Summary
In Sanco Co. v. Employers c. Ins. Co., 102 N.H. 253, it was held that the care, custody and control of the insured included possessory control as well as proprietary control and that damage to an elevator by an insured's employees was within the exclusion clause of the policy.
Summary of this case from Newfoundland c. Ins. Co. v. KamienieckiOpinion
No. 4760.
Argued September 1, 1959.
Decided September 25, 1959.
1. Where a liability insurance policy excluded coverage for property damage with respect to "property used by the insured" and "property in the care, custody or control of the insured or property as to which the insured . . . is exercising physical control" such exclusion was held to apply to property damage to an elevator in a building of another where the insured's employees were engaged in construction and sustained while the elevator was in the complete control of the insured's employees at the time of the accident.
2. The fact that the insured's control did not extend to the entire building did not defeat application of the exclusion clause.
ACTION, in assumpsit for breach of conditions of a certain liability insurance policy issued by the defendant to the plaintiff.
The parties stipulated as to the material facts.
Plaintiff alleges that on July 3, 1957, its servants negligently damaged a freight elevator on the premises of the Manchester Hosiery Mills, while operating the same in the process of making certain repairs on the third or fourth floors at the request of Manchester Hosiery Mills, over a weekend when the plant was not in operation.
The defendant was notified of the damage, and an adjuster investigated in behalf of the defendant. After some correspondence between the parties and counsel, the defendant disclaimed coverage. The plaintiff, on December 6, 1957, without consulting the defendant, voluntarily paid Manchester Hosiery Mills $1,507.90 for the damage to the elevator. No suit was ever brought against the plaintiff on account of this damage.
The Court (Keller, J.), after hearing, granted defendant's motion to dismiss and made certain findings and rulings as follows:
"(1) The property damage in the instant case comes within the exclusion h(2) and within the exclusion h(3), and consequently the policy does not cover that damage.
"(2) The plaintiff would be entitled to recover $1507.90, but for the exclusion set forth above."
The plaintiff's exception to the granting of defendant's motion to dismiss and defendant's exception to the ruling that plaintiff would be entitled to recover $1,507.90 but for the exclusions, were reserved and transferred. Other material facts appear in the opinion.
Green, Green, Romprey Sullivan (Mr. Meyer Green orally), for the plaintiff.
Wiggin, Nourie, Sundeen, Nassikas Pingree (Mr. Nassikas orally), for the defendant.
The pertinent coverage provisions of the plaintiff's policy of insurance are as follows:
"Coverage B — Property Damage Liability. To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of injury to or destruction of property, including the loss of use thereof, caused by accident."
Expressly excluded from coverage B was certain damage described under "Exclusions" as follows:
"This policy does not apply: . . . (h) under coverage B, to injury to or destruction of (1) property owned or occupied by or rented to the insured, or (2) except with respect to liability under side-track agreements covered by this policy, property used by the insured, or (3) except with respect to liability under such side-track agreements or the use of elevators or escalators at premises owned by, rented to or controlled by the named insured, property in the care, custody or control of the insured or property as to which the insured for any purpose is exercising physical control . . . ."
The determination of the problem of whether the property damaged comes within exclusions h (2) and h (3) of the policy of insurance depends upon the sufficiency of the evidence to support a finding that at the time the property was damaged it was in the possessory and not proprietary control of the plaintiff.
At the time of the accident, the employees of the plaintiff "took care of all of the operations in running the elevator, including the manipulation of the ropes that controlled the elevator, there being no independent power supply . . . ." The damage occurred in the process of lifting some planks in the elevator from the first to the third or fourth floor where repairs were being made when ". . . the planks jammed in some way on a door involved in the operation of the elevators so that it caused damage to the elevator and its appurtenances."
On other occasions when plaintiff had done work for the Manchester Hosiery Mills when the mill was in operation, it was customary for an employee of Manchester to operate the elevator. Otherwise, as in the instant case, an employee of Sanco would do so.
It cannot be seriously argued that the elevator was merely an incidental part of the premises where the work was being done or that it was not "property used by the insured" within the meaning of the policy. From all that appears, it was necessary to performance of the work involved. It is not seriously disputed that plaintiff's servants were in complete physical control of the elevator at the time of the accident, and the fact that plaintiff's control did not extend to the entire factory building does not defeat application of the exclusion clause. See Hardware Mut. Cas. Co. v. Mason-Moore-Tracy, Inc., 194 F.2d 173 (2d Cir. 1952).
A majority of cases support the view that a clause in a liability policy excluding from coverage liability for damage to property ". . . in the care, custody or control of the insured . . ." should be construed as extending to possessory control as well as to proprietary control. See anno. 62 A.L.R. (2d) 1242.
We are of the view that there was sufficient evidence to support the ruling of the Court below that the property damage comes within exclusions h (2) and h (3) of the plaintiff's policy of insurance.
In view of the result reached here, it is not necessary to consider defendant's exception to the Court's finding that the plaintiff would be entitled to recover but for the exclusion clause.
Exceptions overruled.
All concurred.