Allstate Insurance Co. v. Wyoming Insurance Department

ROONEY, Chief Justice,

specially concurring, with whom BROWN, Justice, joins.

I agree with the result reached in the majority opinion, i.e., the affirmance of the district court, but I do not agree with much of that said in the majority opinion. Its sweep is too broad, as is the sweep of the exclusionary rule used by the petitioners in their insurance policies.

The general rule relative to exclusionary clauses is set forth in Annotation: Validity, construction, and application of provision of automobile liability policy excluding from coverage injury or death of member of family or household of insured, 46 A.L.R.3d 1024, § 2, p. 1027 (1972):

“In the absence of a statutory prohibition to the contrary, provisions of automobile liability insurance policies excluding from coverage members of the insured’s family or household have usually been held valid and effective to protect the insurer against claims for injuries to persons who fall within the specified classes. One court stated in this regard that insurance companies have the same right as individuals to limit their liability and to impose upon their obligations whatever conditions they please, not inconsistent with public policy * * (Emphasis added.)

We have accepted the general rule recognized by the Insurance Department’s hearing officer in his conclusions of law and recognized in the majority opinion to the effect that the freedom on the part of insurance companies to include any desired provision in insurance contracts is limited to *824that which is not prohibited by statute or public policy. McKinney v. McKinney, 59 Wyo. 204, 135 P.2d 940 (1943); Ball v. Ball, 73 Wyo. 29, 269 P.2d 302 (1954); Oldman v. Bartshe, Wyo., 480 P.2d 99 (1971); and Vossler v. Peterson, Wyo., 480 P.2d 393 (1971).

Remembering that inter-spousal and parent-child immunity originated in common law and that the insurer steps into the position of the insured in determining the existence of fault or liability on the part of the insured, wherefore the conflict as to fault or liability is primarily between the insured and the one claiming injury1, that said by this court with reference to statutes and the public policy behind inter-spousal and parent-child immunity is pertinent.

“ * * * ‘It is not to be presumed that the legislature intended to abrogate or modify a rule of the common law .by the enactment of a statute upon the same subject; it is rather to be presumed that no change in the common law was intended unless the language employed clearly indicates such an intention. * * * The rules of common law are not to be changed by doubtful implication, nor overturned except by clear and unambiguous language.’ ” McKinney v. McKinney, supra, 135 P.2d at 942, quoting from 25 R.C.L. 1054, § 280.
“ ‘ * * * Conceding it to be within the power of the legislature to make this alteration in the law, if it saw fit to do so, nevertheless such radical and far-reaching changes should only be wrought by language so clear and plain as to be unmistakable evidence of the legislative intention. Had it been the legislative purpose * * * to permit the wife to bring * * * actions against him [her husband] also for injuries to person or property as though they were strangers, thus emphasizing and publishing differences which otherwise might not be serious, it would have been easy to have expressed that intent in terms of irresistible clearness.’ ” Id. 135 P.2d at 944, quoting from Thompson v. Thompson, 218 U.S. 611, 31 S.Ct. 111, 54 L.Ed. 1180 (1910).
“ ‘It must be presumed that the legislators knew the policy of the common law, as established by centuries of judicial decisions. Had it been the intention of the Legislature to permit husband and wife to sue each other for injuries to the person or property caused by the other, it surely would have so declared by express and clear legislative enactment. * * * If such is to become the policy of the law, if such a radical change, so vitally affecting the legal status of husband and wife, is to be made, it should be made by clear and express legislation and not by judicial construction.’ ” Id. 135 P.2d at 950, quoting from Finn v. Finn, 19 Ohio App. 302 (1924).
“ ‘Unemancipated minor child has no right of action against parent or person standing in loco parentis for tort of such parent or person, unless right of action is authorized by statute.’ ” Ball v. Ball, supra, 269 P.2d at 305, quoting from Cook v. Cook, 232 Mo.App. 994, 124 S.W.2d 675 (1939).
“ * * * [I]n substance, * * * the judiciary should be reluctant to encourage actions as maintainable between children and their parents unless sanctioned by the statute law or where they disclose so clear an invasion of the rights of the child as tending to bring discord into the family and to disorganize its proper government. * * * ” Id. 269 P.2d at 314, and also Oldman v. Bartshe, supra, 480 P.2d at 101.

