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Continental Insurance Co. v. Bodie

June 28, 1982

CONTINENTAL INSURANCE CO., APPELLANT
v.
KENNETH BODIE, APPELLEE



APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF THE VIRGIN ISLANDS DIVISION OF ST. CROIX

Author: Weiner

Before: HUNTER and HIGGINBOTHAM, Circuit Judges and WEINER, District Judge*fn*

Opinion OF THE COURT

WIENER, J.

This is an appeal from the denial of plaintiff-appellant's motion for summary judgment, grant of defendant-appellee's cross-motion for summary judgment, and entry of judgment in favor of defendant-appellee and declaring defendant-appellee an insured driver under plaintiff-appellant's liability insurance policy. Because we conclude that there are disputed issues of fact so that summary judgment was inappropriate in this matter, we shall remand for further proceedings.

I.

On August 8, 1975, Earl Drummond (Drummond) rented an automobile for a three day period from Preferred Rentals, Inc. (Preferred), a St. Croix, Virgin Islands car rental agency insured by Continental Insurance Co. (Continental). On the next day, August 9th, a daughter of Drummond was to be married, and while driving members of the wedding party to the ceremony, Kenneth Bodie, (Bodie), Drummond's 25 year old brother, lost control of the rented car, and Lester Pool (Pool), Drummond's nephew, was seriously injured. Drummond was not in the car at the time of the accident. Just how and why Bodie happened to be driving the vehicle is in essence the subject of this appeal. The district court said the following it its "Factual Background:" "Having the obligation of transporting members of the wedding party to the church, a few miles distant, Drummond turned over the rented car to his 25 year old brother, Kenneth Bodie, whom he had engaged to drive that group of ushers and bridesmaids." App. 506a.

On February 22, 1980, Pool brought a personal injury action against Bodie, who notified Continental, the insurer of the car. Continental disclaimed coverage and refused to defend, and subsequently filed this action for a declaratory judgment that Bodie was not insured under the policy issued by Continental to Preferred. In the interim, Pool recovered a $2,720,700.00 judgment against Bodie. This appeal followed grant of summary judgment in favor of Bodie and against Continental.

II.

A.

At issue in this case is the coverage, with regard to the use of the automobile by Bodie, of the insurance policy issued by Continental to Preferred. The decision of this court in Buntin v. Continental Insurance Co., 583 F.2d 1201 (3d Cir. 1978) makes clear that the relevant document for the court's consideration is the Continental insurance policy, issued to Preferred, not the rental agreement between Preferred and Bodie, for it is the former which governs the scope of Continental's coverage. Id. at 1205.

Buntin involved the very same policy of Continental providing insurance to Preferred, and a similar issue of coverage to one other than Preferred's permittee. We held there that where the insured vehicle was being used for the purposes and benefit of the names insured's permittee, and while the permittee was travelling in the car, the person actually driving the car was included within the onmibus clause and was an additional insured under the policy. Id.

The Buntin court then ruled that the so-called "omnibus clause" of the policy, rather than the conflicting Endoresment No. Two rider, was the controlling definition of ...


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