March 14, 1935
GEORGE W. DEER & SON
EMPLOYERS INDEMNITY CORPORATION ET AL.
Appeal from the District Court of the United States for the Southern District of Indiana, Indianapolis Division; Robert C. Baltzell, Judge.
Before EVANS and FITZHENRY, Circuit Judges, and LINDLEY, District Judge.
EVANS, Circuit Judge.
The explosion occurred a few hours after the policy became effective. Appellant delivered the kerosene, with the explosive material added to the kerosene, a few days earlier. The liability asserted by appellant, if it exists, must be traceable to the policy which contained the following provisions.*fn1
Liability turns on the meaning of the word "accidents" as used in paragraph 1, which is set forth in the margin. Appellees argue that the words "accidents or errors occurring while this policy is in force" should be construed so as to restrict the meaning of the word "accidents" to a meaning synonymous with mistake. Inasmuch as the mistake was made before the policy was issued, no liability under the policy arose. This is appellees' argument.
We perceive no sufficient reason for so restricting the meaning of this word. The insurance company selected its terminology.It should not repudiate the fair or usual meaning of the word it employs. If the language it adopts in its contract is capable of two constructions, it cannot be permitted to adopt one meaning in selling the policy and another in avoiding liability. Mutual Life Ins. Co. v. Hurni Packing Co., 263 U.S. 167, 44 S. Ct. 90, 68 L. Ed. 235, 31 A.L.R. 102.
Moreover, in the policy in question this word "accidents" is used several times. In all other places it is used in its usual sense as meaning mishap. In paragraph B, entitled "Public Liability at Stations," the word "accidents" is twice used. It first appears in the phrase "excluding accidents caused by Teams, Automobiles or Elevators," etc. Its second use appears in the clause "as a result of accidents occurring while this policy is in force," etc. Thus used, it negatives the construction which appellees place upon it. If we were otherwise in doubt as to the proper meaning to be given it in paragraph 1, the doubt was removed when appellees chose to give to the word when used elsewhere in the policy a meaning inconsistent with the meaning now advanced by them.
This conclusion makes it unnecessary for us to consider the additional ground advanced by appellant in favor of its contention that it should recover the expenses incurred in defending the litigation brought by the husband and the administrator against appellant.
The judgment is reversed with directions to grant a new trial.