{ "id": 11649162, "name": "THE HERTZ CORPORATION, Plaintiff v. NEW SOUTH INSURANCE COMPANY, Defendant", "name_abbreviation": "Hertz Corp. v. New South Insurance", "decision_date": "1998-04-07", "docket_number": "No. COA97-809", "first_page": "227", "last_page": "231", "citations": [ { "type": "official", "cite": "129 N.C. App. 227" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "420 S.E.2d 155", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1992, "pin_cites": [ { "page": "157-58" } ], "opinion_index": 0 }, { "cite": "332 N.C. 333", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2506934 ], "year": 1992, "pin_cites": [ { "page": "336-38" } ], "opinion_index": 0, "case_paths": [ "/nc/332/0333-01" ] }, { "cite": "493 S.E.2d 767", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1997, "pin_cites": [ { "page": "769" } ], "opinion_index": 0 }, { "cite": "128 N.C. App. 171", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11652990 ], "year": 1997, "opinion_index": 0, "case_paths": [ "/nc-app/128/0171-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 20-279", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "opinion_index": 0 }, { "cite": "338 S.E.2d 92", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1986, "pin_cites": [ { "page": "96" }, { "page": "96" } ], "opinion_index": 0 }, { "cite": "315 N.C. 341", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4716667 ], "weight": 2, "year": 1986, "pin_cites": [ { "page": "347" }, { "page": "347" } ], "opinion_index": 0, "case_paths": [ "/nc/315/0341-01" ] }, { "cite": "152 S.E.2d 436", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1967, "pin_cites": [ { "page": "444" }, { "page": "442-44" } ], "opinion_index": 0 }, { "cite": "269 N.C. 341", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8563605 ], "weight": 2, "year": 1967, "pin_cites": [ { "page": "352" }, { "page": "348-51" } ], "opinion_index": 0, "case_paths": [ "/nc/269/0341-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 20-281", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "year": 1993, "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 20-279.21", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "year": 1997, "pin_cites": [ { "page": "(b)(2)" } ], "opinion_index": 0 } ], "analysis": { "cardinality": 420, "char_count": 9743, "ocr_confidence": 0.777, "pagerank": { "raw": 7.259244762335987e-08, "percentile": 0.4326215543840587 }, "sha256": "49e0ea6a6c3a84b3535625dacfe6b7f6b70d59968d5cf01c8f77eefd49dce27f", "simhash": "1:9b7b927a16d663f2", "word_count": 1533 }, "last_updated": "2023-07-14T18:14:06.814789+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges MARTIN, John C., and MARTIN, Mark D., concur." ], "parties": [ "THE HERTZ CORPORATION, Plaintiff v. NEW SOUTH INSURANCE COMPANY, Defendant" ], "opinions": [ { "text": "LEWIS, Judge.\nBennie Prince rented a car from plaintiff and accidentally drove it into Chinita Murphy\u2019s Buick. Ms. Murphy and her passengers were injured and the Buick was damaged. The accident took place in Wilmington, North Carolina.\nAt the time of the accident, Mr. Prince was the named insured of an automobile insurance policy issued by defendant New South Insurance Company (\u201cNew South\u201d). The New South policy reads,\nPART A \u2014 LIABILITY COVERAGE\nINSURING AGREEMENT\nWe will pay damages for bodily injury or property damage for which any insured becomes legally responsible because of an auto accident... .\n\u201cInsured\u201d as used in this Part means:\n1. You . . . for the ownership, maintenance, or use of any auto ....\nOTHER INSURANCE\nIf there is other applicable auto medical payments insurance we will pay only our share of the loss. Our share is the proportion that our limit of liability bears to the total of all applicable limits. However, any insurance we provide with respect to a vehicle you do not own shall be excess over any other collectible auto insurance providing payments for medical or funeral expenses.\nThe rental agreement between Mr. Prince and plaintiff, The Hertz Corporation (\u201cHertz\u201d), states,\n10. LIABILITY PROTECTION\n(a) Within the limits stated in this paragraph, Hertz will indemnify, hold harmless, and defend you . . . FROM AND AGAINST LIABILITY TO THIRD PARTIES_THE LIMITS OF THIS PROTECTION, INCLUDING OWNER\u2019S LIABILITY, ARE THE SAME AS THE MINIMUM LIMITS REQUIRED BY THE AUTOMOBILE FINANCIAL RESPONSIBILITY LAW OF THE JURISDICTION IN WHICH THE ACCIDENT OCCURS ....