# FILED January 14, 1999 Cecil W. Crowson Appellate Court Cle rk IN THE COURT OF AP PEALS OF TENNESSEE

AT NASHVILLE ROBERT EDMONDSON, ) ) Plaintiff/Appellee, ) Davidson Circuit N o. 96C-4092 ) VS. ) Appeal No. 01A01-9802- CV-00097 ) MARCUS P. SOLOMON and ) BRENDA SOLOMON, and ) ) HAULERS INSURANC E COMPANY, ) INC., ) ) Defendant/Appellant. ) APPEAL FROM THE CIRCUIT COURT OF DAVIDSON COUNTY

AT NASHVILLE, TENN ESSEE THE HONORABLE WA LTER C. KURTZ, JU DGE

CYNTHIA D. PLYMIRE ORTALE, KELLEY, HERBERT & CRAWFORD, LLP Nashville, Tennessee Attorney for Appellant
SARA STEIN Nashville Attorney for App

ellee

AFFIRMED

ALAN E. HIGHERS, J.
CONCUR: W. FRANK CRAWF

ORD, P.J., W.S. DAVID R. FARMER, J.2

Defe ndant H au lers Ins ura nc e (“ H au lers ” or “A pp ella nt”) , ap pe als the trial c ou rt’s d en ial o f H a ulers ’ Motionfor Part ial Sum

mary Judgme

nt seeki ng a s eto ff ag ain st th e to tal a m ou nt o f un ins ure d m oto rists coverage due und er t he H au le rs poli cy, for disabil it y amou nts paid t o Plaint if f, Robert Edm ondson (“E dm on ds on ” or “A pp elle e”) , by his em plo ye r an d u nd er a dis ab ility p olic y.
I. Factual and Procedur al History
The Pla intif f, R ob ert E dm on ds on, an d th e D efe nd an ts, M arc us P. S olo m on an d B ren da So lom on, wer e invol ved in an auto m obile a ccide nt on Fe brua ry 12 , 19 96 , in Nashvill e, Davidson County, Tennessee. At t he tim e of the acc iden t, Edm ond son wa s insu red b y a p olicy o f insura nce with Ha ulers Insurance Comp

any, Inc. with $25, 000 in uni nsured/under insur ed motorist coverage.
Foll owing the ac cid en t, Ed m on ds on rec eiv ed $5 ,05 4.3 0 in Ac cid en t an d S ick ne ss be ne fits fr om his employer pu rsu an t to his employment contract, and $3,253.33 under an additi onal disabi li ty i nsurance policy.
Pla intiff fi led an act ion agai nst Defendant s Solomon and Haulers seek ing dama ges ari sing f rom inju ries in t he accident . On October 20, 19 97 , H au lers filed a M otio n fo r P art ial S um m ary Ju dg m en t se ek ing a se toff ag ain st th e to tal a m ou nt o f un ins ure d m oto rists co ve rag e d ue un de r the H au lers ’ po licy for d isa bility am ou nts paid by Edmondson’s employer andunder a d isa bility po licy of in su ran ce . In s up po rt o f this m otio n, Haulers reli ed on the foll owing policy pr ovisi ons:

B. The limit of li abil it y shall be r educed by all sums: 2. Paid or payable because of t he “bodil y inj ury” under

any of the follo w ing or sim ilar law : a. Workers’ compensati on law; or b. D isa bility be ne fits la w . F. W e w ill no t pa y fo r an y e lem en t of lo ss if a person is en

titled to receivepa ym en t for the same element of loss under any of the follo w ing or sim ilar law : 1. Workers’ compensati on law; or 2. D isa bility be ne fits la w . Thus,Haulers argued t hat i ts $25, 00 0. 00 lim it of lia bility sh ou ld b e re du ce d b y th e $ 8,3 07 .63 dis ab ility paymen ts alr eady received by Edmo ndson from other sources.
Edmond son fi led a resp ons e in o ppo sition to this m

otion. E dm ond son argu ed th at the exc lusion ary3

language in the po licy sp ec ifica lly re fers to benefi ts pai d under workers’ compensation law , dis ab ility b en efits law or sim ilar law . It w as Ed m on ds on ’s c on ten tion tha t the H au lers po licy refe rs to be nefi ts cr eated by legi slat ive en ac tm en t, su ch as So cia l Se cu rity dis ab ility o r w ork ers ’ co m pe ns atio n a nd theref ore does

