Legg v. Certain Underwriters at Lloyd's of London

CourtCourt of Appeal of Missouri (US)
Citation18 S.W.3d 379
Parties(Mo.App. W.D. 1999) . Robert Legg, Respondent v. Certain Underwriters at Lloyd's of London, Appellant WD56067 & WD56283 Missouri Court of Appeals Western District Handdown Date:
Decision Date14 December 1999

18 S.W.3d 379 (Mo.App. W.D. 1999)
This slip opinion is subject to revision and may not reflect the final opinion adopted by the Court.
Robert Legg, Respondent
Certain Underwriters at Lloyd's of London, Appellant
WD56067 & WD56283
Missouri Court of Appeals Western District
Handdown Date: 12/14/99

Appeal From: Circuit Court of Jackson County, Hon. Ronald R. Holliger, Judge

Counsel for Appellant: Daniel F. Church

Counsel for Respondent: Richard C. Miller

Opinion Summary:

The defendant insurance company appeals from a judgment in favor of the plaintiff truck driver in the driver's action for breach of insurance contract and vexatious refusal to pay. The accident occurred while the truck driver was en route to a delivery but while he was in another's personal automobile, rather than while driving his truck.


Court holds:

(1) The policy language is ambiguous and, thus, is interpreted in favor of the insured. Since the driver en route to a delivery, he was "under dispatch" and protected while away from home.

(2) The intoxication exclusion cannot be applied because the insurer failed to present sufficient evidence that the truck driver entered the other driver's car knowing the other driver was intoxicated and unfit to drive.

(3) The trial court properly sustained the truck driver's motion to strike expert witnesses on the basis that they were not timely filed. The court need not determine whether the testimony would be so cumulative as to disallow it.

(4) The facts and issues of this case were not clear and were of first impression to Missouri courts. The trial court erred in granting the truck driver statutory penalties and attorney's fees. That part of the judgment is reversed.

(5) No authority has been cited, nor could this court find any, specifically stating that litigation expenses other than attorney's fees are allowed pursuant to the penalty statutes. As such, the penalty statute must be strictly construed, which results in the reversal of the litigation expenses awarded.

Opinion Author: Harold L. Lowenstein, Judge

Opinion Vote: AFFIRMED IN PART; REVERSED IN PART. Stith, Lowenstein and Smith, JJ., concur.


Robert Legg (Legg) filed a petition for damages for breach of an insurance contract and for vexatious refusal to pay, against Certain Underwriters at Lloyd's of London (Lloyd's). Lloyd's had issued a "Contractor Protection Plan" (the "Plan") to the trucking company for which Legg was a contract driver. The policy provided total disability coverage to Legg as an insured if he became disabled as the result of an occupational accident. The Plan provided up to $300,000 in benefits for an occupational accident and a maximum of $15,000 in benefits for non-occupational accidents. Legg, after leaving Liberty, Mo., was in Georgia, en route to making a delivery in Florida, when he was injured. After parking his truck for the night, Legg, who became intoxicated, was in a car with another man, also intoxicated, when the car overturned leaving Legg with severe and paralyzing spinal cord injuries. The crucial questions involving the policy provisions concerned whether:

1) The injuries were sustained while Legg was "under dispatch", making the accident an occupational accident as defined by the Lloyd's policy. By way of summary judgment, the trial court ruled in Legg's favor on this point.1

2) An exclusion provision would disqualify the claim if Legg was intoxicated,2 making dispositive the answer to the question whether he was a passenger, rather than the driver of the car. After a bench trial on this provision, the court found Legg was not driving the car and the exclusion did not thwart the claim.

The trial court then found Lloyd's refusal to pay vexatious and awarded fees and expenses. Lloyd's has appealed.

In April 1992, respondent Legg was an independent contractor/truck driver for Inway and had picked up a load from the Kansas City area for delivery to Maxville, Florida. En route, he was advised that since he would be unable to arrive at his destination before the close of business on Friday, April 24, he would have to wait until Monday morning to make the delivery and unload the truck. Accordingly, he arrived at a truck stop in Valdosta, Georgia, between 5:00 and 7:00 p.m. on Friday, April 24. He then secured the truck for the weekend, intending to continue the trip to Florida on Monday morning, and testified to such.

