Ranger Ins. Co. v. Robertson
| Decision Date | 12 February 1986 |
| Docket Number | No. 13764,13764 |
| Citation | 707 S.W.2d 135 |
| Parties | RANGER INSURANCE COMPANY, Appellant, v. James Lewis ROBERTSON, et al., Appellees. |
| Court | Texas Court of Appeals |
C.C. Small, Jr. Small, Craig & Werkenthin, Austin, for appellant.
Mike Davis, Byrd, Davis & Eisenberg, Austin, for appellees.
Before SHANNON, C.J., and GAMMAGE and CARROLL, JJ.
This appeal stems from an airplane crash near Graford on December 5, 1974. Byron McKnight was the pilot and his wife, Amelda Ann McKnight, was a passenger. The flight had originated in Hobbs, New Mexico and was to terminate in Dallas. Both the pilot and the passenger perished in the crash.
James Lewis Robertson, as executor of the wife's estate, sued the husband's estate for wrongful death in the district court of Travis County. The district court rendered summary judgment that the Texas doctrine of interspousal tort immunity barred the suit. The court of civil appeals affirmed the summary judgment. Robertson v. Estate of McKnight, 591 S.W.2d 639 (Tex.Civ.App.1979).
On November 12, 1980, the Supreme Court reversed the judgment, holding that the law of New Mexico concerning interspousal tort immunity should be applied. The Supreme Court ordered the cause remanded to the district court "to proceed to trial on the merits in conformity with this opinion." Robertson v. Estate of McKnight, 609 S.W.2d 534, 537 (Tex.1980).
The husband's estate then filed its motion for rehearing. The Supreme Court overruled the estate's motion for rehearing on January 14, 1981. After the Supreme Court had delivered its opinion, but about one month before it acted on the motion for rehearing, counsel for both estates, without knowledge of counsel for the liability insurance company, announced to the district court that they had settled all claims asserted in the cause. 1 On December 11, 1980, the district court signed a consent judgment approving the settlement agreement of the parties and ordering that the wife's estate recover $275,000.00 from the husband's estate.
Thereafter, the representatives of the husband's and wife's estates sued the liability carrier of the husband's estate, Ranger Insurance Company, in the district court of Travis County to enforce the consent judgment. Ranger filed an independent suit seeking a declaratory judgment that it was not obligated to pay the consent judgment. The district court consolidated the two suits.
Ranger insisted that the consent judgment was void because it was rendered when the motion for rehearing was still pending in the Supreme Court. Nevertheless, after trial to the court, the district court rendered judgment that appellees recover $275,000.00 from Ranger. Ranger then perfected its appeal from that judgment to this Court.
This Court held that the district court was without jurisdiction to render the consent judgment and because the judgment on appeal was predicated upon the void consent judgment, it too was void. This Court set aside the judgment and dismissed the appeal. Ranger Ins. Co. v. Robertson, 680 S.W.2d 618 (Tex.App.1984).
The Supreme Court granted Robertson's application for writ of error and in a per curiam opinion approved our holding that the district court was without jurisdiction to render the consent judgment and that the judgment predicated upon the consent was void. The Supreme Court also affirmed our judgment setting aside the void judgment and dismissing the appeal from that judgment. Robertson v. Ranger Ins. Co., 689 S.W.2d 209 (Tex.1985).
The Supreme Court further noted that Ranger's declaratory judgment suit had been consolidated with Robertson's suit on the consent judgment. Although the district court rendered no declaratory judgment, it did file a conclusion of law that liability coverage existed for the husband's estate. The Supreme Court concluded that although the district court's judgment "did not deal specifically with these issues, by implication, the rendition of judgment against Ranger for the amount of the consent judgment constituted a rendition of judgment against Ranger in its declaratory judgment suit." Id. at 211 (emphasis added). 2 The Court then directed this Court to consider "the other points of error presented."
