What Is “Use” Of An Automobile

Grand Prairie Insurance Law Attorneys and those in Dallas, Fort Worth, Richardson, Mesquite, De Soto, Duncanville, North Richland Hills, and other places in the DFW area need to have an understanding how the courts interpret insurance policies.
The United States 5th Circuit Court of Appeals issued an opinion in 2012, that dealt with policy interpretation of the word “use” in the context of the insurance policy.
The Federal Court applied in some detail, Texas policy interpretation rules for determining the insurance companies duty to defend with respect to the facts of the case. The style of the case is National Casualty Company v. Western World Insurance Company.
The plaintiff in the underlying lawsuit alleged that emergency medical technicians (EMT’s) employed by Preferred Ambulance fatally injured the plaintiff’s mother while loading her into an ambulance. Preferred Ambulance held a Commercial Auto (“Auto”) policy from National Casualty Company and a Commercial General Liability (“GCL”) policy from Western World Insurance Company. The former covered liability arising from the use of an auto; the CGL policy excluded it. The Auto policy also excluded injuries resulting from the providing of “any medical or other professional services.”
In a lawsuit to determine coverage, the lower court ruled both insurers had a duty to defend the underlying action.
This Court upheld the lower court ruling saying the Auto insurer must defend because alleged loading constitutes “use” of the ambulance, and the CGL insurer must defend because the allegation of negligent strapping of the decedent to the gurney is not “use” of the auto and so does not trigger the auto-use exclusion in the CGL policy.
The Court applied an established three part test for determining whether an injury relates to the “use” of an automobile:
1. The accident must have arisen out of the inherent nature of the automobile, as such;
2. The accident must have arisen within the natural territorial limits of the automobile, and the actual use must not have terminated; and 3. The automobile must not merely contribute to cause the condition which produces the injury, but must itself produce the injury.
The Auto insurer conceded the first two elements but argued that, because the injury occurred while loading the decedent into the ambulance, the ambulance did not actually cause the injury. The Court disagreed, observing that Texas courts apply the three part test liberally.
Next, the Court considered whether the CGL insurer had a duty to defend. The CGL insurer conceded that the underlying lawsuit fell within the insuring agreement but argued that the policy excluded injuries arising out of the “use” of any automobile. Significantly, “use” was defined in the policy to include “operation and loading or unloading,” and the Court had already determined that the accident occurred during loading.
The Court disagreed, however, noting that a single factual allegation falling within coverage was enough to trigger a duty to defend. This is particularly true when construing an exclusion. The Court noted that the pleading alleged in part that the decedent’s injuries resulted from the failure of EMT’s to properly secure the decedent into the gurney. This conduct, according to the Court, was not related to the “use” of an automobile as that term was defined in the policy. To reach this result, the Court necessarily reasoned that securing a person to a gurney is not sufficiently related to loading a person into the ambulance. Consequently, the Court ruled that the CGL insurer also owed a duty to defend the underlying lawsuit.
These coverage cases can be confusing for even the most experienced attorneys.