McCrary v. United States, Civ. A. No. 1658.

• Decision Date: 24 April 1964
• Docket Number: Civ. A. No. 1658.
• Citation: 235 F. Supp. 33
• Parties: Paul Howard McCRARY, Plaintiff, v. UNITED STATES of America, Defendant and Third-Party Plaintiff v. STATE FARM AUTOMOBILE LIABILITY INSURANCE COMPANY, Third-Party Defendant.
• Court: U.S. District Court — Eastern District of Tennessee

235 F. Supp. 33

Paul Howard McCRARY, Plaintiff, v. UNITED STATES of America, Defendant and Third-Party Plaintiff v. STATE FARM AUTOMOBILE LIABILITY INSURANCE COMPANY, Third-Party Defendant.

Civ. A. No. 1658.

United States District Court E. D. Tennessee, Northeastern Division.

April 24, 1964.

Smoot, Wright & Cate, Kingsport, Tenn., J. Kenneth Wright and William H. Cate, Kingsport, Tenn., of counsel, for plaintiff.

John H. Reddy, U. S. Atty., Chattanooga, Tenn., David E. Smith, Asst. U. S. Atty., Knoxville, Tenn., and William E. Bowman, Asst. U. S. Atty., Knoxville, Tenn., of counsel for defendant third-party plaintiff.

Swingle & Hardin, Greeneville, Tenn., James N. Hardin, Greeneville, Tenn., of counsel, for third-party defendant.

NEESE, District Judge.

The plaintiff McCrary brought this action in tort against Frank X. Kuhn,¹ alleging the diverse citizenship of the parties and the jurisdictional amount, 28 U.S.C. § 1332(a) (1). Damages are claimed for personal injuries and loss of property allegedly caused by the negligent or wrongful act or omission of Mr. Kuhn, resulting from the operation of a motor vehicle. After the defendant had answered, a motion was filed by the United States attorney, averring that the Attorney General of the United States had certified that, at the time of the incident out of which this action arose, the defendant Kuhn was acting within the scope of his employment under a contract with the Architect of the Capitol for personal services, that the plaintiff's remedy was by action against the United States as provided by 28 U.S.C. § 1346 (b), and that such remedy was exclusive. This motion was granted, and the United States was substituted for Mr. Kuhn as the party defendant herein. 28 U.S.C. § 2679(b) and (c) and 1346(b). The Attorney General is now defending this action, 28 U.S.C. § 2679(c) and is authorized to compromise or settle the plaintiff's claim, 28 U.S.C. § 2679(e), infra.

After the United States was substituted as the defendant herein, the United States attorney for this District sought permission at the pretrial conference to implead Mr. Kuhn's automobile liability insuror, State Farm Mutual Automobile Insurance Company of Bloomington, Illinois (hereinafter referred to as State Farm), as a third-party defendant. Rule 14(a), Federal Rules of Civil Procedure. It was asserted that the national sovereign was an "insured" under a policy of automobile liability insurance issued by State Farm to Mr. Kuhn and in force at the time of the automobile accident involved herein. The Court was disposed initially to refuse permission, on the theory that State Farm was relieved of liability by 28 U.S.C. § 2679 which placed any liability exclusively on the federal government. Gipson v. Shelley, D.C. Tenn. (1963), 219 F.Supp. 915. However, on the representation of counsel for the sovereign that this Court had not considered and passed on the precise question to be presented by the proposed third-party complaint, the motion was granted on the authority of Irvin v. United States, D.C.S.D. (1957), 148 F. Supp. 25.² State Farm has now moved for a dismissal of the third-party complaint on the ground that a cause of action is not stated against it on which relief could be granted. Rules 14(a) and 12(b) (6) Federal Rules of Civil Procedure.

The only provision found in Mr. Kuhn's policy with the third-party defendant under which it is, or may be, liable to the defendant United States for all or part of the plaintiff's claim in this action, is as follows:

"* * * (T)he unqualified word `insured' includes (1) the named insured, and also includes * * * (3) any other person while using the owned automobile, provided" etc. "and (4) under Coverages A and B any person or organization legally responsible for the use thereof by an insured defined under the three subsections above."

Mr. Kuhn is the named insured in this policy and owned the insured vehicle. Coverages A and B of the policy protect an insured against liability for bodily injury and property damage, such as the plaintiff claims to have sustained in this action. The question for determination, then, is whether the United States has a right of action against the automobile liability carrier of its employee Kuhn which would permit it to be indemnified or exonerated if the plaintiff McCrary is successful in holding the defendant United States liable under the Tort Claims Act for the negligence of its said employee.

