{ "id": 2565176, "name": "The Ohio Casualty Insurance Company and West American Insurance Company, Plaintiffs-Appellees, v. United States Fidelity and Guaranty Company, Francis T. Carroll, et al., and Parkway Motors, Inc., Defendants-Appellants", "name_abbreviation": "Ohio Casualty Insurance v. United States Fidelity & Guaranty Co.", "decision_date": "1967-02-21", "docket_number": "Gen. No. 66-81", "first_page": "457", "last_page": "462", "citations": [ { "type": "official", "cite": "79 Ill. App. 2d 457" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "318 F2d 714", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 161883 ], "year": 1963, "opinion_index": 0, "case_paths": [ "/f2d/318/0714-01" ] }, { "cite": "303 F2d 897", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 250822 ], "year": 1962, "opinion_index": 0, "case_paths": [ "/f2d/303/0897-01" ] }, { "cite": "297 F2d 208", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 226148 ], "year": 1961, "opinion_index": 0, "case_paths": [ "/f2d/297/0208-01" ] }, { "cite": "288 F2d 734", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 1986744 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/f2d/288/0734-01" ] }, { "cite": "337 SW2d 284", "category": "reporters:state_regional", "reporter": "S.W.2d", "case_ids": [ 10154675, 2260359 ], "opinion_index": 0, "case_paths": [ "/sw2d/337/0284-01", "/tex/161/0093-01" ] }, { "cite": "161 Tex 93", "category": "reporters:state", "reporter": "Tex.", "case_ids": [ 2260359 ], "opinion_index": 0, "case_paths": [ "/tex/161/0093-01" ] }, { "cite": "181 NE2d 191", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "35 Ill App2d 43", "category": "reporters:state", "reporter": "Ill. App. 2d", "case_ids": [ 5263639 ], "pin_cites": [ { "page": "52" } ], "opinion_index": 0, "case_paths": [ "/ill-app-2d/35/0043-01" ] }, { "cite": "50 ALR2d 97", "category": "reporters:specialty", "reporter": "A.L.R. 2d", "opinion_index": 0 } ], "analysis": { "cardinality": 480, "char_count": 8879, "ocr_confidence": 0.556, "pagerank": { "raw": 1.5262484541829901e-07, "percentile": 0.6702672626859713 }, "sha256": "8e6e9bed1250b3bcce61934d6000036aa2c9cbb491f1492570e40ea474f9462a", "simhash": "1:ff2feb8bda288d1c", "word_count": 1432 }, "last_updated": "2023-07-14T21:28:59.322915+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "The Ohio Casualty Insurance Company and West American Insurance Company, Plaintiffs-Appellees, v. United States Fidelity and Guaranty Company, Francis T. Carroll, et al., and Parkway Motors, Inc., Defendants-Appellants." ], "opinions": [ { "text": "MR. JUSTICE SEIDENFELD\ndelivered the opinion of the court.\nThis appeal from a declaratory judgment involves a dispute between plaintiff insurance companies and the defendant insurance company as to which is responsible under their respective policies for defense and any judgment arising out of an injury suit filed by Carroll against Livesay, Jr.\nThe facts are not in dispute and only a legal question emerges. The appeal is taken from the judgment declaring that U.S.F. & G. is primarily liable and Ohio Casualty and West American liable for any excess.\nCarroll was a salesman-employee of Parkway Motors. In the course of his employment he permitted Livesay, a prospective customer, to drive a car from the lot on a demonstration with himself as a passenger. During the drive Carroll was injured in an accident. It is not questioned that Carroll was under the Workmen\u2019s Compensation Act.\nThe effect of the employee exclusionary clause in Parkway\u2019s policy, written by U.S.F. & G., is in issue. Ohio Casualty insured Livesay\u2019s father\u2019s car and West American insured Livesay\u2019s mother\u2019s car. Livesay was a permitted user under both of his parents\u2019 policies.\nThe coverage clause in the U.S.F. & G. policy provides :\n\u201cI Coverage A \u2014 Bodily Injury Liability \u2014 Automobile\n\u201cTo pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of bodily injury, sickness or disease, including death at any time resulting therefrom, sustained by any person, caused by accident and arising out of the ownership, maintenance or use of any automobile.\u201d\nThe exclusionary clause in the U.S.F. & G. policy provides:\n\u201cThis policy does not apply\n\u201c (g) Under Coverage A (Bodily Injury Liability-Automobile) to bodily injury to or sickness, disease or death of any employee of the insured arising out of and in the course of (1) domestic employment by the Insured, if benefits therefor are in whole or in part either payable or required to be provided under any workmen\u2019s compensation law, or (2) other employment by the Insured\u201d;\nThe policy also provides:\n\u201cThe unqualified word \u2018Insured\u2019 includes the named Insured . . .\u201d\nThere is also a \u201cseverability of interests\u201d clause which provides:\n\u201c8. Severability of Interests. The term \u2018the Insured\u2019 is used severally and not collectively, but the inclusion herein of more than one Insured shall not operate to increase the limits of the Company\u2019s liability.\u201d\nThe direction of U.S.F. & G.\u2019s argument is that its policy, to avoid duplication of coverage with Workmen\u2019s Compensation insurance, was not intended to apply to an employee of the named insured whose injury occurred within the scope of his employment; that the exclusionary clause is intended to cover situations or hazards and not to declare who is insured; and that the addition of the \u201cseverability\u201d clause in standard policies since 1955 does not affect the situation wherein an employee is involved; that if so intended, it could have been easily so stated clearly.\nPlaintiffs argue that the use of the phrase excluding \u201cany employee of the insured\u201d in the U.S.F. & G. policy indicates an intention to exclude only Carroll who was the employee of Parkway, and not to exclude Livesay, Jr. as an additional insured; that otherwise, the phrase would have to be rewritten to mean \u201cinsureds,\u201d in the plural, or \u201cany or all insureds.