Marson Coal Co., Inc. v. Insurance Co. of State of Pa.

Decision Date29 October 1974
Docket NumberNo. 13452,13452
Citation158 W.Va. 146,210 S.E.2d 747
CourtWest Virginia Supreme Court
PartiesMARSON COAL COMPANY, INC. v. The INSURANCE COMPANY OF the STATE OF PENNSYLVANIA.

Syllabus by the Court

1. In ascertaining the intention of parties to an insurance contract where construction is required, the test is what a reasonable person in the insured's position would have understood the words of the policy to mean. Thompson v. State Automobile Insurance Co., 122 W.Va. 551, 554, 11 S.E.2d 849, 850 (1940).

2. Ambiguous and irreconcilable provisions of an insurance policy should be construed strictly against the insurer and liberally in favor of the insured, although such construction should not be unreasonably applied to contravene the object and plain intent of the parties.

3. Where a contract prepared from a printed from contains, when executed, both the form printing and, as well, written or typewritten inserious and there appears an irreconcilable repugnance and conflict between the printed and written portions thereof requiring interpretation, the writing will prevail over the printing to determine the intention of the parties.

4. Where proof is to be made of some fact which is recorded in writing, this jurisdiction is committed to the 'best evidence' rule, which requires the production of the written document and which forbids the consideration of parol evidence, unless the failure to produce the document itself is properly accounted for.

5. A condition in an insurance policy requiring that the operator of the designated aircraft have a certain number of 'logged' flying hours is not satisfied by proof of flying time not 'logged' in any record book; such requirement contemplates and reasonably requires either production of the journalized entry or, upon proper explanation of the failure or inability to produce the document, parol evidence establishing journalization.

Steptoe & Johnson, Herbert G. Underwood, Clarksburg, for appellant.

Herschel Rose and Duane Southern, Fairmont, for appellee.

HADEN, Justice:

This is an appeal by the plaintiff below, Marson Coal Company, Inc., from the final decision of the Circuit Court of Randolph County in a declaratory judgment action brought by it to seek determination of liability coverage under a certain policy of aviation insurance issued by the appellee, The Insurance Company of the State of Pennsylvania. The circuit court's assailed judgment declared the non-availability of coverage to the coal company.

By a policy renewal dated March 5, 1972, the insurance company issued an Aviation Hull and Liability Policy to the coal company insuring it against specified hazards for the period from March 5, 1972 to March 5, 1973.

On April 18, 1972, the aircraft described by the policy collided with a high-tension wire owned by the Monongahela Power Company, which resulted in the death of the pilot, Harry C. Marson, III, and the sole passenger, William R. McCutcheon.

The insurance company denied coverage under the policy and the plaintiff, thereafter, instituted a declaratory judgment action. The case was tried to the court without a jury, and upon the trial court's findings of fact and conclusions of law, coverage under the policy was denied.

The primary issue arising upon the pleadings, discovery and evidence was whether, under the facts adduced, the policy afforded liability coverage to plaintiff at the time of the accident. An ancillary issue, involving the application of the 'best evidence rule,' also became highly significant in the determination of this action.

The pertinent portions of the insurance policy, which are of paramount significance, are as follows: Item 8 of the 'DECLARATIONS' provides:

'When in flight the aircraft will be piloted only by Harry Marson, provided he is a private or commercial pilot properly certificated by the FAA having a minimum of 1900 logged flying hours including 200 hours on helicopters; or any private or commercial pilot with a helicopter rating properly certificated by the FAA having 500 logged helicopter flying hours.'

That portion of the above quoted provision, beginning with the words 'Harry Marson' and ending with the close of the quote, was a typewritten addition to a standard form printed policy. Within the printed portions of the policy, under 'EXCLUSIONS', the following provision is found:

'THIS POLICY DOES NOT APPLY AND NO COVERAGE IS AFFORDED:

'2. To any insured while the aircraft is in flight:

'(b) if piloted by a pilot not properly certificated and qualified under the current applicable Federal Air Regulations for the operation involved whether said pilot is designated in the Declarations or not; . . ..'

