Hamilton v. Maryland Casualty Company

• Decision Date: 17 November 1966
• Docket Number: No. 22833.,22833.
• Citation: 368 F.2d 768
• Parties: George Maurice HAMILTON and Barbara Jane Lawson, Appellants, v. MARYLAND CASUALTY COMPANY, Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

368 F.2d 768 (1966)

George Maurice HAMILTON and Barbara Jane Lawson, Appellants, v. MARYLAND CASUALTY COMPANY, Appellee.

No. 22833.

United States Court of Appeals Fifth Circuit.

November 17, 1966.

William H. Roundtree, George Ritchie, Cocoa, Fla., for appellants.

Rodney G. Ross, Maguire, Voorhis & Wells, Orlando, Fla., for appellee.

Before BROWN, GEWIN and GOLDBERG, Circuit Judges.

JOHN R. BROWN, Circuit Judge:

Another of that ever-growing list¹ of intramural insurance Donnybrooks which, as local disputes over the local reading of a local contract with no federal overtones, constitutional, statutory or otherwise, could better be left to local courts to resolve,² it seems the better part of judicial wisdom to bring this to an end without postponing the evil day of decision. Guillot v. Cenac Towing Company, Inc., 5 Cir., 1966, 366 F.2d 898. Helpful as is the Florida Supreme Court reference procedure,³ especially in areas which present alternative governmental or social policy choices even though ostensibly garbed in the austere form of an insurance policy,⁴ we think the question here is the simple one whether the insurance contract says what it means and means what it says. Jacksonville Terminal Co. v. Florida East Coast Railway Co., 5 Cir., 1966, 363 F. 2d 216, at 220. If it does — and we hold that it does — the District Court was clearly correct and should be affirmed. In construing what is euphemistically called the Family Automobile Policy only one real question specifically arises: is a brother-in-law living in the same household as the sister-in-law a relative? Once that is answered the only problem remaining is whether there is any justifiable basis for disregarding the plain words of the contract.

The facts neither complex nor conflicting can be severely capsulated. As with another family, this, too, begins in the beginning. Patterson v. Thomas, 5 Cir., 1961, 289 F.2d 108, 117 (dissenting opinion). Margie Frye, the Assured, lived in the same household with McElroy Lawson and Mrs. McElroy Lawson, the sister of Margie Frye. Barbara Jane Lawson, the daughter of the McElroy Lawsons, was obviously Miss Frye's niece. While driving her father's automobile, Barbara injured the Damage Claimant, George Hamilton. The Damage Claimant, Hamilton, not unnaturally, pursues the Insurer to secure satisfaction of the judgment he has against Barbara who as co-plaintiff and co-appellant is now aligned with her former adversary, likewise a not uncommon contemporary development dictated by selfinterest, morality, or a combination of both. See, Smoot v. State Farm Mut. Auto. Ins. Co., 5 Cir., 1962, 299 F.2d 525; Smoot v. State Farm Mut. Auto. Ins. Co., 5 Cir., 1964, 337 F.2d 223; Seguros Tepeyac S.A., Compania Mexicana v. Bostrom, 5 Cir., 1965, 347 F.2d 168. It highlights the significant questions to likewise capsulate the District Court's action. The District Judge held that McElroy Lawson, a brother-in-law of the Assured, was a relative. This had the effect of denying coverage under the exclusion for a non-owned automobile if owned by a relative residing in the same household with the Assured.

This Family Automobile Policy presumably on the 1958 revised form afforded, and was intended to afford, broad and liberal coverage both as to persons known and unknown and vehicles known and unknown.⁵ The changes wrought by the 1963 revision are of no significance here.⁶ Of critical importance, the significant terms of the clauses describing the assureds such as "relative," "owned automobile," and "non-owned automobile" were specifically defined.⁷ As to these the 1963 revision⁸ also made some changes, none significant here.

Since the accident was caused by an automobile other than the one owned by the Assured, Aunt Margie, both as to coverage⁹ and the persons insured (see note 5, supra, Par. (a) (1) (2)), the result depends on whether Barbara's father's car was a "non-owned automobile" (note 5, supra, Par. (b) (1) (2)) as the policy defines it. (Note 7, supra). It simplifies the problem to reconstruct the definition clauses into an amalgam of "relative" and "non-owned automobile." It then reads:

"`Non-owned automobile\' means an automobile * * * not owned by * * * either the named insured or any relative of the named insured who is a resident of the same household * * *."

The possible points of controversy are thus quickly and sharply reduced. The car was not owned by Aunt Margie, the named Assured. But just as positively, it was owned by Barbara's father. Equally clear, and unlike so many cases where the very vexing factual problem is whether the "relative" is a resident of the household,¹⁰ Barbara's father was a part of this household.

