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Continental Insurance Co. v. Collinsworth3/24/2005
In this appeal from an adverse summary final judgment, the insurer calls upon us to determine the meaning of an exclusion clause in an insurance policy that the trial court found did not exclude coverage for the tragic boating incident that claimed the life of Ted Collinsworth and inflicted serious injuries on Robert Crockford. A salutation at the beginning of the marine insurance policy issued by Continental Insurance Company to Ted and his wife Dorothy warmly greets them with "Welcome Aboard! We are delighted that you are participating in the Boat U.S. Marine Insurance Program. The policy you are holding is designed by and especially for a recreational boater like you." Toward the end of the policy, however, is the "Racing Exclusion," which tells Ted and Dorothy that " e will not cover powerboats while engaged in any speed race or test. We do cover predicted log cruises or similar competitions and sailboat racing." The issue we must resolve is whether the provision "any speed race" is ambiguous and should be interpreted in favor of the insureds as excluding only officially organized and sanctioned powerboat races.
Ted and Robert, good friends and companions, each purchased powerboats capable of speeds approximating 110 miles per hour. The two went out on Lake Tarpon, where there is no speed limit, to drive their boats. While traveling side-by-side at approximately 80-85 miles per hour, something happened to cause the two boats to collide. Ted died as a result of the collision and Robert was seriously injured. Five eyewitnesses reported that they thought the boats were racing at the time, and the Boating Accident Investigation Report concluded that Ted and Robert were "racing (unsanctioned) south on Lake Tarpon" at the time of the accident. Robert denied that they were racing and testified in an affidavit that he and Ted were "simply enjoying driving fast across the water as our boats were designed to do, and as we frequently did on Lake Tarpon."
Dorothy, as personal representative of Ted's estate, filed a wrongful death action against the Crockfords that was subsequently settled by the Crockfords' liability insurance carrier. We are not concerned with the result of that action. The Crockfords filed suit against Ted's estate, which turned to Continental to provide a defense and coverage under the marine insurance policy previously mentioned. Relying on the racing exclusion quoted earlier, Continental instituted a declaratory judgment action seeking a determination that the accident came within the racing exclusion, thereby relieving it of liability for the defense of the action and any resulting award of damages. The trial court held that the exclusion was ambiguous and "capable of being fairly and reasonably read both for and against coverage" and construed it in favor of coverage. Believing this decision to be erroneous, Continental appeals. Continental asserts that the exclusion applies to any racing event, sanctioned or unsanctioned, official or unofficial, and that it, therefore, acts to exclude coverage for what it contends to have been a race between Ted and Robert.
It is to the provisions of the exclusion clause that we must look to resolve the issue before us, and the textual point marked for emphasis by the parties upon which we now intently gaze is "any speed race." Dorothy argues that this provision, undefined in the policy, is ambiguous and thus subject to interpretation. Relying upon the general rule that requires an ambiguous exclusion to be interpreted in favor of coverage, she contends that "any speed race" should refer only to officially-sanctioned speed races. She draws support for this argument from the provisions of the second sentence of the clause, which exce
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