Court Opinion

ID: 9477324
Source: CourtListenerOpinion
Date Created: 2023-08-05 06:20:09.501729+00
Date Added: 2024-06-11T17:39:27.063301
License: Public Domain

MERRITT, Circuit Judge,
dissenting.
The majority’s rationale for construing the insurance policy against this man who has been crippled for life is shortsighted. It is a company oriented approach that erroneously restricts the individual claimant’s rights to insurance.
Our responsibility in a diversity case is not simply to apply in a crabbed and one-sided way what a state’s courts have done in a given area of law in the past. Instead, we are to predict what the state’s highest court would do if faced with the question at issue. If there is binding state precedent on the issue, and no persuasive indication that the prior rule has been placed in question or is undergoing reformulation within that state’s courts, then of course we are bound to apply the previous precedent. But the task always is predictive. See Bagwell v. Canal Insurance Co., 663 F.2d 710, 712 (6th Cir.1981). To do otherwise would undermine the Erie doctrine by inviting forum shopping — encouraging one party seeking law reform to litigate in state court while encouraging an opposing party favored by tenuous, but extant, state precedent to litigate in federal court. See Commissioner v. Estate of Bosch, 387 U.S. 456, 462-65, 87 S.Ct. 1776, 1781-83, 18 L.Ed.2d 886 (1967); Bernhardt v. Polygraphic Co., 350 U.S. 198, 202-05, 76 S.Ct. 273, 275-77, 100 L.Ed. 199 (1956); 19 C. Wright, A. Miller & E. Cooper, Federal Practice & Procedure § 4507.
The majority and the District Court both have professed themselves bound by two 50-year-old cases from the Kentucky *158courts, but neither of the two precedents cited by the majority is controlling, because neither faced the question of policy interpretation presented here.
The insured in Fowler v. Brotherhood of Railroad Trainmen, 253 Ky. 786, 70 S.W. 2d 669 (1934), was to be considered disabled and thereby compensable under the terms of the policy if he were to “suffer the amputation or severance of an entire hand at or above the wrist joint.” 70 S.W.2d at 670. He alleged in his complaint that the severance or amputation of more than half of his palm and several fingers “below the wrist joint ” had resulted in “equivalent to or greater than” the disability that would be brought about by amputation or severance “at or above the wrist joint.” Id. (emphasis added). Thus, in Fowler Kentucky’s highest court rejected the contention that severance below a specified anatomical location can be deemed the equivalent of severance “at or above” that site.
In Brotherhood of Railroad Trainmen v. Wilkins, 257 Ky. 331, 78 S.W.2d 6 (1935), a like contention was rejected.
The injury of the plaintiff in the instant case,1 by contrast, presents the question whether an injury caused by an incomplete severance of a limb that is above the required anatomical site and that produces functional loss substantially equivalent to that produced by a total severance of that limb, should be deemed a “loss” produced by a “dismemberment by severance” (Travelers), or by a “severance” (Allstate), or by an “actual severance” (Continental). To frame the interpretive issue more precisely: Does the term “severance” define not only the manner but also the extent of the injury? There is no Kentucky case law on this question.
Kentucky law does hold to the general rule that, for obvious reasons, ambiguous terms in insurance policies are to be construed against the drafter and in favor of the insured. See State Farm Mutual Auto Insurance Co. v. Shelton, 413 S.W. 2d 344 (Ky.1967). None of the three policies define the term "severance” or “sever.” Dictionary definitions emphasize the manner of injury but leave room for ambiguity on the extent required for a “severance.” 2
When existing state precedents leave a federal court in doubt about what view the state’s highest court would take on an issue of first impression, it is appropriate to examine the views of the courts in other jurisdictions. See Bailey v. V & O Press Co., 770 F.2d 601, 604 (6th Cir.1985). Modern case law from other jurisdictions can provide guidance as to what a modern Kentucky court might do in this case.
In King v. Metropolitan Life Ins. Co., 20 Tenn.App. 246, 97 S.W.2d 651, 654 (1936), surgeons reattached a limb severed totally except for a little skin. “Severance” was held to refer to “the manner rather than to the exact physical extent of the injury.” Accord, Huff v. Vulcan Life & Accident Ins. Co., 206 So.2d 861, 864 (Ala.1968).
