Providence Wash. Ins. Co. v. VALLEY FORGE INS.

An insurance company sued other insurance companies to recover contribution on the settlement of third party claims. The third parties had been injured when their rental van's tire blew out, overturning the van on the freeway, and they claimed that the van's owner negligently maintained and rented the van. The van was registered to a sole proprietorship rental agency and had received regular maintenance at service stations owned by the same sole proprietor. Plaintiff insurance company defended the sole proprietor under a business automobile liability policy issued in his rental agency's trade name, and then sued other insurers for contribution. Defendants denied coverage under commercial general liability and garage operations policies issued to the proprietor, doing business as the service stations. On defendants' motion for summary judgment, the trial court found that the underlying bodily injuries arose out of the rental van's use and were therefore excluded from coverage by policy exclusions of damages arising out of the use of autos, or rented autos, owned by the insured. The trial court rejected plaintiff's argument that the van's owner was the…