Central Sur. & Ins. Corp. v. Elder
| Decision Date | 04 March 1963 |
| Docket Number | No. 5543,5543 |
| Court | Virginia Supreme Court |
| Parties | CENTRAL SURETY & INSURANCE CORPORATION v. MRS. NANCY C. ELDER. Record |
E. Marshall Frost (Caskie, Frost, Davidson and Watts, on brief), for the plaintiff in error.
J. Frank Shepherd (Paul Whitehead, on brief), for the defendant in error.
Mrs. Nancy C. Elder instituted an action against Central Surety & Insurance Corporation to recover $1,781.24 allegedly due her under the medical payments provisions of a family automobile policy (combination form) which Central Surety had issued to her husband, Clay W. Elder, Jr. The amount sought to be recovered represented medical expenses incurred as a result of injuries Mrs. Elder received in an accident while a passenger in an uninsured vehicle owned and operated by another person. Central Surety admitted liability under its policy to the extent of $1,000, which sum was tendered plaintiff. The case was heard without the intervention of a jury and judgment was rendered for $1,781.24 subject to a credit of $1,000 which had been paid. We granted Central Surety a writ of error.
The liability insurance policy issued by Central Surety to Elder covered two automobiles owned by him. One was a Renault designated therein as 'Car 1' and the other was a Buick designated as 'Car 2'. By the terms of the policy plaintiff was an insured.
The sole question presented is whether, under the medical payments provision of the policy, the maximum of Central Surety's liability is $1,000 to each person for any one accident as claimed by it, or $1,000 to each person for each car or a total of $2,000 as contended for by plaintiff.
The policy provisions, as material here, provided:
Affirmed.
'DECLARATIONS
* * *
'Item 3. The insurance afforded is only with respect to such and so many of the following coverages as are indicated by specific premium charge or charges. The limit of the Company's liability against each such coverage shall be as stated herein, subject to all the terms of this policy having reference thereto.
'COVERAGES LIMITS OF LIABILITY PREMIUMS
Car 1 Car 2
'A. Bodily Injury Liability
CLASS 1B $25,000.00 each person
CLASS 1B $50,000.00 each occurrence $29.92 $22.44
'B. Property Damage
Liability $ 5,000.00 each occurrence $17.00 $12.75
'C. Medical Payments $ 1,000.00 each person $ 9.00 $ 5.25
* * * * * * * * * * *
* * *
'PART II -- EXPENSE FOR MEDICAL SERVICES
'Coverage C -- Medical Payments: To pay all reasonable expenses incurred within one year from the date of accident for necessary medical * * * services:
'Division 1. To or for the named Insured and each relative who sustains bodily injury, * * *, caused by accident, while occupying or through being struck by an automobile;
'Division 2. To or for any other person who sustains bodily injury by acident, while occupying
'(a) the owned automobile, while being used by the named Insured, by any resident of the same household or by any other person with the permission of the named Insured; or
'(b) a non-owned automobile, if the bodily injury results from (1) its operation or occupancy by the named Insured * * * or (2) its operation or occupancy by a relative, * * *.
* * *
'Limit of Liability: The limit of liability for medical payments stated in the declaration as applicable to 'each person' is the limit of the Company's liability for all expenses incurred by or on behalf of each person who sustains bodily injury as the result of any one accident.
* * *
'CONDITIONS
* * *
On August 30, 1960, Frank B. Brown, Field Claim Superintendent for Central Surety, wrote plaintiff's attorney a letter concerning plaintiff's claim for medical payments. It stated in part as follows:
* * *.'
On September 8, Brown wrote plaintiff's counsel another letter in which he stated in part:
Central Surety refused to pay plaintiff's claim in excess of $1,000, and this action followed. The amount in dispute is $781.24 and interest thereon.
It is conceded here, as it was in the trial court, that had Elder been issued separate policies on each of his automobiles, there would be medical payments coverages of $1,000 on each vehicle, or a total of $2,000 available to each person. In holding Central Surety liable for plaintiff's entire claim of $1,781.24, the trial court pointed out that Condition 4, supra, means that the terms apply separately to each vehicle, 'which would in effect mean two policies of insurance in the one and the insured is entitled to the same protection and coverage as if two policies of insurance were issued.'
Here, plaintiff urges the same line of reasoning. She also points out that Elder, her husband, paid a premium for medical payments on each car and that without additional coverage on Car 2 there would be no consideration for the premium paid.
On the other hand, Central Surety contends that there is consideration for the premium paid for medical payments on Car 2, because it provides broader coverage than if such insurance were only on Car 1. Central Surety further contends that no ambiguity exists in the policy; that the words 'each person' have a definite and clear meaning; that each person is one particular person and when the schedule of limits of liability under Item 3, supra, is read along with 'Limit of Liability' pertaining to medical payments under Part II, supra, it is clear that the company's liability is limited to $1,000 for each person; and that Condition 4, supra, 'merely means that when two or more automobiles are insured, the terms of the policy, with all the benefits and limitations, shall apply to each automobile.'
We have not heretofore had the occasion to consider the precise question here involved. However, there are three State courts which have dealt with the proposition. Two are intermediate appellate courts and the third is a court of last resort.
In Sullivan v. Royal Exchange Assurance, 181 Cal.App.2d 644, 5 Cal.Rptr. 878 (1960) the facts were somewhat similar and...
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