No. 13-0692 - West Virginia Mutual Insurance Company, Inc. v. Betty J. Adkins, Rayetta D. Baumgardner, Diana L. Boerke, Latha A. Bolen, Charlotte L. Deal, Constance L. DeVore, Teressa D. Hager, Lorenna D. Hankins, Tammy H. Clark, Pamela K. Hatfield, Marcie J. Holton, Linda L. Jones, Patty S. Lewis, Teresa Lovins, Martha J. Martin, Louella Perry, Sherry L. Perry, Janice Pettit, Kimberly A. Roe, Janice Roush, Rebecca Smith, Beulah Stephens, and Debra L. Wise
FILED October 23, 2014
RORY L. PERRY II, CLERK
SUPREME COURT OF APPEALS
OF WEST VIRGINIA
Davis, Chief Justice, dissenting:
Betty J. Adkins, Rayetta D. Baumgardner, Diana L. Boerke, Latha A. Bolen,
Charlotte L. Deal, Constance L. DeVore, Teressa D. Hager, Lorenna D. Hankins, Tammy H.
Clark, Pamela K. Hatfield, Marcie J. Holton, Linda L. Jones, Patty S. Lewis, Teresa Lovins,
Martha J. Martin, Louella Perry, Sherry L. Perry, Janice Pettit, Kimberly A. Roe, Janice
Roush, Rebecca Smith, Beulah Stephens, and Debra L. Wise. Each of these twenty-three
women suffered catastrophic injuries caused by West Virginia Mutual Insurance Company,
Inc.’s (“West Virginia Mutual”), insureds. Each of these women’s lives has been
dramatically and permanently changed by the horrific nature and extraordinary extent of their
injuries. And each of these women signed a global settlement agreement believing that she
would receive her proportionate share of the full policy limits of insurance coverage that had
been purchased specifically to compensate patients for the medical negligence of the
individual doctor and the medical practice responsible for their grievous harm. Despite the
fact that the respondents’ injuries were inflicted during two separate policy periods for which
insurance coverage had been purchased, the majority of this Court, with seeming disregard
for the traumatic nature of the respondents’ injuries, has permitted recovery for only one of
these coverage periods, thereby allowing the respondents to receive only one-half of the
insurance policy proceeds that should be available to them. From this decision, I resolutely
dissent.
For many years, United Health Professionals, Inc. (“UHP”), carried insurance
coverage with shared limits under a claims-made policy. In 2008, UHP changed its coverage
(1) to provide separate coverage limits for itself distinct from the coverage limits applicable
to its individual physicians;1 (2) to render such coverage retroactive to 2002; and (3) to
markedly alter the wording of the operative policy language providing coverage for the
respondents’ claims in the case sub judice. In light of these significant coverage changes,
it is clear that the plaintiffs were entitled to the policy limits that they were awarded by the
Circuit Court of Kanawha County.
As the majority of the Court observed in its opinion, the operative language of
UHP’s insurance policy changed significantly in 2008. Prior to that time, the limit of
insurance portion of the policy stated that “[t]he Limit of Insurance specified in the Policy
1 The policy provision retaining shared coverage for paramedical employees does not apply to the facts of the case sub judice.
Declarations for each insured as the ‘annual aggregate’ is the total limit of our liability for
damages for that insured resulting from any and all medical incident(s) which are first
reported during the policy period.” (Emphasis in original). When the terms of UHP’s
insurance policy were altered in 2008, the pertinent limit of insurance portion of the policy
also was changed to provide that “[t]he limit of insurance specified in the policy
declarations for each insured as the ‘annual aggregate’ is the total limit of the Company’s
liability for damages for that insured resulting from all covered medical incident(s) during
the policy period.” (Bolded emphasis in original; italicized emphasis added). This marked
departure from the policy’s prior language indicates an intention to change the limits of the
coverage in the 2008 insurance policy, as well as the coverage for all subsequent years in
which this language was included in UHP’s policy of insurance. In short, while the prior
version of the subject policy language required medical incidents to have been reported
during the policy period in order to be covered thereunder, the 2010 version of the policy
provides coverage for “all covered medical incident(s) during the policy period.” (Emphasis
added). However, it is unclear from the express wording of this language whether the
referenced covered medical incidents are required to be reported during the policy period to
receive coverage. That requirement, though, is not clearly set forth in the amended language
as it was in the prior version. Alternatively, the subject language could require that the
medical incidents must have been sustained during the policy period to be covered.