In Reliance Ins. Co. v. Kinman, 252 Ark. 1168, 483 S.W.2d 166, 170 (1972), the femur bone of the leg was completely severed and found lying in a nearby ditch. The rest of the lower leg was connected only by nerve, artery, muscle and skin. The insurer refused to pay because the leg was not finally amputated until some 18 months after the accident, after elaborate attempts at reattachment, grafting and reconstruction ultimately failed. The Arkansas Supreme Court, however, held that the *159policy term “actual severance” was ambiguous and granted recovery. The court observed that “loss” by “actual severance” is a “clearly ambiguous” term because it could be interpreted to mean “physical severance” in one instance and “functional severance” in another, whichever appeared to be most beneficial to the insurer. For example, if a leg were completely severed and successfully reattached with restoration of function, there would be no loss of use despite a total physical severance. The court noted that
[h]ad the (surgical) miracle occurred certainly the [insurer] would have contended there was no liability.... Given such an ambiguity, it is axiomatic that the provision should be construed in favor of the insured since the [insurer] wrote the policy and selected its own terminology. This litigation may well be the result of policy language which was drafted long in advance of modern and more recent medical technology and skills.
483 S.W.2d at 171. See also Mifsud v. Allstate Insurance Co., 116 Misc.2d 720, 456 N.Y.S.2d 316 (Cir.Ct.1982) (distinguishing irreparable “amputation” from functional “severance”); see generally Annot., 51 A.L.R. 4th 156.
Following the approach used by these courts, I would interpret the ambiguous term “severance” to refer to the manner rather than the extent of the injury. A “severance,” thus, would be an injury that results in a forcible tearing or disruption of the affected limb that results in substantial disunion of the limb and substantial loss of function of the portion distant to the site of disruption.
If appellant’s' arm had been totally severed, the insurers would be obligated to pay. If his doctors had elected to complete surgically the amputation that had nearly been accomplished traumatically, the insurers likewise would have been obligated to pay. But because appellant’s doctors, operating at “the forefront of medical practice in order to do it,” App. 24, attempted to save the tatters of the arm that remained, even though the functional result is the same, the majority denies recovery. The unfortunate result is that formerly “aggressive” surgeons like Dr. Briedenbach here will have to think twice in the future about trying to save badly injured limbs and “maybe ... have to start questioning these people about their insurance policies before we attempt any surgery.” App. 24. I do not believe that Kentucky law is so shortsighted.
It might be argued that, were we to interpret the term “severance” in the more liberal fashion that I have recommended, insurers in the future would defeat recovery simply by tightening up their language. For example, “loss by severance” might be redrafted to read “loss by a total physical separation of the limb into two pieces, occurring at or above the wrist joint and resulting in irreparable and total loss of function.” I see no problem in such a development. Such clear and unambiguous language would declare the intention of the parties and provide the insured with unambiguous notice of the protection for which he is contracting — notice that the appellant here lacked.

.According to appellant's doctor, Mr. Burchett suffered a "functional amputation" which “jack-nifed" his arm open, disrupted the bone, and, except for some tissue left on one side, left the "whole arm ... almost off.” App. 15. In other words, the arm was cut through except for what little was hanging as if by a thread. At most hospitals, what remained would have been amputated. What does remain after the surgeons' attempt to salvage what they could is "an arm which is just marginally better than a prosthesis.” App. 24.

.Webster's New Twentieth Century Dictionary (Unabridged 1968) defines "sever":
1. to put or divide in two, especially by violence; to separate, as by cutting or rending;
3.to separate; to disjoin, as things distinct but united by some tie.
"Sever" is defined in neither of the two standard medical dictionaries, Stedman’s or Dorland’s.