Trinity Universal Ins. Co. v. Capps
| Citation | 506 F.2d 16 |
| Decision Date | 15 November 1974 |
| Docket Number | 74-1279,Nos. 74-1235,s. 74-1235 |
| Parties | TRINITY UNIVERSAL INSURANCE COMPANY, a Texas corporation, Plaintiff-Appellee, v. Charles CAPPS et al., Defendants-Appellants. Richard J. SCHELFO and Donna Schelfo, Plaintiffs-Appellants, v. GOVERNMENT EMPLOYEES INSURANCE COMPANY, a foreign corporation incorporated under the laws of the District of Columbia, et al., Defendants-Appellees. |
| Court | United States Courts of Appeals. United States Court of Appeals (7th Circuit) |
Saul I. Ruman, Hammond, Ind., for defendants-appellants Charles Capps et al.
James E. Schreiner, George E. Bloom, Hammond, Ind., for plaintiff-appellee Trinity Universal Ins. Co.
Edward J. Raskosky, George H. Kohl, Hammond, Ind., for plaintiffs-appellants Richard J. Schelfo and Donna Schelfo.
William S. Spangler, David J. Hanson, Gary, Ind., for defendants-appellees Government Employees Ins. Co. et al.
Before HASTINGS, Senior Circuit Judge, and CUMMINGS and LAY, * Circuit Judges.
These two cases, as did Miller v. Hartford Accident and Indemnity Co., 7 Cir., 506 F.2d 11 (1974), also decided today, raise the same issue of whether an insurance policy covering several cars permits aggregation or 'stacking' of the liability limits of each car to determine the total uninsured motorist recovery. Although separately briefed and argued, the cases are therefore consolidated for opinion. Jurisdiction is based on diversity of citizenship and the law of Indiana applies. Although the policy language and the facts are somewhat different in each case, the law to be applied here is the same as in Miller.
In No. 74-1235, Trinity Universal Insurance Company (Trinity) issued Charles Capps one insurance policy covering a 1971 Toyota and a 1962 Ford truck. On May 5, 1972, the Toyota was struck by an uninsured motorist and Capps' wife and one child were killed and his two other children were injured.
For purposes of the uninsured motorist provision of the Trinity policy, the definition of an insured included not only the named insured but any relative or any other person occupying an insured automobile. The limits of liability section of the uninsured motorist coverage stated, inter alia, that 'the limit of liability stated in the declarations as applicable to 'each accident' is the total limit of the company's liability for all damages, including damages for care or loss of services, because of bodily injury sustained by two or more persons as the result of any one accident.' In the declarations, the limits of liability listed under each car for uninsured motorist coverage were $15,000 for each person and $30,000 for each accident and $2,000 for medical payments coverage. A separability clause in the policy applicable to the medical expenses coverage but inapplicable to the uninsured motorist coverage provides: 'When two or more automobiles are insured hereunder, the terms of this policy shall apply separately to each * * *.'
Trinity admitted liability for $30,000 under the uninsured motorist coverage and paid that amount to the clerk of the district court for use of the insureds. Trinity paid $2,000 to Capps under the medical payments coverage. Upon Capps' demand that Trinity was liable for up to $64,000, since the policy covered two cars, Trinity brought this action for declaratory judgment seeking a declaration that its uninsured motorist liability was limited to $30,000. The District Court for the Northern District of Indiana, the Honorable Allen Sharp, Judge, presiding, granted summary judgment for Trinity on both the uninsured motorist and medical expense coverages. This is an appeal from that judgment.
Subsequent to the decision in this case, the Indiana Court of Appeals in Jeffries v. Stewart, Ind.App., 309 N.E.2d 448 (1974), found that where a policy covering several cars had both a limits of liability clause on uninsured motorist coverage and a separability clause applicable to that coverage an ambiguity was created as to whether the limits of liability clause applied to each car or to the insurance contract as a whole. Resolving the ambiguity in favor of the insured, the court held that the insured was entitled to aggregate the liability limits. The Jeffries court stated, in dicta, that the ambiguity there could have been avoided if the separability clause by its express terms did not apply to the uninsured motorist provision or if the...
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