Remspecher v. Jacobi

941 S.W.2d 701, 1997 Mo. App. LEXIS 289, 1997 WL 90838

• Court: Missouri Court of Appeals
• Decided: February 25, 1997
• Docket: No. 70302
• Status: Published

Opinions

CRANE, Presiding Judge.

Defendant, Connie Rae Jacobi, negligently drove her automobile over the center line of a road and collided with an automobile driven by plaintiffs wife. Plaintiffs wife suffered extensive physical injuries. Plaintiff, Edgar Remspeeher, and his wife filed an action against Jacobi, the operator of the insured automobile, and her insurer, defendant SEC-URA Insurance (SECURA). The parties entered into a consent judgment pursuant to § 537.065 RSMo in which plaintiffs wife was awarded $1,500,000.00 on her negligence claim and plaintiff was awarded $500,000.00 on his loss of consortium claim.

Jacobi was an insured under an insurance policy issued by SECURA to Jacobi’s parents on three motor vehicles. The policy had limits of liability coverage of $100,000.00 for each person and $300,000.00 for each occurrence. The Limits of Liability clause provides:

The Limits of Liability shown in the Declarations apply subject to the following:

1. The bodily injury liability limit for “each person” is the maximum payable for all damages, whether to the injured person or others, because of bodily injury sustained by one person in any one occurrence.

SECURA paid $100,000.00 into the court for the single limit of liability under its policy and denied any coverage beyond its single limit coverage of $100,000.00.

Plaintiff and his wife¹ filed a declaratory judgment action requesting that the trial court determine whether the language of the SECURA policy afforded a separate limit of liability for plaintiffs loss of consortium claim or whether that claim was included in the total damages arising out of the accident and subject to the single limit of $100,000.00. The case was submitted to the trial court upon a stipulation of facts. The trial court entered judgment in SECURA’s favor and declared that SECURA had no liability under the terms of its policy for any sum in addition to the $100,000.00 already paid into court. Plaintiff appeals. We affirm.

On appeal plaintiff argues that the language in the limitations of liability clause in SECURA’s policy is ambiguous because the language does not distinguish whether the word “sustained” applies to “all damages” or “bodily injury” and the ambiguity must be construed against the insurer so that plaintiffs loss of consortium claim would be treated as a separate injury entitled to a separate limitation of liability- We disagree that the language is ambiguous.

An insurance company may include a derivative claim in the single limits or treat the derivative claim as a separate injury entitled to separate limits by the language of its policy. Anderson v. St. Paul Mercury Ins. Co., 792 S.W.2d 440, 441 (Mo.App.1990). Under policies fixing a maximum recovery for “bodily injury” to one person, courts hold that the limitation is applicable to all claims of damage flowing from such bodily injury; therefore, it is immaterial that some part of the damages may be claimed by a person other than the one suffering the bodily injuries. Id. All damage claims, direct and consequential, resulting from injury to one person, are subject to the limitation. Id. (citing Annotation, Construction and Application of Provision in Liability Policy Limiting the Amount of Insurer’s Liability to One Person, 13 ALR3d 1228, 1234 (1967) and United States Fidelity & Guar. Co. v. Safeco Ins. Co. of Am., 522 S.W.2d 809, 821, n. 6 (Mo. banc 1975)). Alternatively, under policies where the limitations on recovery are written in terms of maximum recovery for “personal injury” or “damages” to one person, rather than “bodily injury,” courts have held that liability for consequential damages suffered by one other than the person physically injured might be treated as a separate claim for purposes of applying the limitation provision, so there could be recovery for the consequential damages notwithstanding payment of the maximum for the direct injury. Id. (citing 13 ALR3d at 1244). See also Annotation, Consortium Claim of Spouse, Parent or Child of Accident Victim as Within Extended “Per Accident” Coverage Rather Than “Per Person” Coverage of Automobile Liability Policy, 46 A.L.R.4th 735 (1986).

The issue on appeal is whether the limitation of liability clause unambiguously includes plaintiffs derivative claim in the single limits, or if the clause is ambiguous and therefore may be construed to treat plaintiffs derivative claim as a separate injury entitled to separate limits. Whether a policy is ambiguous is a question of law. General American Life Ins. Co. v. Barrett, 847 S.W.2d 125, 131 (Mo.App.1993). An ambiguity exists when there is duplicity, indistinctness, or uncertainty in the meaning of the language in the policy. Krombach v. Mayflower Ins. Co., Ltd., 827 S.W.2d 208, 210 (Mo. banc 1992). Language is ambiguous if it is reasonably open to different constructions. Id.

Plaintiff relies on Cano v. Travelers Ins., 656 S.W.2d 266 (Mo. banc 1983) to support his argument that the limit of liability clause in the SECURA policy is ambiguous and therefore may be construed to allow a separate limitation of liability for each person damaged. In Cano the supreme court found the following provision ambiguous:

The limit of liability stated in the declarations is applicable to “each person” is the limit of The Travelers’ liability for all damages because of bodily injury sustained by one person as a result of any one accident. ...