Actions not specifically provided for in the Tort Claims Act, have been allowed where courts were dealing with "* * * an established type of liability, which was within the broad sweep of the claims for which the United States had agreed to stand liable. * * *" United States v. Gilman (1954), 347 U.S. 507, 74 S.Ct. 695, 98 L.Ed. 898, 901. Undoubtedly, the United States may be sued as a third-party defendant for contribution claimed by a joint tort-feasor, although no specific provision of the Act provides for such actions. United States v. Yellow Cab Co. (1951), 340 U.S. 543, 71 S.Ct. 399, 95 L.Ed. 523. And where the ship's service officer in charge of a specific business operation at the United States Merchant Marine Academy was issued a policy, not identifying by personal name any of those insured, but naming by positions the incumbents of supervisory offices and adding as additional insured any other superior administrative authority, the United States, which owned and operated the Academy, was "an additional insured" and could maintain a third-party action against the indemnitor when the United States was sued under the Tort Claims Act. Grant v. United States, C.A.2nd, 271 F.2d 651.

The Grant case, supra, seems to have been decided primarily on the premise that the federal government's representatives and its insurance carrier had made a "* * * studied * * *" effort to insure both the United States and all its pertinent officials concerned with the operation of a commercial establishment at one of its installations. Where there is ambiguity in a contract, the practical construction placed on it by the parties, of course, is of controlling importance. Hawkeye Casualty Co. v. Rose, C.A.8th (1950), 181 F.2d 1574.

The issuance date of the policy now under consideration at this bar was May 15, 1962. This date was approximately 60 days following the effective date of the 1961 amendments to 28 U.S.C.A. § 2679. The general effect of these amendments was to make the remedy of a tort claimant for any tort action arising out of the operation of a motor vehicle by a government employee who was acting within the scope of his governmental employment, exclusively against the United States, whether the vehicle was owned by the sovereign or by its employee. Gipson v. Shelley, supra. This change in the applicable law lends added emphasis to the intention of the insuring and insured parties.

Several district courts, including two in the Sixth Circuit, have held that automobile liability policies containing language identical with, or similar to, that in the policy issued by State Farm to Mr. Kuhn, operated to give the United States a cause and right of action against insurors of employees of the federal government. Rowley v. United States, supra; Irvin v. United States, supra; Nistendirk v. United States v. MFA Mutual Insurance Company, D.C.Mo. (1964), 225 F.Supp. 884, 885-8863; Vaughn v. United States v. Tennessee Farmers Mutual Insurance Company, D.C.Tenn., 225 F.Supp. 890, 8911;³ Patterson v. United States, et al. v. State Farm, etc., D.C.Tenn. (1964), 233 F.Supp. 447.⁴

The decisions from the Missouri and Tennessee jurisdictions, supra, were decided following the 1961 amendments to the Tort Claims Act esp. 28 U.S.C. § 2679, but all of them cite Irvin v. United States, supra, an unappealed decision of five years before on which the federal government seems not to have relied in the intervening period.

While the language is dicta, the Court of Appeals for the Fourth Circuit, since the enactment of the pertinent amendments, supra, has observed that "* * * (t)hese amendments, in effect, substitute the liability of the United States exclusively for that of its employees operating motor vehicles within the scope of their employment. * * *" at page 202, fn. 1, and that "* * * (t)he express purpose of the amendments `is to provide a method for the assumption by the Federal Government of responsibility for claims for damages against its employees arising from the operation by them of vehicles in the scope of their Government employment.' Behind it is the desire to protect the government driver from the ever-present danger of personal liability and to relieve him of the expense of supplying private liability insurance. Senate Report, 87th Congress, 2d Sess. (Aug. 1961), U.S.Code Cong. & Adm.News, p. 2784." Uptagrafft v. United States, C.A. 4th (1963), 315 F.2d 200, 204.

Subsections (a) and (b) of 28 U.S.C. § 2679, as amended in 1961, provide that the remedies provided for claims which are cognizable under 28 U.S.C. § 1346 (b) are exclusive not only against the employee or his estate, but exclusive generally. The reason for this is clear enough, viz., "* * * The policy announced in the amendments had been a matter of great concern to Congress and other governmental bodies. Similar legislation was passed in 1960 but was vetoed because of an objectionable provision that does not appear in the present amendments. * * *" Uptagrafft v. United States, supra, 12 at page 204. Bills to provide governmental indemnification for the drivers of vehicles on government business or to provide liability insurance to such drivers at no expense to them had been discarded in favor of the statute eventually passed. Perez v. United States, D.C.N.Y. (1963), 218 F.Supp. 571, 5732; see also Stephan v. Madison, D.C.N.Y. (1963), 223 F.Supp. 256, 258. Had the Congress intended to permit the United States to be indemnified or exonerated in actions under the Tort Claims...