Fifth District reverses $1 million judgment out of Clinton County

The Fifth District Appellate Court has reversed a $1 million judgment entered by Clinton County Circuit Judge Dennis Middendorff against Harco National Insurance Co.

The case involved an insurance coverage question of a leased truck that was in a fatal accident during icy conditions in December 2008 on Interstate 70 in Warren County, Mo.

Hogan Truck Leasing owned the truck and leased it to Justin Time Transportation, LLC. The driver of the leased vehicle, Derell L. Boyd, lost control of the truck and slid on ice-covered roads. The truck driven by Boyd struck and killed Edwin W. Sargent.

The Harco policy for Hogan covered permissive users of Hogan’s vehicles.

Justin Time maintained a $1 million liability insurance policy issued by Netherlands Insurance Co. It also had a $3 million umbrella policy written by Indiana Insurance Co.

Edwin W. Sargent’s estate filed a wrongful death suit, which settled. The plaintiffs then filed a declaratory judgment action against Harco to determine their rights pursuant to Harco’s policy.

The trial court granted summary judgment for the plaintiffs, finding that provisions of Harco’s policy were ambiguous and that Harco waived its right to use the policy exclusion. Harco appealed.

Justice Melissa Chapman wrote the court's opinion which was published March 4. Justices Stephen Spomer and Judy Cates concurred.

The Fifth District held that, "the trial court erred in entering summary judgment for plaintiffs based on the finding that the policy issued to the lessor of the truck was ambiguous and that defendant was not entitled to invoke the policy exclusions to avoid coverage, since the lease provided by defendant’s insured required plaintiffs to obtain their own liability coverage and indemnify defendant’s insured for any losses, plaintiffs complied with those obligations, and several states have upheld similar agreements and determined that the policy defendant issued to the lessor only provided contingent coverage..."

The court further "rejected plaintiffs’ claims that the entire agreement between the parties was ambiguous and that defendant insurer waived its right to raise its policy endorsements as affirmative defenses."

Robert Bassett, Jennifer Dickerson Ross S. Titzer of Williams Venker & Sanders in St. Louis represented Harco.

Hopey A. Gardner and Jeffrey K. Suess of Rynearson, Suess, Schnurbusch & Champion in St. Louis represented Justin Time Transportation, Haag Food Service, Derell Boyd and Indiana Insurance Co.