Graves v. Traders & General Ins. Co., 48855

• Citation: 214 So.2d 116,252 La. 709
• Decision Date: 28 June 1968
• Docket Number: No. 48855,48855
• Court: Louisiana Supreme Court
• Parties: Walter L. GRAVES et al. v. TRADERS & GENERAL INSURANCE COMPANY et al.

Page 116

214 So.2d 116

252 La. 709

Walter L. GRAVES et al. v. TRADERS & GENERAL INSURANCE COMPANY et al.

No. 48855.

Supreme Court of Louisiana.

June 28, 1968.

Rehearing Denied Oct. 9, 1968.

Taylor, Porter, Brooks, Fuller & Phillips, Baton Rouge, for defendant-appellant-relator.

Durrett, Hardin, Hunter, Dameron & Fritchie, Baton Rouge, for defendants-appellees-respondents.

SUMMERS, Justice.

Certiorari was granted to decide how liability should be apportioned between two automobile liability insurance companies who have issued policies providing concurrent or double coverage of a motorist conceded to be responsible for damages arising out of an automobile collision.

On February 8, 1964, a school bus driven by Henry C. Bell struck the rear of an automobile occupied by the plaintiffs Mr. and Mrs. Walter L. Graves. At the time of the accident, Bell was transporting school children between McKinley High School and Port Allen for his employer Cass Collins. Collins owned a 60-passenger school bus which was regularly engaged as a public or livery conveyance, but on this occasion it was being repaired. The vehicle Bell was driving was a temporary substitute which Collins had borrowed from Superior Coach Sales, Inc.

Traders & General Insurance Company had issued its automobile liability policy with a school bus endorsement effective July 26, 1963 insuring Cass Collins for one year with $5,000 limits to each person and $10,000 limits for each accident for bodily injury liability, and $5,000 limits for property damage liability. The policy insured a temporary substitute automobile and contained the following pro rata and excess clauses:

'If the insured has other insurance against a loss covered by this policy the company shall not be liable under this policy for a greater proportion of such loss than the applicable limit of liability stated in the declarations bears to the total applicable limit of liability of all valid and collectible insurance against such loss; provided, * * * coverages * * * with respect to temporary substitute automobiles * * * shall be excess insurance over any other valid and collectible insurance.'

The Travelers Indemnity Company had issued a 'Garage Policy' effective January 1, 1964 for one year, insuring Superior Coach Sales, Inc. with $100,000 limits for each person and $300,000 limits for each accident for bodily injury liability and $25,000 limits for property damage liability. In addition to insuring Superior Coach Sales, Inc., the Travelers policy insured any person using Superior's vehicles with permission. The provision insuring 'any other person' was made applicable:

'(O)nly if no other valid and collectible automobile liability insurance, either primary or excess, with limits of liability at least equal to the minimum limits specified by the financial responsibility law of the state in which the automobile is principally garaged, is available to such person * * *.'

In addition to the foregoing escape clause and a standard pro rata clause, the policy also provided that its limits of liability with respect to 'any other person' would be:

'(T)he amount by which (a) the applicable minimum limit of liability for bodily injury or property damage specified in the financial responsibility law of the state in which the automobile is principally garaged exceeds (b) the sum of the applicable limits of liability under all other valid and collectible insurance available to the insured * * *.'

After the accident, Mr. and Mrs. Graves instituted suit for personal injuries, property damage and medical expense incurred as a result of the collision with the vehicle belonging to Superior Coach Sales, Inc. Cass Collins, Traders and Travelers were joined as defendants. Judgment was rendered in the trial court against all defendants in solido awarding $3,000 to Mr. Graves for personal injuries and medical expense and $2,500 to Mrs. Graves for personal injuries. An award of $211 was made to Mr. Graves for property damage.

Finding the 'other insurance' clauses of the two policies mutually repugnant, and that both policies provided 'primary' coverage, the trial court applied the 'pro rata' provisions of each policy and apportioned the liability between Traders and Travelers. Personal injury liability was decreed against Traders and Travelers, respectively, in the proportion which $5,000 bears to $100,000 or one-to-twenty, and property damage liability was decreed in the proportion which $5,000 bears to $25,000 or one-to-five.

On appeal to the First Circuit the judgment was affirmed. 200 So.2d 67. We granted writs upon the application of Travelers. 251 La. 73, 203 So.2d 89.

Under the quoted clauses the insurance of either company, in the absence of the other, would cover the liability of Cass Collins, and either company alone would be answerable for the damages found to be due by the trial court. But, since each policy provides coverage in situations where other insurance exists, we are called upon to reconcile the conflicting provisions, or otherwise determine a proper disposition under the circumstances.

Our study of the 'other insurance' clauses quoted from the two policies makes it plain that they cannot be reconciled, and if the provisions of both policies are given effect, neither insurer...