Mallinger v. State Farm Mut. Auto. Ins. Co.

• Decision Date: 14 November 1961
• Docket Number: No. 50376,50376
• Citation: 111 N.W.2d 647,253 Iowa 222
• Parties: Anna MALLINGER, Administratrix of the Estate of Joseph E. Mallinger, Deceased, Appellee, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Inc., Appellant.
• Court: Iowa Supreme Court

Page 647

111 N.W.2d 647

253 Iowa 222

Anna MALLINGER, Administratrix of the Estate of Joseph E. Mallinger, Deceased, Appellee, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Inc., Appellant.

No. 50376.

Supreme Court of Iowa.

Nov. 14, 1961.

Rider, Bastian & Beisser, Fort Dodge, for appellant.

John H. Mitchell, Fort Dodge, for appellee.

THOMPSON, Justice.

This litigation is an outgrowth of the same fatal accident we had before us in Mallinger v. Brussow, Iowa, 105 N.W.2d 626. The plaintiff's petition asked a declaratory judgment holding that she was entitled under an insurance policy issued by the defendant to Joseph E. Mallinger, her decedent, on February 19, 1958, to the amount of $1,000, with interest. The defendant denied liability under the policy, asserting the circumstances which brought about the death of the decedent, on July 25, 1958, were not within the purview of the policy, because of certain exclusions contained therein. The case was tried upon a stipulation of facts; so that we have only the proper construction of the terms of the policy to be determined. The trial court held there was an ambiguity in the terms of the policy such that, under the rule that in case of uncertainty or ambiguity in the terms of an insurance policy it must be construed against the insurer, the plaintiff was entitled to recover. It held the exclusion in the policy relied upon by the defendant was void. From this judgment the defendant appeals.

I. Under the stipulation of facts there is no question as to the amount, if the plaintiff is entitled to recover anything. Nor is there any dispute that the policy under which plaintiff claims was in full force on the date of the death of the insured. The entire controversy centers around coverage C of the policy, providing for medical payments, including funeral services, under certain conditions, and an exclusion, (h)(2), found later. Coverage C, so far as material, is found on page 5 and is quoted:

'Coverage C--Medical Payments. To pay reasonable expenses incurred within one year from the date of accident for necessary medical, surgical, X-ray, dental, ambulance, hospital, professional nursing and funeral services, eyeglasses, hearing aids and prosthetic devices, to or for each person who sustains bodily injury, caused by accident, while occupying or through being struck by the automobile, provided the automobile is being used by an insured.

'In addition, with respect to such bodily injury to the named insured and his relatives, this coverage is extended to apply to any other land motor vehicle or trailer not operated on rails or crawler-treads, but not (1) a farm type tractor or equipment designed for use principally off public roads, except while actually upon public roads * * *'.

The exclusion relied upon by the defendant is found on page 8. This page is headed, in bold faced black type 'Exclusions--Insuring Agreements I and II'. The first lines following the heading are 'This insurance does not apply under:'. Following these words are a number of exclusions not material here. The exclusion which defendant contends denies plaintiff's right of recovery is found in the second column on page 8. The material part is this: 'coverages C and M, to bodily injury to any person: '* * * (h)(2) while occupying or through being struck by any automobile, land motor vehicle or trailer if such vehicle is owned by the named insured or a relative and is not included in the definition of 'automobile'; * * *.'

It is apparent that without the exclusion in (h)(2), coverage C would entitle the plaintiff to recover. It insured the decedent for funeral services arising from an accident while occupying or being struck by a farm type tractor designed for use principally off public roads, except while actually upon public roads; and the decedent was on a public road.

But the exclusion is equally definite. It says 'This insurance does not apply under * * *' coverages C and M, (M being the clause which defines and limits the amount of medical expenses) to bodily injury to any person * * * (2) while occupying or through being struck by any * * * land motor vehicle * * * if such vehicle is owned by the named insured or a relative * * *. By stipulation, the decedent was the owner of the 'land motor vehicle', the farm tractor, upon which he was riding, that is to say, which he was 'occupying' when struck. So the exclusion must apply, unless there is some ambiguity in the insurance contract which brings into play the rule above expressed that all uncertainties are determined strictly against the insurer.

