Copyright 1997 - N.C. Administrative Office of the Courts


         Appeal by plaintiff from order entered 16 October 1995 by Judge E. Lynn Johnson in Moore County Superior Court. Heard in the Court of Appeals 1 April 1997.

    Brown & Robbins, L.L.P., by P. Wayne Robbins and Carol M. White, for plaintiff-appellant.

    Kitchin, Neal, Webb & Futrell, P.A., by Stephan R. Futrell, for defendant-appellee.

    WYNN, Judge.

    Andrew T. Hartsell leased a 1992 Honda Accord through Wachovia Auto Leasing Company ("Wachovia") in October 1991, for a period of forty-eight months. He purchased insurance for the vehicle from Integon Indemnity Corporation ("Integon").

    In March 1992, Mr. Hartsell reported that the Honda had been stolen. The next day, the Moore County Sheriff's Department found the vehicle totally destroyed by fire. Mr. Hartsell reported the theft and fire to Integon; but nonetheless, he continued to make the lease payments to Wachovia throughout the term of the lease.

    In May 1992, Mr. Hartsell sued Integon seeking insurance proceeds for the value of the car and his personal property in the car. The trial court dismissed Mr. Hartsell's claim for the value of the car stating: "[Integon] has paid the 'actual cash value' of the insured vehicle to the named Loss Payee, Wachovia Auto Leasing, and therefore, [Mr. Hartsell] has no ownership interest, direct or indirect, in the vehicle at issue." Subsequently, Mr. Hartsell voluntarily dismissed his personal property claim and appealed from the trial court's dismissal of his claim for the value of the car.

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    The issue on appeal is whether the trial court erred by dismissing Mr. Hartsell's claim for the value of the car because for purposes of insurance coverage, he had no "ownership interest" in the burned vehicle. Mr. Hartsell does not dispute that Wachovia holds title to the Honda; rather he contends that the following language in his insurance policy allows him to claim insurance benefits as an owner of the leased vehicle:

    For purposes of this policy, a private passenger type auto shall be deemed to be owned by a person if leased:

             I note that the majority assumes the plaintiff "has an ownership interest in the vehicle." Such an assumption is not necessary to my resolution of this case as I believe the plaintiff did have an insurable interest within the meaning of the policy of insurance. At the time of the loss, the plaintiff had a leasehold interest (under the terms of the lease) (with some 42 months remaining on the lease) and an ownership interest (under the terms of the policy) in the vehicle. The policy specifically provides that a vehicle leased for "a continuous period of at least 6 months" is "owned" within the meaning of the policy. In this case, the plaintiff had a forty-eight month lease on the vehicle, well in excess of the six month policy provision.

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