The legislature has not enacted a statute changing the common law and long time judicially recognized public policy of the state to the effect that inter-spousal and parent-child immunity for negligence exists in Wyoming. As will be noted infra, the exclusionary clauses in appellants’ policies go well beyond inter-spousal and parent-child immunity and are improper for that reason.

*825The established public policy in this respect was not changed by the enactment of § 31-4-120(a), W.S.1977, Cum.Supp.1983. It provides:

“(a) No owner of a motor vehicle required to be licensed shall operate or permit the operation of the vehicle without having in full force and effect an automobile liability policy as provided by W.S. 31-9-403 or bond in amounts provided by W.S. 31-9-102(a)(x). * * *”

Section 31-9-403 referred to therein refers to a current liability insurance policy on a specified motor vehicle or motor vehicles with an insurance carrier authorized to do business in this state. Section 31-9-102(a)(x) requires the policy to be at least in the amount of $10,000 for bodily injury or death of one person in any one accident, $20,000 for such of two or more persons in any one accident, and $5,000 for injury to or destruction of property.

Section 31-4-120(a), supra, does not prohibit an exclusionary clause. It does not address the question. Certainly, there is no express prohibition or clear language setting forth such. Nor does consideration of §§ 31-9-101, et seq. and 31-10-101, et seq., W.S.1977, the Motor Vehicle Safety-Responsibility Act and the Uninsured Motorist Act, change the result. As pointed out in the majority opinion, they concern separate matters for separate purposes. (It is difficult, however, to understand the necessity for the Motor Vehicle Safety-Responsibility Act in light of § 31-4-120(a) requiring compulsory insurance). The majority opinion seems to see some pertinency in the requirement of the Motor Vehicle Safety-Responsibility Act for the insurance policy prescribed therein to protect the insured “from the liability imposed by law for damages arising out of the” ownership, use or maintenance of the vehicle. The “liability imposed by law” is that resulting from negligence or intentional invasion of another’s rights. It says nothing about revoking the inter-spousal or parent-child immunity — i.e., a status which defines the perimeters of “liability imposed by law” and which status is one that is other than that in which liability is imposed by law.

Likewise, the majority opinion finds some association between (1) the requirement in § 31-4-120(a) that “no owner * * * shall operate or permit operation of the vehicle” not covered by a liability policy, and (2) the identity of those to whom he may be liable. There is no connection. The liability policy is expected to protect the owner from economic loss in cases in which he is liable under the law. The fact that he must have such a policy does not define the group to whom he is liable, i.e., whether or not it includes those with inter-spousal or parent-child immunity.

The majority opinion recognizes the purpose of § 31-4-120(a) to be for the protection of the “general public.” But established public policy does not include spouses, parents, or their children as part of the general public. It sets them off from the general public for this purpose.

Because the insurance policy required by the Motor Vehicle Safety-Responsibility Act need not insure liability under any workmen’s compensation law or on account of injury to an employee (§ 31-9-405(e), W.S. 1977) but does not refer to inter-spousal or parent-child immunity, the majority opinion concludes that the legislature intended to abrogate this long-standing immunity. As noted, we have said that such abrogation must be express; but beyond that, the exceptions contained in § 31-9 — 405(e) recognize the existence of a relationship for exclusion which is not nearly as close or important as the inter-spousal and parent-child relationship. And there are other exceptions under the act from the requirement as to security, such as a person who was legally parked at the time of the damage and an owner whose vehicle was being operated by someone without his permission. The point is that the two acts are separate and with different purposes — as recognized by the majority opinion, and, secondly, those exceptions listed in § 31-9-405(e) are not similar to the inter-spousal and parent-child immunity. Expressio uni-us est exclusio alterius applies to similar things as noted in Citizens Mutual Insur*826ance Company v. Central National Insurance Company of Omaha, 65 Mich.App. 349, 237 N.W.2d 322, 325 (1975), (one of the two cases referred to in the majority opinion in this respect). The rule cannot be applied, for example, to exclude crutches when the words of exclusion are “dogs, cats, chickens and horses.”

