This is an action by an ambulance service (insured) against its automobile liability insurance carrier (insurer) to recover expenses and reasonable attorney fees incurred in defending a wrongful death action. Judgment was entered for insurer after its demurrer to insured's complaint was sustained and insured refused to plead further. Insured appeals.
The policy included the following provisions:
Insured was sued by the estate of one Albert A. Laskey. According to insured's complaint, the estate's complaint alleged that Laskey was injured in a logging accident and died while being transported in insured's ambulance and that
Insured tendered defense of the Laskey action to insurer. Insurer refused the tender, and insured successfully defended the action at its own expense. After disposition of the Laskey action, insured brought this action to recover expenses and reasonable attorney fees.
Insured's duty to defend depends on two documents: (1) the insurance policy, and (2) the Laskey complaint. "If the complaint [against insured], without amendment, may impose liability for conduct covered by the policy, the insurer is put on notice of the possibility of liability and it has a duty to defend." Ferguson v. Birmingham Fire Ins., 254 Or. 496, 507, 460 P.2d 342, 347 (1969). "The insurer's knowledge of facts not alleged in the complaint is irrelevant in determining the existence of the duty to defend * * *." Id. at 505, 460 P.2d at 346. "[I]f the complaint is ambiguous or unclear and may be reasonably interpreted to include an incident within the coverage of the policy, there is a duty to defend." Blohm et al. v. Glens Falls Ins. Co., 231 Or. 410, 416, 373 P.2d 412, 415 (1962). "[T]he insurer owes a duty to defend if the injured claimant can recover under the allegations of the complaint upon any basis for which the insurer affords coverage." Casey v. N.W. Security Ins. Co., 260 Or. 485, 489, 491 P.2d 208, 210 (1971).
The general rule for the interpretation of the words of the policy which are critical to the disposition of this controversy is set out in 7 Appleman, Insurance Law and Practice 144, § 4317, as follows:
Even when the rule which governs a decision of the present kind is recognized, the task is not much easier. The problem is the requisite causal connection
We have discovered only one similar case. In Employers' Commercial Union Insurance Company of America v. Danches, 311 So.2d 758 (Fla.App. 1975), the court held that delay on the part of an ambulance company in delivering a patient to the hospital, which delay caused the patient's death, was not within the coverage of a similarly worded policy. The report of the case does not disclose the reason for the delay. It is surprising that there is not more law on similar situations, since the language in question is common to almost all automobile liability policies. Two cases exist wherein the plaintiff suffered injuries from being dropped by ambulance attendants using ambulance equipment in the course of transporting the plaintiff from her residence to the ambulance parked in the street. In the one case coverage was afforded, Owens v. Ocean Acc. & Guar. Corp., 194 Ark. 817, 109 S.W.2d 928 (1937); in the other, it was denied, J.T. Hinton & Sons v. Employers' Liability Assur. Corp., 166 Tenn. 324, 62 S.W.2d 47 (1933). In the case allowing coverage, the policy contained coverage for loading and unloading, whereas in the case denying coverage there was no such provision. However, neither decision seems to have been based upon a consideration of such provision.
Insured has diligently searched the United States for opinions which have afforded coverage under similar language in causally attenuated cases. However, for almost every such opinion, one can be found in which similar facts resulted in a contrary ruling. For reports of cases, see annotations to 7 Appleman, Insurance Law and Practice § 4317 et seq., and Annotation, 89 ALR2d 150 (1963). Case-matching in the present situation is singularly futile. We conclude that errors in organization and in receiving and transmitting directions are not risks of the kind which the parties contemplated would be covered by the policy. Although such risks would not exist except for insured's ownership, maintenance and operation of the ambulance and the causal relation stemming therefrom, they are risks which are more closely related to insured's operation of its business than to insured's operation of its ambulance.
If, after Laskey had been picked up and was on the way to the hospital, the ambulance broke down or was involved in an accident due to insured's negligence and Laskey died as a result of the delay, we certainly would have no difficulty in saying that there was sufficient causal connection between Laskey's death and insured's negligent maintenance or use of its ambulance to make the death one "arising out of the * * * maintenance or use of the automobile," as that language would be "understood by a person of reasonable intelligence." In considering whether Laskey's death "arose out of" insured's maintenance or use of its ambulance, we are unable to distinguish the situation in which the ambulance breaks down or has an accident on its way to pick up Laskey, from the situation in which a similar mishap occurs after he is in the ambulance. In both situations Laskey's death would seem to be equally and directly causally connected with the maintenance or use of the ambulance. We therefore conclude that under the Laskey complaint liability could have been imposed upon insured for conduct covered by the policy and that the trial court erred in sustaining the demurrer to insured's complaint.
The judgment of the trial court is reversed, and the case is remanded to the trial court for further proceedings.