Although, this, too, is an unlikely interpretation of the subject language insofar as none of
the injuries suffered by the respondents occurred during the 2010 policy period as interpreted
by the majority’s opinion. Finally, the controverted language could be construed to provide
coverage for medical incidents sustained during a period in which coverage was provided by
the subject policy and its retroactivity provision. This was the construction the circuit court
afforded the policy language when it awarded the respondents the policy coverage limits for
both the 2006 and the 2007 policy periods commensurate with when the insureds’ medical
negligence caused the respondents’ injuries.
Although the parties stipulated, during the circuit court proceedings, that the
terms of the subject policy of insurance are clear and unambiguous, the determination of
whether an insurance policy is ambiguous is a question of law, not of fact, that must be
decided by the presiding tribunal. “The interpretation of an insurance contract, including the
question of whether the contract is ambiguous, is a legal determination that . . . shall be
reviewed de novo on appeal.” Syl. pt. 2, in part, Riffe v. Home Finders Assocs., Inc., 205
W. Va. 216, 517 S.E.2d 313 (1999). See also Syl. pt. 1, in part, Berkeley Cnty. Pub. Serv.
Dist. v. Vitro Corp. of America, 152 W. Va. 252, 162 S.E.2d 189 (1968) (“The question as
to whether a contract is ambiguous is a question of law to be determined by the court.”). This
Court has defined “ambiguous” to mean that “[w]henever the language of an insurance policy
provision is reasonably susceptible of two different meanings or is of such doubtful meaning
that reasonable minds might be uncertain or disagree as to its meaning, it is ambiguous.” Syl.
pt. 1, Prete v. Merchants Prop. Ins. Co. of Indiana, 159 W. Va. 508, 223 S.E.2d 441 (1976).
Accord Syl. pt. 1, Shamblin v. Nationwide Mut. Ins. Co., 175 W. Va. 337, 332 S.E.2d 639
(1985). Given that the subject policy provision is capable of multiple, discordant meanings,
the majority should have determined that it was ambiguous and construed it accordingly.
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No. 13-0692 - West Virginia Mutual Insurance Company, Inc. v. Betty J. Adkins, Rayetta D. Baumgardner, Diana L. Boerke, Latha A. Bolen, Charlotte L. Deal, Constance L. DeVore, Teressa D. Hager, Lorenna D. Hankins, Tammy H. Clark, Pamela K. Hatfield, Marcie J. Holton, Linda L. Jones, Patty S. Lewis, Teresa Lovins, Martha J. Martin, Louella Perry, Sherry L. Perry, Janice Pettit, Kimberly A. Roe, Janice Roush, Rebecca Smith, Beulah Stephens, and Debra L. Wise
FILED October 23, 2014
RORY L. PERRY II, CLERK
SUPREME COURT OF APPEALS
OF WEST VIRGINIA
Davis, Chief Justice, dissenting:
Betty J. Adkins, Rayetta D. Baumgardner, Diana L. Boerke, Latha A. Bolen,
Charlotte L. Deal, Constance L. DeVore, Teressa D. Hager, Lorenna D. Hankins, Tammy H.
Clark, Pamela K. Hatfield, Marcie J. Holton, Linda L. Jones, Patty S. Lewis, Teresa Lovins,
Martha J. Martin, Louella Perry, Sherry L. Perry, Janice Pettit, Kimberly A. Roe, Janice
Roush, Rebecca Smith, Beulah Stephens, and Debra L. Wise. Each of these twenty-three
women suffered catastrophic injuries caused by West Virginia Mutual Insurance Company,
Inc.’s (“West Virginia Mutual”), insureds. Each of these women’s lives has been
dramatically and permanently changed by the horrific nature and extraordinary extent of their
injuries. And each of these women signed a global settlement agreement believing that she
would receive her proportionate share of the full policy limits of insurance coverage that had
been purchased specifically to compensate patients for the medical negligence of the
individual doctor and the medical practice responsible for their grievous harm. Despite the
fact that the respondents’ injuries were inflicted during two separate policy periods for which
insurance coverage had been purchased, the majority of this Court, with seeming disregard
for the traumatic nature of the respondents’ injuries, has permitted recovery for only one of
these coverage periods, thereby allowing the respondents to receive only one-half of the
insurance policy proceeds that should be available to them. From this decision, I resolutely
dissent.
