Ohio Supreme Court ruling signals more insurance claims in fatal 2007 Bluffton bus crash
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Ohio Supreme Court ruling signals more insurance claims in fatal 2007 Bluffton bus crash
A March 2, 2007 bus crash that killed seven people – including five members of the Bluffton (Ohio) University baseball team – was at th e center of the Ohio Supreme Court's attention this week.
On Tuesday, Dec. 28, the Supreme Court voted 5-2 that the Bluffton University's insurance policies extend coverage to those affected by the crash along I-75 in Atlanta, Ga.
Accordfing to an Associated Press report, the ruling "means that as much as $21 million more in insurance money will be available to pay claims."
"The issue argued before the Supreme Court in September was whether Bluffton University 'hired' the bus when it contracted with Ottawa-based Executive Coach Luxury Travel, and whether the team's coach gave 'permission' to use a company driver to get the team to and from a Sarasota, Fla., tour nament," the AP said. "Previously, the Allen County Common Pleas Court and the 3rd District Court of Appeals in Lima disagreed that the university's insurance companies were responsible for paying the claims. Tuesday, in a seven-page opinion written by Justice Paul Pfeifer, the high court reversed that decision."
Among the 29 passengers who originally survived the crash, was Bluffton baseball coach James Grandey, who was left in critical condition. Grandey is a McClain High School graduate and the son of Highland County Prosecutor Jim Grandey.
The crash occurred during the early morning hours of March 2, 2007, on Interstate 75 in Atlanta, when a chartered motorcoach was carrying 33 members of the Bluffton University baseball team from Bluffton, Ohio on their way to a tournament game during spring break in Sarasota, Florida.
About 5:38 a.m. EDT, operating the motorcoach southbound in a left-hand HOV lane of I-75 in the Atlanta metropolitan area, the driver apparently mistakenly entered a left HOV-only exit ramp from the HOV lane which led upward to a wide elevated road and a T-junction marked by a stop sign. The bus was traveling at highway speed, when it reached the top of the ramp and the stop sign. As the driver of the motorcoach failed to successfully stop or turn, and lost control, the bus slid sideways into a concrete bridge wall and chain-link security fence and fell 19 feet, landing onto its left side across the Interstate highway below.
A March 2, 2007 bus crash that killed seven people – including five members of the Bluffton (Ohio) University baseball team – was at the center of the Ohio Supreme Court's attention this week.
The Supreme Court of Ohio ruled Dec. 28 that when an auto insurance policy issued to a university extends liability coverage to any person operating “with permission” a vehicle that is “owned, hired or borrowed” by the university, the policy language provides coverage for injuries resulting from a traffic accident in which a bus driver employed by a charter bus company was operating the company’s bus while it was under charter by the university.
The Court’s 5-2 decision, which reversed the ruling by the Third District Court of Appeals and remanded to the trial court for further proceedings, was authored by Justice Paul E. Pfeifer.
In March 2007, five baseball players from Bluffton University, the bus driver and the bus driver’s wife were killed and others were injured when a chartered bus in which they were traveling to a Florida tournament crashed in Atlanta, Ga. The university’s baseball coach had made arrangements to charter the bus from Executive Coach Luxury Travel Inc. and had agreed to Executive Coach’s suggestion that one of its drivers known to the coach, Jerome Niemeyer, be assigned as the driver for the Florida trip.
Among the 29 passengers who originally survived the crash, was Bluffton baseball coach James Grandey, who was left in critical condition. Grandey is a McClain High School graduate and the son of Highland County Prosecutor Jim Grandey.
The crash occurred during the early morning hours of March 2, 2007, on Interstate 75 in Atlanta, when a chartered motorcoach was carrying 33 members of the Bluffton University baseball team from Bluffton, Ohio on their way to a tournament game during spring break in Sarasota, Florida. About 5:38 a.m. EDT, operating the motorcoach southbound in a left-hand HOV lane of I-75 in the Atlanta metropolitan area, the driver apparently mistakenly entered a left HOV-only exit ramp from the HOV lane which led upward to a wide elevated road and a T-junction marked by a stop sign.
The bus was traveling at highway speed, when it reached the top of the ramp and the stop sign. As the driver of the motorcoach failed to successfully stop or turn, and lost control, the bus slid sideways into a concrete bridge wall and chain-link security fence and fell 19 feet, landing onto its left side across the Interstate highway below.
