Scribd Logo
Upload

Welcome to Scribd!

  • 85 views

    Palermo vs. Pyramids Insurance

    Uploaded by

    Caroline A. Legaspino
    This document discusses a court case regarding an insurance claim. The insured was driving without a valid license at the time of an accident. The court found that being unlicensed did not preclude recovery under the insurance policy when the insured was operating their own vehicle. The requirement for a valid license only applies when another person is driving with permission of the insured.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Palermo vs. Pyramids Insurance

    Uploaded by

    Caroline A. Legaspino
    85 views4 pages
    This document discusses a court case regarding an insurance claim. The insured was driving without a valid license at the time of an accident. The court found that being unlicensed did not preclude recovery under the insurance policy when the insured was operating their own vehicle. The requirement for a valid license only applies when another person is driving with permission of the insured.

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    This document discusses a court case regarding an insurance claim. The insured was driving without a valid license at the time of an accident. The court found that being unlicensed did not preclude recovery under the insurance policy when the insured was operating their own vehicle. The requirement for a valid license only applies when another person is driving with permission of the insured.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    85 views4 pages

    Palermo vs. Pyramids Insurance

    Uploaded by

    Caroline A. Legaspino
    This document discusses a court case regarding an insurance claim. The insured was driving without a valid license at the time of an accident. The court found that being unlicensed did not preclude recovery under the insurance policy when the insured was operating their own vehicle. The requirement for a valid license only applies when another person is driving with permission of the insured.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    You are on page 1of 4

    VOL.

    161, MAY 31, 1988 677


    Palermo vs. Pyramid Insurance Co., Inc.

    *
    No. L-36480. May 31, 1988.

    ANDREW PALERMO, plaintiff-appellee, vs. PYRAMID


    INSURANCE CO., INC., defendant-appellant.

    Commercial Law; Insurance; Policy; Authorized driver clause;


    The driver of the insured motor vehicle at the time of the accident
    which was the insured himself was the “authorized driver” under
    the policy.—There is no merit in the appellant’s allegation that
    the plaintiff was not authorized to drive the insured motor vehicle
    because his driver’s license had expired. The driver of the insured
    motor vehicle at the time of the accident was the insured himself,
    hence an “authorized driver” under the policy.

    Same; Same; Same; Same; An infraction of the Motor Vehicle


    Law by the insured, is not a bar to recovery under the insurance
    contract, although he is subject to penal sanctions.—While the
    Motor Vehicle Law prohibits a person from operating a motor
    vehicle on the highway without a license or with an expired
    license, an infraction of the Motor Vehicle Law on the part of the
    insured, is not a bar to recovery under the insurance contract. It
    however renders him subject to the penal sanctions of the Motor
    Vehicle Law,

    Same; Same; Same; Same; The requirement that the driver be


    permitted in accordance with the law and the regulations to drive
    the motor vehicle and is not disqualified from driving the vehicle
    by order of a court or by reason of enactment or regulation applies
    only when the driver is driving on the insured’s order or
    permission; When requirement not applicable.—The requirement
    that the driver be “permitted

    _______________

    * FIRST DIVISION.

    678

    678 SUPREME COURT REPORTS ANNOTATED

    Palermo vs. Pyramid Insurance Co., Inc.

    in accordance with the licensing or other laws or regulations to


    drive the Motor Vehicle and is not disqualified from driving such
    motor vehicle by order of a Court of Law or by reason of any
    enactment or regulation in that behalf,” applies only when the
    driver “is driving on the insured’s order or with his permission.” It
    does not apply when the person driving is the insured himself.
    Same; Same; Same; Where the insured himself was personally
    operating the vehicle but without license to operate it, her license
    having expired before issuance of the policy, she is not precluded
    from enforcing a policy indemnifying her against liability for
    bodily injuries inflicted by the use of the vehicle.—In an American
    case, where the insured herself was personally operating her
    automobile but without a license to operate it, her license having
    expired prior to the issuance of the policy. the Supreme Court of
    Massachusetts was more explicit: “x x x Operating an automobile
    on a public highway without a license, which act is a statutory
    crime is not precluded by public policy from enforcing a policy
    indemnifying her against liability for bodily injuries inflicted by
    use of the automobile.” (Drew C. Drewfield McMahon vs. Hannah
    Pearlman, et al., 242 Mass. 367, 136 N.E. 154, 23 A.L.R. 1467.)

    APPEAL from the decision of the Court of First Instance of


    Negros Occidental.
    The facts are stated in the opinion of the Court.

    GRIÑO-AQUINO, J.:

    The Court of Appeals certified this case to Us for proper


    disposition as the only question involved is the
    interpretation of the provision of the insurance contract
    regarding the “authorized driver” of the insured motor
    vehicle.
    On March 7, 1969, the insured, appellee Andrew
    Palermo, filed a complaint in the Court of First Instance of
    Negros Occidental against Pyramid Insurance Co., Inc., for
    payment of his claim under a Private Car Comprehensive
    Policy MV-1251 issued by the defendant (Exh. A).
    In its answer, the appellant Pyramid Insurance Co.,
    Inc., alleged that it disallowed the claim because at the
    time of the accident, the insured was driving his car with
    an expired driver’s license.
    After the trial, the court a quo rendered judgment on
    October 29,1969 ordering the defendant “to pay the
    plaintiff the sum of

    679

    VOL. 161, MAY 31, 1988 679


    Palermo vs. Pyramid Insurance Co., Inc.

