Court: Wisconsin Supreme Court; December 30, 1953; Wisconsin; State Supreme Court
The defendant argues that the insurance policy should be interpreted based on the intentions of the parties, claiming that it was not intended for medical expenses to be paid more than once for any injured person. Conversely, the plaintiff asserts that the policy is unambiguous and that its various coverages are divisible and severable. Citing legal precedent, the plaintiff references 44 C. J. S. Insurance, which indicates that a policy termed entire may actually be divided into separate coverages based on the parties' intentions as discerned from the contract's terms. The excerpt discusses how policies that group multiple risks, such as bodily injury and property damage related to motor vehicles, can legally function as multiple distinct policies. Although no Wisconsin case directly addresses the divisibility of insurance contracts, a referenced case, Loomis v. Rockford Ins. Co., illustrates that a breach concerning one property does not invalidate coverage for others under a divisible policy. The text further notes that medical-payment provisions in automobile insurance are recent developments, with such provisions allowing injured passengers to claim medical expenses independently of the insured's liability. The policy outlines specific coverage agreements, including bodily injury liability, which obligates the insurer to pay damages resulting from accidents associated with the insured vehicle.
Coverage K provides for the payment of reasonable medical expenses incurred within one year of an accident for individuals sustaining bodily injury, sickness, or disease while in or entering/exiting the insured automobile, provided it is used by the named insured or with their permission. The insurer is also responsible for immediate medical and surgical relief expenses for others at the time of the accident. However, exclusions apply, including liability assumed under contracts and injuries or deaths of employees engaged in non-domestic employment when benefits are provided under Workmen’s Compensation Law.
The limit of liability under Coverage K is defined as $500 for each person for all incurred expenses from any single accident. Payments made under this coverage do not admit liability on behalf of the insured or the insurer. The insurer has subrogation rights, allowing them to recover costs from third parties after making payments under the policy.
The insurance policy, which includes bodily injury, property damage, and medical payments, indicates that while it is a single document, the coverages are distinct and separable, with Coverage K treated as a separate contract. It specifically covers medical payments regardless of liability and is not limited to negligent operation of the vehicle. The defendants argued that their payment of a judgment fulfilled their obligations under the policy, but this was found insufficient as they did not comply with the conditions of Coverage K, specifically regarding direct payments to the injured party or service providers, which would have satisfied the coverage terms.
The defendant argues that the insurance policy excludes liability for obligations assumed under any contract, suggesting that neither the insurer nor the insured intended for direct obligations to exist towards the injured party, Cora Severson, as Louis C. Larson did not enter into any agreement regarding medical payments for her. Furthermore, the defendant asserts there is no privity of contract between the plaintiff and the insurance company, preventing the plaintiff from suing directly. The plaintiff counters by referencing Tweeddale v. Tweeddale, which establishes that when a promise is made to a third party for consideration, a binding debtor-creditor relationship is created, allowing the third party to enforce the promise. This principle has been upheld in Wisconsin law, including cases like In re Bratt. The defendant attempts to distinguish insurance contracts but fails to apply relevant case law correctly. Additionally, the defendant claims the plaintiff cannot pursue two separate actions on the same contract, citing Werner v. Riemer and Stern v. Riches. However, the court indicates that the plaintiff's actions do not constitute splitting causes of action, as the current case involves a separate contract and does not require different trials. Thus, the court affirms the judgment in favor of the plaintiff.