For many years, United Health Professionals, Inc. (“UHP”), carried insurance
coverage with shared limits under a claims-made policy. In 2008, UHP changed its coverage
(1) to provide separate coverage limits for itself distinct from the coverage limits applicable
to its individual physicians;1 (2) to render such coverage retroactive to 2002; and (3) to
markedly alter the wording of the operative policy language providing coverage for the
respondents’ claims in the case sub judice. In light of these significant coverage changes,
it is clear that the plaintiffs were entitled to the policy limits that they were awarded by the
Circuit Court of Kanawha County.
As the majority of the Court observed in its opinion, the operative language of
UHP’s insurance policy changed significantly in 2008. Prior to that time, the limit of
insurance portion of the policy stated that “[t]he Limit of Insurance specified in the Policy
1 The policy provision retaining shared coverage for paramedical employees does not apply to the facts of the case sub judice.
Declarations for each insured as the ‘annual aggregate’ is the total limit of our liability for
damages for that insured resulting from any and all medical incident(s) which are first
reported during the policy period.” (Emphasis in original). When the terms of UHP’s
insurance policy were altered in 2008, the pertinent limit of insurance portion of the policy
also was changed to provide that “[t]he limit of insurance specified in the policy
declarations for each insured as the ‘annual aggregate’ is the total limit of the Company’s
liability for damages for that insured resulting from all covered medical incident(s) during
the policy period.” (Bolded emphasis in original; italicized emphasis added). This marked
departure from the policy’s prior language indicates an intention to change the limits of the
coverage in the 2008 insurance policy, as well as the coverage for all subsequent years in
which this language was included in UHP’s policy of insurance. In short, while the prior
version of the subject policy language required medical incidents to have been reported
during the policy period in order to be covered thereunder, the 2010 version of the policy
provides coverage for “all covered medical incident(s) during the policy period.” (Emphasis
added). However, it is unclear from the express wording of this language whether the
referenced covered medical incidents are required to be reported during the policy period to
receive coverage. That requirement, though, is not clearly set forth in the amended language
as it was in the prior version. Alternatively, the subject language could require that the
medical incidents must have been sustained during the policy period to be covered.
Although, this, too, is an unlikely interpretation of the subject language insofar as none of
the injuries suffered by the respondents occurred during the 2010 policy period as interpreted
by the majority’s opinion. Finally, the controverted language could be construed to provide
coverage for medical incidents sustained during a period in which coverage was provided by
the subject policy and its retroactivity provision. This was the construction the circuit court
afforded the policy language when it awarded the respondents the policy coverage limits for
both the 2006 and the 2007 policy periods commensurate with when the insureds’ medical
negligence caused the respondents’ injuries.
Although the parties stipulated, during the circuit court proceedings, that the
terms of the subject policy of insurance are clear and unambiguous, the determination of
whether an insurance policy is ambiguous is a question of law, not of fact, that must be
decided by the presiding tribunal. “The interpretation of an insurance contract, including the
question of whether the contract is ambiguous, is a legal determination that . . . shall be
reviewed de novo on appeal.” Syl. pt. 2, in part, Riffe v. Home Finders Assocs., Inc., 205
W. Va. 216, 517 S.E.2d 313 (1999). See also Syl. pt. 1, in part, Berkeley Cnty. Pub. Serv.
Dist. v. Vitro Corp. of America, 152 W. Va. 252, 162 S.E.2d 189 (1968) (“The question as
to whether a contract is ambiguous is a question of law to be determined by the court.”). This
Court has defined “ambiguous” to mean that “[w]henever the language of an insurance policy
provision is reasonably susceptible of two different meanings or is of such doubtful meaning
that reasonable minds might be uncertain or disagree as to its meaning, it is ambiguous.” Syl.
pt. 1, Prete v. Merchants Prop. Ins. Co. of Indiana, 159 W. Va. 508, 223 S.E.2d 441 (1976).
