United States v. Myers

• Decision Date: 06 July 1966
• Docket Number: No. 22830.,22830.
• Citation: 363 F.2d 615
• Parties: UNITED STATES of America, Appellant, v. James S. MYERS, Individually and for his wife, Harriet Myers, and as Natural Guardian and Next Friend of James Myers, a Minor, et al., Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

363 F.2d 615 (1966)

UNITED STATES of America, Appellant, v. James S. MYERS, Individually and for his wife, Harriet Myers, and as Natural Guardian and Next Friend of James Myers, a Minor, et al., Appellees.

No. 22830.

United States Court of Appeals Fifth Circuit.

July 6, 1966.

COPYRIGHT MATERIAL OMITTED

Kenneth J. Mighell, Asst. U. S. Atty., Dallas, Tex., Robert J. Vollen, Alan S. Rosenthal, Martin Jacobs, Robert V. Zener, Attys., Dept. of Justice, Washington, D. C., John W. Douglas, Asst. Atty. Gen., Melvin M. Diggs, U. S. Atty., for appellant.

Phillip L. Kelton, Paul Kemp Hyde, Wilson W. Herndon, Dallas, Tex., for appellees, Strasburger, Price, Kelton, Miller & Martin, Dallas, Tex., of counsel.

Bradford D. Corrigan, Jr., Golden, Croley, Howell, Johnson & Mizell, Dallas, Tex., for amicus curiae, National Rural Letter Carriers Assn., Marion Edwyn Harrison, Reeves, Harrison, Sams & Revercomb, Washington, D. C., of counsel.

Gambrell, Harlan, Russell & Moye, Atlanta, Ga., amicus curiae, on behalf of National Underwriters, etc., Charles A. Moye, Jr., Edward W. Killorin, George W. Hart, Atlanta, Ga., of counsel.

Before HUTCHESON and BELL, Circuit Judges, and FULTON, District Judge.

HUTCHESON, Circuit Judge:

This appeal is from a judgment dismissing the third-party complaint of the United States against Government Employees Insurance Company GEIC in a suit brought against the United States under the Federal Tort Claims Act, 28 U.S.C. Secs. 1346(b), 2671-2680. The suit was instituted to recover for injuries and damages sustained in an automobile accident involving an automobile owned and operated by a United States employee, Elwood C. Pugh, who at the time of the accident was acting within the scope of his employment. The question before us is whether the United States is entitled to recover as an additional "insured" under the automobile liability policy issued by GEIC to Pugh and in force at the time of the accident, which defined "insured" to include "any other person or organization legally responsible for the use of the insured automobile * * *."

The district court similarly stated the issue posed for decision. It then determined that an "interpretation" of the Pugh policy was necessary to ascertain whether the United States was intended by the parties to the policy — Mr. Pugh and GEIC — to be included as an additional "insured" under the policy. The court concluded that the United States was not intended as an additional "insured", relying on the fact that the policy was designed to cover primarily "pleasure" uses of the Pugh automobile; that the premium rate basis of the policy was "pleasure use"; and that had the premium rate basis been "business use", Mr. Pugh would have paid a substantially higher premium. The court also looked to the 1961 amendments to the Federal Tort Claims Act (28 U.S.C. Section 2679 (b)-(e)); noted that these amendments provide for assumption by the Federal Government of responsibility for claims for damages against Government employees arising from the operation by them of vehicles in the scope of their Government employment; and ruled that the amendments evidence a Congressional intent that the United States not be allowed recovery from an employee's liability insurer. Myers v. United States, 241 F.Supp. 515 (N.D.Tex.1965). We have carefully and closely examined the district court's findings and conclusions, but we are unable to agree with or accept them.

The court below rested its decision on its "interpretation" of the insurance contract between Mr. Pugh and GEIC to determine whether the parties to that contract "intended" to include the United States within its coverage. But the court's efforts in this regard are entirely misdirected. For in the case at bar "interpretation" as such is not only unnecessary, but wholly inappropriate.

