Gunter v. Lord
| Decision Date | 26 March 1962 |
| Docket Number | No. 45858,45858 |
| Citation | 242 La. 943,140 So.2d 11 |
| Parties | David GUNTER et al. v. Oscar E. LORD et al. |
| Court | Louisiana Supreme Court |
Gist, Murchison & Gist, DeWitt T. Methvin, Jr., Alexandria, for defendants-relators.
Jeron J. LaFargue, Sulphur, for plaintiffs-respondents.
A writ of certiorari was granted in this case but the review was 'limited to the issue of plaintiff Gunter's right to recover twice for medical expenses,' on the showing made by applicant for the writ that a conflict exists between decisions of the Courts of Appeal of the State and that the question has not yet been decided by this Court.
The instant action, ex delicto, is for damages for personal injuries sustained in an automobile accident. The plaintiffs, Mr. and Mrs. David Gunter and Mrs. Hazel Lord, were injured through the negligent operation of the car by its driver, Mr. Oscar E. Lord, husband of Mrs. Hazel Lord. 1 The State Farm Mutual Automobile Insurance Company, insurer of Mr. Lord, is the sole remaining defendant, the suit as to Oscar E. Lord having been dismissed. The Trial Court, following the reasoning in Hawayek v. Simmons (Orleans Court of Appeal, 1956), 91 So.2d 49, 61 A.L.R.2d 1254, rejected plaintiff's demands for medical expenses on the ground that they had already been paid under the medical payments provision of the policy; the Court of Appeal, Third Circuit, reversed the Trial Court on this issue, and adopting the ruling in Distefano v. Delta Fire & Casualty Company, La.App. (1st Circuit, 1957), 98 So.2d 310, held that 'the quantum of damages for liability under the general liability provisions should include medical and hospital expenses as specials, and a prior payment under the medical pay clause should not be set-off against the amount payable under the general liability provisions.' The judgment was therefore amended to include medical expenses in amount of $1,074.60 ($669.60 past medical and $375.00 future medical) in the quantum of damages awarded Mr. Gunter, and in all other respects was affirmed. 132 So.2d 488.
The policy sued on, captioned Family Automobile Policy, Combination Form, under the section headed 'Declarations,' lists coverages () for with specified limits of liability-- in the case of medical payments, '$1,000 Each Person.' A subsequent section, headed 'Part I--Liability,' deals with Coverages A and B, reciting that the defendnt is obligated 'To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages' because of bodily injury sustained by any person, and property damage, 'arising out of the ownership, maintenance or use of the owned automobile * * *.' Coverage C, found under 'Part II--Expenses for Medical Services,' obligates the insurer 'To pay all reasonable expenses incurred within one year from the date of accident for necessary medical, surgical, X-ray and dental services * * * and necessary ambulance, hospital, professional nursing and funeral services:' as follows: 'Division 1, To or for the named insured and each relative who sustains bodily injury, sickness or disease, including death resulting therefrom * * * caused by accident, while occupying or through being struck by an automobile; Division 2, To or for any other person who sustains bodily injury, caused by accident, while occupying (a) the owned automobile' while said automobile is being used by the named insured, by a resident of the same household, or by any other person with his permission; or '(b) a non-owned automobile' if the injury results from 'its operation or occupancy by the named insured' or its operation by his employee, or 'its operation or occupancy by a relative * * *.' Under the section headed 'Conditions' is the declaration (Condition 7, applicable to Part II, quoted above) that
The defendant-relator, State Farm Mutual Automobile Insurance Company, in this Court invites attention to the fact that the appellate courts which first considered the question of double recovery for medical expenses incurred by a plaintiff--while reaching opposite results--both approached the matter from a negative standpoint, without taking into account the positive law of our State; thus, when the issue was first presented (1956) the Orleans Court of Appeal considered that the plaintiff should Not be allowed to recover More than his damages from the insurer, 2 and a year later the Court of Appeal for the First Circuit, in deciding the same question, considered that the insurer of the defendant ought Not be allowed to collect premiums for Two coverages without paying under both; 3 and that subsequent opinions adopted, without much discussion, one view or the other. 4 Invoking our positive law, as embodied in articles of the Louisiana Civil Code, relator cites, as fully controlling here, the provision by which a wrongdoer is obliged to repair the damage done to another, 5 and submits that the law intends an injured person to be compensated, but no more; observing that in Louisiana the courts do not allow punitive damages, but only compensatory damages in an action for tort, 6 relator argues that respondent has no further 'damages' to be 'repaired' since obligations are extinguished by payment, 7 and may be discharged by any person concerned, such as a surety. 8 Aside from the above provisions, other articles of the Code concerned with equitable principles 9 are relied upon as not allowing respondent to enrich himself by recovering again of defendant an amount which has already been paid to him by the same defendant.
The plaintiff-respondent, on the other hand, stands on the proposition (asserted first by the Court in the Distefano case, supra) that a claim based on the liability feature of an insurance policy is a tort claim while a claim based on the medical payments feature of an insurance policy is a claim sounding in contract; and argues that these are two separate insurance agreements for which separate premiums are paid--the second (medical payment) providing coverage regardless of fault on the part of the insured. In answering relator's argument, respondent submits that if it should be held that under the 'liability policy' these medical payments are already covered, it is the defendant insurance company which has been unjustly enriched by receiving a premium for something it did not have to pay.
Sober reflection shows an inaccuracy in the above reasoning, induced perhaps by the facility of our direct action statute (R.S. 22:655) by which injured parties may proceed against the liability insurer as if it were itself the tort feasor, rather than a contractual indemnitor. It is clear that the provision covering liability based on fault and insured under coverages A and B is no less a contractual obligation, as between the insurer and the insured, than the provision of the medical payments coverage under C, since both are based solely on contract; the direct action procedure merely omits one step and allows a plaintiff to make his proof of the insured's liability in the same action in which he seeks to prove the contractual obligation of the insurer to indemnify the insured.
To ascertain the common intention of the parties and to give effect thereto--a cardinal rule in the interpretation of contracts, and incorporated in our Civil Code, Article 1945--we turn to an examination of the policy provisions, bearing in mind that 'All clauses of agreements are interpreted the one by the other, giving to each the sense that results from the entire act,' Article 1955; in other words, 'The contract must be viewed as a whole, and the intention of the parties gathered from all its parts, to the end of giving practical effect to the instrument in the way intended * * *.' Calhoun v. Ardis, 144 La. 311, 313, 80 So. 548, 549. See Civil Code, Articles 1764, 1945--1962; Long Bell Petroleum Co. v. Tritico, 216 La. 426, and cases cited at 454, 43 So.2d 782.
After studying and analyzing the sections of the agreement describing the coverage under A and B, and under C, we think it clear that the inducement insofar as concerned the insured was twofold: (a) financial coverage, within the limits stated, in case of injury to persons or property through his fault arising out of the operation, maintenance and use of the named automobile or a 'non-owned' automobile as therein defined; and (b) a financial cushion for medical, hospital and funeral expenses, regardless of fault on his part, for (1) himself and each relative who sustains bodily injury 'while occupying or through being struck by An automobile' (emphasis ours), and for (2) any other person who sustains bodily injury through...
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