    P20,000.00. value of the insurance of the motor vehicle in


    question to pay the costs.”
    On November 26, 1969, the plaintiff filed a “Motion for
    Immediate Execution Pending Appeal.” It was opposed by
    the defendant, but was granted by the trial court on
    December 15, 1969.
    The trial court found the following facts to be
    undisputed:

    “On October 12,1968, after having purchased a brand new Nissan


    Cedric de Luxe Sedan car bearing Motor No. 087797 from the Ng
    Sam Bok Motors Co. in Bacolod City, plaintiff insured the same
    with the defendant insurance company against any loss or
    damage for P20,000.00 and against third party liability for
    P10,000.00. Plaintiff paid the defendant P361.34 premium for one
    year, March 12,1968 to March 12,1969, for which defendant
    issued Private Car Comprehensive Policy No. MV-1251, marked
    Exhibit ‘A.'
    “The automobile was, however, mortgaged by the plaintiff with
    the vendor, Ng Sam Bok Motors Co., to secure the payment of the
    balance of the purchase price, which explains why the registration
    certificate in the name of the plaintiff remains in the hands of the
    mortgagee, Ng Sam Bok Motors Co.
    “On April 17, 1968, while driving the automobile in question,
    the plaintiff met a violent accident. The La Carlota City fire
    engine crashed head on, and as a consequence, the plaintiff
    sustained physical injuries, his father, Cesar Palermo, who was
    with him in the car at the time was likewise seriously injured and
    died shortly thereafter, and the car in question was totally
    wrecked.
    “The defendant was immediately notified of the occurrence,
    and upon its orders, the damaged car was towed from the scene of
    the accident to the compound of Ng Sam Bok Motors in Bacolod
    City where it remains deposited up to the present time.
    “The insurance policy, Exhibit ‘A,' grants an option unto the
    defendant, in case of accident either to indemnify the plaintiff for
    loss or damage to the car in cash or to replace the damaged car.
    The defendant, however, refused to take either of the above-
    mentioned alternatives for the reason as alleged, that the insured
    himself had violated the terms of the policy when he drove the car
    in question with an expired driver’s license.” (Decision, Oct. 29,
    1969, p. 68, Record on Appeal.)

    Appellant alleges that the trial court erred in interpreting


    the following provision of the Private Car Comprehensive
    Policy MV-1251:
    680

    680 SUPREME COURT REPORTS ANNOTATED


    Palermo vs. Pyramid Insurance Co., Inc.

    “AUTHORIZED DRIVER;

    Any of the following:


    (a) The Insured.
    (b) Any person driving on the Insured’s order or with his permission.
    Provided that the person driving is permitted in accordance with the
    licensing or other laws or regulations to drive the Motor Vehicle and is
    not disqualified from driving such motor vehicle by order of a Court of
    law or by reason of any enactment or regulation in that behalf.” (Exh. ‘A/)

    There is no merit in the appellant’s allegation that the


    plaintiff was not authorized to drive the insured motor
    vehicle because his driver’s license had expired. The driver
    of the insured motor vehicle at the time of the accident was
    the insured himself, hence an “authorized driver” under the
    policy.
    While the Motor Vehicle Law prohibits a person from
    operating a motor vehicle on the highway without a license
    or with an expired license, an infraction of the Motor
    Vehicle Law on the part of the insured, is not a bar to
    recovery under the insurance contract. It however renders
    him subject to the penal sanctions of the Motor Vehicle
    Law.
    The requirement that the driver be “permitted in
    accordance with the licensing or other laws or regulations
    to drive the Motor Vehicle and is not disqualified from
    driving such motor vehicle by order’ of a Court of Law or by
    reason of any enactment or regulation in that behalf,”
    applies only when the driver “is driving on the insured’s
    order or with his permission.” It does not apply when the
    person driving is the insured himself.
    This view may be inferred from the decision of this
    Court in Villacorta vs. Insurance Commission, 100 SCRA
    467, where it was held that:

    “The main purpose of the ‘authorized driver’ clause, as may be


    seen from its text, is that a person other than the insured owner,
    who drives the car on the insured’s order, such as his regular
    driver. or with his permission, such as a friend or member of the
    family or the employees of a car service or repair shop, must be
    duly licensed drivers and have no disqualification to drive a motor
    vehicle.”

    In an American case, where the insured herself was


    personally operating her automobile but without a license
    to operate it, her license having expired prior to the
    issuance of the policy,
    681

    VOL. 161, MAY 31, 1988 681


    Republic vs. CFI of Camarines Sur

    the Supreme Court of Massachusetts was more explicit;

    “x x x Operating an automobile on a public highway without a


    license, which act is a statutory crime is not precluded by public
    policy from enforcing a policy indemnifying her against liability
    for bodily injuries inflicted by use of the automobile.” (Drew C.
    Drewfield McMahon vs. Hannah Pearlman, et al., 242 Mass. 367,
    136 N.E. 154, 23 A.L.R. 1467.)

    WHEREFORE, the appealed decision is affirmed with costs


    against the defendant-appellant.
    SO ORDERED.

              Narvasa, Cruz, Gancayco and Medialdea, JJ.,


    concur.

    Decision affirmed.

    Note.—An insurance policy definitely fixes the meaning


    of “authorized driver.” That stipulation cannot be
    disregarded or rendered meaningless. It is binding on the
    insured. (Gutierrez vs. Capital Insurance and Surety Co.,
    Inc., 130 SCRA 100.)

    ——o0o——

    © Copyright 2022 Central Book Supply, Inc. All rights reserved.

    You might also like