Carrabba v. Employers Cas. Co.
| Decision Date | 15 October 1987 |
| Docket Number | No. C14-86-306-CV,C14-86-306-CV |
| Citation | 742 S.W.2d 709 |
| Parties | CARRABBA, et al., Appellants, v. EMPLOYERS CASUALTY COMPANY, et al., Appellees. (14th Dist.) |
| Court | Texas Court of Appeals |
Byron Lee, Houston, for appellants.
Jerry P. Campbell, Beverly Willis Bracken, Waco, Robert D. Green, Susan E. Crowley, Houston, Edwin E. Wright, III, Dallas, for appellees.
Before JUNELL, DRAUGHN and ELLIS, JJ.
This appeal concerns a suit for declaratory judgment regarding priority of insurance liability. In March 1981, a tractor-trailer collided with a vehicle driven by Dr. Robert A. Winkelmann. Dr. Winkelmann died as a result of the accident. His widow filed suit for wrongful death against John Ben Carrabba, individually, and John Ben Carrabba, Inc., d/b/a Carrabba Oil Company (employer of the driver) and against Gooseneck Trailer Manufacturing Co., Inc. (the owner of the tractor). The defendants in the Winkelmann cause brought the present suit against various insurance carriers for declaration of the priority of insurance coverage. We affirm the judgment of the trial court.
The controlling issue of this appeal, as in the court below, is the priority of two insurance policies.
Members of the Carrabba family are officers of both Gooseneck Trailer Manufacturing Co., Inc., and Carrabba Oil Company. At the time of the accident, Gooseneck was covered by a comprehensive automobile liability policy issued by Employers Casualty Company with limits of $250,000 per person and $500,000 per occurrence. Additionally, Gooseneck carried a $1,000,000 umbrella policy, requiring underlying insurance of $500,000 per person and $500,000 per occurrence. Gooseneck's umbrella policy was issued by Mission Insurance Company and its managing agent Sayre & Toso. John Ben Carrabba and Carrabba Oil were insured by Gulf Insurance Company under a comprehensive automobile policy including non-owned and hired automobile coverage with a combined single limit of $500,000. The trailer, owned by yet another individual, Tommy Parker, was insured by Compass Insurance Company and Armco Insurance Group under a comprehensive automobile policy with $250,000 limits.
Despite oral and written demand by Carrabba Oil, the insurance companies refused to state what coverage would be afforded under the various policies. Carrabba Oil and Gooseneck ("the Carrabbas") then filed a declaratory judgment action against each of the insurance companies and the Sayre & Toso agency seeking a declaration of coverage. Compass and Armco denied any coverage, relying upon an exception in the policy. The remaining insurance companies, Employers, Mission, and Gulf, participated in negotiating a settlement of the Winkelmann suit for $1,250,000.
The contribution to this settlement was as follows:
Employers $ 250,000
Gulf 300,000
Carrabbas 100,000
Mission 600,000
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Total $1,250,000
The settlement was remarkable in that although the combined insurance coverage was in excess of the settlement, an insured was required to contribute. A potential gap existed in the insurance scheme. Since only one person was injured in the accident, Employers refused to pay more than $250,000, its per person limit of liability, not $500,000, its policy limit per occurrence. Mission insisted that liability under its policy did not attach until the underlying insurer or the insured had paid the underlying limit of $500,000 specified in the policy. It refused to participate in the settlement until $250,000 in addition to Employers' $250,000 had been contributed. Gulf alleged that its policy was excess over Mission's by virtue of the policy provision that "[the non-owned vehicle] endorsement shall be excess over any other valid and collectible insurance available to the insured."
Following the settlement, the Carrabbas moved for partial summary judgment against Gulf, alleging that the Gulf policy was a primary policy, and therefore, Gulf's policy limit of $500,000 should be added to the $250,000 contributed by Employers before Mission contributed. Employers, Mission and Sayre & Toso joined the motion. Summary judgment was granted on the priority issue only; the trial court ordered liability to be assessed against Employers first, Gulf second, and Mission third.
Early in the litigation, Gulf filed a cross-action against the other defendants to the declaratory judgment, reasserting its claim to be an excess insurer only and alleging that if a $250,000 gap existed between the Employers and Mission policies, the gap was due to the negligence of Employers, Mission, and Sayre & Toso in failing to coordinate the coverage. Mission and Sayre & Toso also filed cross-claims against Employers, alleging negligence, and against Gulf and Employers, asserting Mission had no liability under its umbrella policy until all other insurance was exhausted. Both Gulf and Employers filed third party claims against Compass and Armco to recover settlement costs.