The trial court, based upon a finding that Harry Marson had 1,549 hours and 4 minutes logged flying time and 123 hours and 30 minutes logged helicopter flying time, concluded that the plaintiff failed to sustain its burden of establishing that Harry Marson 'was properly certificated by the FAA and had the logged flying hours required by the typewritten declarations and printed exclusion of the policy.' The trial court's finding was predicated upon the exclusion of certain 'secondary' evidence offered during the trial purporting to supply evidence of flying time not recorded in the exhibited logs.

With reference to the above quoted policy provisions, the trial court stated:

'(I)f the conditions precedent had been credibly established by a preponderance of the evidence, this Court would have held that there is coverage under the policy and that the typewritten declarations would have controlled the printed exclusion.'

The trial court reasoned, however, that under applicable Federal Aviation Regulations, Harry Marson, at the time of the accident was carrying a passenger in the helicopter; that he was not properly certificated; that he did not thereby meet the requirements described in said Item 8 and was thereby excluded from coverage under Item 2(b) of the 'EXCLUSIONS' of the policy. The trial court opined that said Item 8 was not intended to be controlling or even material to the initial question of coverage, but was merely a declaration of the plaintiff's representations concerning the identity of the person piloting the helicopter. We disagree with that legal conclusion.

A careful reading of the printed provisions of the policy in conjunction with the typewritten insertion of Item 8 reveals an anomaly which would titillate the imagination of the most sophisticated minds of the esoteric community of practicing insurance policy draftsmen. Even counsel for the appellee would seem to admit the problem by stating: 'This is a case where the draftsman did put in words which mean nothing. The words 'helicopter rating' are surplusage.'

The practical solution, however, in determining the existence or extent of coverage under an insurance contract lies not in resolving conflicting views concerning obscure refinements, as are exemplified by this contract; rather, it is in arriving at a fair interpretation of the words of the policy by a reasonable person in the insured's position. See, Thompson v. State Automobile Insurance Co., 122 W.Va. 551, 554, 11 S.E.2d 849, 850 (1940). For this reason, the courts have uniformly adopted and maintained the cardinal rule of construction that clauses in insurance contracts should be construed liberally in favor of the insured. Thompson v. State Automobile Insurance Co., Supra; Hamlet v. American Fire Ins. Co., 107 W.Va. 687, 690, 150 S.E. 7, 8 (1929); Cook v. Citizens Insurance Company of Missouri, 105 W.Va. 375, 376, 143 S.E. 113, 114 (1928). Such rule is of course subject to the equally established rule that construction should not be applied to contravene the intention of the parties, and that policies of insurance, like other contracts, must receive a reasonable interpretation consonant with the apparent object and plain intent of the parties. Kanawha Investment Co. v. Hartford Steam Boiler Inspection and Ins. Co., 107 W.Va. 555, 557, 149 S.E. 605, 606 (1929).

Appellant relies primarily upon the rule of construction that in the interpretation of a contract partly printed and partly written or typewritten, where there appears an irreconcilable repugnance and conflict between the written and printed portions thereof, the former will prevail over the latter. See, Gabbert v. William Seymour Edwards Oil Co., 76 W.Va. 718, 86 S.E. 671 (1916).

On the other hand, counsel for the appellee contends that such rules of construction are not applicable where, as here, the provisions of the contract may be read as unambiguous and reconcilable. International Nickel Co. v. Commonwealth Gas Corp., 152 W.Va. 296, 163 S.E.2d 677 (1968); Lewis v. Dills Motor Co., 148 W.Va. 515, 135 S.E.2d 597 (1964); Magnus v. Halltown Paper Board Co., 143 W.Va. 122, 100 S.E.2d 201 (1957).

As indicated by the trial court's reasoning in its findings of fact and conclusions of law, it is, perhaps, possible to interpret the provisions of this insurance contract to exclude coverage under the facts in this case. Such interpretation, however, must be predicated not only upon the suggestion of counsel for appellee that the words 'helicopter rating' are surplusage, but upon the assumption that the whole of Item 8 is surplusage.

Item 8 of the 'DECLARATIONS' purports to provide coverage while the designated aircraft is piloted by Harry Marson, 'provided he is a private or commercial pilot certificated by the...

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