Trapf v. Commercial Union Ins. Co., 64471
| Decision Date | 16 September 1994 |
| Docket Number | 64474,No. 64471,64471 |
| Citation | 886 S.W.2d 144 |
| Parties | Alvin C. TRAPF, et al., Plaintiffs/Respondents/Cross-Appellants, v. COMMERCIAL UNION INSURANCE COMPANY and Northern Assurance Company of America, Defendants/Appellants, and Kohn-Senf Insurance Agency, Inc., Defendant/Cross-Appellant. |
| Court | Missouri Court of Appeals |
George F. Kosta, St. Louis, for appellant Commercial Union Ins.
Michael A. Gerritzen, Gerritzen & Gerritzen, St. Louis, for respondent Trapf.
Michael S. Weinberg, Goffstein, Kraus, Sherman, Seigel & Weinberg, St. Louis, for Kohn-Senf.
Alvin C. Trapf and George W. Engemann, the insured driver and his passenger, along with their spouses, Beverly I. Trapf and Edith R. Engemann, (hereinafter collectively referred to as insureds) filed suit against Commercial Union Insurance Company and its subsidiary, Northern Assurance Company of America, (hereinafter collectively referred to as insurer) and Kohn-Senf Insurance Agency, the Trapfs' insurance broker. Plaintiff insureds sought damages for personal injuries sustained by the driver and passenger, and damages for the spouses' loss of consortium, pursuant to the underinsured motorist provision of the Trapfs' insurance policy. The Trapf vehicle was involved in a collision with an allegedly underinsured vehicle. The court granted a judgment in favor of all insureds and against insurer. The alternative claim against the insurance broker seeking damages for its failure to procure underinsured motorist coverage was dismissed.
In this consolidated appeal, insurer contends the trial court erred in entering judgment in favor of insureds based on a finding of underinsurance coverage because the policy language was ambiguous. Insureds cross appeal dismissal of their alternative claim against the Trapfs' insurance broker, Kohn-Senf, for failure to provide a policy to cover their losses. We reverse the judgment for insureds and affirm the dismissal.
This case was tried without a jury on stipulated facts agreed to by plaintiffs and defendant insurer only. On November 4, 1987, driver Alvin Trapf was heading west on Highway 100 in Franklin County, Missouri. George Engemann was a passenger. Both driver and passenger received injuries when an eastbound vehicle driven by Elaine Landolt swerved into Trapf's automobile, causing a head-on collision. The negligence of Landolt was the sole cause of the collision. Landolt was covered by a policy of insurance with liability limits of $50,000 per person and $100,000 per collision. Trapf and his spouse were paid $50,000 by Landolt's insurance carrier. Engemann and his spouse were also paid $50,000. The Trapfs and Engemanns agreed not to execute and garnish upon any property of Landolt. They reserved their right to submit and pursue an underinsured motorist claim against the insurer of the Trapf vehicle.
Alvin and Beverly Trapf had a policy of automobile insurance with defendant Northern Assurance Company of America covering their vehicle on November 4, 1987. The "coverage declarations" page of the policy notes under "underinsured motorist" bodily injury coverage of $25,000 per person and $50,000 per collision. The same amounts of bodily injury coverage are noted under "uninsured motorist." The parties did not stipulate whether or not a separate premium was charged to the Trapfs for the stated underinsured motorist limits. There is no evidence a premium charge was asserted and paid for underinsured coverage. All plaintiffs, the Trapfs and the Engemanns, were "covered persons" under the underinsured motorist provision.
Alvin Trapf and George Engemann sustained extensive injuries as a result of the collision, and their spouses sustained damages for loss of consortium. They filed this action against Northern Assurance, which they allege is wholly owned by Commercial Union, to recover the limits of the underinsurance motorist provision. Only two issues remained at the time of trial: (1) whether the insureds are legally entitled to be paid any underinsured motorist benefits under the policy; and, (2) the amount of damages, if any, due. The trial court found the Trapfs' and Engemanns' damages exceeded $100,000 each. The amount of damages is not contested on appeal. The trial court also found the terms of the underinsured motorist endorsement of the Trapf policy were ambiguous, and therefore should be construed in favor of coverage. It awarded $25,000 to the Trapfs and $25,000 to the Engemanns. The trial court then, on its own motion, dismissed the alternative claim against Kohn-Senf, the Trapfs' insurance broker, because that claim was premised on the broker's alleged failure to procure underinsured motorist coverage for the Trapfs.
Insurer's first of two points on appeal is dispositive. Insurer contends the trial court erred in finding underinsured motorist benefits were payable under the policy because the Landolt vehicle was not an "underinsured motor vehicle" as clearly and unambiguously defined under the Trapf policy. We agree because the Landolt policy provided as much coverage as the underinsured limits in the Trapf policy.
Under a section of the policy entitled, ENDORSEMENTS, the following language appears:
The following endorsement applies only if the declarations indicate a limit of liability for it.
We will pay damages which a covered person is legally entitled to recover from the owner or operator of an underinsured motor vehicle because of bodily injury:
1. Sustained by a covered person; and
2. Caused by an accident.
The owner's or operator's liability for these damages must arise out of the ownership, maintenance or use of the underinsured motor vehicle.
We will pay under this coverage only after the limits of liability under any applicable bodily injury liability bonds or policies have been exhausted by payment of judgments or settlements.
....
"Underinsured motor vehicle" means a land motor vehicle or trailer of any type to which a bodily injury liability bond or policy applies at the time of the accident but its limit for bodily injury liability is less than the limit of liability for this coverage.
However, "underinsured motor vehicle" does not include any vehicle or equipment:
1. To which a bodily injury liability bond or policy applies at the time of the accident but its limit for bodily injury liability is less than the minimum limit for bodily injury liability specified by the financial responsibility law of the state in which your covered auto is principally garaged.
. . . . .
The trial court found an ambiguity arises from two sentences in the...
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