859 F2d 924 Nationwide Mutual Insurance Company v. H Kuehling

859 F.2d 924

Unpublished Disposition

NATIONWIDE MUTUAL INSURANCE COMPANY, Plaintiff-Appellee,
v.
William H. KUEHLING, Lowen Kuehling, et al., Defendants-Appellants.

NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel.


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1

No. 87-6644.

2

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Aug. 4, 1988.
Decided Sept. 23, 1988.

3

Before FARRIS and WIGGINS, Circuit Judges and M.D. CROCKER*, District Judge.

4

MEMORANDUM**

5

William Kuehling and Lowen Kuehling appeal from the district court's order granting summary judgment in favor of Nationwide Mutual Insurance Company. We affirm.

BACKGROUND

6

On February 20, 1984, William Kuehling was injured when the motorcycle he was riding collided with an automobile driven by Mr. Philip Goodlove. Mr. Goodlove's insurance policy with Nationwide Mutual limited Nationwide's liability for bodily injury to $25,000 per person and $50,000 per occurrence. The Kuehlings demanded $50,000 from Mr. Goodlove, the per occurrence limit on the policy. Nationwide Mutual offered to settle the case by paying $25,000 for Mr. Kuehling's injuries, but would not pay for Mrs. Kuehling's claim for loss of consortium under the per occurrence limitation, relying upon the following policy language:

7

For bodily injury liability, limits shown for any one person are for all legal damages, including loss of services, claimed by anyone for bodily injury to one person as a result of one occurrence. Subject to this limit for any one person, the total limit of our liability shown is for all damages, including loss of services, due to bodily injury to two or more persons in any one occurrence.


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8

The uncontested facts show that William Kuehling was injured in the collision, but his wife, Lowen Kuehling, was not present at the scene of the accident, did not witness the collision nor did she sustain any physical injuries as a result of the collision.

9

The Kuehlings argue that the critical policy language is ambiguous, requiring examination of the intent of the parties, and thus summary judgment was inappropriate. They also contend that Nationwide Mutual's failure to serve Philip Goodlove with notice of the hearing on the motion for summary judgment deprived Goodlove of due process.

10

Nationwide Mutual sought declaratory relief to determine coverage, and the district court granted Nationwide Mutual's motion for summary judgment, holding that Mrs. Kuehling's loss of consortium claim is covered under the per person limit, and that their combined claims under the Goodlove policy were limited to the $25,000 per person coverage.

STANDARD OF REVIEW

11

The grant or denial of summary judgment is reviewed de novo. If a review of the pleadings and supporting documents shows there is no genuine issue as to any material fact, the moving party is entitled to judgment as a matter of law. Cal. Arch. Bldg. Prod. v. Franciscan Ceramics, 818 F.2d 1466, 1468 (9th Cir.), cert. denied --- U.S. ----, 108 S.Ct. 698, 699, 98 L.Ed.2d 650 (1988).

DISCUSSION

12

Under the applicable California law interpreting insurance contracts, doubts as to the meaning of an insurance policy must be resolved against the insurer to secure indemnity to the insured for losses to which the insurance relates. Continental Cas. Co. v. Phoenix Constr. Co. (1956) 46 Cal.2d 423, 437-438. An insurance company has the right to limit or exclude certain coverage in the policies it issues, and the plain language of the limitation must be respected. Hartford Fire Ins. Co. v. Spartan Realty International (1987) 194 Cal.App.3d 947, 951. Language in the policy must be given a reasonable interpretation and the words used are to be given their common, ordinary and customary meaning. United Services Automobile Assn. v. Warner (1976) 64 Cal.App.3d 957, 962. If the terms of the policy are plain and unambiguous, its interpretation must be construed from the language used, and the court has the duty to enforce the policy as agreed upon by the parties. Strict construction does not mean strained construction, and the court should not "rewrite a policy" to bind the insurer to a risk it did not contemplate and for which it was not paid. Safeco Insurance Co. v. Gilstrap (1983) 141 Cal.App.3d 524, 533. If the policy is clear and unambiguous, the court should not look to the reasonable expectations or intents of the parties. State Farm Mutual Auto. Ins. Co. v. Ball (1981) 127 Cal.App.3d 568, 572-573.

13

Appellants argue that the language of the limits of payment for bodily injury is ambiguous because it does not clearly and reasonably state that loss of consortium is included in the per person limitation.1 The ambiguity arises from the unclear meaning of the phrase "loss of services." Appellant contends that California law recognizes loss of consortium as a non-derivative independent cause of action which includes more than mere loss of services, relying upon Abellon v. Hartford Insurance Co. (1985) 167 Cal.App.3d 21, and Rodriguez v. Bethlehem Steel Corp. (1974) 12 Cal.3d 382.

14

The district court found the language of the policy clear and unambiguous because the policy expressly aggregated consortium claims with the claims of the person primarily injured. United States Automobile Assn. v. Warner (1976) 64 Cal.App.3d 957; State Farm Mutual Ins. Co. v. Ball (1981) 127 Cal.App.3d 568. Appellant argues that these cases must be distinguished, however, because the critical language aggregating the consortium claims in those cases included "loss of care and services" while the policy at issue includes only "loss of services."