We fail to find such an ambiguity. It is true a somewhat careful reading of the entire policy is required to make its meaning clear; but upon such reading it is apparent that no medical services were provided for the insured when he was injured while 'occupying' his own farm tractor. It must be remembered that the policy's primary purpose was to protect the insured against public liability arising from his operation of an automobile, described as a Chevrolet sport coupe No. F58J164083. Of course he was entitled to any other provisions of the policy fairly covered by it. Coverage C provides for medical payments, including funeral services to the stipulated amount, caused to the insured by an accident involving the automobile; and in addition such medical payments as might be incurred from the operation of a farm tractor as specified in coverage C and limited by the exclusions. The general rule that an insurance policy is a contract and is to be construed according to the language used is not in dispute. We said, in Field v. Southern Surety Company, 211 Iowa 1239, 1242, 235 N.W. 571, 572: 'The general rule is that a policy of insurance must be construed most favorably to the insured, but this rule applies only when there is a real ambiguity in the language of the policy. If the words used in the policy are plain and unambiguous, it is the duty of the court to give effect to such language in accordance with its plain and ordinary meaning, and not make a new contract for the parties by arbitrary judicial construction.' Authorities are cited.

The problem here, as in all similar cases, is to determine whether there is an ambiguity. It is true the policy seems to insure, on page 5, under coverage C, and to take away much of the benefit on page 8, under the exclusion (h)(2). But the exclusion or limitation need not be a part of the insuring clause; it is enough if it is clearly delimited at another point in the policy. Thus, in McCann v. Iowa Mutual Liability Insurance Company, 231 Iowa 509, 1 N.W.2d 682, 684, we affirmed a directed verdict for the defendant where the coverage clause broadly insured against public liability caused by the operation of the plaintiff's automobile; while at another point in the policy there was a clause excluding coverage under 'Coverages A * * *, while the automobile is operated by any person under the age of 14 years, or by any person in violation of any state, federal or provincial law as to age applicable to such person * * *'. It appeared the insured automobile was at the time of the accident operated by the plaintiff's son in violation of a restricted school driving permit. Likewise in Twogood v. American Farmers Insurance Association, 229 Iowa 1133, 296 N.W. 239, it appeared that the exclusions were separately set forth and not contained in or as a part of the insuring clause. We there reversed a judgment on jury verdict for the plaintiff, with directions to enter judgment for the defendant.

The California case of Security Trust and Savings Bank of San Diego v. New York Indemnity Company, 220 Cal. 372, 31 P.2d 365, 368, is much in point. The California Supreme Court there said: 'The very purpose of exception or limitation clauses is to exclude risks otherwise covered by general coverage clauses. It is of their nature to conflict with general clauses, in that they constitute restrictions on the latter. An insurance contract, like any other contract, should be construed as an entirety, the intention being gathered from the whole instrument.'

While the exclusions in the policy now before us are not on the same page as the general coverage, they are clearly set out. They are in the same size type as the remainder of the policy; and, as pointed out above, they are labelled at the top of page 8, where the one in question is found, in large black faced type, 'Exclusions * * *'. The most casual inspection of the policy could not miss at least this heading which is in itself a warning to the policyholder to see what is excluded. In addition, page 1 of the policy provides 'State Farm Mutual Automobile Insurance Company, in consideration of the premium paid and in reliance upon the declarations which are in part set forth on page 2 and in part on page 3 of this policy, does hereby agree with the insured named therein to afford insurance for the coverages indicated in the declarations subject to all the terms and conditions of the Company's policy form 9427.

'It is understood and agreed that said declarations and policy form together with the terms of any endorsements designated on page 2 of this policy constitute the entire contract between the Company and the insured.' The policy is form 9427 and is so labelled. Here at the outset is a warning to the insured that his coverage is defined by the entire policy contract.

The exclusion of any medical coverage to the insured while he was occupying a farm tractor--a 'land motor vehicle'--owned by himself, is in no manner uncertain or ambiguous. The plaintiff urges that the exclusion left little medical or funeral expense coverage for the insured; it would apply only when he was riding on the public highway on a farm tractor not owned by himself or a relative, or if he were struck by such a vehicle on the highway. So it may be; but the fact remains it is the coverage granted and limited by the express terms of the...