Opinion ID: 596179
Heading Depth: 2
Heading Rank: 3

Heading: The Pooled Liability Fund As St. John's Insurance

Text: 17 Even if we were to consider the pooled liability agreement to be insurance, the result in this case would not change. American asserts that the pooled liability agreement, according to its plain meaning, provides primary coverage for Nurse Lierz. Read as a whole, the pooled liability agreement extends primary coverage to St. John's, but not to Nurse Lierz. American bases its contentions on only two clauses of the original agreement, 8 and ignores later amendments. 18 It should be restated that Nurse Lierz was not a covered party, she was an employee of a covered party. In 1982, the pooled liability agreement was amended, by a majority vote of the Sisters of Mercy hospitals, to make the liability pool excess to insurance coverage that the hospitals required their employed physicians to maintain. This independent coverage was not to be less than $200,000/$600,000. The 1982 amendment also made each hospital individually and immediately responsible for this minimum required coverage, if any physicians failed to maintain it. Joint Appendix at 58. In 1986, the agreement was further amended to require that all professional employees of the Sisters of Mercy, Inc., hospitals obtain individual malpractice insurance in the amount of $500,000/$500,000, as a precondition of a given hospital participating in the fund. Joint Appendix at 72. Although the 1986 amendment did not specifically address the excess coverage idea contained in the 1982 amendment, read together, the two amendments fairly indicate that the pooled liability agreement was not intended to be available to indemnify the hospitals' professional employees except in amounts over the $500,000 coverage provided by the required insurance policies. 19 Thus, even if the pooled liability fund could be construed to be St. John's insurance, by its terms it does not extend coverage to St. John's professional employees for amounts under $500,000. Accordingly, Nurse Lierz, a professional employee, did not have other insurance for liabilities under $500,000 and American is liable.