Staufenbiel v. Amica Mutual Insurance Company
MEMORANDUM AND ORDER: IT IS HEREBY ORDERED that Defendant's Amica Mutual Insurance Company's Motion for Summary Judgment (Doc. 20 ) is GRANTED, in part. Count II is hereby DISMISSED with prejudice. Signed by District Judge John A. Ross on 3/30/15. (JWD)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
AMICA MUTUAL INSURANCE
MEMORANDUM AND ORDER
This matter is before the court on Defendant Amica Mutual Insurance Company's
("Amica") Motion for Summary Judgment (Doc. 20). The motion is fully briefed and ready for
disposition. For the following reasons, the motion will be GRANTED, in part.
The Parties do not dispute the following facts. 1 On February 23, 2013, Plaintiff John
Staufenbiel ("Plaintiff') was struck by a vehicle driven by Jennifer Raftery ("Raftery") while he
was walking along highway Route T in St. Charles, Missouri. Raftery carried an insurance
policy which offered coverage of $100,000 per person and $300,000 per accident. Plaintiff
recovered the full $100,000 policy limit. This action arises as a result of Plaintiffs claims that
Raftery was underinsured. At the time of the accident, Plaintiff was an additional insured on an
auto insurance policy issued to Plaintiff's parents by Amica, Policy No. 940224-20HB (the
"Policy"). The Policy provided underinsured motor ("UIM") vehicle coverage for four separate
See Amica's Statement of Uncontroverted Material Facts (Doc. 22) and Plaintiff's Response to
Defendant's Statement ofUncontroverted Material Facts (Doc. 28).
automobiles each with limits of $100,000 per person and $300,000 per accident. Plaintiff made a
demand on Amica for payment of $400,000, the sum of the four policy limits. Amica declined to
make payment and Plaintiff brought this action for Breach of Contract (Count I) and Bad
FaithNexatious Refusal (Count II).
Amica has now moved for summary judgment (Doc. 20). Amica asserts that Plaintiff is
not entitled to recover $400,000 because clear and unambiguous policy language prohibits the
stacking of policy limits. Amica also argues that Plaintiff does not qualify for coverage under
the Policy because clear and unambiguous policy language prohibits duplicate recovery of
amounts already recovered from the underlying tortfeasor. Additionally, Amica asserts that
Plaintiff is not entitled to recover under the Policy because he failed to comply with and
breached the Policy. Finally, regarding Count II, Amica argues that Plaintiff never made a presuit demand that fell within the applicable policy limit.
The relevant provisions of the Policy's Underinsured Motorists Coverage Endorsement
(Doc. 22-1 at 31-33) read as follows:
UNDERINSURED MOTORISTS COVERAGE-MISSOURI
We will pay compensatory damages which an insured is legally entitled to recover
from the owner or operator of an underinsured motor vehicle because of bodily
1. Sustained by an insured; and
2. Caused by an accident.
The owner's or operator's liability for these damages must arise out of the ownership
maintenance or use of the underinsured motor vehicle.
We will pay under this coverage only if 1. or 2. below applies:
1. The limits of liability under any bodily injury liability bonds or policies applicable
to the underinsured motor vehicle have been exhausted by payment of judgments or
2. A tentative settlement has been made between an insured and the insurer of the
underinsured motor vehicle and we:
a. Have been given prompt written notice of such tentative settlement; and
b. Advance payment to the insured in an amount equal to the tentative
settlement within 30 days after receipt of notification.
"Underinsured motor vehicle" means a land motor vehicle or trailer of any type to
which a bodily injury liability bond or policy applies at the time of the accident but
the amount paid for bodily injury under that bond or policy to an insured is not
enough to pay the full amount the insured is legally entitled to recover as damages.
LIMIT OF LIABILITY
The Limit of Liability shown in the Schedule or in the Declarations for each person
for Underinsured Motorists Coverage is our maximum limit of liability for all
damages, including damages for care, loss of services or death, arising out of bodily
injury sustained by any one person in any one accident. Subject to this limit for each
person, the Limit of Liability shown in the Schedule or in the Declarations for each
accident for Underinsured Motorists coverage is our maximum Limit of Liability for
all damages for bodily injury resulting from any one accident.
