Elledge v. Warren

The trial court granted summary judgment dismissing Mary A. Elledge’s claim against her insurer under the uninsured motorist coverage, enforcing the exclusion of uninsured motorist coverage when the insured is occupying an uninsured automobile owned by the named insured or a relative. We reverse. The exclusionary provision is contrary to the statute which requires uninsured motorist protection unless specifically waived.

Mary A. Elledge owned two automobiles and a Honda motorcycle. Both automobiles were insured, and uninsured motorists protection was provided for both. Under the terms of the policy, her son was an insured. The motorcycle was not insured. Mrs. Elledge’s son Murray Elledge was operating the Honda motorcycle in Lafayette and had stopped for a traffic light. Two other motorists — one insured and one uninsured — collided causing one to strike and injure Murray. In the claim for damages for personal injuries and medical expenses, plaintiff joined her insurer as party defendant under her uninsured motorist coverage, in the event the uninsured motorist was found to be the sole cause of the accident.

Mrs. Ellege’s insurer, defendant State Farm Mutual Automobile Insurance Company, moved for summary judgment based on its .'policy exclusion relating to uninsured motorist coverage — Part IV coverage U at page 8:

“EXCLUSIONS. This policy does not apply under Part IV.

“a) to bodily injury to an insured while occupying an automobile (other than an insured automobile) owned by the named insured or a relative, or through being struck by such an automobile, . . .”

As to the applicability of the exclusionary clause to' the uninsured motorcycle in this case, we note that in many instances the words of a policy are interpreted according to their general and popular use. The exclusionary clause in this case is worded in terms of automobiles other than insured automobiles, i. e., uninsured automobiles, owned by the named insured or his relatives. We accede to the proposition that in its general and popular use the word uninsured automobile would not comprehend motorcycle.

However, the rule of general and popular use construction applies only where the terms are not defined by the policy itself. “Where a policy of insurance contains a definition of any word or phrase, this definition is controlling.” Hendricks v. American Employers Insurance Co., 176 So.2d 827, 830 (La.App. 2 Cir. 1965), writ refused 248 La. 415, 179 So.2d 15. Furthermore, exclusionary provisions must be read in the context of the entire policy. West v. City of Ville Platte, 237 So.2d 730 (La.App. 3 Cir. 1970).

In the case at hand the exclusion relating to automobiles owned but not insured is found in Part IV of the policy. The definition of such an uninsured automobile is found in the same section, as follows :

“. . . the term ‘uninsured automobile’ shall not include:

(4) a land motor vehicle or trailer if operated on rails or crawler-treads or while located for use as a residence or premises and not as a vehicle . . .”

In Thibodeaux v. St. Paul Mercury Insurance Company, 242 So.2d 112, (La.App. 3 Cir. 1971), this definition was held to have the following meaning:

“This specific exclusion of certain types of land motor vehicles indicates that the policy did include all land motor vehicles under its uninsured motorist provision

The court found that the insurance company had thereby intended to include motorcycles within the concept of uninsured automobiles. We believe that although it was not so nominated, the process of reasoning which the court used in this case was that applied in Darrell v. State Fire and Casualty Company, 221 So.2d 5, 6 (Fla.App. 3 Dist. 1969):

“So when we apply the maxim ‘expressio unius est exclusio alterius’ to the above quoted portion of the insurance policy we conclude that as defined in the policy ‘automobile’ means all land vehicles except those specifically excluded and that therefore a motorcycle is an automobile within the meaning of the instant insurance policy.”

Having determined that the definition of uninsured automobiles in the present policy includes motorcycles, we read the exclusion in this context and conclude that mo-tbrcycles are included within the vehicles owned but not insured to which this exclusion applies.

That such a broad definition of automobiles is warranted in interpreting the exclusion clause is borne out by the fact that in Rushing v. Allstate Insurance Co., 216 So.2d 875 (La.App. 2 Cir. 1968) the court found an identically worded exclusion applicable to a truck.

Can the insurer require its insured owner of uninsured motorist coverage to pay additional premiums when the insured owns more than one automobile in order to provide uninsured motorist coverage while its insured is occupying other vehicles “owned by the named insured or a relative” ? We find it cannot.