Later on Friday evening, Legg walked to a nearby Best Western motel and entered the King of the Road Lounge, a bar that served alcoholic beverages. He stayed at the lounge until closing time early Saturday morning. He was intoxicated when he left the lounge; it was stipulated that laboratory blood results taken more than an hour after the accident showed Legg's blood alcohol level to be .135.

While drinking, Legg became acquainted with another patron, James Hudson, who also became intoxicated during the evening. The bartender, Cathy Mixer, recalls that Legg and Hudson met each other at the bar and talked and purchased drinks for each other. She further testified that Hudson became so intoxicated that she took his keys and said she would drive him home. Hudson testified that when the bar closed, he was so intoxicated that he was in no condition to drive, and therefore, gave his keys to Mixer intending that he not drive himself home.

Legg and Hudson left the lounge together. Subsequently, after 2:00 a.m. on Saturday, April 25, 1992, Legg and Hudson were involved in a one-car accident, approximately ½ to miles from the bar. Hudson's vehicle overturned, rolled down an embankment, and landed on its top. The investigating police officer estimated Hudson's car was traveling at least 75 miles per hour at the time of the accident.

There was dispute as to whether Hudson or Legg was driving the car at the time of the accident. Legg testified that Hudson offered to drive respondent back to his truck, and he was a passenger. Legg testified he crawled into the back seat on the driver's side after the accident, and told an investigating police officer he had been a passenger. However, the car was traveling away from the truckstop at the time of the accident.

Contrarily, Hudson testified he was not driving the car at the time of the accident and that he had given his car keys to the bartender, who must have given them to Legg. Hudson further testified that he remembers leaving the bar with Legg and getting into the passenger side of his car. He had no recollection of why the car was headed northbound, as Hudson's home was located to the south of the lounge. The bartender confirmed several facts related by Hudson, ultimately that she gave Legg the keys and saw the two leave together, but did not see them physically get in to the car.

As a result of the April 25, 1992, car accident, Legg sustained a fractured dislocation of his thoracic spine resulting in paraplegia from the waist down, chest trauma, and pulmonary contusions. Lloyd's first received report of his claim for benefits on April 27, 1992. Claims manager Brenda J. Cullinan was assigned to the supervision of the claim by Claims Management Corporation (hereinafter "CMC"), which is the third-party administrator for Lloyd's on claims under the Plan. Over the next two months, CMC's investigation included interviewing witnesses, securing medical and law enforcement records, and obtaining an initial statement from respondent.

On June 26, 1992, Cullinan advised Legg by letter that the claim for occupational accident benefits was denied because it was not determined to be an occupational accident. Further the claim was excluded, as the loss was the result of voluntary intoxication. However, the Plan did offer respondent the full amount of the non-occupational accident coverage of $15,000, due to the tragedy and substantial loss to his family, with the express language that they were not making any admission of liability.

Legg made no response to the denial letter, nor any communication relating to his claim for almost the next two years. Then on September 12, 1994, this action for damages and vexatious refusal to pay, section 375.296 and 375.420 RSMo 1994, was filed.3 Lloyd's raised the occupational accident policy definition and the intoxication exclusion as affirmative defenses. The trial court granted respondent's motion for summary judgment holding that as a matter of law, Legg sustained an occupational accident because he was "under dispatch" at the time of the accident as he had not completed his trip to Florida and unloaded his truck. After trial on the intoxication issue, the court found that both Legg and Hudson were intoxicated, Hudson was the driver and Legg the passenger at the time of the accident, and that Lloyd's failed to present sufficient evidence that respondent got into the vehicle knowing Hudson was intoxicated and unfit to drive. Therefore, the court concluded that respondent's loss was not "caused by or resulting from his intoxication" and found the denial of respondent's claim was vexatious, willful, and without reasonable cause.

The trial court further approved Legg's fifty-percent contingent attorney's fee as reasonable and entered a final judgment awarding the claimant the total sum of $608,806.57. This sum was for benefits owed under the Plan, prejudgment interest, statutory penalties under Missouri vexatious refusal to pay statute (section375.296) attorney's fees of $184,289.67 (section 375.420) and litigation expense reimbursement of $14,984.28.4

Lloyd's points on appeal are straightforward and direct: 1) Under the Plan, since Legg was not performing any occupational functions at the time of the accident, he was not "under dispatch" and was ineligible for occupational benefits; 2) Even if this event was covered, Legg's intoxication excluded him from benefits; 3) Lloyd's was prejudiced by the court's exclusion of expert testimony...

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