This is the most we will pay regardless of the number of:
2. Claims made;
3. Vehicles or premiums shown in the Schedule or in the Declarations; or
4. Vehicles involved in the accident.
No one will be entitled to receive duplicate payments for the same elements of loss
under this coverage and Part A, Part B or Part C of this policy.
We will not make a duplicate payment under this coverage for any element ofloss for
which payment has been made by or on behalf of persons or organizations who may
be legally responsible.
The Policy also contains the following additional, relevant provisions:
PART E- DUTIES AFTER AN ACCIDENT OR LOSS
We have no duty to provide coverage under this policy if the failure to comply with the
following duties is prejudicial to us:
A person seeking any coverage must:
1. Cooperate with us in the investigation, settlement or defense of any of claim or
2. Promptly send us copies of any notices or legal papers received in connection with
the accident or loss.
3. Submit, as often as we reasonably require:
a. To physical exams by physicians we select. We will pay for these exams.
b. To examination under oath and subscribe the same.
4. Authorize us to obtain:
a. Medical reports; and
b. Other pertinent records.
(Id. at 24-25).
PART F- GENERAL PROVISIONS
Legal Action Against Us
No legal action may be brought against us until there has been full compliance with
all the terms of this policy.
TWO OR MORE AUTO POLICIES
If this policy and any other auto insurance policy issued to you by us apply to the same
accident, the maximum limit of our liability under all the policies shall not exceed the
highest applicable limit of liability under any one policy.
(Id. at 25, 27).
SUMMARY JUDGMENT STAND ARD
Summary judgment is proper "if the movant shows that there is no genuine dispute as to
any material fact and the movant is entitled to judgment as a matter of law." FED. R. C1v. P.
56(a). To support an assertion that a fact cannot be or is genuinely disputed, a party must cite "to
particular parts of materials in the record," show "that the materials cited do not establish the
absence or presence of a genuine dispute," or establish "that an adverse party cannot produce
admissible evidence to support the fact." FED. R. Civ. P. 56(c)(l)(A)-(B). "The court need
consider only the cited materials, but it may consider other materials in the record." FED. R. C1v.
P. 56(c)(3). In determining whether summary judgment is appropriate, a court must look at the
record and any inferences to be drawn from it in the light most favorable to the nonmovant.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).
A. Choice of Law
District courts, whether sitting in diversity or deciding supplemental state law claims, are
required to use the choice-of-law rules for the state in which it sits. DCS Sanitation Mgmt., Inc.
v. Castillo, 435 F.3d 892, 895 (8th Cir. 2006); Wolfley v. Solectron USA, Inc., 541 F.3d 819, 823
(8th Cir. 2008). The Parties agree that Missouri law applies. Therefore no choice of law analysis
B. Count I: Breach of Contract
It is well settled the interpretation of an insurance policy is a question of law. Council
Tower Ass'n v. Axis Specialty Ins. Co., 630 F.3d 725, 728 (8th Cir. 2011) (citing Seeck v. Geico
Gen. Ins. Co., 212 S.W.3d 129, 132 (Mo. 2007) (en bane)). Applying the rules of construction is
unnecessary when a provision is clear as written, unless a statute or public policy dictates
otherwise. Council Tower Ass'n, 630 F.3d at 728 (citing Cincinnati Ins. Co. v. Bluewood, Inc.,
560 F.3d 798, 802 (8th Cir. 2009)).
Where language used in an insurance contract is
unambiguous, all terms are given their plain, ordinary, and usual meaning.
Commercial Union Ins. Co., 754 S.W.2d 16, 18 (Mo. Ct. App. 1988); Shahan v. Shahan, 988
S.W.2d 529, 535 (Mo. 1999). "The plain or ordinary meaning is the meaning that the average
layperson would understand." Shahan, 988 S.W.2d at 535.
