LOFBERG v. AETNA CASUALTY SURETY COMPANY (1968)

This appeal from a judgment in a declaratory relief action comes to us on a settled statement under rule 7, California Rules of Court.

From the statement it appears that the following was uncontradicted or admitted at the trial.   Plaintiff-appellant Reynold Lofberg asked “John Doe,” whom he met in a bar, to drive him home in plaintiff's car.   Shortly after the trip started plaintiff “passed out.”  “John Doe” thereafter drove the vehicle into a telegraph pole, causing injuries to plaintiff.  “John Doe” ran from the accident and disappeared.   Plaintiff does not know the identity of the driver, “John Doe” being a fictitious name.

At the time of the accident plaintiff was the named insured and his automobile the covered vehicle of a liability insurance policy written by defendant-respondent The Aetna Casualty and Surety Company, hereinafter called “Aetna.”   The policy specified that any person using the automobile with plaintiff's permission was an “insured.”  “John Doe” never gave written notice of the accident or otherwise communicated with Aetna.   Plaintiff, however, did give written notice to Aetna but the notice did not contain particulars sufficient to identify “John Doe.”   Plaintiff thereafter commenced an action against “John Doe,” but he could not be found and summons was not served.   Aetna denies any liability for plaintiff's injuries under the policy.   No contention, at least on this appeal, is made that plaintiff's claim against “John Doe” is fraudulent.

In his declaratory relief action plaintiff sought judgment, “1. Ordering defendant to appear in and defend plaintiff's suit against JOHN DOE and pay any judgment therein up to $10,000.00, or in the alternative, 2. Ordering defendant to submit plaintiff's claim to arbitration under the ‘uninsured motorist’ provisions of said policy.”   The trial court concluded that “John Doe” was not an insured under the policy, that Aetna was not obligated to defend, or to pay any judgment in, plaintiff's action against “John Doe,” and that Aetna had no obligation under the “uninsured motorist” provisions of the policy “to arbitrate plaintiff's alleged uninsured motorist claim.”   Judgment accordingly was entered for Aetna.

 Plaintiff offers no authority in support of his contention that Aetna is legally obligated to appear in and defend the action on behalf of a defendant who has not been served with summons and who himself is under no obligation to appear.   Such an appearance, if made, must be by an attorney.   An attorney may not appear in an action without authority from the party on whose behalf he appears.   Indeed such an unauthorized appearance would be ground for disciplinary proceedings.  (Bus. & Prof.Code, § 6104).   Under the circumstances, the determination of the trial court that Aetna was not required to defend, or to pay any judgment in, the “John Doe” action, was clearly correct.

We now consider plaintiff's second contention which relates to Aetna's liability under the “uninsured motorist” provisions of the policy.

Insurance Code section 11580.2 provides in part and as applicable here, as follows:  “No policy of bodily injury liability insurance covering liability arising out of the ownership, maintenance, or use of any motor vehicle, shall be issued * * * to the owner * * * of a motor vehicle, * * unless the policy contains * * * a provision * * * insuring the insured * * for all sums * * * which he or they, as the case may be, shall be legally entitled to recover as damages for bodily injury * * * from the * * * operator of an uninsured motor vehicle.  * * *”   The section also defines “uninsured motor vehicle,” as pertinent here, as “a motor vehicle with respect to the ownership, * * * or use of which there is [bodily injury liability insurance] * * * but the company writing the same denies coverage thereunder.”   It also states “The term ‘uninsured motor vehicle’ shall not include an automobile owned by the named insured.”

The subject policy, following closely the statutory language of section 11580.2, states the term “uninsured automobile” means “an automobile with respect to the ownership * * * or use of which there is * * * a bodily injury liability * * * insurance policy applicable at the time of the accident but the company writing the same denies coverage ¹ thereunder.”   However, the policy does not, as does section 11580.2, contain language to the effect that the term “uninsured motor vehicle” does not include an automobile owned by the named insured.