The rationale for inter-spousal and parent-child immunity is that which common sense dictates:

* * * The procedural difficulties, the dangers of disrupting the secrecy and serenity of marital relations, the avenue for fraud, the startling innovation in permitting such controversies, and the lack of clear legislative indorsement have all been assigned as ample reasons for the refusal of the courts to sanction, by supplying statutory interpretation, a new form of litigation manifestly requiring unequivocal legislation for its existence. * * * ’ ” McKinney v. McKinney, supra, 135 P.2d at 946, quoting from Emerson v. Western Seed & Irrigation Co., 116 Neb. 180, 216 N.W. 297, 56 A.L.R. 327 (1927). “ ‘ * * * [T]he specific purpose was to safeguard the company against the natural and inevitable partiality of the assured to an injured person if he should happen to be a member of the same family circle.’ ” Id. 135 P.2d at 948, quoting from State Farm Mutual Automobile Insurance Company v. James, 80 F.2d 802 (1936).
“ ‘ * * * Without actual dishonesty, the disposition to favor those close to one reflects itself in opinions and judgments, and one insured is more likely to concede by admission or nonresistance blame for hurting a member of his household than for doing harms to others.’ ” Id. 135 P.2d at 948, quoting from Cartier v. Cartier, 84 N.H. 526, 153 A. 6 (1931).
“‘ * * * [T]he rule * * * should be adhered to until such time as the Legislature shall deem it wise and prudent to open up a field for marring or disturbing the tranquillity of family relations * * *. If that source of litigation is to be opened up at all, it should come about by legislation. * * * ’” Id. 135 P.2d at 950, quoting from Drake v. Drake, 145 Minn. 388, 177 N.W. 624, 9 A.L.R. 1064 (1920).
“ ‘ * * * The wide acceptance of this rule is chiefly due to the following reasons advanced in its behalf:
“ ‘1. Preservation of family harmony.
“ ‘2. Maintenance of disciplinary authority of the parent.
“ ‘3. Prevention of collusion or fraud.
‘4. Preservation of equal distribution of the family exchequer.
“ ‘5. Avoidance of useless litigations, since the parent may inherit any money which the child recovers in such an action.
“ ‘6. Prevention of stale claims by minors upon reaching majority.’ ” Ball v. Ball, supra, 269 P.2d at 305, quoting from Boston University Law Review, Vol. 23, pp. 259, 260.

McKinney v. McKinney, supra, and Ball v. Ball, supra, quote from many other holdings which word the rationale in several ways. Generally, they note the purpose of the rule is to promote domestic harmony, protect against over friendly lawsuits, engender peace of society, allow security in the home, uphold the sacredness of marriage, etc. The deterioration of the family unit with accompanying loss of discipline and morality is the cause of many of the social problems of today. Attention to such matters, ranging from the rise in the rate of crimes to malfunction of education, is most often directed at- the effect rather than the cause. In most instances the cause lies in the aforesaid breakdown of the family unit, lack of discipline and low moral standards. Changing the public policy relative to inter-spousal and parent-child immunity would only aggravate an already bad situation.

“ ‘ * * * Family deterioration registers quickly in political life, appearing in loss of integrity in both citizenship and governmental activities.’ ” (Emphasis omitted.) Ball v. Ball, supra, 269 P.2d at 314.

Finally, the cases quoted in the majority opinion for the proposition that § 31-4-120(a) changes the Wyoming public policy recognizing inter-spousal and parent-child *827immunity can be easily distinguished. The quotations are from Montana (1), Nevada (1), Florida (1), Kentucky (1), Michigan (4), and California (1). There is no indication in any of these cases that inter-spousal and parent-child immunity has been judicially established in the respective states, as it has in Wyoming. But there are other distinguishing factors.

The quotation from the Montana case of Transamerica Insurance Co. v. Royle, Mont., 656 P.2d 820 (1983), which follows the wording of the Montana statute, spells out the cardinal difference between the Wyoming and Montana law. Section 61-6-301(1), Mont.Code Ann. (1983), provides in part:

“(1) Every owner of a motor vehicle * * * shall continuously provide insurance against loss resulting from liability imposed by law for bodily injury or death or damage to property suffered by any person * * *.” (Emphasis added.)

Obviously, the legislative intent was positive and express in establishing liability toward “any person.” Not so in Wyoming. Neither § 31-4-120(a) nor the statutes referred to therein reflect that the liability is to be to “any person,” and the intent to do so is not even implied, let alone expressed, in Wyoming law. Ergo, the public policy set forth in McKinney v. McKinney, supra, and Ball v. Ball, supra, remains Wyoming law.

