Court Opinion

ID: 9760949
Source: CourtListenerOpinion
Date Created: 2023-08-29 01:25:18.601569+00
Date Added: 2024-06-11T07:29:19.005260
License: Public Domain

NYE, Chief Justice,
dissenting.
I respectfully dissent. The core issue is whether the Edinburg Consolidated Independent School District is the named insured under the subject insurance policy. The majority concludes the policy does not cover the District. I disagree for an additional reason not set out in my original dissent. In the original opinion, the majority, in arriving at their conclusion, relied heavily on the construction of Section 23.-26(a) of the Texas Education Code. This section states:
The trustees shall constitute a body corporate and in the name of the school district may acquire and hold real and personal property, sue and be sued, and receive bequests and donations or other moneys or funds coming legally into their hands.
The majority then states that “it does not follow that an insurance policy, undisputedly insuring only the trustees, necessarily covers the District simply because by statute the trustees have been given the power to manage and govern the District.”
I see two major problems with the majority’s conclusion. First, section 23.26(a) does not address who has the power and authority to manage and control Texas school districts. This statute establishes the principle that trustees and a school district are synonymous entities for purposes of a lawsuit.
Second, the majority’s conclusion that the policy “undisputedly” covers only the trustees is incorrect. Even though the insurance policy does not specifically designate the Edinburg Consolidated Independent School District as a named insured, such designation is not necessary to afford coverage. An insured may be identified in the policy either by name or by description. Scott v. Industrial Life Insurance Co., 411 S.W.2d 769, 773 (Tex.Civ.App. — Dallas 1967, no writ). As the purpose of a name is to designate the person or entity intended to be insured, any designation which *615fulfills that purpose is also sufficient. See 2A M.S. Rhodes, Couch Cyclopedia of Insurance Law Sec. 23:4 (Rev.2d ed. 1984) and cases cited in footnote seven. In the instant ease, even though the policy designates the trustees as insureds and does not specifically designate the District as an insured, this Court should not say that, as a matter of law, the District is not the named insured under the policy.
In their “OPINION ON MOTION FOR REHEARING,” the majority decides that the subject insurance policy is “unambiguous” regarding the identity of the named insured. In support of this conclusion, they cite several cases, Faulkner, Entz-minger and O’Shea. These cases hold, in part, that rules applicable to the construction of insurance policies are akin to those rules applicable to interpreting ordinary contracts. With this I have no quarrel. These cases do not, however, resolve ambiguities concerning the identity of a named insured and, therefore, fail to settle the controlling issue before this Court.
It has always been the law of this State that when the language of the insurance policy creates an ambiguity, the policy shall be construed most favorably to the insured. Ranger Insurance Co. v. Bowie, 574 S.W.2d 540, 542 (Tex.1978); East Texas Fire Insurance Co. v. Kempner, 87 Tex. 229, 27 S.W. 122 (Tex.1894); Eggert v. American Standard Life Insurance Co., 404 S.W.2d 99, 104 (Tex.Civ.App. — Corpus Christi 1966, no writ). We apply this rule when the terms of the insurance contract are susceptible to more than one reasonable construction. Bowie, 574 S.W.2d at 542. According to Section 23.26(a), a suit against a school district’s trustees in their official capacities is equal to a suit against the school district. This makes good common sense. Why should the school district carry two policies of insurance covering the same liabilities of the same insureds? I believe the majority’s “OPINION ON MOTION FOR REHEARING” is contrary to the established Texas Law.
I would grant appellant’s “MOTION FOR REHEARING,” reverse the trial court’s judgment and render judgment in favor of the Edinburg Consolidated Independent School District.