“This dog won’t hunt”: Good luck collecting on towing bill
Fred Muluya d/b/a Anakiya Trucking owned a large box truck that was insured under a commercial automobile policy issued by Progressive Casualty Insurance Company. In the early morning of December 20, 2016, the police department in Eliot, Maine, contacted National Wrecker, Inc. (NWI), to respond to an accident involving Muluya’s truck, which had gone off the road and crashed into a ditch on property owned by a third party. The truck had sustained substantial damage, and diesel fuel was leaking from the punctured fuel tank. In an effort to contain the leaked fuel and prevent further leakage, the NWI employees pumped the remaining diesel fuel from the truck and laid absorbent pads over the spilled fuel. NWI also removed debris from the scene. Two NWI wreckers removed the truck from the third party’s property to the roadway and towed it to an NWI facility in Eliot. NWI sent Muluya an invoice detailing these services and requesting payment of $7,440.
In February 2017, NWI filed a complaint against Muluya seeking payment of its invoice. In June 2017, the court entered judgment in favor of NWI and awarded it $26,540 in total damages for the services listed on the invoice and the subsequent storage fees for Muluya’s truck.
Muluya’s policy provided $5,000 in compulsory property damage liability coverage and $100,000 in optional property damage coverage.
The liability coverage of the policy stated:
[I]f you pay the premium for liability coverage, we will pay damages … for bodily injury, property damage, and covered pollution cost or expense, for which an insured becomes legally responsible because of an accident arising out of the ownership, maintenance or use of an insured auto.
The policy defined “property damage” as “damage to tangible property including any applicable sales tax and the costs resulting from loss of use of the damaged property.”
Pursuant to Maine’s reach-and-apply statute, NWI filed a claim against Progressive on August 7, 2017, seeking recovery of the $26,540 judgment it had obtained against Muluya. NWI also sought a declaratory judgment that would entitle it to collect on its judgment against Muluya from Progressive.
The parties filed cross-motions for summary judgment in May 2018, along with a joint stipulation of fact. Both parties contended that the “sole legal issue to be decided in the case [was] whether Progressive’s insurance policy covers National Wrecker’s judgment.” The court granted Progressive’s motion for summary judgment and denied NWI’s. NWI appealed.
On appeal, the court noted that the parties did not dispute that the basis for the underlying judgment was Muluya’s liability for payment for the services rendered by NWI. Rather the parties disputed whether property damage to the property owned by the third party was inseparably linked to those services and Muluya’s liability.
Muluya’s policy did cover property damage caused by Muluya’s truck to the third-party owner’s property as a result of the accident. The court observed, however, that Muluya had not been sued by the property owner, nor had Muluya’s responsibility for any property damage ever been otherwise established. The question before the court therefore was whether the underlying judgment obtained by NWI was for damage to the third-party owner’s property.
The court stated that, although the parties stipulated that the trial court entered judgment for NWI and awarded $26,540 in total damages for the services listed on the invoice and the subsequent storage fees, nothing in the record specified the allegations of the underlying complaint or the basis for the award. Nothing established that those services were a direct result of the unidentified third-party owner’s property damage that would be covered under Muluya’s policy.
The court held that Progressive was entitled to judgment as a matter of law because NWI failed to satisfy its burden of showing that the allegations of the underlying judgment established liability for property damage covered by the policy.
The judgment of the trial court was affirmed.
National Wrecker, Inc. v. Progressive Casualty Insurance Company—Supreme Judicial Court of Maine—October 24, 2019—No. Yor-19-63.