All that is left, therefore, is the question whether a brother-in-law of the named Assured is a "relative." And on that score we have no doubt that within the context of this broad coverage, he is so. The role of the Court is perhaps fortunately easier since the term is a neutral one in the sense that to be a relative is, on occasions, the status which affords insurance coverage, while in others the status works an exclusion of coverage.¹¹ The sauce ought therefore to be for insurer and assured alike. In a policy which extends insurance to persons whose age, sex, physical, mental competence and moral responsibility are completely unknown and covers vehicles of unknown age, vintage, operability, mechanical condition or ownership, there is no place for a narrow reading of "relative." Stated in operational terms, not the legalism of wills, trusts, estates, and conveyancing, any attempt, as urged here, to read into it distinctions between affinity and consanguinity would thwart the intended breadth of the coverage as well as the reflext exclusions which are essential to prevent abuses.

For Florida we make such an Erie alignment.¹² For Florida we reject the notion that "relative" is ambiguous.¹³

There this case would end without more were it not for the contention alternatively asserted but pressed almost as the main argument that Barbara qualifies under Par. (c) (2) (note 5, supra) as a "person * * * legally responsible for the use of * * * (2) a non-owned automobile."

As near as we can discern it, two arguments seem to be made. The first is that unless Par. (c) (2) is given this reading, it is superfluous and serves no need not encompassed by Par. (b) (2). The second is that the proviso clause of Par. (c) (2) — "* * * if such automobile is not owned * * * by such person" in effect reads out the general definition of a non-owned automobile (note 7, supra) so that the only limitation is that (1) theÅ automobile not be owned by the named assured (here Aunt Margie) and (2) that it not be owned "by such person" (here Barbara). Amplifying this it is urged that "owned automobile" and "non-owned automobile" are mutually exclusive terms and the Insurer ought not to be permitted to distort simple words by the policy's special definitions.¹⁴ We find none of these arguments persuasive.

As to the first, there are a number of functions for Par. (c) (2) not encompassed within Par. (b) (2) including a wide range of situations in which liability is imputed to a third person on familiar principles of respondeat superior, or the like,¹⁵ because of the operation of a non-owned vehicle by a relative living in the same household. In practically none of these situations could "such person" qualify under either (a) or (b).

As to the second, rather than detracting from the general definition the proviso clause adds a further limitation. The automobile must not only meet the general definition of one not owned by, or regularly furnished for the use of, a relative residing in the same household. Additionally it must not either be owned or hired b"such person or organization." This purpose seems clear from the fact that Par. (c) (2) expressly requires that the party for whom such "other person or organization" has a legal liability must have the status of an assured under Par. (a) or (b). And with respect to Par. (b) this brings into play the composite definition of "relative" and "non-owned automobile."

None of the other contentions warrant any comment.

Affirmed.

1 One discerning authority and indefatigable writer describes it thus. "The romance, such as it is, of good, bad, and indifferent, decisions on automobile coverage decisions proceeds with ever increasing acceleration. In the 21-year period from 1936 through 1956, the courts of this country reported 1,443 decisions on automobile coverage questions, averaging about 70 each year. In 8½-year period from 1957 through the first six months of 1965 they decided some 2,100 such cases, averaging about 247 each year. The present rate is over 300 each year." Risjord, 1964-1965 Highlights of Automobile Liability Insurance Law, 16 Fed.Ins.Counsel Quarterly, Winter 1965-66, p. 6 hereinafter referred to as "Highlights" with appropriate year.

2 Judge Sobeloff recently sounds the tone of wonderment. "This controversy between two insurers is here because of the singular fascination the federal diversity forum holds for insurance companies, even when the controlling state law question has not been clearly settled and only a state court can give an authoritative answer." Travelers Ins. Co. v. Employers' Liability Assurance Corp., Ltd., 4 Cir., 1966, 367 F.2d 205.

3 Hopkins v. Lockheed Aircraft Corp., 5 Cir. 1966, 358 F.2d 347, and the certification cases there cited. See also Kaplan, Certification of Questions from Federal Appellate Courts to the Florida Supreme Court and Its Impact on the Abstention Doctrine, 16 U.Miami L.Rev. 413 (1962).

4 Nowhere is this more spectacularly evident than in the diametrically conflicting readings of a uniform, simple, common standard policy clause by states separated only by imaginary political boundaries. Consider, for example, "* * * the running, ceaseless controversy over `Who Is The Insured?' on which courts have differed and...