Wendy Setters individually and as the parent of minors Melanie Ann Setters and Nicole Krystal Setters v. Permanent General Assurance Corporation

Court of Appeals of Tennessee

Wendy Setters individually and as the parent of minors Melanie Ann Setters and Nicole Krystal Setters v. Permanent General Assurance Corporation

DecidedOctober 10, 1996

Docket03A01-9605-CV-00161

StatusPublished

This text of Wendy Setters individually and as the parent of minors Melanie Ann Setters and Nicole Krystal Setters v. Permanent General Assurance Corporation (Wendy Setters individually and as the parent of minors Melanie Ann Setters and Nicole Krystal Setters v. Permanent General Assurance Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals of Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Wendy Setters individually and as the parent of minors Melanie Ann Setters and Nicole Krystal Setters v. Permanent General Assurance Corporation, (Tenn. Ct. App. 1996).

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Opinion

I N THE COURT OF APPEALS OF TENNESSEE

W ENDY SETTERS, i ndi vi dua l l y a nd ) C/ A NO. 03A01- 9605- CV- 00161 a s t h e pa r e nt o f t he mi nor s , ) M M NN COUNTY CI RCUI T COURT c I M l a ni e Ann Se t t e r s a nd e ) Ni c o l e Kr ys t a l Se t t e r s , )

Pl a i nt i f f - Appe l l a nt , ) ) ) FILED ) October 1, 1996 ) v. ) Cecil Crowson, Jr. ) Appellate C ourt Clerk ) ) PERMANENT GENERAL ASSURANCE ) CORPORATI ON, ) ) De f e nda nt - Appe l l e e , ) ) a nd ) ) ) W LLI AM B. SETTERS, I ) ) HONORABLE J OHN B. HAGLER, J R. , De f e nda nt . ) J UDGE

Fo r Ap p e l l a nt For Appe l l e e

E. L. PARKER, I I I J ERRY M M . ARTI N Et o wa h , Te nne s s e e Knoxvi l l e , Te nne s s e e

OPINION

AFFI RMED AND REMANDED Sus a no, J .

1 Thi s i s a de c l a r a t or y j udgme nt a c t i on. I n t he

c omp l a i nt , W ndy Se t t e r s ( M s . Se t t e r s ) s e e ks a de c l a r a t i on t h a t e r

a n e x c l us i on i n he r a ut omo bi l e i ns ur a nc e pol i c y i s i nva l i d a s

a g a i ns t publ i c p ol i c y; a nd, a l t e r na t i ve l y, t h a t t he e xc l us i on,

d u e t o a n a mbi gui t y i n t he i ns ur a nc e pol i c y, i s une nf or c e a bl e

a g a i n s t he r . The s ubj e c t pr ovi s i on e xc l ude s t he e xt e ns i on of

l i a b i l i t y c ove r a ge t o a n i ns ur e d whe n t ha t pe r s on’ s ne gl i ge nc e

c a u s e s i nj ur y t o a f a mi l y me mbe r . Re l yi ng on t hi s e xc l us i on, t h e

d e f e nd a nt , Pe r ma ne nt Ge ne r a l As s ur a nc e Cor por a t i on ( Pe r ma ne nt

Ge ne r a l ) , d e ni e d c ove r a ge wi t h r e s pe c t t o c l a i ms a s s e r t e d by M s . r

Se t t e r s i ndi vi dua l l y a nd on be ha l f of he r c hi l dr e n a r i s i ng s ol e l y

o u t o f i nj ur i e s s us t a i ne d by t he c hi l dr e n i n a n a ut omobi l e

a c c i d e nt . The a c c i de nt wa s c a us e d, i n pa r t , by t he ne gl i ge nt

d r i v i n g of he r hus ba nd. The t r i a l c our t gr a nt e d Pe r ma ne nt

Ge n e r a l ’ s mot i on f or j udgme nt on t he pl e a di ngs , f i ndi ng t he

e x c l u s i on t o be “ va l i d, e nf or c e a bl e a nd not vi ol a t i ve of t he

p u b l i c pol i c y” of Te nne s s e e . Pl a i nt i f f a ppe a l s , r a i s i ng t wo

i s s u e s t ha t pr e s e nt t he f ol l owi ng que s t i ons :

1. I s a pr ovi s i on i n a n a ut omobi l e i ns ur a nc e pol i c y e xc l udi ng c ove r a ge f or l i a bi l i t y t o a “ f a mi l y me mbe r ” vi ol a t i ve of t he publ i c pol i c y of Te nne s s e e ?

2. I s t he l i a bi l i t y c ove r a ge i n t he s ubj e c t pol i c y a mbi guous s o a s t o wa r r a nt a s t r i c t c ons t r uc t i on a ga i ns t Pe r ma ne nt Ge ne r a l ?

2 I

Our r e vi e w i n t hi s c a s e i s gove r ne d by we l l - e s t a bl i s h e d

r ul e s :

[ W e a r e bound t o t r e a t a s f a l s e a l l ] a l l e ga t i ons of . . . t he movi ng pa r t y, whi c h a r e de ni e d, a nd a s t r ue a l l we l l - pl e a de d a l l e ga t i ons c ont a i ne d i n t he pl e a di ngs of . . . t he oppone n t of t he mot i on. Se e Tr i gg v . M ddl e Te nn. El e c . M mbe r s hi p Cor p. , 533 i e S. W 2d 730, 732- 33 ( Te nn. App. 1975) . . In ot he r wor ds , on a n a ppe a l f r om a n or de r a l l owi ng a j udgme nt on t he pl e a di ngs . . . a l l we l l - pl e a de d f a c t s a nd a l l r e a s ona bl e i nf e r e nc e s d r a wn t he r e f r om mus t be a c c e pt e d a s t r ue . Tr i gg a t 733 ( c i t i ng Dar wi n v . Town of Cooke v i l l e , 170 Te nn. 508, 97 S. W 2d 838 . ( 1936) ; Rodge r s v . Rodge r s , 53 Te nn. 489 ( 1871) ) . Conc l us i ons of l a w a r e not a dmi t t e d nor s houl d j udgme nt on t he pl e a di ngs be gr a nt e d unl e s s t he movi ng pa r t y i s c l e a r l y e nt i t l e d t o j udgme nt . Tr i gg a t 733.