The quotation in the majority opinion from the Nevada case, Estate of Neal v. Farmers Insurance Exchange, 93 Nev. 348, 566 P.2d 81 (1977), is likewise misplaced. The Nevada court was interpreting a proof of financial responsibility enactment. The court noted that the act “specifically prohibits an insurer from excluding this required minimum security for tort liability,” 566 P.2d at 83. The court then held:

“ * * * In light of this provision and because the household exclusion would otherwise be valid, the insurance policy here need provide nothing more than the minimum security required by the Act, and, beyond this minimum security, the exclusionary clause is viable. * * *” Id. 566 P.2d at 83.

Again, a situation other than under Wyoming law.

The Florida case of Reeves v. Miller, Fla., 418 So.2d 1050 (1982), involved a clause in the insurance contract which excluded “any obligation for which the United States may be liable under the federal tort claims act.” The question of inter-spousal or parent-child immunity was not before the court. In any event, the Florida enactment specifically provides:

“(1) Required benefits. — Every insurance policy * * * shall provide * * * for payment of all reasonable expenses incurred for necessary medical, surgical [etc.] * * * to the named insured, relatives residing in the same household, persons operating the insured motor vehicle, passengers in such motor vehicle, and other persons struck by such motor vehicle * * * all as specifically provided in subsections (2) and (4)(d), * * *.
* ⅜: ⅜ * * *
“(2) Authorized exclusions. — Any insurer may exclude benefits:
“(a) For injury sustained by the named insured and relatives residing in the same household while occupying another motor vehicle owned by the named insured and not insured under the policy, * * *.
“(4) * * *
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“(d) The insurer of the owner of a motor vehicle shall pay personal injury protection benefits for:
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“3. Accidental bodily injury sustained by a relative of the owner residing in the same household, under the circumstances described in subparagraph 1. or subpara-graph 2., provided the relative at the time of the accident is domiciled in the owner’s household and is not himself the owner of a motor vehicle with respect to which security is required * * *.” Fla.Stat.Ann., § 627.736 (West).

The public policy of Florida, as stated in this statute, is to recognize the propriety of including exclusionary clauses (much broad*828er than that judicially recognized in Wyoming) in insurance contracts. The quotation from Reeves v. Miller, supra, in the majority opinion has no value as a precedent to Wyoming law.

Kentucky does not have a compulsory insurance law similar to § 31-4-120(a). The Kentucky law is a “no fault” insurance law, regularly referred to as a “Motor Vehicle Accident Reparations Act” or a “Motor Vehicle Reparations Act.” Among its purposes are:

“(1) To require owners, registrants and operators of motor vehicles in the Commonwealth to procure insurance covering basic reparation benefits and legal liability arising out of ownership, operation or use of such motor vehicles;
“(2) To provide prompt payment to victims of motor vehicle accidents without regard to whose negligence caused the accident in order to eliminate the inequities which fault-determination has created;
⅜ # ⅝ ‡ # ⅜
“(5) To reduce the need to resort to bargaining and litigation * * * ;
“(6) To help guarantee the continued availability of motor vehicle insurance at reasonable prices * * *.” (Emphasis added.) Ky.Rev.Stat., § 304.39-010 (1981 Replacement).

Ky.Rev.Stat., § 304.39-030 provides that “every person” suffering injury from motor vehicle accidents in the state “has a right to basic reparation benefits” unless rejected; and, if the accident occurred in another state, the basic reparation insureds and “the driver and other occupants” of the motor vehicle have such right. Ky.Rev.Stat., § 304.39-040 provides that “basic reparation benefits shall be paid without regard to fault” and that such “obligation exists without regard to immunity from liability or suit which might otherwise be applicable.” Ky.Rev.Stat., § 304.39-060 “abolishes” tort liability for damages arising out of motor vehicle accidents in the state to the extent provided by the basic reparation benefits, but allows rejection of such benefits by “any person,” who then retains tort rights and liabilities. Subsection (2)(c) then provides that:

“Tort liability is not limited for injury to a person who is not an owner, operator, maintainer or user of a motor vehicle ⅜ ⅜ * tl

When read in context with the “no fault” enactment, the quotations in the majority opinion from Bishop v. Allstate Insurance Company, Ky., 623 S.W.2d 865 (1981), referring to inapplicability of an exclusion clause to “dilute or eliminate the minimum coverage requirements,” are hardly of value in interpretation of the Wyoming statutes and public policy.