In very plain language Mr. Pugh's policy insures any "person or organization legally responsible for the use" of the insured automobile. The only question in the court below was, and in this court is, whether the United States may qualify as an additional "insured" under this language. And we are convinced that this no longer is a question to be answered by applying the usual rules of contract construction. On the contrary, an unbroken line of cases, presenting this very question and involving the same or very similar contract language, has definitively answered the question in favor of the United States.¹

It would indeed be difficult to conceive of a situation in which the meaning of disputed language was more firmly and finally decided, and where "interpretation" as such was so unnecessary. For GEIC has continued using the disputed language in the face of the many judicial pronouncements holding that the United States is an additional "insured" thereunder. It must be presumed that GEIC continued using the disputed phrase understanding that it would be given a meaning consonant with the repeated judicial interpretations thereof. In these circumstances GEIC cannot now argue that it did not "intend" to include the United States within the disputed phrase; rather by retaining this phrase it is deemed to have acquiesced in, and must now accept, the definite and only meaning given the phrase by prior decisions. Government Employees Ins. Co. v. United States, 349 F.2d 83, 86 (10th Cir. 1965), cert denied, 382 U.S. 1026, 86 S.Ct. 646, 15 L.Ed.2d 539 (1966); Adams v. United States, 241 F.Supp. 383, 385 (S.D.Ill.1965); Patterson v. United States, 233 F.Supp. 447, 449 (E.D.Tenn. 1964).²

Fully cognizant of the wealth of authority opposing its conclusions, the district court attempted to distinguish the above referenced cases. The court observed that the Pugh policy insured primarily "pleasure" uses of Mr. Pugh's automobile, and would have cost much more had Mr. Pugh specified that he intended to use his automobile for business purposes; for the court this was sufficient to render the prior decisions inapposite, since they all "dealt with policies specifying the employees' occupation (such as `mail carrier') and provided coverage for `business' use of the covered automobile." 241 F.Supp. at 519.

This analysis is completely wide of the mark. In none of the referenced cases did the court rest its decision on the existence or non-existence of "business use" coverage. The one court that has specifically considered this point rejected it point blank as irrelevant to the question here presented. Town v. United States, No. 64-577-JWC, S.D.Cal., Oct. 30, 1964. Cf. Percivill v. United States, Civil No. 1454, W.D.Tex., March 1, 1966.³ And clearly this is correct. The "pleasure-business" argument would, if at all appropriate, go to whether the accident here involved was within the coverage of the policy. But no questions are raised in this regard. Thus the court's "pleasure-business" analysis must be rejected.⁴

It must be remembered that GEIC selected the disputed language which it utilized in its policy. With knowledge of the accepted interpretation of that language, certainly GEIC could and should have expressly excluded the United States as an "insured" under its policy if it was dissatisfied with the accepted construction. This GEIC has in fact recently done.⁵ Since it did not do so before the accident here in question, it must be held responsible for this dereliction. See Patterson v. United States, 233 F.Supp. 447, 449 (E.D.Tenn.1964); Irvin v. United States, 148 F.Supp. 25, 32 (D.S.D.1957). See also Gabriel v. United States, Civil No. 64-C-3-D, W.D.Va., ......, 19...

We must also reject the district court's analysis of the effects of the 1961 amendments to the Federal Tort Claims Act 28 U.S.C. Section 2679(b)-(e). The court distilled from these amendments a Congressional intent that the United States now assume full responsibility for claims for damages resulting from automobile accidents involving Government employees while acting within the scope of their Government employment, to the exclusion of any action against such employees personally. And indeed this was the intent, and is the effect, of the amendments. See Uptagrafft v. United States, 315 F.2d 200, 204 (4th Cir. 1963), cert. denied, 375 U.S. 818, 84 S.Ct. 54, 11 L.Ed.2d 52 (1963).

But nowhere in the amendments is there any indication that Congress intended to preclude recovery by the United States from the employee's liability carrier, where the employee has voluntarily, albeit unnecessarily, included the United States as an "insured" under his policy. The court below found this intent implied from the fact that Congress did not expressly include within the amendments authority for the United States to proceed against its employees' insurers. However these amendments had as their purpose the protection of Government employees from personal liability arising from automobile accidents negligently caused by them; they were not designed to, and should not be held to, affect the rights created by and existing by virtue of insurance contracts taken out by Government employees. Plainly Government employees no longer need to insure against automobile accidents occurring while they are acting within the scope of their Government employment; but nothing prohibits them from doing so if they so choose. In light of the host of judicial determinations that the United States may recover as an additional "insured" under the language here involved and where the policy includes business accidents, many decided before Congress enacted the 1961 amendments to the Federal Tort Claims Act, we cannot believe that Congress would have left its intent to overrule these decisions to implication. Rather it would have, and certainly should have, expressly declared its views if they were contrary to the accepted judicial construction. And with but one exception⁶ other than the present case, all courts that have considered this problem since the 1961 amendments have upheld continued Government recovery as an...