Sam Galati v. New Amsterdam Casualty

From a judgment on an automobile collision policy in favor of the insured, the insurer appeals. The pertinent facts, all of
which are stipulated or established by uncontradicted evidence to which no objection was made, are as follows: Sam Galati, the plaintiff, leased a Chevrolet automobile from Manchester Lend-Lease Company on August 1, 1957, for a term
of two years under a written contract providing for monthly rental payments of $75 each during the term of the lease. Title
to the vehicle remained vested in the lessor. The contract, which has been lost and is not before us for examination, admittedly
contained a provision allowing Sam to purchase the car at any time during the life of the lease at a figure to be computed
by some no-longer-remembered formula whereby a portion of the rental payments was credited on the purchase price. At the time
the lease was entered into Sam was required to obtain, and did obtain from appellant, a policy of collision insurance on the
car payable to himself and Manchester Lend-Lease Company as their interests might appear. That policy was in force at all
times herein mentioned.The specific provision of it with which we are concerned is denominated Exclusion (1). It recites that
the coverage should not apply "* * * if the automobile is or at any time becomes subject to any bailment lease, conditional
sale, purchase agreement, mortgage or other encumbrance not specifically declared and described in this policy."