Riordan v. Commercial Travelers Mut. Ins. Co., 1160--II

• Decision Date: 17 July 1974
• Docket Number: No. 1160--II,1160--II
• Citation: 525 P.2d 804,11 Wn.App. 707
• Parties: Nola J. RIORDAN, Respondent, v. The COMMERCIAL TRAVELERS MUTUAL INSURANCE COMPANY, a foreign corporation, Appellant.
• Court: Washington Court of Appeals

Page 707

11 Wn.App. 707

525 P.2d 804

Nola J. RIORDAN, Respondent, v. The COMMERCIAL TRAVELERS MUTUAL INSURANCE COMPANY, a foreign corporation, Appellant.

No. 1160--II.

Court of Appeals of Washington, Division 2.

July 17, 1974.

Coleman P. Hall, Karr, Tuttle, Koch, Campbell, Mawer & Morrow, Seattle, for appellant.

Jackie L. Ashurst, Preston, Thorgrimson, Ellis, Holman & Fletcher, Seattle, for respondent.

ARMSTRONG, Judge.

The major issue presented in this appeal is one which has not previously been addressed by the appellate courts of this state. We are called upon to interpret an exclusionary clause in an accident-health insurance contract which expressly excepts from coverage any loss occurring or originating while the insured is intoxicated. The question presented is whether such a clause is applicable where the event which produced death or loss is not in any sense causally connected with the intoxication. We affirm the summary judgment of the trial court, determining as a matter of law that such an exclusionary clause does not preclude coverage where the loss and the alleged intoxication are entirely unrelated.

The facts in this case are not in dispute, having been stipulated by the parties. The insured, Edwin L. Riordan, died as a result of an automobile accident which occurred at approximately 5:30 p.m. on December 23, 1969. At the time of the accident, Mr. Riordan was a passenger in his own automobile, which was being driven by John Kalina. Mr. Riordan and the driver of the car were returning home to Seattle after a business trip to Portland, Oregon. Prior to their return, Mr. Riordan had consumed alcoholic drinks along with dinner in Portland. An autopsy was performed which found Mr. Riordan's blood alcohol level to be .13 percent. It is estimated that he had been riding as a passenger for almost an hour and a half on the return trip before the accident.

The accident occurred after dark on an interstate highway near Chehalis, Washington. The cause of the accident was a truck with a low trailer standing across the highway in an intersection following an uncompleted left turn, and blocking both lanes of traffic in the direction the Riordan car was traveling. There was no negligence on the part of the insured or the driver of his car. The entire responsibility for the accident rested with the truck driver.

Commercial Travelers Insurance Company was given actual notice of the accidental death January 13, 1970, by a letter with a certified copy of the death certificate enclosed. The death certificate indicated that the fatal injuries occurred while the decedent was a passenger in an auto-truck collision, and under the caption 'other significant conditions,' the certificate further indicated that the insured's blood alcohol level was excessive. Pursuant to a provision in the insurance policy requiring that 'affirmative proof of loss' be furnished to the company within 90 days following a loss, Mrs. Riordan's insurance agent, when he submitted the death certificate on January 13, 1970, also requested that the company send whatever forms were necessary for completion of Mrs. Riordan's claim. The company's proof of loss form, containing a certified attending physician's statement, was mailed to the company on March 23, 1970, the 90th day following the loss. On April 2, 1970, Commercial Travelers returned the proof of loss form and expressed its intention to deny Mrs. Riordan's claim, on the grounds that proof of loss was insufficient and untimely, and because the loss allegedly occurred under circumstances excluded from coverage; I.e., while the insured was intoxicated. Upon motion for summary judgment, the trial court ruled that Commercial Travelers did not have grounds upon which to deny Mrs. Riordan's claim, and the company challenges these rulings before this court.

The company's major contention is that the loss in this case occurred under circumstances excluded from coverage under the following provision of the insurance contract:

The insurance under this contract does not cover:

(3) Any loss occurring or originating:

(d) While he is intoxicated or under the influence of narcotics, unless administered on the advice of a physician.

When confronted with the undisputed fact that the sole cause of the accident in this case was the negligence of a third-party truck driver over whom the insured, as well as the nonnegligent driver of his car, had no control, and that the alleged intoxication of the insured was in no way related to the accident, the insurance company interposes that the above language of the exception clause makes no reference whatsoever to a causal connection between intoxication and the accident. Stated simply, the company contends that if an insured, after an evening of slight overindulgence in drink, were to retire to the relative safety of his own bed, perhaps to sleep away any lingering effects, and were to be fortuitously struck by a bolt of lightning in the middle of the night as he slept, then under the provisions of the clause in question, the insured's widow would be denied the benefits of the accidental death policy. This result is urged upon us despite the fact that the insured, as in the instant case, may have paid the policy premiums for many years under the not unreasonable belief that his widow would not be unprotected in the event of an untimely and entirely accidental death.

This court simply cannot countenance the construction of this exclusionary clause urged uppon us by the insurance company. Such a construction smacks of the application of caveat emptor against the purchaser of insurance policies--a position clearly untenable, so closely is the insurance industry affected with the public welfare. See Touchette v. Northwestern Mutual Ins. Co., 80 Wash.2d 327, 332, 494 P.2d 479 (1972). Indeed, because of strong public policy in the insurance area, nearly a converse position to caveat emptor applies, for it has long been the rule in this state that exceptions from liability in accident insurance policies must be construed strongly against the insurance company, lest the exceptions unfairly devour the whole policy. The Supreme Court of our state, which has followed this rule since the turn of the century, has thusly stated:

It is the established and universal law that insurance policies are to be construed in favor of the insured, and most strongly against insurance companies. This is a reasonable rule, considering the fact that these policies are prepared by men who are learned in the law and trained in preparing contracts of this kind, and who have studied the legal effects of all the multifarious provisions in the ordinary insurance policies, whether accident or life; while the insured are frequently men and women of limited understanding, of simple methods of thought, and who, as a rule, would not be capable of technically construing doubtful provisions in a contract.

Starr v. Aetna Life Ins. Co., 41 Wash. 199, 203, 83 P. 113, 114 (1905).

In interpreting the meaning of the exclusionary clause in question, we are mindful of several well established principles. First, a clause or phrase cannot be considered in isolation, but should be considered in context, including the purpose of the provision. See Hartford Accident & Indem. Co. v. Novak, 83 Wash.2d 576, 585, 520 P.2d 1368 (1974); State Farm Mutual Auto. Ins. Co. v. Phillips, 2 Wash.App. 169, 177, 467 P.2d 189 (1970). Second, the language of insurance policies is to be interpreted in accordance with the way it would be understood by the average man, rather than in a technical sense. Zinn v. Equitable Life Ins. Co., 6 Wash.2d 379, 107 P.2d 921 (1940); Dairyland Ins. Co. v. Ward, 83 Wash.2d 353, 517 P.2d 966 (1974). Finally, contracts of insurance are to be given a practical, reasonable and fair interpretation consonant with the apparent object and intent of the parties, and a strained or forced construction is to be avoided as well as a narrow or technical interpretation which will relieve the insurance company from...