Court Opinion

ID: 9760374
Source: CourtListenerOpinion
Date Created: 2023-08-29 00:50:31.070399+00
Date Added: 2024-06-11T07:29:10.428910
License: Public Domain

HECHT, Justice,
dissenting.
As a rule, if an insurance policy is subject to more than one reasonable interpretation, one which affords coverage controls. Blaylock v. American Guarantee Bank Liab. Ins. Co., 632 S.W.2d 719, 721 (Tex.1982); Glover v. National Ins. Underwriters, 545 S.W.2d 755, 761 (Tex.1977). The Court invokes this rule but fails to apply it, because the interpretation the Court adopts of the policy in question is *739demonstrably unreasonable. I therefore dissent.
The simple question in this case is what is the limit of liability for the death of three passengers in an airplane under the terms of the policy covering the plane. The answer requires an analysis of three policy provisions: Coverage D, the Declaration, and Endorsement No. 1. The first of these, Coverage D, is entitled “Single Limit Bodily Injury (including or excluding passengers) and Property Damage Liability.” Apart from property damage, Coverage D extends by its terms to “bodily injury, sickness or disease, including death at any time resulting therefrom”. The second provision, the Declaration, states the liability limits for Coverage D as follows:
COVERAGES_LIMITS OF LIABILITY
[[Image here]]
D. Single Limit Bodily SEE ENDORSEMENT Injury and Property # 1 Damage Liability Including Passengers $1,000,000 each occurrence
Finally, the third provision involved here, Endorsement No. 1, limits liability for “bodily injury” to passengers to $100,000 apiece, not to exceed $300,000 per occurrence.
The Court fixes upon Endorsement No. 1 and concludes that because it uses the words “bodily injury” but not the word “death”, its $300,000 limitation applies to bodily injury claims only and not to death claims. Noting that Coverage D extends to “bodily injury, sickness or disease, including death”, the Court argues that if the limits in Endorsement No. 1 were meant to apply coextensively with that coverage, the same phrase should have been used both places. The Court rejects the idea that the phrase “bodily injury” in Endorsement No. 1 is a shorthand reference to the coverage provided by Coverage D, including death.
The first problem with the Court’s persnickety view of “bodily injury” is that if that phrase is not sometimes read to include death, then there is no limitation in the policy expressly applicable to “death” claims. The only other policy limit is the $1,000,000 limit in the Declaration, which applies to “Bodily Injury”. If the Court read the Declaration as strictly as it reads Endorsement No. 1, then the $1,000,000 limitation would likewise apply only to bodily injury claims, and there would be no policy limits for death claims. As attractive as it might be to have a policy without any limits whatever, that result is reaching even for the Court. Exercising restraint, the Court indulges in a little appropriate inconsistency, reading “bodily injury” very strictly in Endorsement No. 1 and more broadly in the Declaration. If the Court were as consistent as it is literal, however, it would be forced to conclude that the claims of the passengers in this case are subject either to the $300,000 limits of Endorsement No. 1 or to no limits at all.
To excuse its inconsistency, the Court explains that the Declaration refers not only to “Bodily Injury” but to Coverage D, which uses the word “death”. But this leads to the second problem with the Court’s view. The title of Coverage D uses the words “Bodily Injury” as a shorthand reference for what its terms describe as “bodily injury, sickness or disease, including death at any time resulting therefrom”. The same shorthand reference is used in the Declaration. It seems to me that the very most the Court could say from this is that of three pertinent instances in which the phrase “bodily injury” is used, two are a shorthand reference to the longer phrase in Coverage D, and one, in Endorsement No. 1, is unclear. The Court, however, goes further, baldly insisting that “bodily injury” must be read as a shorthand reference including death in the title of Coverage D and in the Declaration, but cannot be read to include death in Endorsement No. 1.
Inconsistency is not the only fault in the Court’s view; more importantly, perhaps, it leads to absurd results. If the phrase “bodily injury” in Endorsement No. 1 does not include “death”, surely it does not include “sickness” or “disease” either, two other words used to describe the coverage extended under Coverage D. Thus, following the Court’s reading of the policy, passenger claims for bodily injury are limited to $300,000 per occurrence, but passenger *740claims for sickness, disease or death resulting from bodily injury are subject to the higher limit of $1,000,000 per occurrence. So, in the Court’s view, if the three passengers in this case had been severely injured, even permanently crippled, policy coverage for their claims would be limited to $300,-000. If, however, they had contracted pneumonia or some other sickness or disease while recovering from the injuries, their claims would be covered to the extent of $1,000,000. In the Court’s view of this policy, it would certainly pay an injured passenger well to get a cold while suffering from his other injuries. The suggestion is, of course, facetious, but demonstrates one absurdity in the Court’s interpretation of the policy.
Yet another absurdity results from the Court’s view. The insurer’s obligation to defend the insured against claims is contained in the following policy provision:
With respect to such insurance as is afforded by this Policy for bodily injury liability and for property damage liability coverages the Company shall: (a) defend any suit against the Insured alleging such injury, sickness, disease, or destruction _
Obviously, the provision does not use the word “death”. Applying the Court’s interpretation of “bodily injury”, one must conclude that the insurer here is obliged to defend the insured against claims for bodily injury, sickness and disease, three of the four descriptions used in Coverage D, but not against claims for death, the other description in that coverage. The Court offers no explanation for this rather peculiar result of the application of its interpretation to other provisions of the policy.
An interpretation of an insurance policy that is inconsistent and leads to absurd results is not, in my view, a reasonable one. The phrase “bodily injury” used in Endorsement No. 1, Mission suggests, has the same meaning that it has in the title of Coverage D and in the Declaration, that it serves occasionally as a shorthand reference to the phrase, “bodily injury, sickness or disease, including death”, used in the body of Coverage D. Under this interpretation, coverage of passenger claims for bodily injury, sickness, disease and death would be limited to $300,000 per occurrence. The total coverage for those claims, other such claims by non-passengers, and property damage claims would be limited to $1,000,000. And the insurer would be obliged to defend the insured against all such claims. This interpretation is far from certain, as I readily admit; the language of the policy is not as clear as it might be. There is room for doubt. However, the interpretation the insurer suggests is consistent and sensible, attributes missing in the Court’s interpretation, and it would be entirely reasonable except for one major fault: it restricts the plaintiffs’ recovery in this case.
Because I believe that the Court’s interpretation of the policy language in this case is plainly unreasonable, I would accept the only reasonable interpretation that has been suggested and affirm the judgment of the court of appeals.
I therefore dissent.
PHILLIPS, C.J., joins in this dissenting opinion.