Problems caused by the financially irresponsible and the uninsured motorist have been the subject of much study. See The Problem of the Financially Irresponsible Motorist, 24 U.Kansas City L.Rev. 82 (1955-56); The Uninsured Motorist: National and International Protection Presently Available and Comparative Problems in Substantial Similarity, 9 Buffalo L.Rev. 283-320 (1960); Public Responsibility and the Uninsured Motorist, 47 Georgetown L. J. 700, 702 (1959); Uninsured Motorist Coverage in Virginia, 47 Virginia L.Rev. 145 (1961); The Nature and Potential of the Saskatchewan Insurance Experiment, 14 Florida L.Rev. 352 (1961); Widess, A Guide to Uninsured Motorist Coverage (1969); and New Provisions for Protection from Injuries Inflicted by an Uninsured Automobile, 396 Insurance L.J. 19, 20 (1956).

By the end of 1968, forty-six states had legislation requiring insurance companies to include uninsured motorist coverage (unless specifically waived) in all liability policies issued or delivered by an insurer licensed in the state, upon any motor vehicle principally used or garaged in the State. Widess, supra, § 111, p. IS. Louisiana is one. LSA-R.S. 22:1406, subd. D (1) provides:

“D.(l) No automobile liability insurance covering liability arising out of the ownership, maintenance, or use of any motor vehicle shall be delivered or issued for delivery in this state with respect to any motor vehicle registered or principally garaged in this state unless coverage is provided therein or supplemental thereto, in not less than the limits described in the Motor Vehicle Safety Responsibility Law of Louisiana, under provisions filed with and approved by the Commissioner of Insurance, for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness or disease, including death, resulting therefrom; provided, however, that the coverage required under this section shall not be applicable where any insured named in the policy shall reject the coverage.”

In the light of the history of this legislation as reported by the cited authorities, we find it appropriate to review our appreciation of our own statute.

There existed in our society a situation whereby financially irresponsible people could acquire and drive vehicles capable of great damage. Because of their financial irresponsibility and lack of insurance, they were unable to respond to their victim in damages under LSA-C.C. Art. 2315. This created a class of injured people in our state who were left without recourse and who, without some form of relief, might become wards of the state. Insurance plans (such as the financial responsibility law) oriented toward coercing motorists to purchase insurance or removing them from the highways if they did not, proved ineffective. Other plans had to be developed.

In an effort to forestall plans distasteful to itself, the insurance industry set forth a plan of compensation for the innocent victims of the uninsured motorists. In surveying the problem, it became evident to our legislature that the source of the harm was a danger peculiar to the use of the automobile and the industry most capable and most interested in resolving the problem was the one most closely related thereto in terms of economics and self interest • — the automobile insurers. Therefore, our legislature seized upon the solution set forth by the insurance industry and made the offering of uninsured motorist protection a mandatory condition precedent before the companies could conduct business in Louisiana.

The evil and the injuries existed. By the terms of our statute, whenever evil perpetuates itself upon a policy holder availing himself of uninsured motorist coverage (or insureds under his policy), he is to be compensated for his injuries. In Booth v. Freeman’s Fund Insurance Company, 253 La. 521, 218 So.2d 580, 583 (1969), our Supreme Court concluded “that the intent of our uninsured motorist statute and the policy endorsement issued thereunder is to afford protection to the insured when they become the innocent victims of the negligence of uninsured motorists.” See also Valdez v. Federal Mutual Insurance Company, 272 Cal.App.2d 223, 77 Cal.Rptr. 411, 413 (1969). “ . . . Such statutes must be liberally construed to carry out this objective of providing compensation for those injured through no fault of their own.”

The nature of the premium charged for this protection gives insight into the coverage afforded. The rate is a flat one and coverage is available to all persons at the same rate. The rate is unrelated to risks. By terms of the policy, the policy holder and members of his family are covered, irrespective of the number, ages or sex of those in the family. The insured family members are covered while guest passengers of an uninsured motorist who injures them. Thibodeaux v. St. Paul Mercury Ins. Co., 242 So.2d 112 (La.App. 3 Cir. 1971). It would be impossible to effectively gauge the frequency of the insured’s travel as a guest of others, as well as these other’s driving ability, age, sex, etc.

This points to the fact that the intent of the coverage is to protect an insured at all times. He is not to be protected only when in his own car or with a member of his family. If he were, his frequency and degree of exposure to uninsured motorists could possibly be gauged and rates regulated accordingly. Once this definable scope of risks has been enlarged and extended to cover cases, at &. flat rate, when the insured is a guest passenger of the uninsured motorist, it follows that the intent of the coverage is to protect the insured at all times against the generalized risk of damages at the hands of the uninsured motorists and not to limit coverage to certain situations or to a certain degree of risk of exposure to the uninsured motorists.

