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GUARANTY NATL. INS. CO. v. CHESTER CTY. HOUS. AUTH

June 12, 1989

GUARANTY NATIONAL INSURANCE CO.
v.
CHESTER COUNTY HOUSING AUTHORITY, HARFORD MUTUAL INSURANCE CO., CHARLES BLOSENSKI, INC., ZURICH-AMERICAN INSURANCE CO., and EDWARD OLIVER



The opinion of the court was delivered by: POLLAK

 POLLAK, UNITED STATES DISTRICT JUDGE

 The parties settled the state court action with a $ 450,000 payment to Mr. Brunson in full settlement of all claims. By the terms of a July 1987 stipulation, Guaranty National Insurance Companies ("Guaranty"), the Harford Mutual Insurance Company ("Harford"), and Zurich-American Insurance Company ("Zurich") -- the insurers for Metro Transportation, Chester County, and Charles Blosenski, respectively -- each contributed to the $ 450,000 payment, reserving the final division of liability for negotiation. Complaint, Exh. D. The stipulation further provided that in the event that the three companies could not agree on the percentage of each company's contribution to the total of $ 450,000,

 
the insurance carriers will litigate inter se in a court of competent jurisdiction the following issues to determine the amount, if any, of each carrier's responsibility for the accident in question:
 
1. Respective comparative negligence, if any, of defendants;
 
2. Agency relationship, if any, between Edward Oliver and Metro Transportation Company, t/a Yellow Cab of Philadelphia; and
 
3. Coverage obligations, if any, of Guaranty National Insurance Company with respect to Edward Oliver.

 Stipulation, Complaint, Exh. D, at 3. Plaintiff in the present action seeks declaratory relief determining its obligation to cover Edward Oliver and the percentage of each company's liability.

 Pending before the court are three motions for partial summary judgment. *fn1" The cross-motions all center around the issue of whether, at the time of the accident, Edward Oliver was covered under a Guaranty National policy insuring the Metro Transportation taxicab. Guaranty National contends that it should make no contribution to the Brunson settlement, because Mr. Oliver was neither (1) a named insured nor (2) a user covered by permission of the named insured. Conversely, Zurich maintains that Mr. Oliver was a named insured and/or a permitted user. Harford and Chester County join in Zurich's motion and also seek to estop Guaranty National's assertion of non-coverage.

 It is appropriate to grant summary judgment pursuant to Federal Rule of Civil Procedure 56 if, after review of all evidentiary material in the record in light favorable to the non-movant, there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 106 S. Ct. 2548, 2553, 91 L. Ed. 2d 265 (1986). Because the cross-motions of plaintiff and defendants address the same issues, I will evaluate the evidence for each issue in turn.

 I. Named Insured

 The initial question is whether Edward Oliver was covered as a "named insured" under Guaranty National's policy EAL100300, which covered the taxicab for the period during which the accident occurred. Complaint, Exh. C. Item 1 of the policy designates the "Named Insured" as "Metro Transportation Co. T/A Yellow Cab Co. and/or Other Individuals or Entities Trading As Yellow Cab Co. or Operating Under the Authority of Metro Transportation Co." Moving defendants contend that Mr. Oliver, as a leased driver, *fn2" was "trading as Yellow Cab Co. or operating under the Authority of Metro Transportation Co." within the meaning of the designation of the named insured. Plaintiff contends that the designation, both on its face and in the context of the whole policy, does not include leased drivers.

 There is no dispute over the content of the policy, only over the interpretation of the term "named insured." It is a general principle under Pennsylvania law that ambiguities in an insurance contract are to be read against the drafter, see Tidewater Grain Co. v. S.S. Point Manatee, 614 F. Supp. 29 (E.D. Pa. 1984). Nevertheless, the courts are to read policy provisions so as to avoid ambiguities, if the plain language of the policy permits, and attempt to view the policy in its entirety, ...


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