Sciaudone v. Steuk

• Decision Date: 09 July 1986
• Docket Number: No. 85-123,85-123
• Citation: 512 A.2d 1108,128 N.H. 261
• Parties: Leona A. SCIAUDONE, Administratrix of the Estate of Fay Shankle et al. v. Robert L. STEUK, Administrator of the Estate of Walter A. Shankle, and State Farm Fire & Casualty Company.
• Court: New Hampshire Supreme Court

Page 1108

512 A.2d 1108

128 N.H. 261

Leona A. SCIAUDONE, Administratrix of the Estate of Fay Shankle et al. v.Robert L. STEUK, Administrator of the Estate of Walter A. Shankle, and State Farm Fire & Casualty Company.

No. 85-123.

Supreme Court of New Hampshire.

July 9, 1986.

Cullity, Kelley & McDowell, Manchester (Joseph F. McDowell, III, on brief and orally), for plaintiff.

Holland, Donovan, Beckett & Welch P.A., Exeter (Stephen G. Hermans, on brief and orally), for intervenorPatrick A. Mastrolillo.

Scotch & Zalinsky, Manchester (Barry M. Scotch on brief and orally), for defendantState Farm Fire & Cas. Co.

SOUTER, Justice.

The plaintiff and the intervenor appeal from a decree of the Superior Court(Gray, J., acting on the report of a Master, Louie C. Elliot, Jr., Esq.) entered on a petition for declaratory judgment.The court found that an insurance policy issued by the defendantState Farm Fire and Casualty Company excluded coverage for any liability of the late Walter Shankle for unintentionally causing the death of the plaintiff's decedent or injuring the intervenor's son.We affirm.

In June 1980, Walter and Fay Shankle were husband and wife, living in Candia with Fay Shankle's son from a prior marriage, Patrick M. Mastrolillo.On June 15 of that year the Shankles purchased a one-year homeowners policy from State Farm, naming both Walter and Fay as insureds.On October 20, 1980 the Shankles were divorced under a decree that also divided their Candia property, on a portion of which Fay continued to reside with Patrick.No one notified State Farm of the divorce.On November 16, 1980 Walter entered Fay's house, where he shot and killed Fay, shot and injured Patrick, and then committed suicide.

The administratrix of Fay's estate brought a wrongful death action against the administrator of Walter's estate, alleging both intentional and unintentional tortious conduct.Patrick's father made similar allegations in an action in two counts, one brought on Patrick's behalf in his capacity as Patrick's guardian and next friend, and one brought on his own behalf for the expenses of Patrick's medical care and for his own emotional suffering.The administratrix of Fay's estate then filed the present petition under RSA 491:22 seeking a declaration that State Farm would be responsible for any judgment based on Walter's unintentional conduct, and Patrick's father intervened with a similar claim.The master recommended dismissal of the petition.

The appeal turns on the application of five policy terms:

Definitions

"Throughout this policy, 'you' and 'your' refer to the 'named insured' shown in the Declarations and the spouse if a resident of the same household, and 'we', 'us' and 'our' refer to the Company indicated in the Declarations."

" '[B]odily injury' means bodily harm ... including required care ... and death resulting therefrom."

" '[I]nsured' means you and the following residents of your household:

a. your relatives;

b. any other person under the age of 21 who is in the care of any person named above."

Exclusion

"Coverage L--Personal Liability and Coverage M--Medical Payments to Others do not apply to:

....

g. bodily injury to you or any insured within the meaning of part (a) or (b) of the definition of insured."

Condition "Severability of Insurance.This insurance applies separately to each insured.This condition shall not increase our limit of liability for any one occurrence."

The master found that the exclusion barred coverage for any liability to Fay's estate or to Patrick.He reasoned that because the policy defined "you" to include the named insured, and Fay was so named, the exclusion of liability coverage for "bodily injury to you" referred to Fay and excluded coverage for her death.Because Fay was a named insured, the master also found the exclusion applicable to Patrick's direct claim for injury.Under the definition of "insured" as including the named insured's relatives living in the named insured's household, Patrick was an "insured within the meaning of part (a) ... of the definition of insured," with the result that coverage for liability arising from bodily injury to him was excluded.

As against this analysis, the plaintiff and the intervenor contend that the master erred in failing to treat the policy as if it had become two separate policies at the time of the divorce, one naming Fay as insured, the other naming Walter.On this assumption Fay would not have been a named insured under Walter's policy, nor would Patrick have been an additional insured, and the exclusion would not preclude the coverage sought here.In support of this position the appellants offer four arguments, none of which in our judgment is availing.

There is, first, the argument that "you" is defined or used ambiguously, in the sense that readers of the policy might reasonably differ on whether "you" continued to refer to Fay after the divorce.SeeLaconia Rod & Gun Club v. Hartford Acc. & Indemn. Co., 123 N.H. 179, 182, 459 A.2d 249, 251(1983).They reason that the ambiguity must be resolved against State Farm under the rule in Trombly v. Blue Cross/Blue Shield of New Hampshire-Vermont, 120 N.H. 764, 423 A.2d 980(1980).The ambiguity argument fails, however, for the simple reason that there is nothing arguably ambiguous in the policy's definition of "you."It "refer[s] to the 'named insured.' "Fay was a named insured; the reference to "bodily injury" in the exclusion was therefore a reference to her bodily injury and that of her relative.It could not be clearer.

Second, the intervenor argues that the exclusion should be held inapplicable because its purpose is to reduce the risk of collusion within a family, seeNational Farmers Union Property & Casualty Co. v. Maca, 26 Wis.2d 399, 405, 132 N.W.2d 517, 520(1965), a risk which was effectively terminated with the divorce.But even if we assume that such was the reason for the exclusion, and that the exclusion sweeps more broadly than necessary in this case, those reasons are insufficient to authorize the court to ignore unambiguous policy language and rewrite the contract.SeeCharest v. Union Mut. Ins. Co., 113 N.H. 683, 686, 313 A.2d 407, 409(1973).

Third, the intervenor argues that the policy must be construed as "divisible" in the sense of providing several, rather than joint coverage of the insureds.The intervenor rests this position on the theory underlying Hoyt v. New Hampshire Fire Insurance Co., 92 N.H. 242, 29 A.2d 121(1942), and upon the policy's severability clause, quoted above.Neither Hoyt nor the severability clause, however, addresses the issue now before us.

Hoyt construed the provisions of several fire policies covering the interests of three tenants in common, one of whom set the fire that destroyed the insured premises.This court applied a general rule of construction, that interests of joint tenants are severally insured, with the practical result that the fault of one joint tenant will not defeat coverage of the...