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08/17/93 OTIS BAKER v. EARL DEPEW

August 17, 1993

OTIS BAKER, APPELLANT,
v.
EARL DEPEW , DEFENDANT, AND THE AETNA CASUALTY & SURETY COMPANY, RESPONDENT



APPEAL FROM THE CIRCUIT COURT OF JACKSON COUNTY. The Honorable C. William Kramer, Judge.

Elwood L. Thomas, Judge, Covington, C.j., Price, Limbaugh and Robertson, JJ., concur; Benton, J., concurs in part and Dissents in part in separate opinion filed; Holstein, J., concurs in opinion of Benton, J.

The opinion of the court was delivered by: Thomas

FACTS AND BACKGROUND OF ACCIDENT

This insurance litigation arose out of a one-vehicle accident involving a 1979 Ford F-100 pickup truck owned by Holloway Construction Company (hereinafter "Holloway") driven by defendant Earl DePew, employed as a foreman by Holloway in the construction of a dam at Blue Springs Lake. Plaintiff Otis Baker, employed by Holloway as a heavy equipment operator, was riding in the back of the pickup at the time of the accident. Holloway employees were not allowed to drive their personal cars into the construction site, so they parked at an outlying parking area, and DePew transported them back and forth between the parking area and the construction site. At the time Baker was injured he was riding in the bed of the pickup truck because the cab was filled with other employees. Baker was injured when DePew stopped the truck suddenly, without warning, causing Baker's back to be thrown against a large, steel tool box located in the bed of the pickup truck. Baker sustained serious injuries to his back that required surgery and resulted in ninety percent to one-hundred percent disability, according to two physicians who testified on his behalf. Baker filed a workers' compensation claim against Holloway in which he alleged he had incurred $21,544.22 in medical expenses and $220,000.00 in past and future lost wages. Baker has not been able to return to work and, according to his doctor, is permanently disabled.

Plaintiff Baker filed a common law negligence action against defendant DePew for his personal injuries. DePew tendered his defense to the defendant, The Aetna Casualty & Surety Company (hereinafter "Aetna"), who had in effect at the time of the accident a business automobile liability insurance policy covering the pickup truck with Holloway as the named insured providing liability insurance coverage with limits in the amount of $2 million. DePew, who was operating the pickup truck with the permission of Holloway at the time of the accident, contends that he is an insured under the omnibus clause of the policy. Aetna denied coverage and refused to defend on the grounds that coverage is excluded by the fellow employee exclusion. DePew's personal attorney filed an answer on behalf of DePew after Aetna declined to defend. Thereafter, at a hearing of which defendant and his attorney had notice but failed to appear, a default judgment was entered in favor of plaintiff Baker and against defendant DePew in the amount of $875,000.00. Baker then filed the present legal garnishment action against Aetna seeking to satisfy his judgment against DePew. Baker and Aetna both filed motions for summary judgment. The trial court sustained Aetna's motion for summary judgment determining that DePew was not covered under the Aetna policy because of the fellow employee exclusion. Baker appealed to the Court of Appeals, Western District, which reversed the trial court and remanded the case with directions to enter judgment in the garnishment action in favor of Baker against Aetna in the amount of $875,000.00 plus legal interest. This Court then granted transfer.

POLICY PROVISIONS

The following provisions of the Aetna policy are relevant to the coverage issue presented in this case and the case precedents relied on by the respective parties:

SECTION II - LIABILITY COVERAGE

A. COVERAGE

1. WHO IS AN INSURED

The following are "insureds."

a. You for any covered "auto."

b. Anyone else while using with your permission a covered "auto" you own. . . . [Commonly called omnibus coverage.]

B. EXCLUSIONS

This insurance does not apply to any of the following:

4. EMPLOYEE INDEMNIFICATION AND EMPLOYER'S LIABILITY [Commonly referred to as employee exclusion clause.]

"Bodily injury" to:

a. An employee of the "insured" arising out of and in the course of employment by the "insured;"

5. FELLOW EMPLOYEE [Commonly referred to as a cross-employee exclusion clause.]

"Bodily injury" to any fellow employee of the "insured" arising out of and in the course of the fellow employee's employment.

SECTION V - DEFINITIONS

D. "Insured" means any person or organization qualifying as an insured in the Who is An Insured provision of the applicable coverage. Except with respect to the Limit of Insurance, the coverage afforded applies separately to each insured who is seeking coverage or against whom a ...


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