not ref er to the type of benefit s Edm

ondson received because

his benef it s were paid by operat ion of contract and not operati on of l aw.
F oll owing arg

um en t of c ou ns el, th e F ifth C ircu it for D av ids on C ou nty en ter ed an O rde r de ny ing Haulers’ M otio n fo r P art ial S um m ary Judgment. On January 16, 1998 Hauler s fi led a M otion fo r an In terlocu tory Ap pe al fo r de term ina tion of th e is su e o f se toff. T his m otio n w as de nie d o n J an ua ry 2 1, 1 99 8.
An Agreed Judgment Order was fil ed in f avor of Edm ondson against the unnamed Defendant Ha ulers in the am ou nt o f $2 5,0 00 .00 an d d ism iss ing the ca se ag ain st th e S olo m on s o n J an ua ry 2 9, 1 99 8. H au lers the n paidto E dm on ds on the jud gm en t am ou nt w ith the excepti on of the di sputed $8,307.63, which w as pa id d irec tly into the C ou rt p en din g th is C ou rt’s de cis ion on ap pe al.
II. Setoff Under the Haulers Policy Appellant co

nte nd s th at th e tr ial c ou rt e rre d in not al lowing Hauler s, purs uant to it s policy pr ovisi ons, to reduce it s li mit of l iabi li ty for disabil it y benefit s paid to Edmondson by o ther sources.
Ha ulers contends that t he clear i ntent of the li miting provi si ons i s to a llow s etoff ag ains t unins ured motorist coverage for payments already paid by ot her sources. Edm ondson argues

that the word “l aw” is not ambiguous.

It re fer s to be ne fits c rea ted by leg isla tive en ac tm en t, su ch as So cia l Se curity disabil it y or workers’ compensation. The benefit s paid t o Edm ondson were paid pursuant to cont ract and not due to any legisl ati ve en ac tm en t.
C on trac ts of insur ance are to be int erpreted l ike othercontract s. That i s, they s hould be construed accordi ng to th e u su al, na tura l, an d o rdin ary m ea nin g o f the lan gu ag e e m plo ye d. Am eric an N atio na l Pr op erty and Cas. Co. v. Gray , 80

3 S .W .2d 69 3, 696 ( Tenn. App.1990). The ordinary mean ing of “ workers’ compensation law

” or “dis ab ility b en efits law ” w ou ld e nc om pa ss w ork ers ’ co m pe ns atio n o r dis ab ility b en efits4

paidby op era tion of la w . H au lers w an ts th is C ou rt to ex ten d th e m ea nin g of th es e te rm s to inc lud e b en efits paid by operati on of contract . This Court i s of the opini on that the t erms used are clear and should be gi ven thei r ordi nary meaning.
This case bears some simil ari ty t o Elsner v. Walker , 879 S.W.2d 852, (Tenn. App. 1994). I n Elsner , the Unin sured M oto rists po licy pro vid ed tha t “the lim it of liab ility s ha ll be red uc ed by all s um s p aid because of bodil y inj ury or pr operty damage by or on behalfof persons or organizat ions w ho m ay be leg ally res po ns ible .” The ins ure r so ug ht a se toff for medical i nsurance coverage provided to t he plaint if fs by their medical insurance carrie r. The court i nterpr eted t he language “per sons or org an iza tion s w ho m ay be leg ally res po ns ible ” to m ea n ex ac tly what it said and no

thin g m ore . Th e C ou rt n ote d th at n ow he re in th e p olic y is the re a n e xp licit, p lain stat ement that [t he insu rer’s] liability w

ill be red uce d by sum s pa id by an in sure d’s m edic al insu ranc e ca rrier. If the ins ure r ha d in ten de d th at th ey be en titled to a red uc tion for pa ym en ts o f an ins ure d’s medical i nsurance, it co uld ha ve inc lud ed su ch a p rov isio n. Id . at 854.
In the Elsner case the insu rer so ugh t to ha ve th e co urt, in es sen ce, n ullify the q ualifying term “by or on behalfof persons ororganizat ions who may be legally responsible ” an

d a llow se toff f or b en efits pa id by other sour ces. I n the

ca se be for e th is C ou rt, H au lers se ek s to ha ve this co urt nu llify th e w ord “la w ” from the clause and all ow setof

