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Shepherd v. Crown Life Ins. Co.

MARCH 7, 1974.

HARLAN S. SHEPHERD, PLAINTIFF-APPELLANT,

v.

CROWN LIFE INSURANCE COMPANY, DEFENDANT-APPELLEE.



APPEAL from the Circuit Court of McLean County; the Hon. WILLIAM T. CAISLEY, Judge, presiding.

MR. PRESIDING JUSTICE SMITH DELIVERED THE OPINION OF THE COURT:

Plaintiff sued a group insurer asserting coverage as a dependent for medical expenses incurred as a result of an accident while self-employed. From an order dismissing his complaint he appeals.

The exclusion in the policy relied upon by the insurer reads:

"The insurance under this benefit shall not be payable for any of the following medical care or service:

7. Those due to bodily injury arising out of or in the course of an individual's employment or a bodily injury or sickness covered by any Workmen's Compensation Law or similar legislation."

As we have said, plaintiff was self-employed — he operated a service station — and was injured when a truck rolled off a rack and pinned him against a workbench. Both parties agree and the court judicially noted that self-employed persons are not covered by the Workmen's Compensation Act or similar legislation.

Plaintiff argues that the above exclusion does not exclude him for the reason that he was not covered by the Illinois Workmen's Compensation Act (Ill. Rev. Stat. 1971, ch. 48, par. 138.1). He argues that the second "or" should not be read as a disjunctive but rather as a conjunctive. If we reword the exclusion along the lines he suggests, it would re-read in essence — "medical care and service excluded from coverage are those due to a bodily injury arising in the course of an individual's employment and covered by the Workmen's Compensation Act." The insurer, on the other hand, says that there are two separate and alternative exclusions and if plaintiff falls in either one there is no coverage. In their view, the exclusions are, (1) medical care and service due to bodily injury arising out of or in the course of an individual's employment, or (2) those due to bodily injury or sickness covered by any Workmen's Compensation Law or similar legislation. Plaintiff, the insurer argues, falls into category (1) — medical care due to a bodily injury arising out of his employment — and therefore what is said in category (2) is immaterial, that is, it is not to be read conjunctively with (1).

We agree, though an argument can be made, as plaintiff does, that the purpose of the policy's exclusion is to prevent double recovery, that is, recovery under this policy and under coverage provided by the Workmen's Compensation Act. If this thought were to be adopted as the true intent of this exclusion, the necessary implication is that where there isn't a double recovery — no workmen's compensation coverage — then this exclusion would not prevail. But this means rewriting the clause and not separating it into two distinct exclusions. In view of the language used which presents no ambiguities or absurdities, we read an intent of the insurer that not only was it concerned about double coverage — category (2) — but that an extra risk lies in covering persons for injuries due to bodily injury arising out of their employment. The company could well have concluded as a reason for the first exclusion that many accidents do occur in the course of an individual's employment and desired them excluded — and in our opinion used language to so exclude them — without regard to whether such employment was or was not covered by the Workmen's Compensation Act.

Plaintiff cites many cases where "or" has been read as "and" — of course many contexts require that result. On the other hand "or" is disjunctive — it is a conjunction used to introduce alternatives. Grammatically, "or" is a conjunction and, as we have seen, can be used conjunctively — but in our opinion, it was not so used here. The cases cited from other jurisdictions — there is no Illinois decision in point — are not particularly apt for medical care due to bodily injury arising out of an individual's employment and bodily injury or sickness covered by the Workmens' Compensation Laws. Why use "bodily injury" twice if double recovery was all that was intended to be avoided. No useful purpose can be served by analysis of these out-of-state decisions, for, as we have said, the language used is clearly different. This conclusion is buttressed by the use of the phrase "non-occupational bodily injury" in two sections of the policy. One, in particular, under the caption "MAJOR MEDICAL EXPENSE BENEFIT" reads:

"If an individual, while insured for this benefit incurs Eligible Expenses for medical care or services for a non-occupational bodily injury, * * * the company will * * * pay the Major Medical Expense Benefit as hereinafter defined."

It is used again in a section relating to the extension of benefits. The policy relates solely to major medical benefits and clearly the thrust is that to be eligible for benefits, the injury must be "non-occupational".

We conclude therefore that the court was correct in reading "or" disjunctively. Accordingly, the judgment appealed from is affirmed.

Affirmed.

TRAPP, J., ...


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