American Casualty Company of Reading, Pa. v. Gerald

• Court: U.S. Court of Appeals — Fourth Circuit
• Writing for the Court: BOREMAN, J. SPENCER BELL and WINTER, Circuit
• Citation: American Casualty Company of Reading, Pa. v. Gerald, 369 F.2d 829 (4th Cir. 1966)
• Decision Date: 22 November 1966
• Docket Number: No. 10542.,10542.
• Parties: AMERICAN CASUALTY COMPANY OF READING, PENNSYLVANIA, Appellant, v. Ethel Hill GERALD, Appellee.

369 F.2d 829 (1966)

AMERICAN CASUALTY COMPANY OF READING, PENNSYLVANIA, Appellant, v. Ethel Hill GERALD, Appellee.

No. 10542.

United States Court of Appeals Fourth Circuit.

Argued October 6, 1966.

Decided November 22, 1966.

Clyde T. Rollins and Armistead W. Sapp, Jr., Greensboro, N. C. (Armistead W. Sapp, Greensboro, N. C., on the brief), for appellant.

Welsh Jordan, Greensboro, N. C. (Charles E. Nichols, Edward L. Murrelle and Jordan, Wright, Henson & Nichols, Greensboro, N. C., on the brief), for appellee.

Before BOREMAN, J. SPENCER BELL and WINTER, Circuit Judges.

WINTER, Circuit Judge:

Appellant seeks reversal of a judgment against it in the amount of $100,000.00, with interest, on a "Special Hazards Accident Policy," purchased by appellee's deceased husband's employer, wherein it insured him, under certain conditions, against accidental injury or accidental death. Three basic questions, presented by a variety of motions throughout the litigation, are presented for decision. First, did the policy cover decedent, when he died while attending an awards dinner held in a country club constructed on property owned by his employer; second, was the decedent's death an accidental death within the meaning of the policy; and third, if coverage is found by reason of affirmative answers to the first two questions, was appellee entitled to interest from the date of filing proof of decedent's death? Also asserted as reversible error are two evidentiary rulings made during the course of trial. We conclude that each of these questions should be answered in the affirmative, that there was no error in the evidentiary rulings and that, hence, the judgment of the district court should be affirmed.

The decedent, W. A. Gerald, was a senior vice president of Pilot Life Insurance Company. His duties included attendance at dinner meetings throughout the twenty-two state area in which Pilot Life operated, to make promotional talks and present awards to Pilot's agents and employees in recognition of their efforts on behalf of Pilot, and to induce them to greater efforts to further the business of Pilot. Prior to September 24, 1964, Pilot purchased a policy of life insurance on the life of Mr. Gerald, in which his wife, the appellee herein, was the named beneficiary. The policy was in effect on September 24, 1964. By the terms of the policy, designated a "Specific Hazards Accident Policy," appellant agrees to pay $100,000.00 in the event of the death of the named insured "resulting directly and independently of all other causes from injury * * *." "Injury" was defined to mean "bodily injury caused by accident occurring while this Policy is in force with respect to the Insured Person whose injury is the basis of claim and sustained under the circumstances and in the manner described in the attached Hazards Insert(s)." The "Hazards Insert(s)" set forth in the margin,¹ paraphrased in pertinent part, insured the decedent against accidental death "while on the business of the Policyholder Pilot" and during the course of any bona fide trip made by the decedent, if the trip required the decedent to travel outside the corporate limits of the town or city "in which he is regularly employed." By the terms of the insert, such a trip would be deemed to have commenced when the decedent left his "place of regular employment for the purpose of going on such trip."

The decedent was employed at Pilot's home office, located on 132 acres of land between Greensboro and High Point, North Carolina, outside of the corporate limits of any town or city. Two main buildings have been erected on this tract. One, on the northern side, is a multistory office building, which includes offices, a cafeteria, conference rooms, and other facilities for the conduct of Pilot's insurance business. There are employee parking lots to the rear and sides of this complex of buildings. About three-tenths of a mile south of this building is the Pilot Country Club, formed by Pilot "for the enjoyment and benefit of its home office staff, field office employees, agency representatives, and their families and friends." The country club was separated from the office buildings by a wooded area, a lake, a dam, and two small streams. It had a separate telephone, with a different number and separate listing, and separate parking facilities. Another relatively undeveloped 115 acre tract, owned by Pilot, was separated from this 132 acre tract by a railroad.