Aetna having denied coverage under its policy as to “John Doe,” it would appear that plaintiff's automobile qualifies as an “uninsured motor vehicle,” unless the language of section 11580.2 to the effect that an automobile owned by the named insured is not an “uninsured motor vehicle,” is to be considered as part of the policy.

 It is settled law that an insurance policy is governed by the relevant statutory law in force at the time the policy is issued.   Such provisions are read into the policy and become a part of the contract.  (Interinsurance Exchange v. Ohio Cas. Ins. Co., 58 Cal.2d 142, 148, 23 Cal.Rptr. 592, 373 P.2d 640;  Wildman v. Government Employees' Ins. Co., 48 Cal.2d 31, 39–40, 307 P.2d 359.)   This rule has been applied to section 11580.2.  (Hendricks v. Meritplan Ins. Co., 205 Cal.App.2d 133, 136–137, 22 Cal.Rptr. 682.)   However, where a policy grants benefits equal to, or greater than, those required by section 11580.2, the rights of the parties are determined by the the terms of the policy.  (Cannizzo v. Guarantee Ins. Co., 245 Cal.App.2d 70, 73, 53 Cal.Rptr. 657;  Grunfeld v. Pacific Auto Ins. Co., 232 Cal.App.2d 4, 6, 42 Cal.Rptr. 516.)  Linnastruth v. Mut. Benefit etc. Assn., 22 Cal.2d 216, 218, 137 P.2d 833, holds, “The principle that parties may contract as they please so long as they do not violate the law or public policy is applicable to insurance contracts.”

 The policy of Aetna grants benefits greater than those required by section 11580.2.   It does not exclude from its “uninsured motor vehicle” benefits an automobile owned by the named insured.  “[E]xceptions and exclusions are construed strictly against the insurer and liberally in favor of the insured.”  (Arenson v. Nat. Automobile & Cas. Ins. Co., 45 Cal.2d 81, 83, 286 P.2d 816;  see also Cal. Comp. & Fire Co. v. Ind. Acc. Com., 62 Cal.2d 532, 534, 42 Cal.Rptr. 845, 399 P.2d 381.)   Although the problem before us is an unusual one, we find no basis in law or the policy under which plaintiff must be excluded from the “uninsured motor vehicle” benefits of the policy.   Statutes such as section 11580.2 are liberally construed to carry out their objective of providing compensation for those injured through the negligent use of automobiles.  (Interinsurance Exchange v. Ohio Cas. Ins. Co., supra, 58 Cal.2d 142, 153, 23 Cal.Rptr. 592, 373 P.2d 640;  Katz v. American Motorist Ins. Co., 244 Cal.App.2d 886, 891, 53 Cal.Rptr. 669.)

 Here “John Doe” was allegedly driving the subject automobile with the permission of the owner.   He was accordingly an “insured” under the policy's terms.   Plaintiff was allegedly injured as a result of his negligence.   Aetna denied liability in relation to the accident.   By that act the automobile acquired the status of an “uninsured motor vehicle.”   Plaintiff accordingly became the holder of a claim for bodily injury against the driver of an “uninsured motor vehicle.”   The policy by its terms insured him for all sums which he shall be legally entitled to recover as damages for bodily injury from the operator of such uninsured motor vehicle.

Under the policy, if the parties fail to agree, plaintiff's claim must be arbitrated.   In such arbitration proceedings defendant will, of course, be allowed to raise any available defense to plaintiff's claim including, but not limited to, a denial that “John Doe” was in fact the driver of plaintiff's automobile.

The judgment is reversed.   The cause is remanded to the superior court with direction to enter findings and judgment, consistent with this opinion, in favor of plaintiff.

FOOTNOTES

1.   Aetna contends that it did not deny such “coverage” but that it merely denied liability under a policy it admits having written.   The company insists that the word “coverage” of the policy and the statute means only the writing of a policy covering the subject automobile.   This contention is refuted by the pertinent language of section 11580.2 and the policy, “but the company writing the [policy] denies coverage thereunder.”

ELKINGTON, Associate Justice.

MOLINARI, P.J., and SIMS, J., concur.