Osbon v. National Union Fire Ins. Co.Osbon v. National Union Fire Ins. Co.
James Earl OSBON, et al.,
v.
NATIONAL UNION FIRE INSURANCE COMPANY.
Supreme Court of Louisiana.
*1159 Geary S. Aycock, Arbour & Aycock, West Monroe, Frank W. Hanvey, Anzalone, Parker & Hanvey, Monroe, for applicant.
Brian E. Crawford, Crawford & Anzelmo, Susan N. Belsom, Monroe, for respondent.
MARCUS, Justice[*].
In 1968, Pаuline J. and James Osbon, Sr. divorced. In 1971, Pauline purchased a home which was financed with a mortgage from Troy & Nichols, Inc. The mortgage required Pauline to maintain insurance, including coverage for loss by fire, on her home. National Union Fire Insurance Company of Louisiana (National Union) was selected as the insurer and P.J. Osbon was the named insured.
In 1978, Pauline remarried James Osbon. On February 15, 1990, Pauline's home was destroyed by a fire. An insurance claim was filed with National Union. National Union denied the claim asserting the defense of arson. Pauline and James filed suit. On September 4, 1991, an amended petition was filed removing James Osbon[1] as a plaintiff and alleging that the property was Pаuline Osbon's separate property. A jury found that James Osbon "intentionally set or was responsible" for the fire. The trial judge entered a judgment in favor of National Union rejecting Pauline Osbon's demands. The court of appеal affirmed finding that James Osbon's act of arson was covered by the intentional loss exclusionary clause contained in the insurance policy.[2] On Pauline Osbon's application, we granted certiorari to review thе correctness of that decision.[3]
The issue for our determination is whether Pauline Osbon is barred from recovering under the policy issued by National Union because her home and its contents were destroyed by a fire intentionally set by her husband, James Osbon, Sr.
SECOND PAGE OF STANDARD FIRE POLICY
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Perils not includedThis company shall not be liable for loss by fire or other perils insured agаinst in this policy caused, directly or indirectly, by:
. . . . .
(i) neglect of the insured to use all reasonable means to save and preserve the property at and after a loss....
. . . . .
Conditions suspending or restricting insurance. Unless otherwise provided in writing added hеreto this Company shall not be liable for loss occurring:
(a) While the hazard is increased by any means within the control or knowledge of the insured....
The artiсle "the" is singular and is used to particularize the subject spoken of. "The" is a word of limitation. Black's Law Dictionary (6th ed.). Hence, "the" insured means only one insured. We find that the *1160 phrase "the insured" refers to a specific insured, namely, the insured who (1) is responsible for causing the loss and (2) is seeking to recover under the policy. Accordingly, under
This interpretation is in line with the legislative intent in enacting the exclusion and condition contained in
Moreover, this interpretation is in line with other jurisdictions that have interpreted similar exclusions and conditions contained in statutes and insurance policies. Courts in other jurisdictions generally focus on the article modifying the word "insured," specifically, "the" insured, "an" insured, and "any" insured. A majority of courts interpret "any insured" as applying to all insureds as defined by the poliсy. Thus, the entire policy would be void if any one insured committed arson thereby precluding recovery by an innocent co-insured. Spezialetti v. Pacific Employers Ins. Co.,
Although Pauline Osbon is entitled to coverage under our interpretation of
DEFINITIONS
In this policy, "you" and "your" refer tо the "named insured" shown in the Declarations and the spouse if a resident of the same household ... In addition, certain words and phrases are defined as follows:
* * * * * *
3. "insured" means you and residents of your household who are:
a. your relatives; ...
EXCLUSIONS
We do not insure for loss caused directly or indirectly by any of the following. Such loss is excluded regardless of any other cause or event contributing concurrently or in any sequence to the loss.
* * * * * *
8. Intentional Loss, meaning any loss arising оut of any act committed:
a. by you or at your direction; and
*1161 b. with the intent to cause a loss.
The language of the policy excludes coverage when an intentional act is caused by the named insured or a spouse who is a resident of the household. Thus, it appears that under the policy, an innocent spouse such as Pauline Osbon is excluded from seeking coverage because her loss was a result of the intentional wrongful conduct of her husband.
Thus, our inquiry is narrowed. The issue becomes whether thе policy must be reformed to conform with the standard fire insurance policy as provided by
A. Notwithstanding the requirements of R.S. 22:691 concerning the use of the standard fire policy, the usе of such form shall not be required in the event the policy forms covering the property are equivalent to or exceed the provisions of the standard fire policy.
B. In the event that the policy forms used are nоt equivalent to or do not exceed the terms of the standard fire policy, all of the provisions of the standard fire policy shall become a part of the policy by physically attaching the standard fire pоlicy thereto.
C. Failure to attach the standard fire policy as provided in R.S. 22:691.2(B) shall not affect the rights of the insured under the standard fire policy and the provisions of the standard fire policy shall become a part of the contract and shall prevail.
Moreover, unlike other standard provisions required by the Insurance Code, provisions required by the standard fire insurance policy form cannot be waived by the commissioner of insuranсe.
The intentional act exclusion in National Union's policy does not conform to the standard fire policy form provided in
The court of appeal found that the damage exceeded the National Union policy limits of $32,000.00 for the dwelling, Pauline Osbon's separate property, and $6,400.00 for lоss of use thereof. Hence, she is entitled to recover these amounts less any amount paid to the mortgagee under the loss payable clause contained in the policy. Additionally, the court of appeal found that the damage exceeded the policy limits of $16,000.00 for contents. Since the record does not reflect Pauline Osbon's interest in the contents of the dwelling, the extent to which she is entitled to recover under thе policy for this loss cannot be determined. Accordingly, we find it is necessary to remand the case to the trial court to take further evidence on Pauline Osbon's interest in the contents and to render a proper judgmеnt for this loss.
*1162 DECREE
For the reasons assigned, the judgment of the court of appeal is reversed and set aside. The case is remanded to the district court to enter a judgment in favor of Pauline Osbon and against National Union Fire Insurаnce Company of Louisiana for $32,000.00 for the dwelling and $6,400.00 for the loss of use less any amount paid to the mortgagee under the loss payable clause contained in the policy. The district court is further ordered to take evidence on Pauline Osbon's interest in the contents and to render a proper judgment for this loss. The rights of all parties to appeal the issue of the extent of coverage of the contents to the court of appeal are reserved. The district court is to fix the appropriate interest due in the judgment. All costs are assessed against National Union Fire Insurance Company of Louisiana.
NOTES
Notes
[*] Pursuant to Rule IV, Part 2, § 3, Dennis, J. was not on the panel which heard and decided this case.
[1] James Osbon, Sr. died on October 27, 1990, approximately one year prior to trial.
[2]
[3]
[4]
A. Insurance contracts shall contain such standard provisions as are required by the аpplicable chapters of this Code pertaining to contracts of particular kinds of insurance. The commissioner of insurance may waive the required use of a particular standard provision other than the provisions required in Part XV [governing the Standard Fire Policy,] of this chapter....