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February 10, 1988

Federal Kemper Insurance Co.
Shirley Ward, Administratrix of the Estate of Richard Ward, deceased; and Wilson Walters, Susan Penny and Vogelsong, Elaine, in her own right and for the Estate of Vogelsong Charles W., deceased; and Patrick, William & Velva, in their own name and as parents & co-administrators of the Estate of Patrick, Micah; and Barton, James H. & Charlene, co-administrators of the Estate of Barton, Jeffrey; and Barton, James H. & Charlene, co-administrators of the Estate of Barton, Karen; and Vogelsong, Elaine W.; and Barton, Charles V.; and Barton, Jennifer; and Patrick, Velva V.

The opinion of the court was delivered by: VAN ANTWERPEN


 This matter comes before the court under the Declaratory Judgment Act, 28 U.S.C.A. §§ 2201 and 2202 (West 1982 & Supp. 1987) for a determination as to whether or not plaintiff Federal Kemper Insurance Company (Kemper) is obligated to defend and indemnify defendant Shirley Ward (Shirley) as administratrix of the estate of Richard Ward (Rick), deceased. The parties do not dispute that diversity jurisdiction lies under 28 U.S.C.A. § 1332 (West 1966 & Supp. 1987) and that the amount in controversy exceeds $ 10,000.00. They have also stipulated that a certain automobile insurance policy No. R129365 was duly issued by Kemper to Shirley and was in force on November 29, 1980, when there was an accident, and that Rick was Shirley's son and was a resident of Shirley's household on that date. They further stipulate that Rick's driving privileges were revoked as of July 17, 1980, and that a vehicle involved in the accident, a green 1972 Ford truck, was insured by defendant Susan Penny Wilson Walters (Penny) under Policy No. S396478-F16-38B with State Farm Insurance on June 16, 1980. The parties also agree that the Kemper policy did not list the green 1972 Ford truck as a covered automobile.

 The policy Kemper issued to Shirley contained language common to many insurance policies. It provided in Part I that Kemper will pay damages for bodily injury or property damage for which any covered person becomes legally responsible because of an auto accident and defined covered person as "You or any family member for the ownership, maintainence or use of any auto. . . ." Part I further provided that for any auto other than a covered auto, covered person means any person: "but only with respect to legal responsibility for acts or omissions of you or any family member for whom coverage is afforded under this part. This provision applies only if the person . . . does not own or hire the auto. . . ."

 Under the heading of exclusions, it is provided that:

. . .
For the ownership, maintenance or use of any vehicle, other than your covered auto, which is owned by or furnished or available for the regular use of any family member."

 Although it does not dispute that Rick was a family member of Shirley's household at the time he was killed in the November 29, 1980 automobile accident, Kemper claims it is under no duty to defend or indemnify Shirley because Rick was both an owner of and a regular user of the green 1972 Ford pickup truck which was involved in the accident.

 The additional facts as we find them, from the testimony of the nine witnesses we heard, may be summarized as follows. The green 1972 Ford pickup truck was initially owned by William Wilson, father of Penny. Rick and Penny were planning to be married in early 1981, and Rick wanted to buy the truck for transportation for himself and Penny. William Wilson sold the truck and Rick paid for it. Rick's driver's license was or was about to be revoked, and he concluded that the truck should be titled in Penny's name. During the Fall of 1980, Penny made use of the truck about 3/4ths of the time and Rick used it about 1/4th of the time. He used it a couple of times a week without Penny present, although the two often drove in the truck together. On one occasion, Rick drove the truck out of the state to a place of employment for about one week. Sometime prior to this, Rick had also requested his brother, who repaired cars, to make some repairs to the truck. On six to twelve occasions, it was observed by Penny's employer that Rick drove Penny to work and then continued to drive the truck after dropping Penny off. Rick also told other people that he was buying, or had bought or owned the truck.

 We have great difficulty in accepting the testimony and selective recollection of Penny, who could remember details about things such as one set of keys and telling Rick that he could not use the truck whenever he wanted, but could not for certain recall who paid for the truck, and Janice Wilson, Penny's mother, who, unlike her husband and other witnesses, somehow did not know that Rick's driver's license was revoked, but managed to witness any number of incidents in which Penny allegedly asserted her sole ownership of the truck. In sum, we resolve the obvious credibility issues in favor of the plaintiff's witnesses, who were themselves for the most part somewhat reluctant. We must decide, under the facts, if Rick was an owner of the truck or the truck was furnished or available for his regular use.

 The parties all agree that the law of Pennsylvania, the state in which Shirley resided when Kemper issued her its policy, controls. In a diversity case, a U.S. District Court sitting in Pennsylvania applies the conflict of laws rule that an insurance policy is interpreted by the laws of the state where it is contracted and it is contracted where it is delivered. United States Casualty Co. v. Liberty Mutual Insurance Co., 208 F. Supp. 36 (E.D. Pa. 1962). If proof as to the place of delivery is lacking, there is a presumption that the delivery took place at the insured's residence. Roth v. Maryland Casualty Co., 209 F.2d 371 (3d Cir. 1954).

 The interpretation of an insurance contract is a question of law for the court. Adelman v. State Farm Mutual Auto Insurance Co., 255 Pa. Super. 116, 386 A.2d 535 (1978). When a word used in an exclusion is specifically defined in the definitions section of the policy, that definition is controlling in determining the applicability of the exclusion. Id. 386 A.2d at 538. The terms at issue in the instant case, "own" and "furnished or available for . . . regular use" are not specifically defined in the policy. "Courts, however, cannot rewrite the terms of the policy or give them a construction in conflict with the accepted and plain meaning of the language used. (Citation omitted)." Id.

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