Court Opinion

ID: 9479688
Source: CourtListenerOpinion
Date Created: 2023-08-05 07:25:44.27392+00
Date Added: 2024-06-11T17:47:12.377887
License: Public Domain

ARNOLD, Circuit Judge,
dissenting.
I respectfully dissent. I think this judgment should be affirmed.
This case does not really turn on conflicting other-insurance clauses at all. It is not that complicated. It is simply a case where the policy of one insurer, St. Paul, is by its own clear terms secondary and contingent only.
Cargill, owner of the grain, bought a policy from St. Paul. The pertinent language is as follows:
On all shipments moving under insured bills-of-lading issued by others, or where others have agreed to insure, it is mutually understood and agreed that the insurance provided under this policy is secondary and contingent.
The key phrase for the present case is, “where others have agreed to insure.” This is what happened here. Huffman, the carrier, did agree to insure, and to insure “fully.” When Huffman made this promise to Cargill, the St. Paul policy became secondary and contingent. There is no other way to read the words of the policy. It matters not what any insurance obtained by Huffman said. Huffman’s promise to insure, in and of itself, triggered that part of the St. Paul policy that made it secondary and contingent.
*182Huffman bought coverage from Commercial Union. That policy contains a standard other-insurance clause, rendering Commercial Union’s coverage excess
[i]f there is any other insurance covering the property insured hereunder which in absence of this insurance would cover the loss or damage hereby covered....
The condition described by this clause never came to pass. There is no such “other insurance” — no insurance, that is, which would cover the loss absent the Commercial Union policy. The St. Paul policy does not cover the loss, but this has nothing to do one way or the other with Commercial Union or its policy. It has to do only with Huffman’s promise to obtain insurance. When this promise was made, it rendered St. Paul’s coverage secondary eo instante. Commercial Union’s other-insurance clause might help as against some other insurer, but it avails nothing as against St. Paul, because Huffman’s promise, entirely independently of anything in Commercial Union’s policy, had already made the St. Paul policy secondary.
Because this interpretation of the two clauses reconciles them, it should be preferred. The judgment in favor of Cargill, imposing the entire loss on Huffman and Commercial Union, should be affirmed.