The family of Margaret Wagner sued Texas Memorial Hospital after her death from suicide. In 1983, after being admitted for psychiatric observation, Memorial employees put her in an open unit (having windows capable of being opened), because no space was available in a closed unit. During the night, Wagner climbed up and jumped out of a window, to her death. Wagner’s family was awarded damages of nearly one million dollars, based on a finding that Memorial did not adequately watch Wagner, that it did not address the situation of access to the window and that it did not sufficiently staff the psychiatric unit with trained personnel.
At the time of Wagner’s death, Memorial had the following policies:
1. North River primary CGL $500,000
2. USF hospital professional liability $200,000
3. Guaranty National umbrella policy, $500,000 excess over $500,000
4. Ranger secondary umbrella policy $25,000,000 excess over all other underlying
River paid nothing, relying on a professional liability exclusion. USF paid its full occurrence limit of $200,000 and the rest of the damages were paid by Guaranty and Ranger. All four insurers filed summary judgments with regard to their payment obligations. After a court filed in favor of USF and against North River, River and Guaranty appealed. An appellant court ruled that River’s policy did have an obligation to pay and the USF’s obligation was restricted to it per claim limit. River and Guaranty appealed again.
The crux of the appeal dispute was that USF policy’s aggregate limit should apply rather than its policy’s $200,000 per claim limit. River argued that its med mal and professional liability exclusion should still apply to the loss.
The higher court addressed both questions, including decisions from other cases it deemed relevant to this situation. In its opinion, the fact that a lack of adequate supervision and improperly securing against access to the window were ruled as separate causes of the patient suicide. Since those factors were general in nature, River CGL’s professional exclusion was inapplicable. With regard to USF, the higher court’s view was that the loss involved a single incident and the policy’s aggregate policy limit was not triggered. The lower court decision against River and in favor of USF was affirmed.
Guaranty National Insurance Co., and Ranger Insurance Co., Plaintiffs-Appellees-Appellants v, The North River Insurance Company, Defendant-Appellant, United States Fire Insurance Co., Defendant-Appellee. No. 89-1890. United States Court of Appeals, Fifth Circuit. Filed Aug. 17, 1990. 909 F.2d 133. Affirmed.