\n(b) IF YOU DO NOT PURCHASE LIABILITY INSURANCE SUPPLEMENT (LIS) ... AT THE COMMENCEMENT OF THE RENTAL, YOUR INSURANCE COVERAGE WILL BE PRIMARY, WHICH MEANS THAT PROTECTION PROVIDED BY HERTZ BY THIS PARAGRAPH WILL BE SECONDARY, AND NOT IN ADDITION TO, ANY VALID AND COLLECTIBLE INSURANCE THAT PROVIDES COVERAGE FOR YOU .... IF SECONDARY PROTECTION IS EXTENDED BY HERTZ, THE PROTECTION WILL BE SELF-INSURED BY HERTZ AND WILL BE EXTENDED UNDER THE SAME TERMS AND CONDITIONS AS STATED IN PARAGRAPH 10(a) ABOVE.\nMr. Prince did not purchase the supplementary \u201cLIS\u201d insurance mentioned in the rental agreement.\nMs. Murphy and her passengers brought claims for damages against Mr. Prince. New South denied that its policy covered these claims and refused to settle them or defend Prince against them. Subsequently, Hertz paid $8,703.15 to settle the claims and sued New South to recover its expenses. Hertz prevailed in a bench trial and New South appeals.\nWe hold that the New South policy, and not the Hertz rental agreement, provides coverage for the claims against Mr. Prince. We therefore affirm.\nIn North Carolina, there are two statutes that require Hertz to insure the lessees of its vehicles. The first obligates motor vehicle owners to secure liability insurance that\ninsure [s] the person named therein and any other person, as insured, using any such motor vehicle . . . with the express or implied permission of such named insured . . . against loss from the liability imposed by law for damages arising out of the ownership, maintenance or use of such motor vehicle ....\nN.C. Gen. Stat. \u00a7 20-279.21(b)(2) (Cum. Supp. 1997). The second requires entities who are in the business of leasing motor vehicles to obtain a liability insurance policy that insures\nthe owner and rentee or lessee and their agents and employees while in the performance of their duties against loss from any liability imposed by law for damages . . . caused by accident arising out of the operation of such motor vehicle ....\nN.C. Gen. Stat. \u00a7 20-281 (1993). The minimum limits of insurance required by these statutes are identical.\nIt is well-settled that a motor vehicle owner fulfills the requirements of G.S. 20-279.21(b)(2) by obtaining a policy that insures the owner, and those who drive the insured vehicle with the owner\u2019s permission, in the minimum amounts required by law,\nsubject to the provision that it will not apply if other valid and collectible insurance, in the amount required by the [Motor Vehicle Safety and Financial Responsibility] Act, is provided to such person by a different policy.\nAllstate Ins. Co. v. Shelby Mutual Ins. Co., 269 N.C. 341, 352, 152 S.E.2d 436, 444 (1967). Such a policy accomplishes the purpose of the motor vehicle financial responsibility laws, which is to insure innocent motorists against the losses caused by financially irresponsible motorists. See id.; American Tours, Inc. v. Liberty Mutual Ins. Co., 315 N.C. 341, 347, 338 S.E.2d 92, 96 (1986); see also N.C. Gen. Stat. \u00a7 20-279.21Q) (\u201cThe requirements for a motor vehicle liability policy may be fulfilled by the policies of one or more insurance carriers which policies together meet such requirements.\u201d).\nSection 20-281, which applies to entities in the business of leasing vehicles, supplements section 20-279.21, and it too is intended to protect innocent drivers from financially irresponsible drivers. American Tours, 315 N.C. at 347, 338 S.E.2d at 96. An insurance policy complies with section 20-281 if it provides the coverage described in 20-281, subject to the condition that no coverage is provided if other liability insurance, in the amount required by statute, is provided by a different policy. Cf. Jeffreys v. Snappy Car Rental, 128 N.C. App. 171, \u2014, 493 S.E.2d 767, 769 (1997).\nWith these principles in mind, we turn to the competing insurance provisions at issue in this case. The rental agreement between Prince, the lessee, and Hertz expressly restricts Hertz\u2019s coverage to the \u201cminimum limits required by the automobile financial responsibility law\u201d of the jurisdiction in which the accident occurs, which in this case is North Carolina. Further, paragraph 10(b) states that if, as here, the lessee does not purchase supplementary insurance from Hertz, then the \u201cprotection provided by Hertz by this paragraph will be secondary, and not in addition to, any valid and collectible insurance that provides coverage for you [the lessee].