264 S.E.2d 913 | N.C. Ct. App. | 1980
CHEROKEE INSURANCE COMPANY
v.
AETNA CASUALTY AND SURETY COMPANY
Court of Appeals of North Carolina.
*914 Marshall, Williams, Gorham & Brawley by William Robert Cherry, Jr., Wilmington, for plaintiff-appellant.
Poisson, Barnhill, Butler & Britt by Donald E. Britt, Jr., Wilmington, for defendant-appellee.
ERWIN, Judge.
The application for the comprehensive general liability insurance policy issued by defendant to Sicash contained the following language: "This application contains a description of all hazards known to exist on this date and those which are likely to exist at some time during the policy period, unless otherwise stated herein."
The property referred to as Malibu Wilmington was not listed in the declaration of hazards on the liability schedule by Sicash, but Malibu Wilmington, Inc. was listed as an additional insured. Plaintiff contends that the property was covered by reason of the above language, since the policy did not have an endorsement that excluded Malibu Wilmington.
*915 Defendant contends to the contrary that Malibu Wilmington (apartments) was not listed as a hazard on the liability schedule because of the express intent of the parties (Sicash and defendant) not to include it. Therefore, an endorsement to exclude it from coverage was not necessary.
To resolve the question, whether or not the trial court erred by granting defendant's motion for summary judgment pursuant to G.S. 1A-1, Rule 56, of the Rules of Civil Procedure, we must first determine whether there is any ambiguity in the language of the insurance policy in question. We find no ambiguity.
Liability insurance policies are construed in accordance with the general rule of resolving any ambiguity therein in favor of the insured. Miller v. Caudle, 220 N.C. 308, 17 S.E.2d 487 (1941).
The settled rule is that where there is no ambiguity in the language used in the policy, the courts must enforce the contract as the parties have made it and may not impose liability upon the company which it did not assume and for which the policyholder did not pay. Grant v. Insurance Co., 295 N.C. 39, 243 S.E.2d 894 (1978); Trust Co. v. Insurance Co., 276 N.C. 348, 172 S.E.2d 518 (1970); Williams v. Insurance Co., 269 N.C. 235, 152 S.E.2d 102 (1967). If on the other hand, the language is ambiguous or reasonably susceptible to two interpretations, the courts will give it the interpretation which is most favorable to the insured, that is, in favor of coverage. Woods v. Insurance Co., 295 N.C. 500, 246 S.E.2d 773 (1978). In addition, the terms of an insurance contract must be given their plain, ordinary, and accepted meanings unless they have acquired a technical meaning in the field of insurance or unless it is apparent that another meaning was intended. Grant v. Insurance Co., supra.
As stated in 45 C.J.S. Insurance § 791, p. 830: "[B]roadly speaking, the so-called comprehensive provision of a policy [as in this case] covers loss or damage caused by any risk or peril other than those expressly excluded or excepted from coverage."
In the policy, Malibu Wilmington, Inc. was listed as an additional insured. The policy provided: "This endorsement, issued by one of the below named companies, forms a part of the policy to which attached, effective on the inception date of the policy unless otherwise stated herein." Listed below the above provision was the following:
"(The information below is required only when this endorsement is issued subsequent to preparation of policy)
Endorsement effective Policy No. Endorsement No.
Named Insured
Additional Premium $ Return Premium BI PD
In Advance $ $
1st Anniv. $ $
2nd Anniv. $ $"
Defendant contends that no liability attached, because there was an agreement between it and the insured (Sicash) not to insure the property. Thus, there was no need to fill out the information required to exclude original liability, and it was their custom not to do so. We reject this argument. The language in the policy provided for coverage of the additional insured, Malibu Wilmington, Inc., the owner of the apartments, effective as of the date of the policy's inception, unless otherwise indicated. The accident for which coverage is sought occurred after the inception of the policy. Furthermore, we find other language in the policy helpful. The policy contained a declaration. The declaration provides:
"By acceptance of this policy, the named insured agrees that the statements in the declarations are his agreements and representations, that this policy is issued in reliance upon the truth of such representations and (that this policy embodies all agreements existing between himself and the compay or any of its agents relating to this insurance)."