The court held the phrase “all damages because of bodily injury sustained” was ambiguous because “sustained” could be read to modify either “damages” or “bodily” injury. The court did not find it compelling that “sustained” was closer to “bodily injury” than to “damages.” Because it decided that “sustained” could refer to “damages,” it held the policy was ambiguous and allowed wife to recover under a separate limitation.

The court of appeals has applied Cano to similarly constructed clauses. In Spaete v. Auto. Club Inter-Ins. Exchange, 736 S.W.2d 480 (Mo.App.1987), we followed Cano and found the phrase “all damages for bodily injury sustained by any one person” to be ambiguous. The Western District found the identical clause to be ambiguous in Anderson v. St. Paul Mercury Ins. Co., 792 S.W.2d 440, 441 (Mo.App.1990). In Oliver v. Cameron Mut. Ins. Co., 866 S.W.2d 865, 870 (Mo.App.1993), we found a different construction ambiguous, again relying on Cano:

The limit of bodily injury liability stated in the declarations as applicable to ‘each person’ is the limit of the company’s liability for all damages, including damages for care and loss of services, arising out of bodily injury, sickness or disease, including death at any time resulting therefrom, sustained by one person as the result of any one accident.

However, the supreme court and court of appeals have not found the same ambiguity in other limit of liability clauses. In Fidelity, 522 S.W.2d at 821 n. 6, the supreme court analyzed policy language that provided:

[T]he limit of bodily injury liability ... as applicable to ‘each person’ is the limit of the insurer’s liability for all damages, including damages for loss of services, arising out of bodily injury sustained by one person.

In holding this language to be unambiguous, the court found that this language directed that the limitation was applicable to all claims of damage flowing from such bodily injury, and therefore it was immaterial that some part of the damage may be claimed by some person other than the one claiming the bodily injury. Id. The court determined that from the language used, all damage claims, direct and consequential, resulting from injury to one person were subject to the limitation. Id.

In its motion for rehearing in Cano, insurer argued that Cano was contrary to Fidelity. In denying the motion the supreme court stated that Cano and Fidelity did not involve essentially the same language. “The language in Fidelity refers expressly to ‘damages for loss of services.’ The policy there invoked states explicitly something the policy before us lacks.” Cano, 656 S.W.2d at 272.

In Peters v. Farmers Ins. Co., Inc., 726 S.W.2d 749 (Mo. banc 1987), the supreme court found the following limitation clause in a Farmers policy to be unambiguous:

To pay all sums which the owner or operator of an uninsured motor vehicle would be legally responsible to pay as damages to the insured because of bodily injury sustained by the insured ...

The court distinguished this language from that in Cano on the grounds that the Farmers policy did not present the problem of nouns and modifiers which led the court to hold the provision in Cano ambiguous.

In Lair v. American Family Mut. Ins. Co., 789 S.W.2d 30, 34 (Mo. banc 1990), the supreme court explained that the ambiguity in the language in Cano resulted because the grammatical arrangement of the sentence allowed the participle “sustained” to modify either the phrase “all damages” (thus applying to bodily and non-bodily injuries) or the phrase “bodily injuries” (in which case non-bodily injuries would be excluded).

The Western District found the following limitation clause to be unambiguous in Killpack v. Farm Bureau Ins. Co., 861 S.W.2d 608, 613 (Mo.App.1993):

The limit of liability as applicable to each person is the maximum limits of the Company’s liability for all damages, including damages for care or loss of service or consortium, because of bodily injuries sustained by one person as a result of any one accident.

The court, relying on Fidelity, which construed a nearly identical clause, found that the parenthetical phrase indicating that damages included damages for loss of consortium was unambiguous in limiting ail claims, direct or consequential, to the policy limit for one person.

In State Farm v. Chambers, 860 S.W.2d 19, 20-21 (Mo.App.1993), the Southern District found the following language unambiguous:

Under “Each Person” is the amount of coverage for all damages, including damages for care and loss of services, arising out of and due to bodily injury to one person.

The court first looked at the arrangement of words within the sentence. It found the phrase “to one person” followed “bodily injury” indicating the phrase was to modify “bodily injury.” It held that the punctuation of the sentence also made the meaning clear. Because the phrase “including damages for care and loss of services” was set off by commas, it functioned to explain the term “all damages.” The court determined that for the prepositional phrase “to one person” to refer to “all damages,” then the phrase “arising out of and due to bodily injury” likewise would have to be set off by commas. Because there was no comma after “injury,” the court found it apparent that “arising out of and due to bodily injury to one person” was to be treated as a unit which modifies “all damages.” The court found that the syntax and punctuation of the definitional sentence resolved the issue and there was no ambiguity. Id. at 21.

