Wise v. Westchester Fire Insurance Company
| Decision Date | 13 July 1972 |
| Docket Number | No. 71-1152.,71-1152. |
| Parties | W. Virgil WISE and Anita Wise, Plaintiffs-Appellees, v. WESTCHESTER FIRE INSURANCE COMPANY, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Tenth Circuit |
James B. Zongker, of Render, Kamas & Kelly, Wichita, Kan., for plaintiffs-appellees.
Darrell D. Kellogg of Kahrs, Nelson, Fanning, Hite & Kellogg, Wichita, Kan. (Larry A. Withers, Wichita, Kan., with him on the brief), for defendant-appellant.
Before MURRAH, SETH and BARRETT, Circuit Judges.
This diversity action was brought by Mr. and Mrs. Virgil Wise of Kansas, to recover damages due under the uninsured motorist coverage allegedly provided in a policy of insurance issued to Mr. Wise by Westchester Fire Insurance Company, a New York corporation. Mrs. Wise was the natural mother and Mr. Wise the stepfather of Ricky Eugene McCowan, who died as a result of being struck by an automobile driven by an uninsured motorist during the time the Westchester policy was in effect. E. E. McCowan, the natural father of the decedent, obtained a judgment against the uninsured motorist in a Kansas state court in the amount of $26,500. The state court apportioned this judgment between McCowan and Mrs. Wise as the decedent's natural father and mother. In the present suit, Westchester contends that the policy issued to Mr. Wise did not provide uninsured motorist coverage, hence no liability on the state court judgment.
Upon trial of this case without a jury, the Federal District Court found the policy to be unclear and ambiguous and admitted extrinsic evidence in the form of testimony to clarify the intentions of the parties with regard to it. The court held that the policy when construed in favor of the insured provided uninsured motorist coverage and entered judgment in favor of Mr. and Mrs. Wise in the full amount of the state court judgment, plus interest and costs. The trial court subsequently amended its findings and judgment to limit recovery by Mrs. Wise under the policy to $15,750 with interest, in conformity with the state court's apportionment of the judgment. We affirm that judgment.
The testimony elicited at trial revealed that in 1967, Mr. Wise had purchased an automobile owned by the Haysville State Bank, Haysville, Kansas. The Bank financed the purchase and requested that Wise apply for insurance on the automobile with F. G. Stearns & Son, an insurance agency with offices located in the Bank. The only person with whom Wise had any contact pertaining to issuance of the Westchester policy was Alfred Sherwood, the car salesman with whom he had dealt. Sherwood obtained Mr. and Mrs. Wise's signatures on a blank application form and recorded the information necessary for completion of the form. The trial court found that Wise specifically requested uninsured motorist coverage at the time he signed the application.1 The car salesman testified that he notified the Stearns agency of this request and was informed by an unidentified employee that "it would be all right."
The declarations page of the Westchester policy which was subsequently issued to Wise is divided into seven items. Our concern is only with item 3 which describes the various types of coverage available under the policy. Item 3 provides:
Directly under this statement is a column captioned "COVERAGES" containing ten lines lettered "A" through "J," each line bearing the generalized title of one of the various forms of insurance coverage available. To the right of this column are separate columns in which the limits of liability and amounts of premium for the respective coverages may be indicated. The eleventh line of the "COVERAGES" column bears the phrase, "Endorsements (IDENTIFY BY FORM NUMBERS)." Typed on that same line in the column entitled "LIMITS OF LIABILITY" are the form numbers of the two endorsements originally attached to the policy: GU8881a and AL8845a. Item 3 also contains the following statement stamped diagonally across the "COVERAGES" column in red capital letters:
Specific premium charges and limits of liability are indicated in item 3 for coverage D—Comprehensive, Personal Effects—and coverage E—Collision. No premium charges or limits of liability are indicated for coverage J—Family Protection — the category for uninsured motorist protection.
Attached to the policy is endorsement number AL8845a, entitled "Amendment of Family Combination Policy—Kansas," which is the uninsured motorist coverage endorsement in question. The issuing language on this endorsement reads:
"This endorsement, effective 4-11-67 (12:01 A.M., standard time), forms a part of policy No. FAC634538 issued to W. Virgil Wise by Westchester Fire Insurance Company."
Following this language is a caption set out in conspicuous bold print:
The endorsement bears the signature of John Trout as "Authorized Representative, F. G. Stearns & Son."
Trial testimony also indicated that at the time the policy in question was issued Westchester was in the practice of attaching endorsement AL8845a to all of its automobile insurance policies because of the impending effectiveness of K.S. A. 1971 Supp. 40-284, making uninsured motorist coverage mandatory unless specifically rejected in writing by the insured. No attempt was made, however, to explain why the endorsement attached to Mr. Wise's policy contained specific issuing language and the signature of an authorized representative of Westchester's local agency.
On appeal Westchester claims that the operative language of the policy clearly and unambiguously demonstrates that uninsured motorist protection was neither intended nor actually extended, and that the trial court erred in construing the policy to provide such coverage. The specific argument in support of this claim is that the language of item 3 explicitly states that the policy provides only such coverages as are indicated by the...
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