Accord Syl. pt. 1, Shamblin v. Nationwide Mut. Ins. Co., 175 W. Va. 337, 332 S.E.2d 639
(1985). Given that the subject policy provision is capable of multiple, discordant meanings,
the majority should have determined that it was ambiguous and construed it accordingly.
In this vein, the Court previously has held that “[i]t is well settled law in West
Virginia that ambiguous terms in insurance contracts are to be strictly construed against the
insurance company and in favor of the insured.” Syl. pt. 4, National Mut. Ins. Co. v.
McMahon & Sons, Inc., 177 W. Va. 734, 356 S.E.2d 488 (1987), overruled on other grounds
by Potesta v. United States Fid. & Guar. Co., 202 W. Va. 308, 504 S.E.2d 135 (1998). In
other words, “[w]here a provision of an insurance policy is ambiguous, it is construed against
the drafter, especially when dealing with exceptions and words of limitation.” Payne v.
Weston, 195 W. Va. 502, 507, 466 S.E.2d 161, 166 (1995) (citing Syl. pt. 1, West Virginia
Ins. Co. v. Lambert, 193 W. Va. 681, 458 S.E.2d 774 (1995)). Moreover, while
“‘[a]mbiguous . . . provisions of an insurance policy should be construed strictly against the
insurer and liberally in favor of the insured, . . . such construction should not be unreasonably
applied to contravene the object and plain intent of the parties.’ Syllabus Point 2[, in part],
Marson Coal Co.[, Inc.] v. Insurance Co. of State of Pennsylvania, 158 W. Va. 146, 210
S.E.2d 747 (1974).” Syl. pt. 6, Hamric v. Doe, 201 W. Va. 615, 499 S.E.2d 619 (1997).
In this case, the majority should have appreciated the inherent ambiguity in the
language resulting from the 2008 policy amendments and included within the subject 2010
policy. Given that ambiguous policy provisions are to be construed against the insurance
company drafting such language, the majority correspondingly should have adopted the
construction most favorable to the insured, which is the interpretation adopted by the circuit
court to find coverage is available to compensate the respondents under both the 2006 and
2007 policies insofar as their injuries were sustained in 2006 and 2007. To interpret the
subject policy language in the manner advocated by the majority does nothing to clarify this
controverted language and fails to hold West Virginia Mutual accountable for the ambiguity
it created in UHP’s insurance policy.
Relieving the insurer in this case of its duty to provide coverage for the injuries
of the respondents, particularly when such a result is compelled by the ambiguous policy
provision that it drafted and incorporated into a policy of insurance that it sold, produces a
“result [that] is not fair, and it is not the right thing to do.” Manville Pers. Injury Settlement
Trust v. Blankenship, 231 W. Va. 637, 650, 749 S.E.2d 329, 642 (2013) (Davis, J.,
dissenting). The twenty-three women seeking a recovery in this case are not acting out of
greed or avarice, and they did not cause the injuries for which they seek to be compensated.
These ladies are simply trying to gain some measure of recompense for the tragically
disfiguring and humiliating injuries they sustained when they sought treatment for a serious
medical condition and became the unfortunate victims of severe medical negligence.
Accordingly, Betty J. Adkins, Rayetta D. Baumgardner, Diana L. Boerke, Latha A. Bolen,
Charlotte L. Deal, Constance L. DeVore, Teressa D. Hager, Lorenna D. Hankins, Tammy H.
Clark, Pamela K. Hatfield, Marcie J. Holton, Linda L. Jones, Patty S. Lewis, Teresa Lovins,
Martha J. Martin, Louella Perry, Sherry L. Perry, Janice Pettit, Kimberly A. Roe, Janice
Roush, Rebecca Smith, Beulah Stephens, and Debra L. Wise deserve to receive the full
amount of insurance policy limits that provide coverage for their injuries. UHP purchased
insurance specifically to compensate victims of medical negligence caused by its physicians,
and West Virginia Mutual wrote UHP’s policy for this express purpose. Because the
respondents’ injuries span two different policy periods, i.e., 2006 and 2007, and because the
policy’s revisions provide retroactive coverage therefor, the respondents should have been
permitted to recover the full amount of available coverage limits. From the majority’s
contrary conclusion, I respectfully dissent.