At the time of the crash, the university was covered by a primary auto insurance policy issued by the Hartford Insurance Company, an “umbrella” policy issued by American Alternative Insurance Company and an additional excess liability policy issued by the Federal Insurance Company. The terms and conditions of coverage under the umbrella and excess liability policies were the same terms and conditions of Bluffton’s primary auto insurance policy with Hartford. The Hartford policy included in its definition of an insured person, anyone “while using with (the university’s) permission” a covered vehicle that the university “owned, hired or borrowed.”
American Alternative and Federal Insurance both sought declaratory judgments that their policies did not provide coverage for the injuries suffered by the victims of the bus accident. The Allen County Court of Common Pleas granted summary judgment in favor of the insurers, holding that neither Niemeyer nor Executive Coach qualified as “insureds” under the university’s insurance policies because the university did not own and had not “hired” or “borrowed” the bus involved the accident, but rather had contracted with Executive Coach to provide transportation services in a vehicle owned by Executive Coach and driven by one of its employees. The accident victims and families of the deceased students, who were permitted to intervene in the declaratory judgment action as interested parties, appealed the trial court’s judgment. On review, the Third District Court of Appeals affirmed the grant of summary judgment in favor of the insurers.
The accident victims sought and were granted Supreme Court review of the Third District’s ruling
In its decision, the Court concluded that the lower courts erred when they determined that Niemeyer was not an “insured” under the terms of Bluffton’s insurance policies.
“Based on the facts of this case,” Justice Pfeifer wrote, “we conclude that Bluffton hired the bus when (baseball coach James) Grandey procured the use of the bus in exchange for payment to Executive. We also conclude that Niemeyer was driving the bus hired by Bluffton with Bluffton’s permission because Executive had sought and Grandey had granted a request to allow Niemeyer to drive the bus. Accordingly, we conclude that Niemeyer is an ‘insured’ pursuant to the omnibus clause.”
While the insurers argued that Niemeyer was an “unforeseen third party” and they never intended to provide coverage for him, Justice Pfeifer wrote: “We consider this contention disingenuous. ... The omnibus clause is broad. … We are not persuaded by the contention that the driver of a bus that Bluffton rented from a company in the business of renting buses is an unforeseen third party, when a clause in the insurance policy covers ‘anyone else’ driving a hired auto.”
In addition, the majority wasn’t persuaded by several cases cited by the insurers as defining the word “hire.” “We are not persuaded that these cases should be the law of Ohio. First, they are factually inapposite in that they involved the loading and hauling of construction equipment and materials, not the transportation of people. Second, even under this test, we would conclude that Bluffton hired the bus,” wrote Justice Pfeifer.
The majority opinion also addressed the issue of whether Niemeyer could be excluded from coverage once it was determined that he fit the definition of an insured. Of the five listed exceptions in the policy, the Court found that none applied.
Justice Pfeifer’s opinion was joined by Chief Justice Eric Brown and Justice Maureen O’Connor and Judge Timothy P. Cannon of the 11th District Court of Appeals, who sat in place of Justice Robert R. Cupp. Justice Judith Ann Lanzinger concurred in judgment only.
In Justice Evelyn Lundberg Stratton’s dissenting opinion, which was joined by Justice Terrence O’Donnell, she agreed with the lower courts that found Bluffton did not “hire” the Executive Coach bus because Executive selected the bus and hired the driver.
“The majority’s narrow interpretation expands the scope of coverage beyond what the parties to the insurance policy intended,” Justice Stratton wrote. “Today’s opinion unreasonably extends coverage to a third party and effectively opens the door for similar claims under other scenarios because the omnibus clause is standard in many insurance policies.”
The Supreme Court of Ohio ruled Dec. 28 that when an auto insurance policy issued to a university extends liability coverage to any person operating “with permission” a vehicle that is “owned, hired or borrowed” by the university, the policy language provides coverage for injuries resulting from a traffic accident in which a bus driver employed by a charter bus company was operating the company’s bus while it was under charter by the university.
The Court’s 5-2 decision, which reversed the ruling by the Third District Court of Appeals and remanded to the trial court for further proceedings, was authored by Justice Paul E. Pfeifer.
In March 2007, five baseball players from Bluffton University, the bus driver and the bus driver’s wife were killed and others were injured when a chartered bus in which they were traveling to a Florida tournament crashed in Atlanta, Ga. The university’s baseball coach had made arrangements to charter the bus from Executive Coach Luxury Travel Inc. and had agreed to Executive Coach’s suggestion that one of its drivers known to the coach, Jerome Niemeyer, be assigned as the driver for the Florida trip.
Among the 29 passengers who originally survived the crash, was Bluffton baseball coach James Grandey, who was left in critical condition. Grandey is a McClain High School graduate and the son of Highland County Prosecutor Jim Grandey.