f f or bene fi ts paid by ot her sources. Haulers’ argument only can be that t he policy language is un clea r and sho uld b e su fficiently inc

lusive to co ver s etoff for b ene fits paid by o

pera t io n of contract , even though not speci fi call y stated i n the poli cy.
An “ambiguity” in a contr act or i nsurance policy i s doubt or uncertai nty ari sing fr om the possibili ty of the sam e lan gua ge b eing fairly un ders tood in m ore w ay s th an on e. NSA DBA Benefit Plan, I nc. v. Connecticut GeneralLi fe I ns . Co. , 968 S.W.2d 791 (Tenn. App. 1997). This Court does not f ind the t erms “workers’ compensation law

” or “di sa bility be ne fits la w ” to b e a m big uous. The rule of st rict construct ion does not au thorize a pe rve rsio n o f lan gu ag e, o r th e e xe rcis e o f inv en tive po w ers for the pu rpo se of c rea ting an am big uity w he re n on e e xis ts. C on ley v. P ac ific M utu al L ife. I ns . C o. o f C alifo rnia , 8 Te nn. A pp. 4 05 (1 928 ).
Even if this C ourt were to fi nd

tha t the lan gu ag e u se d w as am big uo us , H au lers ’ ar gu m en t w ou ld n ot have m erit . Te nn es se e la w is w ell s ettle d th at a ny am big uity in contract s, i ncluding i nsurance contract s, must5

be co ns true d in fav or o f the ins ure d. Elsner a t 85 4. See also Alls

tate Ins . C o. v . W atts , 811 S.W.2d 883 (Tenn. 19 91 ) (e xc ep tion s, e xc lus ion s a nd lim itatio ns in p olic ies m us t be co ns true d a ga ins t the insur er and in favor of the

ins ure d); U.S. Fidel it y & Guar. Co. v. Murray Ohio Mfg. Co. , 693 F.Supp. 617, 620 (M.D. Tenn. 198 8) (ex clusio n cla use s m ust b e strictly c ons trued in a m ann er m ost fav orab le to the insu red).
An ins ure r m ay lim it risk or c ov era ge as it de em s b es t. Horace M

an n M ut. I ns. Co. v. Burrow, 373 S.W .2d 469 (Tenn. 1963). Under Tennessee’s unins ured motori st st atut es and the comm on law, i nsurers may incl ude off sets which ar e designedto avoid dupl icat ion of i nsurance an d o the r be ne fits. See Tenn. Code Ann. §56-7-1205. This Court does not in an y w ay se ek to ab ridg e H au lers ’ rig ht to cre ate su ch an ex clu sio n reduci ng it s li abil it y by sums paid pursuant to la w , co ntr ac t an d/o r an y o the r so urc es . H ow ev er, this C ou rt h old s that Haulers did

no t cre ate su ch a b roa d e xc lus ion in th e p olic y a t iss ue he re. In sured s s ho uld no t ha v e t o co ns ult a long l in e of cases or consult law review arti cles or t reati ses to determine t he me aning of pol icy language. Elsner

at 85 5. If th e lim itatio n c on ten de d b y H au lers is to be pa rt of t he co ntra ct, it m us t be cle arly writt en into t he policy.
The ordinar y meaning of the t erms used in th is p olic y a llow s H au lers an offs et o nly for disabi li ty and wo rkers compensation benefi ts pai d pursuant t o law . Under the l anguage of the uni nsured motorist coverage lim itatio n, w e fin d n o lim itatio n o r se toff a va ilab le to H au lers for dis ab ility o r w ork ers co m pe ns atio n be ne fits p aid to Edm onds on pu rsu an t to h is e m plo ym en t co ntra ct a nd /or h is o w n d isa bility ins ura nc e p olic y. F or th e fore go ing rea so ns , the trial c ou rt did no t err in d en yin g H au lers ’ M otio n fo r P artia l Su m m ary Ju dg m en t.
III. Conclusion
The judg m ent o f the trial co

urt is hereby affi rmed. Costs of thi s appeal are taxed t o Appellant, for which execution may issue if necessary.

HIGH ERS , J. CONCUR:6

CRAW FORD, P.J ., W.S.

FAR ME R, J.