350 P.3d 1276
Okla. Civ. App.2014Background
- AEC sued Superior, Triple J, and Insurer for damages to AEC's transformer and trailer, alleging breach of bailment/contract, negligence, and quantum meruit.
- Insurer moved for summary judgment arguing no coverage under Triple J's policies; AEC cross-moved for summary judgment asserting coverage via Form F motor carrier endorsement.
- In February 2010 Triple J transported a 5,000 KVA trailer-mounted transformer; an accident occurred in Enid, Oklahoma, causing oil spills and property damage.
- The dispute focused on whether Exclusions B.6 (care, custody or control) and B.11 (pollution) could bar coverage, or whether Form F endorsement ( motor carrier liability) controlled.
- The trial court entered judgments in favor of AEC on the coverage issues; the appellate court affirmed, holding Form F controls over the exclusions and that the insured-contract exclusion does not bar coverage, with total damages and fees awarded to AEC; Superior was dismissed without prejudice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Form F overrides Exclusions B.6 and B.11 to provide coverage. | AEC: Form F control makes coverage apply despite exclusions. | Insurer: Exclusions govern; Form F does not create coverage. | Form F controls; exclusions overridden; coverage found for AEC. |
| Whether Exclusion B.2 (contractual) bars coverage or is reserved by Exception b. | AEC: Exception b preserves coverage via bailment/insured contract. | Insurer: Exclusion B.2 excludes contract-based liability. | Exclusion B.2 does not bar coverage due to reservation of coverage under Exception b and Form F. |
| Whether AEC has standing to sue Insurer directly as motor carrier insurer. | AEC: Statutes permit direct action against insurer; standing exists. | Insurer: Standing is lacking under MCA provisions. | Standing arguments resolved in favor of permitting determination of coverage; Insurer not entitled to dismissal on standing |
Key Cases Cited
- Casualty Reciprocal Exchange v. Waggoner Drilling Co., 340 P.2d 490 (1959 OK 43) (statutory motor carrier liability policy controls over contract exclusions; joint liability of carrier and insurer)
- Enders v. Longmire, 67 P.2d 12 (1937 OK 154) (predecessor statute supported direct action against carrier and insurer)
- Dodson v. St. Paul Ins. Co., 812 P.2d 372 (1991 OK 24) (exclusion removing coverage for liability under contract; insured contract exception interpreted)
- Western Casualty & Surety Co. v. J.R. Adams, Inc., 465 P.2d 794 (1970 OK CIV APP 4) (policy coverage controlled by statute when vehicle involved in transportation)
- Wells Fargo Bank v. Heath, 280 P.3d 328 (2012 OK 54) (standing may be raised anytime; burden on party asserting standing)