The Michigan statute is similar to the Montana statute, supra, in that it provides that the motor vehicle liability policy insures against loss suffered “by any person,” and that:

“(2) When authorized by the insured, * * * coverage may be excluded when a vehicle is operated by a named person. * * * ” (Emphasis added.) Mich.Stat.Ann., § 24.13009 [M.C.L.A. § 500.3009].

As noted with reference to the Montana law, the Wyoming statute does not expressly establish liability toward “any person.” Michigan law creates an only exception by authorizing an exclusion of a person designated in the policy for exclusion. The quotations in the majority opinion from Allstate Insurance Company v. DeFrain, 81 Mich.App. 503, 265 N.W.2d 392 (1978); Lilje v. Allstate Insurance Company, 393 Mich. 259, 224 N.W.2d 279 (1974), citing Allstate Insurance Company v. Motor State Insurance Co., 33 Mich.App. 469, 190 N.W.2d 352 (1971); and Citizens Mutual Insurance Company v. Central National Insurance Company of Omaha, supra, interpret a statute requiring insurance coverage for “every person.” As noted, the Wyoming statute does not do so.

The California law interpreted in State Farm Mutual Automobile Insurance Company v. Smith, 109 Cal.App.3d 575, 167 Cal.Rptr. 410 (1980) is somewhat similar to the Michigan statute which authorizes an exclusion of insurance operation in favor of a *829“named person.” Cal.Ins.Code, § 11580.1(c) (1983 P.P.) (West), provides in part:

“ * * * [T]he insurance afforded by any such policy of automobile liability insurance * * * may, by appropriate policy provision, be made inapplicable to any or all of the following:
* * * * * *
“(5) Liability for bodily injury to an insured * * *.”

The quotation in the majority opinion from State Farm Mutual Automobile Insurance v. Smith, supra, is of questionable value in reflecting California law. It comes from the Court of Appeal, Second District. In the same year, the Court of Appeal, Third District considered a clause which excluded

“ ‘person[s] who [are] related by blood, marriage, or adoption to an insured against whom claim is made if such person resides in the same household as such insured.’ ” See Phelps v. Allstate Insurance Company, 106 Cal.App.3d 752, 165 Cal.Rptr. 263, 266 (1980).

The court found the clause to be overbroad and therefore void. But it noted that this resulted only because the excluded class was not the same as the named insured. It said that:

“ * * * The overbreadth can be cured only by rewriting (reforming) either the exclusion clause or the insured clauses, or both. * * * ” Id. 165 Cal.Rptr. at 266.

Two years later in 20th Century Insurance Company v. Stuart, 129 Cal.App.3d 370, 181 Cal.Rptr. 61 (1982), the Court of Appeal, Second District, was presented with a claim by the mother of a driver of a motor vehicle insured under a policy in which the definition of the insured included the named insured, and “his relatives.” The exclusionary clause included the “insured or any member of the family of the insured residing in the same household as the insured.” The court acknowledged that the word “family” was not defined in the policy, but that the mother was a member of the relatives in residence in any event and that the exclusion clause was not void as against public policy.

The public policy of Wyoming as set forth in McKinney v. McKinney, supra, and Ball v. Ball, supra, has not been changed by statute or otherwise. Inter-spousal and parent-child immunity exists in Wyoming.

However, the exclusionary clause contained in the policy involved in this case goes far beyond inter-spousal and parent-child immunity. There is no statutory provision or public policy authorizing additional exclusions, and the intent of the legislature to require liability insurance coverage in all instances not excluded by existing public policy is adequately expressed, in § 31-4-120(a). For this reason, I specially concur in the majority opinion.

. We said in Ball v. Ball, supra, 269 P.2d at 308, quoting from Brumfield v. Brumfield, 194 Va. 577, 74 S.E.2d 170 (1953):

“ ‘ * * * the fact [of] * * * liability insurance created no liability or cause of action where none otherwise existed. * * * ’ ”