Opinion ID: 1330284
Heading Depth: 1
Heading Rank: 6

Heading: The Fund's Obligation

Text: Appellants assert that the trial court erred in holding the Fund must provide the District with coverage in excess of $1 million per occurrence. We disagree. The insuring agreement portion of the contract of insurance between the District and the Fund provides, The Fund will pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of an occurrence which results in Injury to any person. In addition, the policy contained a section entitled Limits of Liability which read as follows: (1) Regardless of the number of (1) insureds under this policy, (2) persons or organizations who sustain Injury, or (3) claims made or suits brought on account of Injury the Fund's liability is limited as follows. (2) The total liability of the Fund for all damages as the result of any Occurrence including damages for care and loss of services, because of Injury sustained by one or more persons or organizations, shall not exceed the limit of liability stated in the declarations as applicable to each Occurrence. The limits under Coverage A and Coverage B are separate limits and under no circumstances would both limits apply to one Occurrence. (3) For any action or claim brought under [the Act], the liability of the Fund shall not exceed the following limits: Coverage A (a) No person shall recover in any action or claim a sum exceeding 250,000 dollars because of a loss arising from a single Occurrence regardless of the number of agencies or political subdivisions involved. (b) The total sum recovered arising out of a single Occurrence shall not exceed 500,000 dollars regardless of the number of agencies involved. Coverage B (a) No person may recover in any action or claim brought hereunder against any governmental entity and caused by the tort of any licensed physician or dentist, employed by a governmental entity and acting within the scope of his profession, a sum exceeding one million dollars because of loss arising from a single Occurrence regardless of the number of agencies or political subdivisions involved. (b) The total sum recovered hereunder arising out of a single occurrence of liability of any governmental entity for any tort caused by any licensed physician or dentist, employed by a governmental entity and acting within the scope of his profession, may not exceed one million dollars regardless of the number of agencies or political subdivisions or claims or actions involved. (emphasis added). Despite these liability limits in the policy, the trial court held that the Fund was obligated to provide coverage to the extent of the stipulated damages. According to the trial court, § 15-78140 (Supp.1996) mandated this result. Section 15-78-140(a) provides, It is the duty of the Budget and Control Board to cover risks for which immunity has been waived under the provisions of this chapter by the purchase of insurance as authorized in § 15-78-150. S.C.Code Ann. § 15-78-140(a) (Supp.1996). This provision establishes a duty for the Budget and Control Board to purchase insurance against risks for which immunity has been waived. As discussed in Part I of this opinion, the TCA waived this state's immunity up to the monetary limits defined in § 15-78-120. The limits of liability language within the insurance policy was taken verbatim from § 15-78-120. However, on the date the present action accrued in January 1997, the liability limits within subsections (a)(3) & (a)(4) were effectively repealed and had yet to be reinstated by the 1997 Act. See Part I, infra; Dykema; Steinke. Accordingly, there was no limit on the District's liability for the negligence of one of its physicians on the date this claim arose or accrued, and the District is legally obligated to compensate Cody and the Williamsons for their stipulated damages. In turn, the Budget and Control Board was obligated to insure against risks for which liability had been waived. This statutory duty, reiterated within the policy's promise to pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages, obligates the Fund to cover the total amount of the stipulated damages against the District.