We now undertake to discharge the Supreme Court's directive. In 1976, Robertson, as executor of the wife's estate, sued James Brady, the administrator of the husband's estate, asserting that the husband's negligent operation of the aircraft proximately caused the death of his wife. After service of citation, appellee administrator forwarded the petition and citation to the liability insurer, making demand upon Ranger to defend the husband's estate. In the beginning, Ranger accepted coverage and proceeded with the unqualified defense of the lawsuit. Several months later, however, Ranger notified the administrator of the husband's estate that it had determined to deny coverage and that any further defense or investigation of the lawsuit would be made only under a reservation of rights agreement. The administrator, however, demanded that Ranger either continue its unconditional defense or withdraw from the lawsuit. Ranger refused to accept coverage and tender an unconditional defense to the husband's estate, but instead insisted upon a reservation of rights agreement. The administrator then demanded that Ranger remove itself from the defense of the lawsuit, and thereafter employed other counsel to defend the estate.
Subsequent to its initial denial of coverage and its withdrawal of the defense to the suit, Ranger renewed its tender of a defense under a reservation of rights agreement. The administrator, however, steadfastly refused to consent to Ranger's defense of the suit under a reservation of rights agreement and consistently demanded that the insurer undertake the unconditional defense of the suit. After the administrator employed other counsel, Ranger's counsel remained in the suit despite the administrator's efforts to exclude him.
As mentioned above, the administrator of the husband's estate and the executor of the wife's estate, without knowledge of counsel for Ranger, agreed to settle the tort suit for $275,000.00. On December 11, 1980, the consent judgment was rendered by the district court of Travis County approving the settlement agreement made by the parties.
In January, 1981, appellees filed suit in district court to enforce the consent judgment. In their trial petition appellees pleaded that at the time of the airplane crash Ranger had in force a liability insurance policy which protected the husband against liability for injury or death to passengers in the Piper aircraft. Appellees alleged further that although requested to do so, Ranger refused to pay the consent judgment rendered by the district court of Travis County. Appellees pleaded further that by the terms of its liability policy Ranger was responsible to them for the full amount of the consent judgment.
In its trial pleading, Ranger pleaded that the consent judgment did not bind it because (1) it was an agreed settlement of the claim without a written agreement between the insured, the claimant and the insurer, all in violation of the terms of the policy; (2) the judgment was the result of fraud, conspiracy, and collusion between the administrator and the executor; (3) there was no coverage under the policy because the fatal flight was made in IFR (instrument flight rules) conditions and the husband was not properly rated to fly under IFR conditions; and (4) the district court had no jurisdiction to render the consent judgment because, at the time of its rendition, an appeal from the judgment in the same cause was still pending in the Supreme Court. Ranger sought a declaration from the district court that it had no obligation to pay the consent judgment and that no coverage existed under its policy of liability insurance.
That Ranger had no obligation to pay the consent judgment was determined in Ranger Ins. Co. v. Robertson, 680 S.W.2d 618 (Tex.App.1984) and that holding was affirmed by the Supreme Court. Robertson v. Ranger Ins. Co., 689 S.W.2d 209 (Tex.1985). This holding will not be discussed further.
We now examine Ranger's contention that because its policy afforded no coverage of the flight, it had no obligation to pay under its policy. McKnight's plane crashed near Graford. At the time and place of the crash it was raining, foggy, and hazy. The visibility was one half-mile, and there was an indefinite two hundred foot cloud ceiling with the sky obscured.
Ranger based its denial of coverage on the allegation that the pilot was flying the plane in violation of the policy's "Pilot Warranty Clause." That clause provides:
Only the following pilot or pilots holding valid and effective pilot and medical certificates with ratings as required by the Federal Aviation Administration for the flight involved will operate the aircraft in flight ... (emphasis added).
Ranger contends that the district court erred in concluding under the facts of the case that McKnight was properly rated for the flight within the meaning of the policy's pilot warranty clause, thereby affording coverage for the flight.
Federal Aviation Administration Regulations recognize two general types of weather conditions: IFR (instrument flight rules) weather conditions and VFR (visual flight rules) weather conditions. VFR weather conditions, in turn, fall into two categories, basic VFR weather and special VFR weather. IFR weather conditions are those conditions less than the minimum weather conditions for VFR flight. Under visual flight rules, a VFR rated pilot may not operate an aircraft 1,200 feet or less above the surface, outside controlled airspace, unless flight visibility is at least one mile and the aircraft operation is clear of clouds. 14 C.F.R. § 91.105(a) (1985). Accordingly, when a pilot operates an aircraft in...
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