Employers specially excepted to the claims of Gulf, Mission, and Sayre & Toso, arguing that claims of negligence could not be asserted in a declaratory judgment action, that the defendant insurance companies had no standing to assert a negligence cause of action, and that Employers had no duty to the other insurance companies. The special exception was granted, and the allegations in the cross-actions asserted against Employers by Gulf, Mission, and Sayre & Toso were stricken.
After the grant of partial summary judgment, Gulf reimbursed the settlement funds contributed by the Carrabbas; the Carrabbas non-suited Gulf, assigned to Gulf all their causes of action, and realigned themselves with Gulf against Employers, Mission, Sayre & Toso, Compass, and Armco. The Carrabbas then amended their original petition, expanding the suit for declaratory judgment to include claims of negligence, gross negligence, and violations of the Texas Insurance Code. The Carrabbas prayed for damages and punitive damages against both Employers and Compass.
After the original action had been expanded to include negligence claims, Gulf, Mission, and Sayre & Toso, whose pleadings had been struck by the grant of Employers' special exceptions, filed amended petitions, again asserting claims of negligence against Employers and asserting a right of equitable and contractual subrogation to the rights of the Carrabbas. Employers specially excepted to the amended petition of Mission and Sayre & Toso, complaining that the cross-plaintiffs had failed to state a cause of action against Employers. The order granting the second special exception struck the claims of Mission and Sayre & Toso against Employers and specifically stated that "the order or priority of the applicable insurance policies, previously determined by this Court, has finally adjudicated all issues in the case between Mission Insurance Company and Sayre & Toso, Inc., Gulf Insurance Company, Employers Casualty Insurance Company, [the Carrabbas], and Melvin Conn." (Emphasis added.)
On January 30, 1986, an order of severance was filed and granted, removing the third party claims pending against Compass and Armco to a separate cause. Although no motions other than that seeking severance were pending before the trial court on January 30th, the court also signed an order entitled "Final Judgment." This order had the following effect on the claims before the trial court: (1) it reaffirmed the grant of partial summary judgment against Gulf; (2) it reiterated the priority of liability of the insurance policies, making no changes in the priority sequence; (3) it dismissed all claims brought by Gulf, Mission, and Sayre & Toso against Employers; and (4) it dismissed all other relief sought by any party except any action brought against third party defendants Compass & Armco.
Preliminary to addressing appellants' points of error, this court gave serious consideration to the challenge to our jurisdiction raised by appellee Employers. Employers contends that the claims of the Carrabbas against Compass and Armco remain pending in the trial court and the judgment is, therefore, not a final, appealable judgment. An appeal may be prosecuted from a final judgment only. Tex Civ.Prac. & Rem.Code § 51.012 (Vernon 1986). A final judgment fully disposes of all parties and all issues. Hinde v. Hinde, 701 S.W.2d 637, 639 (Tex.1985). If there were claims yet pending in the court below, this court would be without jurisdiction to consider the points of error raised by the appellant. We disagree, however, that any claim of the Carrabbas remained after the final judgment. In the Plaintiffs' Second Amended Petition, the Carrabbas state that they have assigned to Gulf their claims and causes of action against all defendants. Following the assignment of claims, Gulf asserted "third party" claims against Employers, Mission, Sayre & Toso, Compass and Armco. Since the rights of the Carrabbas and the rights of Gulf had been merged by the assignment of claims, the claims of the Carrabbas as well as those of Gulf were asserted in Gulf's third party action against Compass and Armco. Likewise, the Carrabbas' claims against Compass and Armco were removed from the original cause with the trial court's order severing all third party actions. Had they not been so severed, the claims would be among those dismissed by paragraph four of the trial court's final judgment which stated that "all other relief sought by any party except any action against Third Party Defendants, Compass Insurance Company and the Armco Insurance Group, are hereby dismissed"; Compass and Armco were not third party defendants as to the Carrabbas but for the assignment of plaintiffs' claims to Gulf. No party to this appeal contends that the claims of the Carrabbas against Compass and Armco were dismissed by the trial court. They survive in the third party action asserted by Gulf. We, therefore, hold...
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