Parker v. State Farm Mutual Automobile Insurance

Finan, J., delivered the opinion of the Court. This is an appeal from a decision of the Circuit Court for Wicomico County (Travers, J.) rendered in a declaratory judgment proceeding and ordering that the appellee, State Farm Mutual Automobile Insurance Company (State Farm), was under no obligation to defend an insured under one of its policies or to pay any judgment which might be awarded against the insured in a personal injury suit into which the insured was impleaded as third party defendant. The facts of this case are not in dispute. On August 11, 1967, an automobile collision occurred between a vehicle operated by William L. Parker, Jr. ²⁰⁸ (young Parker) and another vehicle operated by Robert Odum, Jr. Riding as a passenger in the Parker car at the time of the accident was young Parker’s sister, Sheila, and as a result of the accident she suffered personal injuries.

Both young Parker and Sheila were minors living in the household of their mother and father. The Parker car was owned by and titled in the name of young Parker’s father, William L. Parker, Sr., who had on May 26, 1967, obtained from State Farm a policy extending automobile liability insurance on the automobile to himself and by endorsement specifically to young Parker. This policy was in force at the time of the accident. Ultimately, Sheila, as equitable plaintiff, through her mother, sued Robert Odum, Jr. for the personal injuries which she sustained, and her parents also sued Odum for the losses which they sustained as a result of Sheila’s injuries.

Odum, in turn, impleaded young Parker as third party defendant pursuant to Maryland Rule 315 a, alleging contributory negligence on the part of young Parker. Neither Sheila nor her parents made any attempt to amend their declaration to assert claims against young Parker. (Rule 315 d 3.) Upon service of the third party claim State Farm refused to defend the insured on the basis of an exclusion in its policy. At that point Sheila and her parents brought a declaratory judgment proceeding in the Circuit Court for Wicomico County requesting the court to determine whether State Farm was liable to defend and indemnify young Parker or whether young Parker was an uninsured motorist within the purview of the Unsatisfied Claim and Judgment Fund Law, Maryland Code (1970 Repl.

Vol.), Art. 66%, § 7-601 et seq. Judge Travers found that although the policy in question obligated State Farm: (Coverage A) “* * * to pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of (A) bodily injury ²⁰⁹ sustained by other persons * * * and to defend any suit against the insured alleging such bodily injury* * (Emphasis supplied.) Sheila was not an “other person” within the meaning of the policy since she was included within the definition of an “insured”. The policy defined “insured” as including: “ (3) if residents of the same household, the relatives of the first person named in the declarations, or of his spouse, and (4) any other person while using the owned automobile, provided the operation and the actual use of such automobile are with the permission of the named insured or such spouse and are within the scope of such permission * * $ 99 Additionally, Judge Travers found that the language of the “household exclusion” clause which provides that: “[T]his insurance does not apply under: * * * (i) Coverage A, to bodily injury to the insured or any member of the family of the insured residing in the same household as the insured; * * *” served to relieve State Farm from any obligation to defend or indemnify young Parker in a suit for bodily injuries by his sister. From this decision William L. Parker, Jr. and John H. Calhoun, Manager of the Unsatisfied Claim and Judgment Fund Board, appeal and urge this Court to reverse the order of Judge Travers on the basis that the case at bar should be controlled by our decision in State Farm Mutual Automobile Ins.

Co. v. Briscoe, 245 Md. 147 , 225 A. 2d 270 (1967). In argument before this Court the appellants endeavored to stress the similarities between Briscoe and the case at bar, whereas, the appellee urged upon the Court the reversal of Briscoe , while at the same ²¹⁰ time pointing out how readily distinguishable it was from the instant case and therefore not dispositive of the issue before us. Briscoe was a suit by an additional insured’s mother. At the time of the accident, the mother was riding with her son, young Briscoe (an unemancipated minor) who resided in the same household with her.

Mr. and Mrs. Briscoe, Sr. sued Rouff, the operator of the other car. Rouff impleaded Monday, the owner of the car that young Briscoe was driving, as well as young Briscoe, as third party defendants. Maryland Rule 315 a. Young Briscoe requested that the insurer provide for his defense in the suit, alleging that he was an additional insured because he had been driving the insured car with the owner’s permission.

The insurance carrier (also in that instance, State Farm) resisted its obligation to defend, taking up the argument that under the “household exclusion” clause young Briscoe was removed from the coverage of the insurance policy for liability imposed by his mother even though this imposition was by indirection. This Court emphasized that the purpose for the “household exclusion” clause was “to protect the insurer against collusive or cozy claims, to exempt him from liability stemming from one whose natural ties and pulls are likely to favor a claimant who lives in the same household, * * *.” ( 245 Md. at 151 ). The Court, speaking through Chief Judge Hammond, recognized: “* * * The cases have drawn a distinction between situations in which a member of the named insured’s family has sought to impose liability on the insurer in a claim against the additional insured and the situation in which a member of an additional insured’s family seeks to impose liability on the insurer in a claim against the named insured. In the first situation the insurer generally has been held not to be liable.

See Patton v. Patton (Pa.), 198 A. 2d 578, 581 ; Johnson v. State Farm Mutual Automobile ²¹¹ Ins. Co. (8th Cir.), 252 F. 2d 158 . In the second situation there is a split authority. * * *” 245 Md. at 151 We chose to hold that, under the facts of that case, a member of an additional insured’s family could impose liability on the insurer through their action which resulted in the impleading of the additional insured. The obvious distinction between Briscoe and the case at bar is that Briscoe represented a claim by an additional insured’s family seeking to impose liability on the insurer in a claim against an additional insured, rather than as here, a case wherein a member of the named insured’s family has sought to impose liability on the insurer in a claim against a named insured.

In addition the present case centers around the “other persons” clause in the policy. It may logically be argued that in Briscoe , since young Briscoe became an “insured” only through his permissive use of the automobile under the omnibus clause of the policy, he was not an “insured” within the meaning of that portion of the definition section of the policy which defines an “insured” as the “named insured” and the relatives of his family, living in his household (this also is the definition in the policy in the case at bar). Therefore, young Briscoe’s mother would qualify as an “other person” so that her suit was in the category of a claim for “bodily injury sustained by other persons,” a significant element absent in the instant case. Addressing ourselves to the present case, the event which imposes liability on the insurer under “Coverage A” is “bodily injury sustained by other persons.” The question which then becomes relevant, is, who are “other persons” within the meaning of the policy.

Within the context of the facts and circumstances of this case, the policy establishes two classifications of individuals, “insured” and “other persons,” and we agree with the lower court’s conclusion that the classificatiqns are mutually exclusive. ²¹² The appellants, understandably, take umbrage with such an interpretation of the “other persons” clause contending .that a correct construction of “other persons” does not exclude all- those who may come within the definition of an insured but rather includes all “other persons” than the operator of the car who is driving with the consent of the owner, the named insured. They cite Hardtner v. Aetna Casualty & Surety Co., 189 So. 365 (La. 1939). 1 However, we do not find Hardtner persuasive because, there, they were discussing the connotation of the word “other” when used in the context of an “omnibus clause” rather than in the bodily injury liability coverage clause, such as in the case at bar. In Hardtner the Court stated: “ * * * To say the least, the meaning of the word ‘other’ as used in the ‘omnibus clause’ is ambiguous and subject to more than one construction. The reasonable