Universal Reinsurance Corp. v. Greenleaf, 58682
|824 S.W.2d 80
|07 January 1992
|UNIVERSAL REINSURANCE CORP., Respondent, v. Gregg GREENLEAF, et al., Appellants.
|Court of Appeal of Missouri (US)
R. Gerald Barris, Springfield, Ill. and Roger C. Denton, St. Louis, for appellants.
Ted L. Perryman and Mark R. Bates, St. Louis, for respondent.
This declaratory judgment action involves a question of coverage under a products liability insurance policy. Plaintiff, Universal Reinsurance Corporation, is the successor of Bellefonte Insurance Company which issued a products liability policy to the Choctaw Manufacturing Company, a Florida corporation, and its officers and shareholders, defendants Bobby Padgett and Al Seiffert, in 1980. Choctaw designed, manufactured, and sold a stick steering mechanism which was incorporated into a fishing boat manufactured by Chrysler Corporation. This boat was purchased by appellants, Gregg and Laura Greenleaf on June 1, 1983. Choctaw Manufacturing Company had ceased doing business and the corporation was dissolved on July 29, 1981. On June 12, 1983, the boat was involved in an accident causing bodily injuries to Gregg and Laura Greenleaf and the death of their two year old son. In May, 1986 the Greenleafs filed suit in the Circuit Court of the City of St. Louis against Bobby Padgett and Al Seiffert, the Chrysler Corporation, and Ireland Keith Ellis, the dealer who sold the boat. Universal denied that coverage existed under the policy issued by its predecessor because the accident did not occur during the period of time that the policy was in force. Prior to the trial of the Greenleaf's lawsuit, appellants settled with Chrysler and entered into an agreement with Padgett and Seiffert pursuant to § 537.065 RSMo. 1986, to limit any recovery against them to the proceeds recoverable under the Bellefonte Insurance policy. In return, Padgett and Seiffert agreed not to contest liability or damages. An uncontested judgment against Padgett and Seiffert was entered in the amount of $1,000,000. The case was tried against the dealer, Ellis, and resulted in a jury verdict in favor of Ellis.
On July 20, 1988, while the underlying lawsuit was pending, Universal instituted this declaratory judgment action against Padgett, Seiffert, and the Greenleafs (herein defendants). Universal alleged that the Bellefonte policy covered the period from August 26, 1980 thorugh August 25, 1981, so it did not cover the July 12, 1983 accident. The defendants counter-claimed, seeking a declaration that coverage was afforded or a reformation of the contract. The trial court ruled in favor of Universal. Only the Greenleafs appealed. We affirm.
The policy provides product liability coverage through the following language:
to which this insurance applies, caused by an occurrence, if the bodily injury or property damage is included within the completed operation's hazard, or the product's hazard....
The key words in this coverage provision "bodily injury" and "occurrence," are defined as follows:
"Bodily Injury"--means bodily injury, sickness or disease sustained by any person which occurs during the policy period, including death at any time resulting therefrom.
"Occurrence"--means an accident, including continuous or repeated exposure to the conditions, which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured.
In issuing policies, the usual and customary practice of Bellefonte's general agent is to fill out the declaration page of the policy with information contained in an application for insurance received from the insured or its agent, and to select appropriate coverage and endorsement forms. These papers are attached to a pre-printed form referred to as the "policy jacket," which then constitutes the complete insurance contract. The declaration page contains the name of the insured, a description of the insured's business, the policy period, the type of insurance provided and the amount of the annual premium. The insuring agreement is contained on a pre-printed form which also includes exclusions and limitations of liability. The definitions are found in the policy jacket, on the front of which is stated "THIS POLICY JACKET WITH THE DECLARATIONS PAGE AND FORMS AND ENDORSEMENTS, IF ANY, ISSUED TO FORM A PART THEREOF COMPLETES THIS POLICY."
The controversy in this case revolves around the appellants' contention that the evidence was insufficient to prove the policy jacket containing the definitions was attached to the other papers which Mr. Padgett received after purchasing the insurance. They argue that since Universal failed to prove that Padgett and Seiffert received the policy jacket, the definitions that limit coverage to a bodily injury resulting from an accident occurring during the policy period do not apply to their injuries arising from a defective product manufactured during the policy period.
Appellants first argue that the trial court erred in placing the burden of proving the existence of coverage upon them rather than requiring Universal, the plaintiff, to prove the absence of coverage. The trial court concluded the evidence failed to provide "a factual basis for a finding whether the jacket was attached to the copy of the policy received by the defendants." The court based this conclusion on the evidence that the policy had been lost. Mr. Seiffert had no recollection of the policy. Mr. Padgett had no distinct recollection if the jacket was attached to the remainder of the policy papers, but he thought he would have remembered it if he had seen it. The court admitted testimony from the employee of Bellefonte's general agent who was responsible for assembling, counter-signing, and mailing insurance policies. She testified to the usual and customary procedure of attaching the jacket and that she had to lift the jacket in order to counter-sign the policy. The trial court accepted this testimony and expressly found Mr. Padgett's testimony "not persuasive." The court concluded that the defendants failed to carry their burden that they had not received the policy jacket containing the definitions or that the parties intended any coverage different than that which was unambiguously expressed by the definitions.
The trial court did not err in placing the burden of proving coverage upon the defendants in the declaratory judgment action. In such an action, the burden of proof usually rests where it would have been placed had a different type of suit been brought. M.F.A. Mutual Ins. Co....
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