Gate Causes Accident But Insurer Off the Hook, Court Rules

The family of a driver who was killed when a sawmill’s gate swung into the road is not due $900,000 in damages from an insurance company, due to a policy exclusion for auto accidents, the U.S. 5^th Circuit Court of Appeals decided in a Mississippi case.

In Colony Insurance vs. Wright, the court recited an addendum to the sawmill’s general liability policy, which excluded “bodily injury or property damage arising directly or indirectly out of the ownership, maintenance, use or entrustment to others of any aircraft, auto or watercraft. Use includes operation and loading or unloading.”

The district federal court and the 5^th Circuit found that the policy was unambiguous and clearly excluded coverage of any type of automobile accident, however negligent the policyholder may have been.

The case began in January 2018 when Marion Wright was driving his personal vehicle to a logging site in Clairborne County, in western Mississippi. As he passed by the sawmill owned by V&B International, Wright slammed into the sawmill gate, which had swung across the road. Wright died at the scene from multiple injuries.

The sawmill owner settled with Wright’s beneficiaries for $900,000 but stipulated that would only come from insurance proceeds. The company’s general liability policy was with Colony Insurance.

Colony denied the claim and moved the case to federal court in 2019. The district federal court granted summary judgment for Colony, concluding that the policy excluded coverage for injuries arising from automobile accidents.

Topics Carriers Legislation