Severson v. Milwaukee Auto. Ins. Co.

• Decision Date: 30 December 1953
• Citation: 265 Wis. 488,42 A.L.R.2d 976,61 N.W.2d 872
• Parties: , 42 A.L.R.2d 976 SEVERSON, v. MILWAUKEE AUTO. INS. CO.
• Court: Wisconsin Supreme Court

Page 872

61 N.W.2d 872

265 Wis. 488, 42 A.L.R.2d 976

SEVERSON, v. MILWAUKEE AUTO. INS. CO.

Supreme Court of Wisconsin.

Dec. 30, 1953.

This is an action to recover $500 medical and funeral payments under the provisions of a policy of insurance issued by the defendant to one Louis C. Larson on June 24, 1951.

Cora J. Severson, a passenger in the Larson automobile when it collided with one owned by Lillian Cornwell, was injured in the collision and died as a result of said injuries on July 7, 1951. Thereafter the plaintiff, as administrator of the estate of Cora J. Severson, deceased, commenced a tort action against Louis C. Larson, the Milwaukee Automobile Insurance Company, his insurer, and Lillian Cornwell. Included in the damages claimed in that action was the sum of $1,176.66 expended by the plaintiff for medical, ambulance, nursing and funeral expenses. In that action the judgment entered in favor of the plaintiff and against the defendants included said amount of $1,176.66. That judgment was thereafter paid by the defendant in this action and the judgment was duly satisfied of record.

The plaintiff then demanded the payment of $500 from the Milwaukee Automobile Insurance Company, pursuant to the provisions of Coverage K in the policy. When payment was refused, this action was commenced. The defendant interposed a plea in bar, pleading the former action and the recovery thereon. An answer was also served and filed in which the allegations in the complaint were generally denied. The case was tried to the court without a jury upon the pleadings and a stipulation of facts. A judgment was entered on May 1, 1953, in favor of the plaintiff and against the defendant, in the sum of $557.20 damages and costs, and the defendant appealed. Further facts will be stated in the opinion.

Hale, Skemp, Nietsch, Hanson & Schnurrer, La Crosse, for appellant.

Burr Tarrant and Floren Hegge, Whitehall, Fugina, Kostner, Quinn & Ward, Arcadia, for respondent.

BROADFOOT, Justice.

The defendant devotes several pages in its brief to the law relative to the construction of contracts and contends that the insurance policy should be construed in the light of the intention of the parties as ascertained from the entire policy. It then contends that it was not its intention that medical expenses be paid twice to any injured person.

The plaintiff states that there is no ambiguity in the policy but that the different coverages afforded by the policy are divisible and severable. The plaintiff quotes from 44 C.J.S., Insurance, § 336, p. 1284, as follows:

'A policy of insurance purporting to be entire may in fact be divisible and severable. The question of divisibility or separability rests primarily on the intention of the parties deducible from the stipulations of the contract and the rules governing the ascertainment of that intention. Where a policy grouping several risks incident to the ownership and operation of motor vehicles, such as those of accidental bodily injury or death occasioned to the operator, loss or damage from accident or injury suffered by some person caused by the vehicle and for which the owner is liable, loss or damage to property caused by the motor vehicle, and loss or damage to the vehicle by fire, accident, burglary, or theft, its legal effect is not different from the legal effect of separate policies, each against one of the grouped risks. * * *'

Our attention was not directed to any Wisconsin case involving the severability or divisibility of insurance contracts. However, we have found a few cases involving that question as they relate to fire insurance policies. One such case is Loomis v. Rockford Insurance Co., 77 Wis. 87, 45 N.W. 813, 8 L.R.A. 834. In that case the buildings and certain personal property situated on three different farms were insured against loss by fire, each for a separate amount, by a policy stating the premium as a gross sum. One of the farms was sold and no report of the sale was made to the insurance company, in violation of the provision of the policy against changing the title to the insured property without the consent of the insurer. Another of the buildings was lost by fire. It was held that the contract was divisible and that the breach of contract as to one of the properties did not avoid the policy as to the remaining property. This case recognizes that separate coverages in one policy may be divisible and separable.

Medical payment provisions in automobile insurance policies are relatively new and our attention is called to no case directly in point. In 8 Appleman, Insurance Law and Practice, p. 312, par. 4896, appears the following:

'Many automobile liability policies now contain the so-called medical indorsement. Under this provision, any passenger or occupant of the insured's car who is injured in accident may recover medical expenses up to a stipulated amount, usually $500 per person. Since such recovery is completely independent of liability on the part of the insured, insurance under the medical indorsement clause is closely akin to a personal accident policy. Many companies, in view of their experience with the medical indorsement covering occupants of the insured automobile, have now extended the coverage of such clause to include the insured himself.'

Relevant provisions of the policy are as follows:

'Insuring Agreements.

'I. Coverage A--Bodily Injury Liability.

'To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury, sickness or disease, including death at any time resulting therefrom, sustained by any person, caused by accident and arising out of the ownership, maintenance or use of the automobile.

'Coverage K--Medical Payments.

'To pay all reasonable expenses incurred within one year from the date of accident for necessary medical, surgical, ambulance, hospital, professional nursing and funeral services, to or for each person who sustains bodily injury, sickness or disease, caused by accident, while in or upon, entering or alighting from the automobile if the automobile is being used by the named insured or with his permission.

'II. Defense, Settlement, Supplementary Payments.

'(d) Pay expenses incurred by the insured for such immediate medical and surgical relief to others as shall be imperative at the time of the accident;'

'Exclusions.

'This policy does not apply: * * *

'(b) under coverages A, B, and K, to liability assumed by the insured under any contract or agreement;

'(d) under coverages A and K, to bodily injury to or sickness, disease or death of any employee of the insured while engaged in the employment, other than domestic, of the insured or in domestic employment if benefits therefor are either payable or required to be provided under any workman's compensation law;' * * *

'Conditions.

'4. Limit of Liability--Coverage K.

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