15

A review of the above cases and the effective language of the policy at issue confirms that the policy language is clear and free of ambiguity. The per person limitation specifically defines "all damages" as including "loss of services." While the language specifically mentions only loss of services, in context, the phrase is inclusive rather than exclusive. See United Services Automobile Assn. v. Warner, 64 Cal.App.3d at 962. "Loss of consortium is not only similar in kind to damage for loss of services in that it arises out of the bodily injury sustained by the injured spouse, but actually includes loss of services as one of its elements." Id., quoting Rodriguez v. Bethlehem Steel Corp., 12 Cal.3d 382, 404-405. In addition, the Abellon court found the absence of the phrase "loss of services" the critical element in that case for finding the Warner case unpersuasive and not controlling: "The Warner 'per person' limitation specifically defines 'all damages' as including loss of 'services'; Hartford's 'per person' limitation contains no such qualifying phrase." Abellon v. Hartford Ins. Co., 167 Cal.App.3d at 31 (emphasis in original).

16

Appellants argue that the absence of language including "care" in the limitation is critical because as defined in Rodriguez and its progeny, consortium claims encompass the loss of spousal companionship, comfort, affection, etc. along with any loss of the injured spouse's physical assistance in the operation and/or maintenance of the home. Appellants argue that Mrs. Kuehling had to quit her job to help take care of her husband, and that he was hospitalized for seven weeks followed by home recuperation for several months. As a result, Mrs. Kuehling suffered complete loss of companionship for more than six months. The argument is unconvincing. The policy here restricts coverage to the per person limitation for "all damages," including loss of services, claimed by anyone for bodily injury to one person. Such language is inclusive. Warner, supra. Mrs. Kuehling's lost earnings which were incurred because she quit her job to care for her husband and the value of the nursing services she provided are not elements of damage for loss of consortium, but are part of Mr. Kuehling's damages recoverable for his bodily injuries. See Rodriguez, 12 Cal.3d at 409.

17

Because we agree that the policy language was clear and unambiguous, the district court was not required to examine the reasonable expectations or intent of the parties. State Farm Mutual Auto. Ins. Co. v. Ball (1981) 172 Cal.App.3d 568, 572.

18

Appellants next assert that summary judgment was inappropriate because Nationwide Mutual failed to serve notice of hearing on the motion for summary judgment upon Philip Goodlove, the insured, thereby depriving Mr. Goodlove of due process of law. The record reflects that this issue was not properly raised in the district court.

19

An appellate court will not ordinarily review an issue not raised or objected to below unless necessary to prevent manifest injustice. Komatsu, Ltd. v. States S.S. Co., 674 F.2d 806 (9th Cir.1982). This circuit has recognized two other exceptions to this general rule which confer upon the appellate court the discretion to address an issue not raised in the lower court. See Bolker v. C.I.R., 760 F.2d 1039, 1042 (9th Cir.1985).

20

Even assuming this court has the discretion to review the issue, this case does not present a proper basis for overturning the district court's grant of summary judgment or require remand because of the failure to serve the notice of motion for summary judgment upon Mr. Goodlove.2 Appellants argued that Goodlove's reasonable expectations with regard to the per person limitations must be examined. Because the policy is clear and unambiguous, the intent of the parties is irrelevant, [State Farm Mutual Auto. Ins. Co. v. Ball, 127 Cal.App.3d at 572-573] so neither the Kuehlings nor Goodlove were prejudiced by the failure to serve notice upon Goodlove nor would the outcome have been affected.

21

For the foregoing reasons, the judgment of the district court is AFFIRMED.

*

The Honorable M.D. Crocker, Senior United States District Judge for the Eastern District of California, sitting by designation

**

This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3

1

Appellant analyzed the language of the original policy issued in 1978. There is no dispute that the endorsement issued in 1983 was in effect at the time of the accident. The error in reference to the language of the 1978 policy was repeated below both by appellee, in their summary judgment motion, and by the court in making its order. The effective language was properly set out in the Complaint and a copy of the effective endorsement was part of the record below. Both versions of the bodily injury limitations include the "loss of services" language. Even though the court relied upon the wrong language, because this court is reviewing the district court's grant of summary judgment, this court must examine the entire record to determine if there is a proper basis for affirmance. Lowe v. City of Monrovia, 775 F.2d 998, 1007 (9th Cir.1985). If the result below is correct, it must be affirmed, although the lower court relied upon a wrong ground or gave a wrong reason. Keniston v. Roberts, 717 F.2d 1295, 1300 n. 3 (9th Cir.1983) [citing Helvering v. Gowran, 302 U.S. 238, 58 S.Ct. 154, 82 L.Ed.2d 224 (1937) ]

2

The issue as stated by appellants raises an obvious standing issue. We are not required to reach the issue in affirming the district court; however, we note that appellants received actual notice and that such notice deprives them of standing to raise the claim. See Wiren v. Eide, 542 F.2d 757, 762 (9th Cir.1976)