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Cordin Motor Freight v. Allstate Ins. Co.

OPINION FILED MARCH 23, 1978.

CORDIN MOTOR FREIGHT, INC., PLAINTIFF-APPELLANT,

v.

ALLSTATE INSURANCE COMPANY, DEFENDANT-APPELLEE.



APPEAL from the Circuit Court of Cook County; the Hon. DANIEL P. COMAN, Judge, presiding.

MR. JUSTICE DIERINGER DELIVERED THE OPINION OF THE COURT:

This is an appeal from a summary judgment in favor of defendant Allstate Insurance Company (hereinafter called "Allstate"). Cordin Motor Freight, Inc. (hereinafter called "Cordin") sued Allstate to recover under an Allstate comprehensive transportation liability insurance policy for loss and damage, resulting from the theft of steel cargoes transported by Cordin, as a common carrier.

At the times of the various occurrences involved, the cargoes were loaded on motor vehicle equipment which had been leased to Cordin. On each occasion the equipment was being driven by the lessor of the equipment who was a principal involved in the theft.

The policies excluded from coverage losses attributable to the infidelity or dishonest act of any employee of the insured or of any owner-operator hired by the insured.

The defendant moved for summary judgment on the ground the truck owner and operator was an "owner-operator hired by the insured."

The motion of plaintiff, Cordin, for summary judgment as to liability was denied. The court found the truck operator was an "owner-operator" hired by the insured, allowed the motion of the defendant for summary judgment and dismissed the action.

This appeal is from that judgment, and the two separately numbered appeals were consolidated.

The issues presented for review are whether one who was the lessor of a motor vehicle which was leased to an insured, Cordin, and who personally operated the vehicle in the cartage of steel for the insured, was or was not, with regard to the theft insurance policy exclusion provision, an owner-operator hired by the insured and whether Allstate is liable under its policy because of the participation in the theft by a co-conspirator who had no relation to the insured.

The policies of truckmen's and motor carrier's liability insurance issued by Allstate to Cordin provide coverage for legal liability incurred by the insured for loss of cargo. The insurance agreements provide:

"Allstate agrees * * * to pay on behalf of the insured all sums which the insured, as a carrier by vehicles shall become legally obligated to pay because of loss or damage to lawful goods and merchandise under bills of lading or shipping receipts issued by it, while such goods and merchandise are in the custody of the insured, or in the custody of connecting carriers, in due course of transit within the continental limits of the United States or Canada."

The insuring agreement in each policy is immediately followed by a section prefaced with the heading: "EXCLUSIONS" which provide in pertinent part:

"This policy does not insure the liability of the insured for * * * loss or damage occasioned by or resulting from the infidelity or dishonest acts of the insured or of the insured's employees or of any owner-operator hired by the insured * * *."

Dennis Danca owned certain vehicles which were leased to Cordin by lease agreements. These vehicles were used by Danca when making pickups and deliveries for Cordin, and the loads of steel were transported by Danca on that equipment.

There were 13 instances over the course of 10 months in which Danca stole cargo which was in the plaintiff's custody. As a consequence thereof, the plaintiff sustained liability for that cargo ...


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