Dеfendant Joseph Leon Anderson, Sr. (hereafter “Senior”) purchased a motor vehicle for his own exclusive possession and use, but registered legal title in the name of his son, Joseph Lеon Anderson, Jr. (hereafter “Junior”). Plaintiff issued to “Joseph *622 Leon Anderson” an owner’s policy of liability insurance, see G.S. 20-279.21(b), which described this vehicle, among others, by make and identification number. Plaintiffs agent charged Senior a specific premium for this vehiсle, which Senior paid. The policy was certified to the Commissioner of Motor Vehicles as an owner’s policy of liability insurance. See G.S. 20-309.
Senior, while driving the vehicle, collided with a vehiclе driven by defendant Watkins and insured by intervenor defendant. Junior at that time was unaware that the vehicle was titled in his name.
Plaintiff sought and obtained a declaratory judgment that its policy provided no coverage of the collision. Intervenor defendant appealed. We reverse.
The Motor Vehicle Safety and Financial Responsibility Act of 1953, now G.S. 20-279.1 to .39, provides the statutоry framework for issuance of automobile liability policies in this jurisdiction. “The provisions of the Financial Responsibility Act are ‘written’ into every automobile liability policy as a matter of law, and, when the terms of the policy conflict with the statute, the provisions of the statute will prevail.”
Insurance Co. v. Chantos,
293
N.C.
431, 441,
This Act provides for two kinds of policies — owner’s, G.S. 20-279.21(b), and operator’s, G.S. 20-279.21(c). “Whether . . . [onе is] insured ... as an owner or as an operator depends on the intent of the parties.”
Lofquist v. Insurance Co.,
The parties stipulated that the policy here was certified to the Commissioner of Motor Vеhicles, pursuant to G.S. 20-279. 21 and -309, as an owner’s policy; and the accuracy of that certification is uncontroverted. The clear intent thus was to issue an owner's policy insuring Senior.
“An owner’s policy protects the
owner, as the named
insured; it alsо protects any other person using the insured vehicle, with the owner’s permission . . . .”
Lofquist, supra,
The policy here defines “owned automobile” as “a private passenger . . . automobile described in this policy for which a specific premium charge indicates that coverage is afforded.” Thе vehicle involved in the collision clearly falls within this definition. The policy does not define “owner,” however; and whether Senior was the “owner” of the “owned automobile” so as to estаblish coverage under the owner’s policy is the dispositive issue.
G.S. 20-4.01(26) defines “owner” as “[a] person holding the legal title to a vehicle.” This definition applies throughout Chapter 20, and thus to G.S. 20-279.1 to .39, thе Financial Responsibility Act, “[ujnless the context otherwise requires.” G.S. 20-4.01. It thus must be read into every liability insurance policy within the purview of the Act, see Chantos, supra, unless the context otherwise requires.
Prior to 1973 the G.S. 20-4.01(26) definition of “owner” appeared in a definition section applicable solely to the Financial Responsibility Act. G.S. 20-279.1(9) (repealed 1973). The 1973 General Assembly repealed the definition in G.S. 20-279.1(9), 1973 N.C. Sess. Laws, c. 1330, s. 39, and placed it in G.S. 20-4.01. The apparent purpose was to eliminate unnecessary repetition of this definition in separate articles of Chapter 20, not to make the definition inapplicable to the Finаncial Responsibility Act.
Prior to repeal of G.S. 20-279.1(9), the provision of the Financial Responsibility Act which defined “owner” as the legal title holder, our Supreme Court held that “for purposes of tort law
and liability insurance coverage,
no ownership passes to the purchaser of a motor vehicle which requires registration” until transfer of legal title is effected as provided in G.S. 20-72(b).
Insurance Co. v. Hayes,
In
Younts v. Insurance Co.,
The court expressly relied on the holding in
Hayes, supra,
that no ownership passes to the vendee until legal title is transferred to him by the person who holds it at time of sale.
Id.
at 586-87,
Plaintiff would have us view
Younts
as mandating that one who does not hold legal title to a vehicle cannot under any circumstаnces obtain owner’s liability insurance thereon.
See Norris v. Insurance Co.,
Here, neither the vendor nor the vendee hаd legal title subsequent to sale of the vehicle. Legal title, instead, was transferred simultaneously and in connection with the vendee’s *625 purchase of the vehicle, from the vendor to a third party, the vendee’s son. That transfer was accomplished at the vendee’s direction and without the knowledge or approval of his son. The vendee, however, paid the entire purchase price, had exclusive possession and use of the vehicle, obtained the insurance coverage for it, and paid the premiums therefor. This sufficed to give him a clear equitable interest in the vehicle, see Insurance Co. v. Insurance Co., supra (son of legal owner may have had equitable interest in vehicle); and that equitable interest sufficed, under the particular facts and circumstances, tо make him the “owner” of the vehicle within the coverage intent of the policy, interpreted in light of the purpose and intent of the Financial Responsibility Act.
In
Engle v. Insurance Co., supra,
The primary purpose оf . . . compulsory motor vehicle liability insurance is to compensate innocent victims who have been injured by financially irresponsible motorists. The victim’s rights against the insurer are not derived through the insured .... Such rights are statutory and become absolute upon the occurrence of injury or damage inflicted by the named insured, by one driving with his permission, or by one driving while in lawful possession of thе named insured’s car, regardless of whether or not the nature and circumstances of the injury are covered by the contractual terms of the policy.
Our Supreme Court stated in
Insurance Co. v. Insurance Co., supra-.
“The purpose of the Act is to provide protection to the public from damages resulting from the negligent operation of automobiles by irresponsible persons. By its definition of an ‘owner,’ the legislature attemрted to close all avenues of escape from its provisions.”
The policy here was clearly intended, by both the issuer and the purchaser, to cover the purchaser while operating the vehicle involved in the collision in question. To allow defeat of coverage by the technicality of placement of legal title in the purchaser’s son, at the purchaser’s direction and without the son’s knowledge,
*626
while the purchaser retained all equitable interest in the vehicle, would defy the legislative intent “to close all avenues of escape from [the] provisions [of the Financial Responsibility Act].”
Insurance Co. v. Insurance Co.,
The “owner” of a vehicle is the holder of the legal title “[ujnless the context otherwise requires.” G.S. 20-4.01. If the oft expressed purpose of the Financial Resрonsibility Act is to be effectuated, the context in which the word “owner” is to be interpreted and applied here otherwise requires. The discrete facts and circumstances dictate that Senior be held the “owner” of the vehicle so as to afford coverage under the policy to compensate the innocent victims of his negligence while operating the vehicle, if such is established.
We therefore so hold, and the judgment declaring the contrary is
Reversed.