Court Opinion

ID: 4132777
Source: CourtListenerOpinion
Date Created: 2017-02-18 01:30:20.368935+00
Date Added: 2024-06-11T14:07:18.287465
License: Public Domain

TH~~A~ORNEYGENERAL
                               OF’ TEXAS
                          AXJIWX-IN.T-s           78711

                                      May 7,      1975

The Honorable hi. L. Brockette                       Opinion   No.   H-   602
Commiraioner    of Education
201 East Eleventh Street                             Re: Uee of school dicrtrict
Austin,  Texar  78701                                fund6 to purchase personal
                                                     injury insurance protection.

Dear   Dr.   Brockette:

         Noting that school dirtrictr are authorized  to purchase insurance
protection againat claim8 made by injured partier and othera under the
Texas Tort Claims Act (Article 6252-19,     V. T. C. S.), your office has
asked whether an independent rchool dirtrict may we local district
maintenance funds to purchase:

                  (a) Personal  injury protection   coverage as pro-
                  vided for in article 5.06-3,    Vernon’8   Texas Inrur-
                  anco Code (Acts 1973, 63rd Leg.,       ch. 52, p. 90);

                  (b) Uninsured motorist protection as provided for
                  in article 5.06-1, Vernon’8  Texas Insurance Code,
                  (Acts 1967; 60th Leg., .ch. 202; p. 448).

         In Attorney General Opinion M-989       (1971) this office concluded
that school districts    were authorized to purchase insurance protection
against claims for bodily injury arising out of risks recognized        by
section 3 of the Texas Tort Claim8 Act (the general liability section)
and that they might also purchase such insurance         to cover employees
exposed to individual liability by virtue of their official duties.      And
                                                                         -
see
-     Attorney   General  Opinion  H-70  (1973).

         Article   5.06-3  requirea that, unlear the coverage ir rejected
in writing,   all policier of automobile    liability inrurance issued or
delivered in thin State shall provide for personal injury protection
coverage, defined in subparagraph        (b) ar:

                                      p.   2670
The Honorable    M. L.   Brockette    page 2     (H-602)

                 “Personal   injury protection”     consists    of pro-
                visions of a motor vehicle liability policy which
                provide for payment to the named insured              in the
                motor vehicle liability policy and members             of the
                insured’s   household,     any authorized operator or
                passenger    of the named insured’s       motor vehicle
                including a guest occupant,       up to an amount of
                $2,500 for each such person for payment of all
                reasonable    expenses arising from the accident
                and incurred within three years from the date thereof
                for necessary     medical,    surgical,   X-ray and dental
                services,   including prosthetic      devices,    and necessary
                ambulance,     hospital,   professional    nursing and
                funeral services,     and in the case of an income
                producer,    payment of benefits for loss of income
                as the result of the accident; and where the person
                injured in the accident was not an income or wage
                producer at the time of the accident,          payments of
                benefits must be made in reimbursement              of neces-
                sary and reasonable       expenses incurred for essential
                services   ordinarily    performed     by the injured person
                for care and maintenance        of the family or family
                household.    . . .

          Subparagraph    (c) of the article provides that the benefits are payable
without regard to fault and without regard to the availability        of similar
benefits from a collateral      source.    It provides that payment of the benefit
shall not create in the insurer any right of subrogation.          These provisions
assure recovery     by the beneficiary     regardless  of duplicate payments in a
judgment against a third person,        under workmen6 compensation,        under a
hospitalization   policy,   under a policy covering interruption     of employment,
or any other source.

         Despite the similarity   of this coverage to other     coverages   which
have been approved for purchase by subdivisions        of the   State, and
particularly   school districts,  we are compelled   to hold    that there is no
authorization   for a school district to purchase personal       injury protection

                                     p.   2671
The Honorable       M. L.      BrockeJte      page 3          (H-602)

coverage     as defined       in article   5.06-3(b)          of the Insurance    Code.

        Furnishing hospitalization   insurance has been upheld only
 because it is considered  a part of the employee’s  compensation.
Attorney General Opinions Nos. WW-7.31 (1959); WW-1101 (1961). And
-see Byrd V. City of Dallas,   6 S.W. 2d. 738 (Tex. 1938).

         However,  under section 5.06-3,     the coverage bought by the
school district is not only for the employee but also for any other persons
who are injured while riding in vehicles owned by the school district
and operated by its employees.     Although limited coverage which
benefited only the employee and those for whom he is financially       responsi-
ble might be authorized as a part of an employee’s       compensation,   s,uch
broad coverage as 5.06-3     contemplates   is not, in our opinion, actually
employee compensation     since the benefits inure to such a ,broad ,group of
persons.

         Further, the school district is not authorized to spend funds to
benefit private individuals.   Tex. Const. art. 3, sets.    50, 51 and 52.
Under section 5.06-3,    the no-fault character  of the coverage would
provide benefits to persons to whom the school district owes no legal
obligation.

        In our opinion the provisions    of such coverage,   at the expense
of the school district,  would amount to a grant of public money or thing
of value to an individual,  in violation of article 3, sections 50, 51 and 52
of the Texas Constitution.

           We,   therefore,      answer    your first         question   in the negative.

         Uninsured motorist coverage is not defined by statute as pre-
cisely as is personal injury protection coverage.        See article 5.06-1,
Vernon’s   Texas Insurance Code.     As described    in Lhe Texas Standard
Form automobile    liability policy, it is the obligation of the insurer:

                        To pay all sums which the insured or his legal
                    representative  shall be legally entitled to recover
                    as damages from the owner or operator of an uninsured

                                                p.     2672
The Honorable    M. L.    Brockette     page 4      (H-602)

                automobile    because of bodily injury, sickness or
                disease.   including death resulting therefore,  . . .
                caused by accident and arising out of the ownership
                maintenance     or use of such uninsured automobile    . , .

          In effect, payment under this coverage would meet the obligation
of a third person to the occupant of the district’s  vehicle (whether an
employee or not) at the expense of the district.    We feel the same
observations     we made earlier as to the personal injury protection
coverage would apply and that there is no authority for the purchase
of such uninsured motorist coverage by a school district upon its
vehicles.

         Such coverage does not in any way meet any obligation               of the
school   district created by the Tort Claims Act.

         We therefore    answer    your second      question   in the negative.

                                      SUMMARY

                    The purchase of either personal injury protection
                coverage  or uninsured motorist coverage by an
                independent school district with local district
                maintenance  funds would be unconstitutional.

                                                       Attorney    General   of Texas

                    LL,    First   Assistant

C. ROBERT HEATH,          Chairman
Opinion Committee

                                        p.   2673