The Court must first address Amica's argument that Plaintiff cannot recover a stacked
total of $400,000 in coverage under the Policy. " 'Stacking' refers to an insured's ability to
obtain multiple insurance coverage benefits for an injury either from more than one policy, as
where the insured has two or more separate vehicles under separate policies, or from multiple
coverages provided for within a single policy, as when an insured has one policy which covers
more than one vehicle." Ritchie v. Allies Property & Cas. Ins. Co., 307 S.W.3d 132, 135 (Mo.
2007) (en bane) (quoting Niswonger v. Farm Bureau Town & Country Ins. Co. of Missouri, 992
S. W.2d 308, 313 (Mo. Ct. App. 1999)). As underinsured motorist coverage is not required in
this state, "the existence of the coverage and its ability to be stacked are determined by the
contract entered between the insured and the insurer." Rodriguez v. Gen. Acc. Ins. Co. of Am.,
808 S.W.2d 379, 383 (Mo. 1991) (en bane).
This means that if the policy language is
unambiguous in disallowing stacking, the anti-stacking provisions are enforceable. Seeck, 212
S.W.3d at 132. "If, however, policy language is ambiguous [as to stacking], it must be construed
against the insurer," and stacking will be allowed. Id. (internal quotation omitted). See also
Midwestern Indem. Co. v. Brooks, No. 14-2016, 2015 WL 855680, at *3 (8th Cir. Mar. 2, 2015)
("[T]he 'key' question is whether the policy unambiguously prohibits stacking or is reasonably
open to different constructions as to the permissibility of stacking.") (emphasis in original)
(internal quotation omitted).
The Policy unambiguously prohibits stacking of underinsured benefits. The Insuring
Agreement on the UIM Coverage Endorsement, found in Section A, page one of the
Underinsured Motorist Coverage-Missouri, clearly indicates that Amica "will pay compensatory
damages which an insured is legally entitled to recover from the owner or operator of an
underinsured motor vehicle because of bodily injury" (Doc. 22-1 at 31 ).
This amount is
expressly limited on the next page by the Limit of Liability provision. The provision reads, in
The Limit of Liability shown in the Schedule or in the Declarations for each person for
Underinsured Motorists Coverage is our maximum limit of liability for all damages ....
This is the most we will pay regardless of the number of:
3. Vehicles or premiums shown in the Schedule or in the Declarations
(Id at 32). The Missouri courts have found similar policy language unambiguous. Hall v.
Allstate Ins. Co., 407 S.W.3d 603, 609-610 (Mo. Ct. App. 2012). See also Midwestern Indem.
Co., 2015 WL 855680, at *3 (finding comparable anti-stacking language unambiguous).
"Although this anti-stacking limitation is unambiguous, ... if a policy has clauses that
claim to prohibit stacking and also contains clauses that appear to authorize stacking, coverage is
ambiguous and must be resolved in favor of the insured." Id at *4 (internal quotation omitted).
Plaintiff argues that the language of the Policy contains ambiguities as it pertains to stacking of
insurance policies because the Limit of Liability provision and Section A, Page one of the
Underinsured Motorists Coverage-Missouri conflict. Specifically, Plaintiff asserts that Insuring
Agreement gives the insured a right to recover by promising to compensate for what the insured
is legally entitled to recover while the Limit of Liability takes that right away by limiting the
Relying on Chamness, Plaintiff argues that an ambiguity exists in an
insurance policy when one portion of the policy promises a benefit and another portion takes that
benefit away. Chamness v. Am. Fam. Mut. Ins. Co., 226 S.W.3d 199, 204 (Mo. Ct. App. 2007).
Plaintiff also asserts that the Declarations Page further confuses the matter because it states that
UIM is covered for each vehicle (See Doc. 22-1 at 11 ).