\u201d This policy fulfilled Hertz\u2019s obligations to provide insurance under sections 20-279.21(b)(2) and 20-281.\nMr. Prince was fully insured by New South. The damages caused by Mr. Prince were within the minimum coverage provided by the New South policy. Because the New South policy constitutes \u201cvalid and collectible insurance that provides coverage for [the lessee],\u201d Hertz\u2019s coverage of Mr. Prince is \u201csecondary, and not in addition to,\u201d the New South coverage. Therefore, Hertz is under no obligation to pay any of the damages caused by Mr. Prince\u2019s negligence.\nNew South contends that its own policy excludes coverage for these damages with the following sentence: \u201c[A]ny insurance we provide with respect to a vehicle you do not own shall be excess over any other collectible auto insurance providing payments for medical or funeral expenses.\u201d New South\u2019s argument is that the liability protection provided by Hertz\u2019s rental agreement constitutes \u201cother collectible auto insurance\u201d as that term is used in the New South policy. Therefore, its own coverage is \u201cexcess,\u201d while Hertz\u2019s coverage is primary. We disagree.\nWhile Hertz\u2019s rental agreement provides the insurance required by statute, it is not \u201cother collectible auto insurance\u201d as that term is used in the New South policy. The rental agreement extends only to the minimum limits required by North Carolina law and it provides only secondary coverage where other valid and collectible insurance exists. The New South policy provides full coverage for the claims against Mr. Prince, and so the law of North Carolina does not require Hertz to provide any coverage. Therefore, the rental agreement provides no coverage for the claims against Mr. Prince, and as to these claims the coverage provided by the rental agreement is not the \u201cother collectible auto insurance\u201d mentioned in the New South policy. See United Services Auto. Assn. v. Universal Underwriters Ins. Co., 332 N.C. 333, 336-38, 420 S.E.2d 155, 157-58 (1992); Allstate, 269 N.C. at 348-51, 152 S.E.2d at 442-44.\nThe judgment of the superior court is affirmed.\nAffirmed.\nJudges MARTIN, John C., and MARTIN, Mark D., concur.", "type": "majority", "author": "LEWIS, Judge." } ], "attorneys": [ "Johnson & Lambeth, by Robert White Johnson, for plaintiff-appellee.", "Grossley, McIntosh, Prior & Collier, by H. Mark Hamlet, for defendant-appellant." ], "corrections": "", "head_matter": "THE HERTZ CORPORATION, Plaintiff v. NEW SOUTH INSURANCE COMPANY, Defendant\nNo. COA97-809\n(Filed 7 April 1998)\nInsurance \u00a7 550 (NCI4th)\u2014 rental car \u2014 competing insurance provisions\nThe judgment of the trial court in a bench trial was affirmed and defendant\u2019s policy provides insurance coverage where plaintiff rented a car and provided insurance, the driver of the car was involved in an accident, plaintiff settled the claim arising from that accident, and plaintiff sought in this action to recover from defendant, the insurer of the driver. The rental agreement expressly restricts plaintiff\u2019s coverage to the minimum limits required by the automobile financial responsibility law of North Carolina and further states that if the lessee does not purchase supplemental insurance, then the protection provided by plaintiff is secondary. Although defendant contends that its policy excludes coverage for \u201cother collectable auto insurance,\u201d plaintiff\u2019s rental agreement extends only to the minimum limits required by North Carolina law and it provides only secondary coverage where other valid and collectible insurance exists. Defendant\u2019s policy provides full coverage and the law of North Carolina does not require plaintiff to provide coverage.\nAppeal by defendant from judgment entered 9 April 1997 by Judge Russell Lanier in New Hanover County Superior Court. Heard in the Court of Appeals 26 February 1998.\nJohnson & Lambeth, by Robert White Johnson, for plaintiff-appellee.\nGrossley, McIntosh, Prior & Collier, by H. Mark Hamlet, for defendant-appellant." }, "file_name": "0227-01", "first_page_order": 267, "last_page_order": 271 }