Court Opinion

ID: 9856860
Source: CourtListenerOpinion
Date Created: 2023-09-24 07:02:26.535716+00
Date Added: 2024-06-11T09:37:28.161629
License: Public Domain

STEELMAN, Judge,
concurring in part and dissenting in part.
I concur in the majority’s conclusion that a substantial right is affected and that defendant’s appeal of the trial court’s interlocutory order is properly before this Court. I also concur in the majority’s determination that the construction of the insurance policy is governed by Maine law.
It should be noted at the outset that this action is between Huber and Canal. W.M. Jr. Trucking, Inc. (W.M.) is not a party to this action. There is nothing in the record that suggests that Canal was aware of the Transportation Contract between Huber and W.M., and its terms are irrelevant to the issues presented in this case.
Is Huber an “Insured” Under the Canal Policy?
Nichols was a driver for W.M. and died as a result of injuries received while picking up a load of plywood at Huber’s Easton, Maine plant. W.M. had procured a liability insurance policy from Canal, which insured the vehicle being operated by Nichols. The Canal policy defines an “insured” as follows;
III. PERSONS INSURED: Each of the following is an insured under this insurance to the extent set forth below:
(a) the named insured;
(b) any partner or executive officer thereof, but with respect to a temporary substitute automobile only while such automobile is being used in the business of the named insured;
*17(c) any other person while using an owned automobile or a temporary substitute automobile with the permission of the named insured, provided his actual operation of (if he is not operating) his other actual use thereof is within the scope of such permission, but with respect to bodily injury or property damage arising out of the loading or unloading thereof, such other person shall be insured only if he is:
(1) a lessee or borrower of the automobile, or
(2) an employee of the named insured or of such lessee or borrower;
(d) any other person or organization but only with respect to his or its liability because of acts or omissions of an insured under (a), (b) or (c) above.
Nichols’ estate filed suit against Huber in the Superior Court of Aroostook County, Maine seeking damages for wrongful death based upon the negligence of Huber. Huber asserted as a defense the negligence of Nichols under Maine’s comparative negligence statute. Me. Rev. Stat. Ann. Tit. 14, § 156. Based upon this assertion of the negligence of Nichols contributing to his injuries, Huber makes the creative argument that it is an insured under the Canal policy.
The majority has gone to great lengths to find ambiguities in the Canal policy and hold that Huber is an “insured.” There are no ambiguities in the Canal policy, and the concept that the Canal policy provides any liability coverage to Huber is patently absurd.
Huber’s argument is that Nichols is an “insured” under section III(c) of the policy as set forth above. Huber then argues that it is also an insured under section 111(d) because it is facing liability because of “acts or omissions of an insured,” i.e. Nichols. Huber does not face liability because of any acts of Nichols, but rather by virtue of allegations of its own negligence by the representatives of Nichols’ estate. The majority distorts an affirmative defense, Maine Rules of Civil Procedure, Rule 8, which may or may not reduce the liability of Huber into a basis for finding coverage under an insurance policy.
The purpose of liability insurance is not to indemnify third parties who may injure or damage the policy holder or their agents and employees. Instead, “ [liability insurance is a contract of indemnity for the benefit of the insured and those in privity with the insured, or those to whom the statute, upon the grounds of public policy, extends the indemnity against liability.” 43 Am. Jur. 2d Insurance § 4 (2009).
*18... literalism should not be pushed to the length of frustrating, in whole or in part, the general intention the contract evidences; nor, on the other hand, should words be made to mean what they do not really say. A contract should be so construed as to give it only such effect as was intended when it was made. Astute and subtle distinctions should not be attempted, to take a plain case from the operation of material bounds.
Johnson v. American Automobile Ins. Co., 161 A. 496, 498 (Me. 1932) (citing Mack v. Rochester German Ins. Co., 13 N.E. 343 (N.Y. 1887), and Lyman & others v. State Mutual Fire Insurance Company, 96 Mass. (14 Allen) 329 (1867)); see also Poisson v. Travelers Ins. Co., 31 A.2d 233, 235 (Me. 1943).
While I understand that this case involves the construction of a Maine insurance policy by a North Carolina Court, and will likely never be considered outside of the context of the present case, I believe that the ramifications of the majority’s decision are significant. Under an insurance policy containing the same or similar language, a defendant in a lawsuit arising out of an automobile accident asserting contributory negligence on the part of the plaintiff could demand a defense, and possibly coverage from a plaintiff’s insurance carrier. This is fundamentally inconsistent with the purpose of a party procuring liability insurance.
A number of other courts have considered the arguments made by plaintiff in the instant case and found them to be without merit. Canal Ins. Co. v. Earnshaw, 629 F. Supp. 114, 120 (D. Kan. 1985), Vulcan Materials Co. v. Casualty Ins. Co., 723 F. Supp. 1263, 1264-65 (N.D. Ill. 1989), Koch Asphalt Co. v. Farmers Ins. Group, 867 F.2d 1164, 1166 (8th Cir. 1989), Transport Ins. Co., Inc. v. Post Express Co., Inc., 1993 U.S. Dist. Lexis 5706 (N.D. Ill. 1993).
I would reverse the ruling of the trial court.
Applicability of Exclusion for Injury to Employee
I would also hold that the exclusion contained in section 1(c) of the policy is applicable and bars any coverage to Huber.
The applicable provision states:
This insurance does not apply:
(c) to bodily irijury to any employee of the insured arising out of and in the course of his employment by the insured or to any *19obligation of the insured to indemnify another because of damages arising out of such injury;
The named insured under the policy was W.M. Nichols was an employee of W.M. Nichols was injured in the course of his employment with W.M. The exclusion is clear, is applicable to the facts of this case, and bars any coverage to Huber.
Conclusion
I would reverse the ruling of the trial court that Canal’s policy “provides defense and indemnity coverage to Huber for the claims asserted against Huber” in the Maine action filed by Nichols’ estate. This matter should be remanded to the Superior Court of Mecklenburg County for entry of judgment dismissing this action, with prejudice.