Where a city's liability insurance policy covering injury "caused by an occurrence" states that the distribution and sale of natural gas is the insured's business and specifically excludes injury arising out of the insured's operation as a water or electric utility, the policy will cover injury from a gas explosion only if some act of negligence in the operation of the gas utility was a contributing cause of the explosion.
These three companion cases all arose out of the same disaster. One is an appeal by one of the defendants from the denial of a summary judgment in the original tort action. The other two are appeals from the trial court's order in an action for a declaratory judgment on the question of insurance coverage.
The Water, Light and Sinking Fund Commission is an agency of the City of Dalton which operates a natural gas, water, sewer and electric utility system. On the morning of December 7, 1967, signs of a leaking water pipe had been spotted in one of the streets. The city dispatched a crew of 3 men to investigate. This crew usually worked on water and sewer maintenance, though it had occasionally worked on gas lines. The city also called Berry Concrete Products Company to arrange for the services of a back-hoe and operator at the site. The city had often hired this Berry equipment in the past. The foreman of the crew instructed the back-hoe operator where to dig. There is evidence that on the way down to the water pipe, the back-hoe struck an exposed gas pipe. Within about an hour and a half, while the crew was still completing its work, there was an explosion in the house fronting on the repair site. The evidence tends to show that the occupants had noticed a strange smell that morning for the first time and had mentioned it to the crew outside. It also shows that the explosion occurred immediately after a person in the house lit a match. As a result of the explosion, a woman was killed and several others were severely burned.
The woman's family has sued the City of Dalton and Berry Concrete Products, generally alleging the negligence of the defendants. They also served the statutory notice of claim upon the city, in which they charged installation of defective gas pipes; failure to properly maintain gas lines; failure to warn occupants of danger; and damage to pipes while working on or near them.
Discovery depositions were taken and all parties apparently stipulated that, with two exceptions, the court could determine all issues of law and fact raised under the pleadings, documents and depositions. Berry & Hartford made motions for summary judgment, while the city and INA made motions to dismiss the Berry and Hartford cross and counterclaims. The court granted the motions to dismiss and certified the ruling for immediate review. The same day it handed down an order denying the Berry and Hartford motions for summary judgment and declaring there was coverage under the INA policy. This order was also certified.
In the meantime, Berry had filed a cross complaint against the city in the original tort action and had moved for summary judgment on the cross claim, calling it a declaratory judgment suit to determine whether defendants or either of them are liable to plaintiffs. This was also denied and certified.
1. The trial court did not err in denying Berry's motion for summary judgment on the cross claim against its co-defendant, the City of Dalton, in the original tort action. The grounds for this motion are essentially that the back-hoe operator was, at the time of the alleged act of negligence, an employee of the city under both the borrowed servant and inherently dangerous work doctrines (Code 105-502), thus relieving Berry from any vicarious liability. On the borrowed servant issue there was conflicting evidence on the extent, if any, of the direction and control exercised by the city over the operator. Fulghum Industries v. Pollard Lumber Co., 106 Ga. App. 49 (126 SE2d 432)
; Harvey v. C. W. Matthews Constr. Co., 114 Ga. App. 866 (3) (152 SE2d 809)
. The fallacy of its argument on the inherently dangerous work doctrine is that the purpose of this doctrine is to allow a plaintiff to bring the employer in as another defendant, not to take the independent contractor out of the case. See 41 Am. Jur. 2d 41, Independent Contractors.
A party defendant may cross claim against another defendant under Code Ann. 81A-113 (g). However, the question of primary liability, as between Berry and the city, is not a matter for decision at this point. They are sued as joint tortfeasors and one cannot have judgment against the other prior to the determination of the plaintiffs' suit. The cross claim can be tried in the original action or in a subsequent separate trial. Code Akin. 81A-142.
2. The trial court did not err in dismissing the Berry and Hartford cross and counterclaims or in denying their motions for summary judgment in the declaratory judgment action. For the reasons stated in Division 1, neither is entitled to an adjudication of the question of primary liability as between Berry and the city or of the question of no liability. See also Darnell v. Tate, 206 Ga. 576 (2) (58 SE2d 160)
. Berry contends further that it is an additional insured under the INA policy with the city. The insurance policy lists as "Persons and Entities Insured" the named insured, its executive officers, directors, stockholders or appointed officials while acting within the scope of their duties, any person (other than an employee of the named insured) or organization when acting as a real estate manager for the named insured, and any person operating city-owned mobile equipment with the city's permission. Berry does not come within any of the above provisions.
3. The insurance policy under consideration states that "INA will pay on behalf of the insured [The Water, Light and Sinking Fund Commission of Dalton, Georgia] all sums which the insured shall become legally obligated to pay as damages because of A. bodily injury or B. property damage to which this insurance applies, caused by an occurrence. . ." The "business of the named insured" is described as "distribution and sale of natural gas." The policy further states that "This insurance does not apply: (c) to injury arising out of operation of the named insured as a water utility or an electric utility."
INA contends that the cause of the explosion was clearly the striking of the gas line by the back-hoe; that this equipment was being operated to assist the city water crew in digging for a water and therefore the occurrence arose out of the specifically excluded by the policy, INA contends the court erred in its declaration of coverage.
The city argues that the intent of the policy was to insure against the normal hazards of the business of distributing natural gas; that an explosion is just such a hazard; and that the particular reason why an interchangeable city crew was digging in the street is immaterial.
The trial court's order stated that the explosion was an occurrence insured against in the policy; that it arose out of the sale and distribution of natural gas; and that INA is obligated to defend the city in the tort action and is liable to and obligated to pay any sums the city may be found obligated to pay in the said action. INA appeals from this order.
It is important to note in the beginning that the question at issue is the construction of a liability insurance policy covering an occurrence in the distribution and sale of gas and expressly excluding the operation of a water or electric utility. This means that before the insurance is payable, there must first be a finding that the city, as a gas utility, is liable for damages. Under the trial court's construction of the policy, INA would be obligated to pay damages for any gas explosion even if the sole proximate cause of the injury was the negligence of the city in its operation as a water or electric utility. The exclusionary provisions of the policy are rendered nugatory by this ruling. It is our opinion that under the proper construction of the policy, INA will be obligated only if an act of negligence in the city's gas operations is found to contribute to the proximate cause of the injury. See City of Poplar Bluff v. New Amsterdam Casualty Co., 386 F2d 172. There the court found no coverage where the property of the insured city department was the instrumentality causing the injury but the proximate cause was the negligence of an employee of another, uninsured, department.
Proximate cause is a matter which should normally be decided in the original tort suit, with perhaps the use of special verdicts. Code Ann. 81A-149. See also Associated Petroleum Carriers v. Pan American Fire &c. Co., 117 Ga. App. 714
, 715 (161 SE2d 411
). However, since the parties have stipulated that the court could decide this issue of fact, the case is reversed and remanded in order that the trial court, if it sees fit, may make a finding of fact as to the specific act or acts of negligence which were the proximate cause of injury. Upon this finding it may then declare the rights of the parties under the liability insurance policy. Alternatively, the court may decide that there are several possible contributing causes and that a jury should make the determination. In this event, the question of coverage would remain open, pending a special verdict on this point.
Judgment affirmed in Case No. 44847. Judgment affirmed in Case No. 44848. Judgment reversed and case remanded in Case No. 44849. Pannell and Quillian, JJ., concur.