Marian G. Gilpin v. Northwestern Security Insurance Company

We seek to determine the coverage provided by an automobile liability insurance policy issued in the State of Arizona. There is no dispute as to the facts. Culiver Motor Company owned a 1967 Rambler automobile which it leased to Lyle-O’Keefe Adjustment Company (O’Keefe). O’Keefe was insured by Tri-State Insurance Company (TriState). O’Keefe furnished the Rambler for the regular use of its employee, Gil-pin. (George Gilpin died while this appeal was pending and Marian G. Gilpin was substituted as appellee. The references in this opinion to Gilpin are to George Gilpin.) Gilpin’s personal automobile, a Chrysler, was insured by Northwestern Security Insurance Company (Northwestern). Gilpin, while driving the Rambler, had an accident, was sued and became a judgment debtor. He contributed $15,000.00 to the settlement of the judgment and by this action sought to recover the $15,000.00 from Northwestern, which had at all times denied liability.

The only problem presented by the appeal is whether the district court was correct in concluding that by virtue of Arizona law the policy in question, notwithstanding the limitations expressed in it, provided a full coverage.

Arizona has a…