M Cl e na han v . Cool e y , 806 S. W 2d 767, 769 ( Te nn. 1991) . c . Thus , i n

t h e i n s t a nt c a s e we a c c e pt a s t r ue a l l we l l - pl e a de d f a c t s i n t h e

c o mp l a i nt . W mus t t he n de t e r mi ne whe t he r , on t he f a c e of t ha t e

p l e a d i ng, t h e p l a i nt i f f i s e nt i t l e d t o move f or wa r d. Aga i ns t

t h i s b a c kgr ound, we be gi n our a na l ys i s .

II

Pe r ma ne nt Ge ne r a l i s s ue d t o M s . Se t t e r s a nd he r r

h u s b a n d , W l l i a m Se t t e r s , a n a ut omobi l e i ns ur a nc e pol i c y. i The

p o l i c y i nc l ude s l i a bi l i t y i ns ur a nc e c ove r a ge f or “ ‘ bodi l y i nj ur y ’

3 o r ‘ p r o pe r t y da ma ge ’ f or whi c h a ny ‘ i ns ur e d’ be c ome s l e ga l l y

r e s p o n s i bl e . ” The pol i c y de f i ne s “ i ns ur e d” i n pa r t a s “ you or

a n y ‘ f a mi l y me mbe r . ’ ” I t f ur t he r pr ovi de s t ha t Pe r ma ne nt Ge ne r a l

h a s “ n o dut y t o de f e nd a ny s ui t or s e t t l e a ny c l a i m f or ‘ bodi l y

i n j u r y ’ or ‘ pr ope r t y da ma ge ’ not c ove r e d unde r t hi s pol i c y. ” Th e

p o l i c y c ont a i ns a numbe r of e xc l us i ons . One of t he s e e xc l us i on s

i s s t a t e d a s f ol l ows :

A. W do not pr ovi de Li a bi l i t y Cove r a ge e f or a ny pe r s on:

* * *

10. For bodi l y i nj ur y t o you or a ny “ f a mi l y me mbe r . ”

Th e t e r m “ f a mi l y me mbe r ” i s de f i ne d i n t he pol i c y a s

a pe r s on r e l a t e d t o you by bl ood, ma r r i a ge or a dopt i on who i s a r e s i de nt of your hous e hol d. Thi s i nc l ude s a wa r d or f os t e r c hi l d.

Soon a f t e r t he pol i c y we nt i nt o e f f e c t , M . Se t t e r s wa s r

d r i v i n g a n a ut omobi l e whe n he wa s i nvol ve d i n a c ol l i s i on wi t h

a no t h e r ve hi c l e . The a c c i de nt wa s c a us e d, a t l e a s t i n pa r t , b y

h i s n e g l i ge nc e . The Se t t e r s ’ mi nor c hi l dr e n, M l a ni e Ann Se t t e r s e

a nd Ni c ol e Kr ys t a l Se t t e r s , we r e pa s s e nge r s i n M . Se t t e r s ’ c a r r

a n d we r e i nj ur e d i n t he a c c i de nt . M s . Se t t e r s s ubs e que nt l y ma d e r

d e ma n d upon Pe r ma ne nt Ge ne r a l f or pa yme nt of da ma ge s s us t a i ne d a s

a r e s u l t of t he c hi l dr e n’ s i nj ur i e s . Ba s e d upon t he “ f a mi l y

4 me mb e r ” e xc l us i on i n t he pol i c y, Pe r ma ne nt Ge ne r a l r e f us e d t o

h o n o r h e r c l a i ms a nd t hi s l i t i ga t i on r e s ul t e d.

III

The f i r s t i s s ue r a i s e d by M s . Se t t e r s i s whe t he r r

e n f o r c e me nt of t he pol i c y’ s e xc l us i on of l i a bi l i t y c ove r a ge f o r

i n j u r i e s t o a f a mi l y me mbe r vi ol a t e s t he publ i c pol i c y of

Te n n e s s e e . She a r gue s t ha t by e xc l udi ng “ i nnoc e nt vi c t i ms f r o m

c o v e r a g e ” a nd “ unf a i r l y e xpos i ng t he i ns ur e d t o l i a bi l i t y wi t h o u t

c o v e r a g e , ” t hi s e xc l us i on c ont r a ve ne s t he publ i c pol i c y of

Te n n e s s e e , a s e xpr e s s e d i n t he Fi na nc i a l Re s pons i bi l i t y La w of

1 9 7 7 , a s a me nde d ( t he Ac t ) , T. C. A. § 55- 12- 101 e t s e q. I n he r

b r i e f , s he pr i ma r i l y r e l i e s upon a c a s e f r om W s hi ngt on, M ual a ut

o f Enumc l aw I ns . Co. v . W s c omb, 634 P. 2d 441 ( W s h. 1982) . i a In

t h a t c a s e , t he Supr e me Cour t of W s hi ngt on de c l a r e d t ha t t he s e a

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