USA Herald – This is the case of T.H.E. Insurance Co. v. Melyndia Davis et al., in the U.S. Court of Appeals for the Fourth Circuit.

In this case, Melyndia Davis and Robert Spencer were injured in Pennsylvania in 2015, during a hot air balloon accident, according to court filings. In 2016, the couple sued the hot air balloon company, New Horizon Balloon Team, in Maryland court.

In August 2021, the Maryland district court ruled in favor of the company’s insurer limiting coverage to $100,000 per passenger, and not the $1 million policy coverage for non-passengers that the couple was seeking.

Here, the couple asked the panel of judges for the Fourth Circuit to overturn the lower court order. Sitting on the panel were senior U.S. Circuit Judge William B. Traxler and U.S. Circuit Judges Robert B. King and Allison J. Rushing.

The Fourth Circuit affirmed the district court’s decision that limited insurance claims to $100,000 for two passengers, agreeing with the insurance company that the couple’s status as "passengers" limited the amount of monetary recovery available to them.

The court agreed, with the Maryland federal judge that found that the couple were considered passengers as defined under an insurance policy issued by T.H.E. Insurance Co. The court further found that it didn’t matter whether their injuries occurred inside or "outside" the hot air balloon's basket.

Melyndia Davis and Robert Spencer are represented by attorneys Douglas P. Desjardins and Amanda C. Dure of Pangia Law Group and L. Steven Emmert of Sykes Bourdon Ahern & Levy PC.

According to court records filed by the couple’s attorneys, they argued that they were not passengers at the time they were injured, but this argument was not well received. The panel made it clear, that even if they were outside of the basket at the time of the injury, they would still be considered "passengers" under the policy because they were stepping off the balloon following a flight.

The panel said, "As a result, even if Davis and Spencer were partially or completely outside the balloon's basket at the time of their injuries, they were 'passengers' under the policy."

While the couple's lawsuit for damages was pending, T.H.E. Insurance Co., sought a declaratory judgment that Davis and Spencer were "passengers" at the time of the accident, confirming that the policy's $100,000 limit for passengers is the applicable coverage amount rather than the $1 million in coverage that is reserved for non-passengers, only.

In response, the couple filed counterclaims against the insurer for contractual and statutory bad faith, which the lower court also rejected, and the Fourth Circuit upheld.