LSA-R.S. 22:1406,, subd. D(l) does not allow the exclusion inserted by the insurer. This statute in effect becomes a part of every policy of insurance to which it is applicable, as if it was written in the policy itself. It follows that any policy provision which narrows the coverage mandated by the statute will not be enforced. This same result was reached with a similar California statute and a similar policy exclusion in Aetna Insurance Company v. Hurst, 3 Cal.App.3d 252, 83 Cal.Rptr. 156, 157 (1969).

There is no requirement in the statute that the insured have any relation, at the time of the accident, with any vehicle he owns and that is insured with the insurer. The uninsured motorists protection covers the insured and the family members while riding in uninsured vehicles, while riding in commercial vehicles, while pedestrians or while rocking on the front porch. See Travelers Indemnity Company v. Powell, 206 So.2d 244, 246 (Fla.Dist.Ct. of App. 1st Dist.1968) “. . . the exclusion clause here (identical to the one before us) is an invalid restriction because it is not the intent of the statute to limit coverage to an insured' by specifying his location or the particular vehicle he is occupying at the time of injury. The statute states its purpose thusly: ‘. . . for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles . . .’”

It is an injury caused by this evil peculiar to automobiles, the uninsured motorist, that the insurance company has agreed to compensate the insured for, and his position at the time of the injury is irrelevant as long as an uninsured motorist has caused his injury. “This so-called uninsured protection is limited personal accident insurance . . . ” Motorists Mutual Insurance Company v. Bittler, 14 Ohio Misc. 23, 235 N.E.2d 745, 750-751 (1968).

The only relation that the insured must have to automobiles at the time of the accident is that he be injured by an automobile driven by an uninsured motorist. Quick v. Michigan Millers Mutual Insurance Co., 112 Ill.App.2d 314, 250 N.E.2d 819 (1969); Matwijko v. Walter Yolandy Lbr. Bldrs. Sup. & F. Corp., 16 A.D.2d 1024, 230 N.Y.S.2d 77 (1962); Lopez v. State Farm Fire & Casualty Company, 250 Cal.App.2d 210, 58 Cal.Rptr. 243 (1967); Gulf American Fire & Casualty Company v. McNeal, 115 Ga.App. 286, 154 S.E.2d 411, 416 (1967).

The purpose of the statute is to protect completely, those willing to accept its protection, from all harm, whatever their status — passenger, driver, pedestrian —at the time of injury, produced by uninsured motorists. The only restrictions are that the plaintiff must be an insured, the defendant motorist uninsured, and that plaintiff be legally entitled to recover. We will not enlarge upon these qualifications and restrict the coverage of such a socially desirable policy by allowing insurance companies to pursue alleged “business interests.”

In the present case, Murray El-ledge is covered while riding in either of Mrs. Elledge’s insured automobiles or while riding his bicycle or walking along the street. Since coverage is not predicated upon the degree or number of exposures to the risk of harm from uninsured motorists, the coverage is a blanket 100% coverage against injuries from uninsured motorists. The argument that the insurer should be compensated for additional risk fails. The payment of the flat rate invokes 100% protection against the designated evil. Payment of another flat rate does not increase the coverage. Such added payments where the policy owner owns additional automobiles, results in the insured paying twice or more times for identical coverage afforded other insureds with only one car. This is distinguished from the situation under collision and liability insurance where an insurer’s liability and resultant rates are directly related to the limited types of risks it assumes and its insured’s frequency of their encounter.

Further insight into the illogical nature of defendant’s pursuit of this “business interest” can be had by examination of the exemption of coverage in the defendant’s policy relating to an insured’s presence in or injury by a relative’s uninsured automobile. Apart from the reasons already discussed, the provision is improper in that coverage of an insured, who has paid for the coverage, is restricted on no better premise than the “business interest” his insurer has in securing a policy from his relative — a matter over which the insured may have no control.

An insurance company may not create irrational and illusory “business interests” and interpose them as a bar to the comprehensive coverage required by our statute.

The exclusionary provision is contrary to the statute and is void. The summary judgment is reversed and the case remanded. Costs of this appeal are assessed to defendant-appellee.

Reversed and remanded.

HOOD, J., concurs and assigns written reasons.

. In Labove v. Traders & General Insurance Company, 219 So.2d 614 (La.App. 3 Cir. 1969), we held that, under those particular facts, a motorcycle was not encompassed in the policy definition of owned automobiles. However, there are significant factors which distinguish La-bove from our case. Note the following language at 616.

“Having regard to (1) this ordinary meaning of the terms, as well as to (2) the intended function of automobile liability policies and (3) the scope of the risks intended to be covered, the courts have consistently held that motorcycles are not considered automobiles (4) for purposes of coverage by automobile liability policies.” (Emphasis and enumeration added.)