\u201d They further argue that the \u201cseverability\u201d clause was meant to end any question as to that interpretation. In effect, they argue that Livesay, Jr. is the insured who was intended to be afforded the benefit of the U.S.F. & G. policy and that Carroll\u2019s suit against the additional insured is not excluded because Carroll is not the employee of that insured.\nThe questions raised in the interpretation of the employee exclusionary clause in the policy in question are no longer novel, but decisions in various jurisdictions are in irreconcilable conflict. 50 ALR2d 97-104.\nThe only Appellate ruling in Illinois bearing on the question is General Acc. Fire & Life Assur. Corp. v. Brown, 35 Ill App2d 43, 52, 181 NE2d 191, decided in the First District in 1962. Having before it an employee exclusionary clause essentially similar to the clause in question here, that court held that the provision would exclude an additional insured from protection under the policy against an injury suffered by an employee of the named insured. The \u201cseverability of interests\u201d doctrine was argued in that case, and while the court noted that the policy before it did not contain that express clause, it offered the dictum:\n\u201cMoreover, courts faced with the question of the effect of such a clause have held that it does not change the meaning of the exclusionary clause. (Transport Ins. Co. v. Standard Oil Co. of Texas, 161 Tex 93, 337 SW2d 284; Kelly v. State Automobile Ins. Ass\u2019n, 288 F2d 734.)\nThe Circuit Court of Appeals for the Seventh Circuit, seeking to apply Illinois law and noting no controlling Illinois decisions, interpreted a similar employee exclusionary clause to conclude that there is no liability when an employee of the named insured is injured while engaged in the employ of said insured. Michigan Mut. Liability Co. v. Continental Cas. Co., 297 F2d 208 (CA 7th, 1961). Shortly thereafter that same court decided another case, seeking to apply Illinois law, with the same conclusion, (having then before it General Acc. Fire & Life Assur. Corp. v. Brown (supra)). Ferrell v. State Automobile Ins. Ass\u2019n of Indianapolis, 303 F2d 897 (CA 7th, 1962). While the \u201cseverability of interests\u201d clause was not before that court in its decisions, the court\u2019s rationale was that the employee exclusionary clause does not attempt to say who is an assured, but simply sets forth the agreement of the parties that the policy shall not be applicable to certain situatiom, including one involving injury to an employee of the named insured while acting in the scope of his employment and thus under the Workmen\u2019s Compensation Act.\nIn cases decided in other jurisdictions directly involving the question of the effect of the \u201cseverability\u201d clause, there is the same irreconcilable conflict in the decisions. The United States Court of Appeals for the Sixth Circuit has rejected the contention, also made here, that the purpose of the \u201cseverability\u201d clause was to clarify the confusion which had existed in the various jurisdictions which had come to opposite conclusions in interpreting the \u201cemployee exclusion clause.\u201d The Sixth Circuit Court found \u201cno evidence . . . that this was the purpose.\u201d Kelly v. State Automobile Ins. Ass\u2019n, 288 F2d 734 (CA 6th, 1961). It found no ambiguity in the exclusionary clause, holding that an employer would take out Workmen\u2019s Compensation to cover any claim of an employee and would rely on protection of liability insurance against claims asserted by the public, and not by its own employees. It concluded that (p 738) \u201cif it was intended by the severability of interests clause to provide coverage in a case like the present one, the language used was inadequate for the purpose.\u201d\nThe United States Court of Appeals for the Fourth Circuit, applying West Virginia law, came to the opposite conclusion in Pepsi-Cola Bottling Co. of Charleston v. Indemnity Ins. Co., 318 F2d 714 (1963).\nWhile this court is not bound by any Illinois authority directly in point on all the issues, it is persuaded that the better reasoning supports the view that the exclusionary clause clearly and unambiguously excludes the. hazard of the liability claim made by the employee, Carroll, and that it was intended that his injuries would be covered, as far as his employer\u2019s liability and garage policy is concerned, by Workmen\u2019s Compensation insurance. We find his situation and the hazard of his claim excluded under his employer\u2019s policy.\nNor are we persuaded that the \u201cseverability\u201d clause creates any change or ambiguity in the interpretation of the exclusionary clause. There is no evidence as to the purpose of that clause, added in 1955 to standard policies, including that of both Plaintiffs\u2019 and Defendant\u2019s policies here. The clause was added presumably by the insurance industry and not a particular insurance company. If it were intended to avoid the conflict in decisions, it could have been stated in clear language adequate to reconcile or avoid these conflicts. It was not so stated.\nThe judgment of the trial court is therefore reversed.\nJudgment reversed.\nMORAN and ABRAHAMSON, JJ., concur.", "type": "majority", "author": "MR. JUSTICE SEIDENFELD" } ], "attorneys": [ "Williams, McCarthy, Kinley and Rudy, of Rockford, for appellant.", "Welsh, Welsh, Holmstrom and Hyzer, of Rockford, for appellees." ], "corrections": "", "head_matter": "The Ohio Casualty Insurance Company and West American Insurance Company, Plaintiffs-Appellees, v. United States Fidelity and Guaranty Company, Francis T. Carroll, et al., and Parkway Motors, Inc., Defendants-Appellants.\nGen. No. 66-81.\nSecond District\nFebruary 21, 1967.\nWilliams, McCarthy, Kinley and Rudy, of Rockford, for appellant.\nWelsh, Welsh, Holmstrom and Hyzer, of Rockford, for appellees." }, "file_name": "0457-01", "first_page_order": 463, "last_page_order": 468 }