State Farm Mutual Automobile Insurance v. Martin Marietta Corp.

MURPHY, Judge. In this “coverage question” appeal from the Circuit Court for Baltimore City, the parties have presented three questions for our review. State Farm Mutual Automobile Insurance Company (“State Farm”), appellant, asks: I. Was the evidence presented sufficient to allow the jury to decide the issue of permissive use?

II

Did the trial court improperly overturn the verdict of the jury when it granted defendant/appellee’s motion for judgment notwithstanding the verdict? Martin Marietta Corporation (“Martin”) and Franklin P. Racey (“Racey”), appellees, ask: ³ Did the trial court properly grant defendants’ motion for judgment notwithstanding the verdict where there was no legally relevant competent evidence from which a rational mind could infer the existence of permission to use the vehicle at the time of the accident? We answer “yes” to State Farm’s questions, and shall explain why appellees’ question is based on an incorrect analysis of the evidence, which was sufficient to establish the driver’s permissive use. BACKGROUND Appellant provided uninsured motorist coverage to James R. Johnson, who was injured in an accident caused by the negligence of David Lee Mansel, Sr. while Mansel was driving an automobile that had been leased by Martin.

Martin and its liability carrier claimed that Mansel was driving without permission when the accident occurred. Appellant claimed that Mansel was insured under Martin’s liability policy. Johnson filed a complaint for declaratory judgment to determine which company would be obligated to compensate him for his damages. The following stipulation was read to the jury: The parties have agreed to the following facts for the purpose of this case.

On December 18, 1988, plaintiff, James R. Johnson, was operating his 1980 Toyota Célica northbound on Hillen Road, Baltimore City. On December 18, 1988, defendant David Lee Mansel, Sr. was operating a 1988 Chevrolet Caprice westbound on Northern Parkway, Baltimore City. On December 18,1988, Mr. Johnson and Mr. Mansel were involved in a motor vehicle accident. On December 18, 1988, Franklin P. Racey was an employee of Martin Marietta Corporation.

On December 18, 1988, the Chevrolet Caprice was leased by Martin Marietta Corporation. Marin (sic), Marietta Corporation assigned the 1988 Chevrolet Caprice to its employee, Franklin P. Racey. ⁴ On December 18, 1988, Defendant Martin Marietta Corporation maintained automobile liability insurance on the 1988 Chevrolet Caprice. On December 18, 1988, David Lee Mansel, Sr. did not have an automobile liability insurance policy in his name, which would provide coverage for his operation of a motor vehicle. On December 18, 1988, plaintiff James R. Johnson had an automobile insurance policy with State Farm Mutual Automobile Insurance Company which provided Uninsured Motorist coverage.

These facts have been agreed to by all parties and by counsel. Mr. Racey testified that, at the time of the accident, Mansel should not have been driving the vehicle at the location where the accident occurred. His testimony included the following questions and answers: Q Can you tell the ladies and gentlemen of the jury how Mr. Mansel came into possession of your company car on December 18th, 1988? A ...

I was running late, and I didn’t have time to get a cab, and I just called Dave and asked him if he would, you know, run me to the airport because I didn’t want to leave my car there for a week, and he said, yes, and about, I don’t know, 15 minutes later, I went up to his apartment or I went up to see if he was ready and then came back and then drove up, and drove to the airport, and why, I don’t know, but I just remember as distinctly of saying, Dave, you know, take the car, park it and hang up the keys, and I left, as I was getting out and that’s how it all started. Q Do you remember any other conversation that you had on the way to the airport that day? A Not really; we talked about a lot of things, and really not particularly anything. * * * * * * Q Was it your understanding that you could allow anyone else over the age of 25 to drive the Martin Marietta vehicle for any reason? ⁵ A No. Q Fine. I am going to refer you to Page 48 of your deposition, specifically line 6, where I asked the question, “And was it also your understanding that you could allow anyone else over the age of 25 to drive that vehicle for any reason?” Your answer: “Yes, because nobody ever told me I could not.

The only stipulation was that if you drove the company vehicle, other than at work, then you supplied, you know, the gas.” Does that refresh your recollection? A Yes. And I was speaking of myself. The jurors also received evidence that Mansel has never been charged with unauthorized use of the vehicle, proscribed by Md.Code art. 27, § 349.