Of equal significance is the language found in Thibodeaux v. St. Paul Mercury Insurance Company, 242 So.2d 112, 114 (La.App. 3 Cir. 1971).

“Admittedly in Labove v. Traders & General Insurance Co., 219 . So.2d 614 (La.App. 3 Cir. 1969), we said that a motorcycle was not an automobile but that ease arose under a ‘Non Owned Automobile’ provision of a. policy and ice were not called upon to decide whether a motorcycle was an automobile under any uninsured motorist protection clause.” (Emphasis added.)

The turning point in Labove is that it dealt strictly with the liability provisions of an automobile insurance policy and not with provisions relating to uninsured motorist protection or exclusion clauses. The turning point in Thibodeaux is that we were dealing with uninsured motorist protection.

Note the reasoning process in Labove. We considered the intended function of liability provisions, scope of the risks intended to be covered, and the purpose of such provisions in order to determine whether motorcycles were encompassed within the word automobile. We also resorted extensively to the definition of this term as provided for in the policy and finding this unacceptable, we resorted to the “ordinary meaning of the terms.” (See Hendricks v. American Employers Insurance Co., supra, for the proposition that “ordinary meanings” give way to definitions in the policy.)

Applying this same reasoning process to the uninsured motorist clauses we find (ns ¡jointed out later with reference sources to follow) that the function and purpose of uninsured motorist provisions is to protect an insured completely and at all times from all injury perpetrated upon him by a person operating all types of motor vehicles for which there is available proper insurance. The risk covered, of course, is singular — any injury at the hands of such uninsured vehicle. Therefore it is initially evident that the breadth of coverage here is larger than in liability provisions. Likewise, it is only fair to conclude that the breadth of exclusion is the same.

In Thibodeaux, this court determined that uninsured motorist coverage clauses covered all injuries caused by all uninsured motor vehicles and that however written such clauses would have to comport with the statutory mandate (LSA-E.S. 22:1406, subd. D(l)). We thereby (however irrelevant some may believe it was to the decision) served notice on all insureds and insurers that the word “automobile” as used in uninsured motorist protection complied with the statute. The court took a definition offered in the policy and construed it to have a certain meaning. The process of construction of the definition was not ordinary usage which, as shown before is improper, but rather, due to the definition being couched in exclusionary terminology, the court used the “expressio uninus est exclusio alterius” method.

With the definition of uninsured auto-bile construed as including motorcycle, consideration should be given to what was meant by the reference to owned but not insured automobiles found in the exclusion before us. Both the definition and the clause appear in the same Part of the policy and when we construe the exclusionary clause in the context of the policy (See West v. City of Tille Platte, supra) we are left with no other conclusion than that the uninsured automobiles i>hraseology found in the exclusionary clause should be read in light of the definition of such “automobles” found in the same Part. Therefore, when the policy says injury by uninsured automobiles owned by third persons is covered while injury by uninsured automobiles owned by the insured or relatives is not — the same definition applies to both provisions and both provisions thereby have the same breadth. That is to say, taking all types of vehicles used on public roads, if the insured has no control over the insurance, he is covered. But if he has control over their insurance and they are uninsured, he is excluded from coverage. This is especially true when we consider that several courts (Spencer v. Traders & General Insurance Company, 171 So.2d 723 [La.App. 3 Cir. 19651; Bushing v. Allstate Insurance Co., 216 So.2d 865 [La.App. 1 Cir. 1968]) have, in effect, found the purpose of the exclusion to be to perpetuate the “business interest” an insurer has in not paying for injuries caused by vehicles which the insured could have insured with the insurer, but did not. The “pay for what you get” principle there applied does not seem to allow for construction of an intent upon the part of the insurer to assume coverage of several types of vehicles which the insured chose not to insure. The use of the concept of uninsured automobiles does infer such an intent in light of the contextually required application of the policy definition thereof. This is even clearer in light of the fact that, as to uninsured motorist provisions, this court previously, in Thibodeaux, led insurers to believe that the use of the concept would carry this broad comprehensive meaning.

That it led not only insurers but insureds to so believe is evidenced by the fact that all but one paragraph of plaintiff’s brief was devoted to the proposition that though applicable to the facts at hand, the exclusion was void.

When words or concepts are defined, then equity and justice require that this definition be applied with equal force to those words or concepts wherever they appear.

This court has previously gleaned the intention of the definition of uninsured automobiles to include motorcycles and has applied this definition to the coverage portion of uninsured automobile insurance. The jurisprudential command of contextual construction requires that this comprehensive definition be applied to the exclusion clauses. To do otherwise would be taking a giant step backward into the judicial gap of hypertechnical credibility.