The Chambers opinion distinguished Cano on several grounds. First, in Cano the court held there was an ambiguity because the policy phrase “sustained by one person” could modify “damages” or “bodily injury.” However, in the policy considered by Chambers, punctuation prevented the phrase “to one person” from modifying “damages.” Id. In Chambers, unlike Cano, the policy specifically identifies “damages for care and loss of services” as included in “all damages.” Id. This language was similar in syntax and punctuation to the language under consideration in Fidelity and distinguished by Cano. Id.

In Fildes v. State Farm Mut. Auto. Ins. Co., 873 S.W.2d 883 (Mo.App.1994), we followed Chambers in finding the following language to be unambiguous:

Under “Each Person” is the amount of coverage for all damages, including damages for care and loss of services, arising out of and due to bodily injury to one person.

We based our analysis on the inclusion of the clause, “including damages for care and loss of services,” which modified the word “damages”:

In Cano, a case involving loss of consortium damages, the Supreme Court stated including the phrase “damages for loss of services” would have clarified any ambiguity. Cano, 656 S.W.2d at 271-72. In reaching that conclusion, the Court distinguished the Cano policy from one upheld in United States Fidelity & G. Co. v. Safeco Ins. Co. of Am., 522 S.W.2d 809 (Mo. banc 1975). That policy defined the “each person” limit of liability as the limit “for all damages, including damages for loss of services, arising out of bodily injury sustained by one person.” Safeco, 522 S.W.2d at 821 n. 6. The Cano court also referenced the language in Hines v. Government Employees Ins. Co., 656 S.W.2d 262 (Mo. banc 1983), as a model of clarity. Cano, 656 S.W.2d at 272. The policy in Hines limited liability to “each person” as “all damages, including damages for care or loss of services, because of bodily injury sustained by one person....” Hines, 656 S.W.2d at 264. By distinguishing these cases, the Cano court indicated such language would not be ambiguous when referring to loss of consortium damages.

Fildes, 873 S.W.2d at 885-86.

Neither the policy in Chambers nor in Fildes uses the word “sustained.” But neither opinion treats that omission as significant. Both opinions treat the word “to” as equivalent to “sustained by” and analyze the phrase “to one person” in the same way as if the phrase had been “sustained by one person.”

No Missouri cases have been brought to our attention which construe the identical language used in the SECURA policy. In Cano, Spaete, Anderson, and Oliver the policy provisions were phrased in such a way that the word “sustained,” although next to the word “injury,” could arguably modify the word “damages.” In Cano, Spaete, and Anderson, no commas separated the intervening words or broke up the modifying phrases. In Oliver commas set off modifying phrases after the word “damages” and before the word “sustained” so that “sustained” could arguably modify “damages” rather than “bodily injury” which was also set off by commas.²

If we address the ambiguity issue in terms of the placement of words and punctuation, the Chambers analysis guides us to a finding that “sustained” in the SECURA policy modifies only the term “bodily injury” and not the word “damages.” Similar to Chambers, the phrase, “whether to the injured person or others,” is set off by commas and functions to explain the term “all damages.” For the phrase “sustained by one person” to refer to “all damages,” the phrase “because of bodily injury” likewise would have to be set off by commas (as was the case in Oliver). Because there is no comma after “injury,” we find it apparent that the whole phrase “because of bodily injury sustained by one person” is to be treated as one unit which modifies “all damages.” Accordingly, the syntax and punctuation do not create an ambiguity.

Further, if we consider the policy language in terms of context, as the courts did in Fidelity, Killpack, and Fildes, we find no ambiguity. In the SECURA policy the word “damages” is followed by a parenthetical clause which specifies that “damages” includes both the injured person’s damages and other persons’ damages. This definition of “damages” thereby excludes an interpretation that damages could also be modified by the phrase “sustained by one person” so as to create separate coverage for each person sustaining damage. Where one person, such as plaintiffs wife, suffers bodily injury for which she and others may claim various types of damages, SE CURA’s policy uses the phrase “whether to the injured person or others,” thereby indicating all derivative claims are subject to the one person limit.

The policy limitation clause is not reasonably open to different constructions. The only meaning which can be given the clause in the SECURA policy is that one limit will be paid for all damage, whether that damage is to the injured person (plaintiffs wife) or others (plaintiff), if it arises out of the bodily injury sustained by one person (plaintiffs wife). The policy limitation clause unambiguously includes plaintiffs loss of consortium claim in the total damages arising out of plaintiffs wife’s bodily injury. The total damages are subject to one $100,000.00 limit.

The judgment of the trial court is affirmed.

GERALD M. SMITH, J., concurs. PUDLOWSKI, J., dissents and submits a dissenting opinion.

1 . Plaintiff's wife’s claim was subsequently dismissed without prejudice.

2 . However, in Eaves v. Boswell, 852 S.W.2d 353, 354 (Mo.App.1993), the Southern District, after reviewing Fidelity, Cano, Peters, and Lair, found policy language virtually identical to Oliver not ambiguous. In Eaves, the relevant policy language provided as follows:

The bodily injury liability limit for each person is the maximum for all damages, including damages for care and loss of services arising out of bodily injury, sickness or disease, including death, suffered by any one person in any one accident.

Id.