On September 24, 1964, the decedent, in the performance of his usual duties for Pilot, left his office suite on the fourth floor of the office building at about 4:30 P.M., the usual hour of closing, to attend an awards dinner to be held at the country club for the agents from the Salisbury, North Carolina district of the division of which decedent was the vice president. His attendance was for the usual purpose of making a promotional speech and presenting awards to agents with ten years' service. From his office the decedent went to the office building parking lot, entered his car and drove it to the country club parking lot, using a roadway contained solely within land owned by Pilot. He parked his automobile in the country club parking lot, then entered the country club, where he spent about an hour in the basement room chatting with fellow-employees and some of the agents from the Salisbury district, their wives and guests. During this time, he was observed drinking one highball and a glass of tomato juice.

When dinner was served at 6:00 P.M. the decedent, and all others present, were served a shrimp cocktail, lettuce salad, and then steak with vegetables. While the decedent was consuming the steak, he was observed to place his napkin to his face, his head dropped to the table and a bluish, purple color appeared in his neck and lower part of his face. Those present tried to assist him; his tie was loosened; he was carried to a couch; an unsuccessful effort was made to remove a piece of steak from his throat; and he was given artificial respiration. A physician and an ambulance were summoned. The physician, who arrived shortly after the decedent was first observed to be in difficulty, examined him and pronounced him dead. A later examination of decedent's body led to the discovery of a piece of steak, about the size of a silver dollar and about an inch thick, lodged in his hypopharynx, immediately above the larynx, so as to cut off all ingress of air. Death was caused by suffocation.

After appellee filed a proof of loss, appellant disclaimed coverage under the policy. In the suit which ensued, appellant moved for summary judgment; and when this motion was denied, the case was tried to a jury. At the conclusion of appellee's evidence, appellant moved for a directed verdict, which was denied, and, at the conclusion of all of the evidence, both parties sought a directed verdict. The later motions were held sub curia and the case submitted to the jury on special issues. After deliberations occupying part of two days, the jury reported its inability to agree and a mistrial was declared. Each party then filed a motion for a judgment non obstante verdicto, or, in the alternative, for a new trial. Making specific findings of fact, the district judge concluded that the decedent's place of regular employment was the main office building on the 132 acre tract, that his presence at the country club was part of a bona fide business trip which commenced at the main office building, and that decedent's death resulted directly and independently of all other causes from bodily injury caused by accident. The district judge entered judgment for appellee in the amount of $100,000.00, and allowed her interest at 6% from October 28, 1964, the date on which proof of loss was filed with the appellant. We think the district judge was correct in his factual and legal conclusions, and we affirm the judgment below. We do so by application of the rule that, notwithstanding that the burden of proof is upon a plaintiff, a plaintiff is entitled to a directed verdict when the facts are so convincing that reasonable men could not differ as to their significance, particularly when there is no conflict in the evidence. Norfolk Southern Ry. Co. v. Davis Frozen Foods, 195 F.2d 662 (4 Cir. 1952); Davis Frozen Foods v. Norfolk Southern Ry. Co., 204 F.2d 839 (4 Cir. 1953), cert. den. 346 U.S. 824, 74 S.Ct. 41, 98 L.Ed. 349 (1953). See also, Wachovia Bank & Trust Co. v. United States, 288 F.2d 750 (4 Cir. 1961); Young v. Clinchfield Railroad Co., 288 F.2d 499 (4 Cir. 1961).

— I —

The question of whether the coverage of the policy extended to the decedent when he died while attending an awards dinner held in a country club constructed on property owned by his employer depends upon whether all of the conditions of coverage were met. From the face of the policy, it would apply only during the course of any bona fide business trip made by the decedent, provided the trip required the decedent to travel outside the corporate limits of the town or city in which he is regularly employed. There is no doubt that the decedent went to the country club for a business purpose — to present service awards to agents of Pilot who had achieved significant milestones in their period of service and to make a promotional and inspirational speech to all present. For an insurance company whose method of making money is to sell insurance, awards, promotional and inspirational addresses to agents who do the selling are a necessary business activity.

Whether the decedent was on a business trip away from his "place of regular employment" is a narrower question. The contract of insurance between Pilot and appellant was embodied in a printed form supplied by appellant. Appellant concedes that the form is in part inoperative because Pilot's entire 132 acre tract on which its home offices and the country club are constructed is outside the corporate limits of any town or city; hence,...