Tsapralis v. Public Emp. Mut. Cas. Co.
| Decision Date | 22 January 1970 |
| Docket Number | No. 40710,40710 |
| Citation | 77 Wn.2d 581,464 P.2d 421 |
| Court | Washington Supreme Court |
| Parties | John TSAPRALIS and Joanna Tsapralis, husband and wife, and Marilyn J. Tsapralis, Appellants, v. PUBLIC EMPLOYEES MUTUAL CASUALTY CO., a Washington corporation, Respondent. |
Griffin, Boyle & Enslow, Carson F. Eller, Tacoma, for appellants.
Eisenhower, Carlson, Newland, Reha & Sinnitt, Paul Sinnitt and Ronald A. Roberts, Tacoma, for respondent.
The plaintiffs (appellants), John Tsapralis and his wife, appeal from a trial court order granting the defendant (respondent), Public Employees Mutual Casualty Company, a motion for a summary judgment, denying recovery under the uninsured motorist provision of the plaintiffs' insurance contract with the defendant.
On November 1, 1963, the plaintiffs were riding in their family automobile when it collided with an automobile driven by Mr. Vernon Walter. The plaintiffs allege that they were injured and suffered damages as a result of the accident which was caused by Mr. Walter's negligence. At that time, Mr. Walter carried bodily injury liability insurance with the Midwest Mutual Casualty Company. On November 5, 1965, the Midwest Mutual Casualty Company became insolvent and all insurance policies issued by it were cancelled.
At the time of the accident, the plaintiffs were named insureds under a contract of insurance with the defendant insurance company. That contract provided, among other things, for benefits payable to the insureds for bodily injury suffered by them and caused by uninsured motorists:
Coverage J, Uninsured Motorists (Dammages for Bodily Injury): To pay all sums which the insured or his legal representative shall be legally entitled to recover as damages from the owner or operator of an uninsured automobile because of bodily injury sustained by the insured, caused by accident and arising out of the ownership, maintenance or use of such uninsured automobile; * * *
The plaintiffs' claims against the defendant were premised on that insurance provision. The plaintiffs contend the cancellation by Midwest Mutual Casualty Company of its outstanding insurance policies caused Mr. Vernon Walter to become an uninsured motorist under the terms of their insurance contract with the defendant.
The trial court, deciding otherwise, based its decision on the policy definition of 'uninsured' automobiles:
an automobile with respect to the ownership, maintenance or use of which there is no bodily injury liability bond or insurance policy applicable at the time of the accident * * *
For the reasons hereafter stated, we reverse.
In considering the insurance contract before us, we interpret it to give effect to the intent of the parties and that intention normally is ascertained largely from the language employed by them. Boeing Airplane Co. v. Firemen's Fund Idem. Co., 44 Wash.2d 488, 268 P.2d 654, 45 A.L.R.2d 984 (1954). But if the language of the policy is reasonably susceptible to more than one interpretation, then we apply that meaning which is most beneficial to the insured. It may be interpreted in accordance with the way it would be understood by the average man purchasing insurance. Ames v. Baker, 68 Wash.2d 713, 415 P.2d 74 (1966); Thompson v. Ezzell, 61 Wash.2d 685, 379 P.2d 983 (1963).
Applying those principles to the term 'uninsured' automobile as defined in the insurance contract before us, we believe that a reasonable and proper interpretation placed upon it by an insured would lead him to conclude that when the tortfeasor's insurance carrier is unable to pay his valid claim, then there was no insurance 'applicable at the time of the accident.' An injured party is as much unprotected by a tortfeasor's insurance carrier which becomes insolvent subsequent to the injury as is one injured by a tortfeasor whose insurance carrier became insolvent immediately before the accident. It is not the moment of impact that an insured logically considers of consequence in contracting for protection against an uninsured motorist--rather, it is the ability of the tortfeasor's insurance carrier to respond in damages for a lawful claim that is the realistic and natural concern of the insured. If the tortfeasor's legal inability to pay that lawful claim occurs after the accident, then that legal inability (insolvency here) should be said, on a relation back in time theory, to have existed at the time of the accident.
Under facts similar to those at hand, courts throughout the country have almost without exception allowed an insured to recover under the uninsured motorist provisions of his own insurance policy, or under a statute, which defines an 'uninsured' automobile not only as one upon which there is No insurance applicable at the time of the accident (as the policy before us does), but which further defines it as one with respect to which there Is a bodily injury liability bond or insurance policy applicable at the time of the accident but the company writing the same denies coverage thereunder. Those courts hold that the 'denial of coverage' provision is reasonably subject to different interpretations and is therefore construed against the position of the insurance carrier. Pattani v. Keystone Ins. Co., 426 Pa. 332, 231 A.2d 402 (1967); Stephens v. Allied Mutual Ins. Co., 182 Neb. 562, 156 N.W.2d 133, 26 A.L.R.3d 873 (1968); State Farm Mutual Automobile Ins. Co. v. Brower, 204 Va. 887, 134 S.E.2d 277 (1964); North River Ins. Co. v. Gibson, 244 S.C. 393, 137 S.E.2d 264 (1964); Katz v. American Motorists Ins. Co., 244 Cal.App.2d 886, 53 Cal.Rptr. 669 (1966). These cases hold in essence that the post-accident insolvency of the tortfeasor's insurance carrier amounts to a 'denial of coverage' even though no claim had been filed by the injured party against that carrier before the insolvency occurred. These cases reach the same result despite the fact that the legal representative of the insolvent carrier's estate has allowed and approved the injured party's claim filed against the estate. Stephens v. Allied Mutual Ins. Co., Supra. To do so, these courts necessarily...
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