Evanston Insurance filed a declaratory judgment complaint seeking a declaration that it did not owe coverage to its insured, Legacy of Life, in an underlying suit which accused Legacy of Life of selling body parts despite being a nonprofit company which engages in organ donation. The plaintiff in the underlying complaint claimed that Legacy of Life sold her mother’s remains to another company at a profit. The woman claimed that Legacy of Life approached her while her mother was in the hospital and asked to take her mother’s body parts after she died to give to hospitals in exchange for processing and storage fees. The woman claimed that instead Legacy sold the parts to a for-profit company which then sold the organs to hospitals. She claimed that learning of this caused her mental anguish. She sought to recover the value of her deceased mother’s body parts along with other damages.
The policy issued to Legacy of Life covered claims arising from “personal injury” or “property damage.” The 5th Circuit heard this case after certifying questions to the Texas Supreme Court. The Texas Supreme Court held that the claims in the underlying complaint did not constitute “personal injury” or “property damage.” The Texas Supreme Court held that there was no personal injury involved, as personal injury was defined as bodily injury or sickness or disease and did not cover mental anguish, unrelated to physical damage or disease of the plaintiff’s body.
The Texas Supreme Court also ruled that property damage did not include coverage for the underlying plaintiff’s loss of use of her deceased mother’s body parts.
This court then held that the insurance thus did not afford coverage for the claims alleged against Legacy of Life in the underlying lawsuit.
For a copy of this decision, click here.
Jeffrey L. Kingsley and Clayton D. Waterman