The insuring agreement reads:
"I. BODILY INJURY LIABILITY COVERAGE PROPERTY DAMAGE LIABILITY COVERAGE
The company will pay on behalf of the insured all sums which the insured shall *916 become legally obliged to pay as damages because ofbodily injury or property damage
to which this insurance applies, caused by an occurrence, and the company shall have the right and duty to defend any suit against the insured seeking damages on account of such bodily injury or property damage, even if any of the allegations of the suit are groundless, false or fraudulent, and may make such investigation and settlement of any claim or suit as it deems expedient, but the company shall not be obligated to pay any claim or judgment or to defend any suit after the applicable limit of the company's liability has been exhausted by payment of judgments or settlements."
To us, the declaration is clearly inconsistent with the contentions of the defendant that the parties expressly omitted Malibu Wilmington from coverage. The clear language of defendant's own contract excludes any prior understanding between the parties not embodied in the policy. Chief Justice Stacy spoke for our Supreme Court in Electric Co. v. Insurance Co., 229 N.C. 518, 520, 50 S.E.2d 295, 297 (1948):
"Policies of liability insurance, like all other written contracts, are to be construed and enforced according to their terms. If plain and unambiguous, the meaning thus expressed must be ascribed to them. But if they are reasonably susceptible of two interpretations, the one imposing liability, the other excluding it, the former is to be adopted and the latter rejected, because the policies having been prepared by the insurers, or by persons skilled in insurance law and acting in the exclusive interest of the insurance company, it is but meet that such policies should be construed liberally in respect of the persons injured, and strictly against the insurance company. Roberts v. Ins. Co., 212 N.C. 1, 192 S.E. 873, 113 A.L.R. 310; Underwood v. Ins. Co., 185 N.C. 538, 117 S.E. 790; Bray v. Ins. Co., 139 N.C. 390, 51 S.E. 922; Bank v. Ins. Co., 95 U.S. 673, 24 L. Ed. 563."
The only question remaining relates to the payment of premium. Defendant contends that no premium was paid by Sicash for Malibu Wilmington. The following condition was provided as a part of the policy in question:
"1. Premium
All premiums for this policy shall be computed in accordance with the company's rules, rates, rating plans, premiums and minimum premiums applicable to the insurance afforded herein.
Premium designated in this policy as `advance premium' is a deposit premium only which shall be credited to the amount of the earned premium due at the end of the policy period. At the close of each period (or part thereof terminating with the end of the policy period) designated in the declarations as the audit period the earned premium shall be computed for such period and, upon notice thereof to the named insured, shall become due and payable. If the total earned premium for the policy period is less than the premium previously paid, the company shall return to the named insured the unearned portion paid by the named insured.
The named insured shall maintain records of such information as is necessary for premium computation, and shall send copies of such records to the company at the end of the policy period and at such times during the policy period as the company may direct."
The above language relating to adjustment of premiums provided a method for the insurer to be paid for its coverage. Defendant placed this condition in the policy in clear language. To us, the provision means that the insurer expected changes during the period of the policy to increase the insurable risk within the broad scope of the general coverage. The language of the policy is forthright. The insuring agreement includes "all sums which the insured [Sicash] shall become legally obliged to pay." Finally, we conclude that defendant has a method to collect the premium due pursuant to the terms of the policy in question.
*917 Our rules do not permit defendant (insurance company) to have a clearly written contract of insurance on one hand showing coverage of Malibu Wilmington and a verbal contract on the other hand showing no coverage.
The entry of summary judgment below is reversed, and the case is remanded for entry of summary judgment for plaintiff.
Reversed and remanded.
ROBERT M. MARTIN and WELLS, JJ., concur.