The crash occurred during the early morning hours of March 2, 2007, on Interstate 75 in Atlanta, when a chartered motorcoach was carrying 33 members of the Bluffton University baseball team from Bluffton, Ohio on their way to a tournament game during spring break in Sarasota, Florida. About 5:38 a.m. EDT, operating the motorcoach southbound in a left-hand HOV lane of I-75 in the Atlanta metropolitan area, the driver apparently mistakenly entered a left HOV-only exit ramp from the HOV lane which led upward to a wide elevated road and a T-junction marked by a stop sign.
The bus was traveling at highway speed, when it reached the top of the ramp and the stop sign. As the driver of the motorcoach failed to successfully stop or turn, and lost control, the bus slid sideways into a concrete bridge wall and chain-link security fence and fell 19 feet, landing onto its left side across the Interstate highway below.
At the time of the crash, the university was covered by a primary auto insurance policy issued by the Hartford Insurance Company, an “umbrella” policy issued by American Alternative Insurance Company and an additional excess liability policy issued by the Federal Insurance Company. The terms and conditions of coverage under the umbrella and excess liability policies were the same terms and conditions of Bluffton’s primary auto insurance policy with Hartford. The Hartford policy included in its definition of an insured person, anyone “while using with (the university’s) permission” a covered vehicle that the university “owned, hired or borrowed.”
American Alternative and Federal Insurance both sought declaratory judgments that their policies did not provide coverage for the injuries suffered by the victims of the bus accident. The Allen County Court of Common Pleas granted summary judgment in favor of the insurers, holding that neither Niemeyer nor Executive Coach qualified as “insureds” under the university’s insurance policies because the university did not own and had not “hired” or “borrowed” the bus involved the accident, but rather had contracted with Executive Coach to provide transportation services in a vehicle owned by Executive Coach and driven by one of its employees. The accident victims and families of the deceased students, who were permitted to intervene in the declaratory judgment action as interested parties, appealed the trial court’s judgment. On review, the Third District Court of Appeals affirmed the grant of summary judgment in favor of the insurers.
The accident victims sought and were granted Supreme Court review of the Third District’s ruling
In its decision, the Court concluded that the lower courts erred when they determined that Niemeyer was not an “insured” under the terms of Bluffton’s insurance policies.
“Based on the facts of this case,” Justice Pfeifer wrote, “we conclude that Bluffton hired the bus when (baseball coach James) Grandey procured the use of the bus in exchange for payment to Executive. We also conclude that Niemeyer was driving the bus hired by Bluffton with Bluffton’s permission because Executive had sought and Grandey had granted a request to allow Niemeyer to drive the bus. Accordingly, we conclude that Niemeyer is an ‘insured’ pursuant to the omnibus clause.”
While the insurers argued that Niemeyer was an “unforeseen third party” and they never intended to provide coverage for him, Justice Pfeifer wrote: “We consider this contention disingenuous. ... The omnibus clause is broad. … We are not persuaded by the contention that the driver of a bus that Bluffton rented from a company in the business of renting buses is an unforeseen third party, when a clause in the insurance policy covers ‘anyone else’ driving a hired auto.”
In addition, the majority wasn’t persuaded by several cases cited by the insurers as defining the word “hire.” “We are not persuaded that these cases should be the law of Ohio. First, they are factually inapposite in that they involved the loading and hauling of construction equipment and materials, not the transportation of people. Second, even under this test, we would conclude that Bluffton hired the bus,” wrote Justice Pfeifer.
The majority opinion also addressed the issue of whether Niemeyer could be excluded from coverage once it was determined that he fit the definition of an insured. Of the five listed exceptions in the policy, the Court found that none applied.
Justice Pfeifer’s opinion was joined by Chief Justice Eric Brown and Justice Maureen O’Connor and Judge Timothy P. Cannon of the 11th District Court of Appeals, who sat in place of Justice Robert R. Cupp. Justice Judith Ann Lanzinger concurred in judgment only.
In Justice Evelyn Lundberg Stratton’s dissenting opinion, which was joined by Justice Terrence O’Donnell, she agreed with the lower courts that found Bluffton did not “hire” the Executive Coach bus because Executive selected the bus and hired the driver.
“The majority’s narrow interpretation expands the scope of coverage beyond what the parties to the insurance policy intended,” Justice Stratton wrote. “Today’s opinion unreasonably extends coverage to a third party and effectively opens the door for similar claims under other scenarios because the omnibus clause is standard in many insurance policies.”
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