
USCA1 Opinion

	




       [NOT FOR PUBLICATION   NOT TO BE CITED AS PRECEDENT]                 United States Court of Appeals                     For the First CircuitNo. 98-1451                   PEERLESS INSURANCE COMPANY,                       Plaintiff, Appellee,                                v.            ANNIE'S, INC., GARY C. KRYSTA, ANN KRYSTA                        and DAVID RIVERA,                     Defendants, Appellants.           APPEAL FROM THE UNITED STATES DISTRICT COURT                 FOR THE DISTRICT OF RHODE ISLAND             [Hon. Mary M. Lisi, U.S. District Judge]                              Before                      Selya, Circuit Judge,                                           Aldrich and Coffin, Senior Circuit Judges.                                                                     Jeffrey S. Michaelson with whom Michaelson, Michaelson &Zurier, Thomas R. Bender and Hanson, Curran, Parks & Whitman wereon brief for appellant.     Gerald C. DeMaria with whom Stephen B. Lang, Patrick B.Landers and Higgins, Cavanagh & Cooney were on brief for appellee.December 1, 1998                                            Per Curiam.  In this case Annie's, Inc., a small dry    cleaning business, obtained a so-called Business Protector    Policy from Peerless Insurance Company (Peerless).  In June of    1994, while the policy was in effect, Derek Gagnon, an Annie's    employee, was driving a step-van on Annie's business when he    collided with another vehicle.  David Rivera, a pedestrian,    was injured as a result of the collision and sued Annie's.     Gary Krysta, an owner and employee of Annie's, owned the van,    but Annie's used, maintained, and stored the van and paid the    expenses of keeping it on the road.  Krysta had acted on    behalf of Annie's when he instructed Gagnon to drive the van    on Annie's pickup route.               Naming Annie's, Krysta, and Gagnon as defendants,Peerless sought a declaratory judgment that it owed no duty to    defend or indemnify Annie's for claims arising out of the    collision.  The district court ruled in its favor, and we    affirm.              The court's rulings related to two parts of the    policy:  the general liability provisions as diminished by an    exclusion clause, and an endorsement providing special    additional coverage.  As to the first, the district court, in    an extensive memorandum, addressed defendants' contention that    a provision excluding from coverage bodily injury and property    damage arising out of the entrustment of an auto to others did    not apply when the injury or damage was due to the negligent    selection, training, or supervision of the driver.  The    exclusion clause makes no such exception.  The district    court's memorandum fully demonstrated the unsoundness of    defendants' contention.              The court's ruling on the second claim was equally    correct, but might be supplemented.  The endorsement provided    coverage for damage caused by use, in the insured's business,    of a "non-owned auto," which it defined as an auto not owned,    leased, hired, or borrowed by the insured.  Defendants'    contention that Gagnon, rather than Annie's, was the borrower    is totally unrealistic.  Annie's maintained and stored  the    van and controlled its use.  Gagnon had no control other than    to do what Krysta, as Annie's agent, instructed him.  Clearly    Gagnon was not the borrower.  Any claim of ambiguity, whether    in the policy or in the circumstances, is untenable.              Even more unpersuasive is defendants' claim that    Peerless' construction makes the endorsement meaningless.  Use    of an employee's personal car might at least raise a duty to    defend.  How much coverage does an insured expect if it    chooses an endorsement with a $41 annual premium?              Affirmed.    