Both Mansel and Racey acknowledged that Mansel had borrowed money from Racey on several occasions, and Racey had never made any demand for reimbursement. Mr. Mansel’s testimony included the following questions and answers: Q Did you tell Mr. Racey that night, December 18th, that you did not have use of either of your vehicles or words to that effect? A Yes. Q Now, on the way to the airport that night, December 18th of ’88, did Mr. Racey tell you anything about using the car or not using the car after he went away?

A No, sir. Q Mr. Racey didn’t say, Dave, after you drop me off, I want you to take this car back to the apartment complex, park it and do not use it further. Did he say that? A To the best of my knowledge, he didn’t say that.

If he did, I didn’t hear him. Q Well, he had never said anything like that before, did he. A No, sir. ⁶ Q Was there any discussion with Frank Racey on that evening before the accident regarding gasoline? A To the best of my knowledge, he gave me $10.00 to purchase gasoline, so there would be enough gasoline in the vehicle to pick him back up. íH ífc sfc í|í Q Would you have taken Mr. Racey’s car or Martin Marietta’s car if he had told you not to?

A No, I wouldn’t. íH ij; # ^ ^ sH Q Okay. Do you remember testifying in your deposition on July 1st, 1992, and I’m specifically referring to page 85, starting at line 8 and ending at line 14. Do you remember me asking the question: “Well, did Mr. Racey ever tell you that he later found out what the company policy was as to the use of the vehicle?” Your answer was: “Yes.” The next question: “What did he tell you in that regard?” Your answer was: “That he never signed any statements saying that anyone couldn’t drive the car. The only thing that he was aware of was that the person had to be over 25 years old.” A Yes.

I believe that was discussed after that. Q So you remember making those statements at the deposition? A Yes. Q And you remember Mr. Racey telling you that?

A Yes, sir. Before final arguments, the jurors received the following instruction: Now, this case is being submitted to you on one written question. You have to decide one factual issue. That is, at the time of the accident, did Mr. Mansel have the permission of Mr. Racey to drive the motor vehicle.

Was he ⁷ driving that car with permission. And the written question will ask that and you will answer that yes or no. We all understand what permission means. And the question is, did Mr. Mansel have Mr. Racey’s permission at the time of the accident.

Permission can be shown to be express or implied. It’s either—and I’m speaking hypothetically—it can be express, you have my permission to drive the automobile. That would be express permission. Or it can be implied permission.

And implied permission would come from evidence of a course of conduct among those involved which would indicate that even though no express permission had been given, by the conduct you could conclude that it was an implied permission. Well, the question which will be submitted to you, and I’ll read it exactly now. “Did Defendant Mansel have permission of Defendant Racey to drive the automobile at the time of the accident,” and the question is, I mean the answer is, “Yes” or “No”. The jurors answered “yes.” We hold that the evidence was sufficient to support that answer. DISCUSSION Mansel would not be covered under Martin’s liability insurance if, at the time of the accident, he was operating the vehicle in a place or for a purpose outside of the permission given by Racey.

There is, however, a presumption that Mansel did have permission to be driving at that time. 1 As soon as the stipulation was read to the jury, appellant had the benefit of this presumption, which shifted to appellees the burden of persuading the jury that Mansel did not have permission to be driving when the accident occurred. McLain, Maryland Evidence, § 301.3 (1987). ⁸ We were told during argument that, in the “underlying case” of Johnson v. Mansel, et al., Johnson’s complaint alleged that Mansel was Martin’s agent, and summary judgment was entered in favor of Martin on that issue. That ruling was obviously correct. Grier v. Rosenberg, 213 Md. 248, 254 , 131 A.2d 737 (1957), State, Use of Shipley v. Walker, 230 Md. 133, 136-137 , 186 A.2d 472 (1962).

Proof that Mansel was not Martin’s agent, however, does not resolve the issue of whether Mansel was a permissive user of Martin’s vehicle. 2 It is true that there is a distinction between the driver who is an agent and the driver who is a permissive user. See, e.g., State,