Bodily Injury

Grand Prairie insurance law attorneys and those in Mesquite, Garland, Richardson, Dallas, De Soto, and other places in Dallas County would want to now about this Texas Supreme Court case.
The opinion was issued in June 2012. The style of the case is, Evanston Insurance Company v. Legacy of Life, Inc.
The case came to the Texas Supreme Court on two certified questions from the Fifth Circuit Court of Appeals. The certified questions arise from a suit filed by a daughter against an organ donation charity when she discovered that the charity–contrary to an earlier representation to her–would allegedly profit from harvesting her deceased mother’s tissues. The charity requested a defense from its insurer and the insurer denied a defense. The insurer’s subsequent suit against the charity resulted. One of those issues will be dealt with here.
Here is some factual background.
Legacy of Life, Inc. (Legacy) is an organ donation charity. Debra Alvarez consented for Legacy to harvest some of her terminally ill mother’s tissues after she died. Alvarez alleges in her suit against Legacy that she only consented because Legacy represented the tissues would be distributed on a nonprofit basis but that Legacy instead transferred them to companies that sold the tissues for a profit. Alvarez brought various claims against Legacy, seeking compensatory damages, mental anguish damages, restitution, exemplary damages, and attorney’s fees. Importantly, Alvarez did not allege that she or her mother suffered a physical injury. Instead, Alvarez alleged that her mother’s estate as the legal and rightful owner of the remains was wrongfully deprived of them, causing restitution damages to the estate and mental anguish damages to Alvarez.
Legacy had a combined medical professional and general liability insurance policy through Evanston Insurance Company (Evanston). Legacy demanded that Evanston defend the Alvarez suit. Evanston denied the request and filed suit in federal court seeking a declaratory judgment that it had no duty to defend because Alvarez did not claim damages for personal injury or property damage. Legacy counterclaimed, asserting various insurance claims and requesting a declaratory judgment in its favor.
Evanston and Legacy both moved for summary judgment.
The Court first noted that in determining whether an insurer has a duty to defend, the eight corners rule is followed by looking at the four corners of the complaint for alleged facts that could possibly come within the scope of coverage in the four corners of the insurance policy. The Court then discussed this legal principle.
With these principles in mind, the Court first determined whether Alvarez’s suit seeks damages for personal injury under Legacy’s policy with Evanston. Specifically, the first certified question asks: “Does the insurance policy provision for coverage of ‘personal injury,’ defined therein as ‘bodily injury, sickness, or disease including death resulting therefrom sustained by any person,’ include coverage for mental anguish, unrelated to physical damage to or disease of the plaintiff’s body?” The policy defines “personal injury” as:
(a) bodily injury, sickness or disease including death resulting therefrom sustained by any person;
When an insurance policy defines its terms, those definitions control. Legacy claims “bodily” only modifies “injury” and that Alvarez’s mental anguish qualifies as sickness under the policy. Evanston maintains that “bodily” modifies “injury,” “sickness” and “disease” and that an accompanying physical injury is required.
The Court agreed with Evanston. In Trinity, a case examining these issues, the court examined a homeowner’s policy that defined “bodily injury” as “bodily harm, sickness or disease.” Even though Texas tort law allows recovery of mental anguish without any physical manifestations in some circumstances, it was held that the policy in Trinity did not cover purely emotional injuries. The Court explained that this interpretation gave effect to the commonly understood meaning of “bodily,” which implies a physical harm.
Legacy argues that the Trinity policy defined “bodily injury,” which is narrower than the term “personal injury” here. The Court disagreed that this difference warrants a different outcome from that in Trinity for two reasons.
First, the definitions in Trinity and the definition here were virtually identical. If two policies have two different defined terms but similar definitions, they should be awarded similar meanings.
Second, relevant grammatical rules indicate that an adverb or adjective typically modifies all the words in a string that follow it and are separated by a disjunctive. This rule certainly does not apply in all situations. As Legacy notes, the broader defined term “personal injury” could caution in favor of “bodily” not modifying all three nouns in subsection (a) here. However, subsections (b) and (c) of the definition of personal injury explain here why “bodily”–as in Trinity–modifies the nouns that follow. Subsections (b)-(c) include types of personal injury that require no physical manifestation, such as malicious prosecution, libel and slander. The use of a broader term here (personal injury) than in Trinity (bodily injury) encompasses these additional types of injury, but it does not alter bodily injury, sickness or disease to allow for such injuries even without physical manifestations. In other words, the parties included injuries that require no physical manifestation in subsections (b)-(c), and essentially duplicated the definition from Trinity in subsection (a), which requires a physical manifestation. To encompass both categories, they selected the broader term “personal injury.”
Here, Legacy maintains that Alvarez’s injuries qualify as sickness or disease under subsection (a) of the definition of personal injury. Because “bodily” modifies injury, sickness, and disease in subsection (a), a physical manifestation is required for sickness or disease to be covered. Alvarez did not allege a physical injury. Therefore, her claims against Legacy did not trigger Evanston’s duty to defend under the personal injury component of its policy. The Court answered the first certified question in the negative.

This case is a prime example showing why an experienced Insurance Law Attorney needs to be involved when a person or company finds themselves in a position of having to make a claim.The opinion was issued in June 2012.