Opinion ID: 2441652
Heading Depth: 1
Heading Rank: 1

Heading: gulf's appeal

Text: The CGL Policy provides, in pertinent part: a. We will pay those sums that the insured becomes legally obligated to pay as damages because of `bodily injury' or `property damage' to which this insurance applies.... Exclusions This insurance does not apply to ... g. `Bodily injury' or `property damage' arising out of the ownership, maintenance,  use or entrustment to others of any ... `auto' owned or operated by ... any insured. .... The CGL Policy contains a special events endorsement that provides in relevant part: IT IS HEREBY UNDERSTOOD AND AGREED THAT THE FOLLOWING SHALL BE INCLUDED AS THE TERMS AND CONDITIONS OF THIS POLICY: SPECIAL EVENTS SHALL INCLUDE... PARADES ... .... Subject otherwise to all the terms, limits and conditions of the Policy. Gulf asserts that the language of the policy, including the policy exclusion, is plain and unambiguous; therefore, this Court must enforce the policy as written. Peters v. Employers Mut. Casualty Co., 853 S.W.2d 300, 302 (Mo. banc 1993); Harrison v. M.F.A. Mut. Ins. Co., 607 S.W.2d 137, 142 (Mo. banc 1980). Gulf contends that the plain meaning of the auto exclusion in the CGL Policy exempts Fuller's injuries from coverage under the policy. This insurance does not apply to... bodily injury or property damage arising out of the ownership, maintenance, use or entrustment to others of any ... `auto'... owned or operated by ... any insured. Although the special events endorsement states that the policy provides coverage for parades, the policy itself excludes coverage for bodily injury arising from the use of an auto owned or operated by Noble. Since Fuller was injured by a mobile studio, Gulf submits, the plain meaning of the auto exclusion acts to deny Fuller coverage. Gulf contends that this Court must read the endorsement in conjunction with the terms of the entire policy, including the auto exclusion, to determine the plain meaning of the CGL Policy. Abco Tank & Mfg. Co. v. Fed. Ins. Co., 550 S.W.2d 193, 198 (Mo. banc 1977). The special events endorsement itself does not provide coverage by its own terms; it merely defines the types of special events that may be covered by the terms of the policy. The endorsement states that it is [s]ubject otherwise to all the terms, limits and conditions of the Policy. For example, just as the special events endorsement is subject to the policy liability limits, Gulf contends, so is the endorsement subject to all other terms of the policy. Gulf asserts that claims arising from parades are covered to the same extent that any claim is covered, that is, subject to all of the terms of the policy. Fuller responds that the policy does provide coverage under the facts of this case. The special events endorsement states that it is, Subject otherwise to all terms, limits and conditions of the Policy. (emphasis added). Fuller distinguishes subject to from subject otherwise to. Fuller explains that if the special events endorsement had been subject to all terms of the policy, then the special events endorsement would have been modified by the terms, limits and conditions of the policy. Fuller notes that the phrase subject to is used in this way in other parts of the policy. In contrast, Fuller explains, because the phrase subject otherwise to was used, the special events endorsement is modified only by the portions of the policy that the endorsement itself does not supersede. Fuller explains that this is so because otherwise means in different circumstances. WEBSTER'S THIRD NEW INTERNATIONAL DICTIONARY, UNABRIDGED 1598 (1961). Fuller concludes that the special endorsement should be read to supersede other policy provisions where necessary to provide coverage for the listed special events. In other words, the special events endorsement is subject to all provisions of the policy except those that conflict with any special event covered in the endorsement. Fuller argues that if the CGL policy is not clear in providing coverage for liabilities arising from the parade, the policy is at least ambiguous. Whether a policy is ambiguous is a question of law. General Am. Life Ins. Co.  v. Barrett, 847 S.W.2d 125, 131 (Mo.App. 1993). An ambiguity exists when there is duplicity, indistinctness, or uncertainty in the meaning of the language in the policy. Language is ambiguous if it is reasonably open to different constructions. Krombach v. Mayflower Ins. Co., 827 S.W.2d 208, 210 (Mo. banc 1992). The use of the word otherwise creates such an uncertainty or indistinctness in this case; the language is reasonably open to both constructions advocated by the parties. While Gulf's argument appears to be persuasive initially, Fuller's focus on the word otherwise highlights the ambiguity in this policy. Subject otherwise to arguably means something different than subject to, because every word in a contract is to be given meaning if possible. Nichols v. Pendley, 331 S.W.2d 673, 676 (Mo.App.1960). The fact that subject to was used elsewhere in the policy strengthens Fuller's argument that the word otherwise has a different meaning. While the policy does not simply state that the special events endorsement supersedes the automobile exception, the policy is at least ambiguous in that regard. When policy language is ambiguous, it must be construed against the insurer. Krombach, 827 S.W.2d at 210. Because the CGL Policy is ambiguous, the language must be construed in favor of the insured. Fuller's injuries are covered by the CGL Policy. Gulf asserts that if the Court finds ambiguity, the Court must attempt to harmonize the ambiguous sections. Haggard Hauling & Rigging Co. v. Stonewall Ins. Co., 852 S.W.2d 396, 401 (Mo.App.1993). Reading the policy and the endorsement as a whole, Gulf contends that any possible ambiguity can be harmonized away. Gulf's argument disregards the validity of the interpretation that Fuller urges. Its plausibility is at least as great as that of Gulf's interpretation. Gulf argues that this case is similar to Killian v. State Farm Fire & Casualty Co., 903 S.W.2d 215 (Mo.App.1995), and American States Ins. Co. v. Porterfield, 844 S.W.2d 13 (Mo.App.1992). In Killian , the insureds allowed a young girl to ride on their moped at a party they hosted. The girl crashed and was injured. The parents sued the insureds alleging negligent supervision and negligent entrustment of the moped. The insureds confessed judgment but did not pay. The parents attempted to collect under the insureds' State Farm homeowner's policy. State Farm denied coverage. 903 S.W.2d at 217. The policy allowed coverage for bodily injury caused by an accident off the insured's property that was caused by the activities of the insured. Id. The Killians argued that hosting a party and allowing a child to ride a moped was an activity of the insured that led to their daughter's injuries. The insureds' homeowner policy, however, also had an exclusion similar to the auto exclusion in the CGL Policy. The policy excluded coverage for bodily injury arising out of the ownership, maintenance, use ... of a motor vehicle owned or operated by ... any insured. Id. at 218. The Missouri Court of Appeals, Western District, found no ambiguity in the policy and held the policy did not provide coverage. The court of appeals stated that the auto exclusion disallowed coverage for the accident because it involved an auto. Id. Similarly, in Porterfield , a trailer broke loose from a truck and collided with the Scarborough's vehicle. 844 S.W.2d at 14. The Scarboroughs entered into a settlement agreement with Porterfield. Porterfield had a CGL Policy with American States Insurance Company. The policy contained an auto exclusion similar to the one in the present case. Id. American refused to pay the judgment and petitioned the court for a judgment stating that the accident was not covered by the American policy. The Scarboroughs argued that the accident was covered due to the negligent supervision and training of Porterfield's employees. Id. at 15. The Missouri Court of Appeals, Western District, found that the injuries arose out of the use of the truck and not from the negligent supervision and therefore there is no coverage for any injuries arising out of the automobile accident. Id. at 16. Gulf argues that this Court should find Fuller's injuries are not covered because, like  the injuries in Killian and Porterfield , her injuries arose from the use of an auto owned and operated by the insured. Gulf's argument in this respect is not supported by Killian or Porterfield . Although the insurance policies in both contained an auto exclusion similar to the one in the present case, the language of the policies was not ambiguous. Killian, 903 S.W.2d at 218; Porterfield, 844 S.W.2d at 15. Because the Killian and Porterfield policies were not ambiguous, there was no need for construction in those cases. For this reason, Killian and Porterfield are not persuasive.