle is the subject of an agreement for its conditional sale and such vendee has an immediate right of possession, in Insurance Co. v. Hayes, 276 N.C. 620, 174 S.E.2d 511, our Supreme Court held that the provisions of G.S. § 20-72(b) control in determining who is an owner. Since in the present case title to the automobile in question had not, when the accident occurred, been transferred to Gore pursuant to G.S. § 20-72, he was not the owner of the automobile for insurance purposes. Ownership remained with C. T. and H. F. Waters trading as W & W Auto Sales. Accordingly, W & W Auto Sales was required to maintain insurance the scope of which was compatible with the provisions of G.S. § 20-279.21. Where, as here, the applicable statutory provisions are broader than and conflict with the express terms of the policy, the former prevail. Insurance Co. v. Casualty Co., 283 N.C. 87, 194 S.E.2d 834. If applicable statutory provisions are not expressly incorporated in an insurance policy, they will be read into such policy. Insurance Co. v. Casualty Co., supra. We conclude that the court properly determined that Michael Gore was not excluded from coverage under the garage liability policy issued by defendant to W & W Auto Sales.

We have carefully reviewed defendant's contentions relating to the running of the Statute of Limitations, the effect of plaintiff's prior action against Michael Gore and the appropriateness of the trial court's findings of fact and have found them to be without merit.

Affirmed.

PARKER and CARSON, JJ., concur.