However, limits of liability are common in any insurance plan regardless of policy type
and do not create a conflict with the grant of insurance. Midwestern Indem. Co., 2015 WL
855680, at *4 ("In Missouri, a policy is not ambiguous just because its broad statement of
coverage is later cabined by policy definitions or exclusions."). Further, the case Plaintiff relies
upon, Chamness, deals specifically with those situations in which an individual is harmed while
occupying a non-owned vehicle and the "other insurance clause appears to provide coverage but
other clauses indicate that such coverage is not provided." Chamness, 226 S.W.3d at 204. The
Missouri Court of Appeals found that such a conflict created an ambiguity and therefore the
Court of Appeals allowed plaintiff to stack the underinsured motorist coverage under three
separate motor vehicles. The Parties raise no such dispute here. Finally, the Court finds that the
declaration page does not confuse the matter - a reasonable layperson would understand the table
to indicate that while driving one of the listed vehicles, the individual was covered by the
underinsured motorist coverage. Nothing in the chart addresses or contradicts the anti-stacking
provision. See Midwestern Indem. Co., 2015 WL 855680, at *4, n.4 ("Missouri Supreme Court
precedent shows a reader cannot rely on a declarations page to outline the precise scope of
coverage.") In sum, the Policy does not permit Plaintiff to stack the underinsured motorist
coverage limits for his four vehicles; as such, the applicable policy limit is $100,000.
2. Offset Provision
Amica argues that duplicate recovery is not permitted under the unambiguous terms of
the Policy and therefore it is entitled to offset the liability limits. An offset provision is one
which reduces the limit of liability by the amount paid by or on behalf of an individual who may
be legally responsible for the accident. See, e.g., Rodriguez, 808 S.W.2d at 381 (The offset
provision provided, "However, the limit of liability shall be reduced by all sums paid because of
the "bodily injury" by or on behalf of persons or organizations who may be legally responsible")
(emphasis added). The effect would therefore be a reduction in the limit of liability, the amount
the insured could potentially recover from the insurer, by the previously recovered amount. The
provision at issue in this case, however, is not an offset provision; it is an unambiguous
prohibition of duplicate recovery. It instead reads, in relevant part,
We will not make a duplicate payment under this coverage for any element of
loss for which payment has been made by or on behalf of persons or organizations
who may be legally responsible.
(Doc. 22-1at32) (emphasis added).
While Plaintiff asserts that the Policy, specifically this provision, is ambiguous because
the term "duplicate payment" could mean either that an insured cannot receive payments under
two separate polices or that the insured cannot receive payments through a collection of different
policies or endorsement that exceed the amount of the judgment to which he is entitled (Doc. 27
at 2-3), when Subpart C is read in the context of the entire Limit of Liability Provision, its plain
meaning is clear. Subpart A, as already indicated by the Court, prohibits the stacking of the UIM
coverage, Subpart B prohibits duplicate recovery for the same items of loss under the different
policy coverages, and Subpart C prohibits duplicate payment for an element of loss already made
by or on behalf of a person who is legally responsible for the loss, in this case the driver's
The language of Subpart C, taken in conjunction with the grant of insurance,2
"'simply means that in determining the total damages to which the underinsured motorist
coverage will be applied, the amount of money already received from the tortfeaser must be
deducted. In this way, it avoids double recovery."' Ritchie, 307 S.W.3d at 141 (citing Jones v.
Mid-Century Ins. Co., 287 S.W.3d 687, 693 (Mo. 2009) (en bane)). It is undisputed that Plaintiff
recovered $100,000 from the driver's insurance. Therefore, Plaintiff is only entitled to recover
under the Policy if his damages exceed $100,000.
Plaintiff alleges that he has over $500,000 in damages and is accordingly entitled to
recover under the Policy. In support of this figure, Plaintiff indicates that this amount includes
"We will pay compensatory damages which an insured is legally entitled to recover from the
owner or operator of an underinsured motor vehicle because of a bodily injury ..." (Doc. 22-1 at
the $100,000 previously recovered and directs the Court's attention to Amica's Exhibit B, a letter
dated August 2, 2013, in which Plaintiff seeks the stacked policy limit of $400,000 from Amica
for the accident (Doc. 22-2). Attached to the letter is a spreadsheet of then-current medical
expenses totaling $70,939.03 (Id. at 13-15). Amica asserts that because some of this treatment
resulted from unrelated incidents and Plaintiff has not provided any additional invoices or
records evidencing supplementary medical care or expenses, Plaintiff is unable to establish
sufficient evidence of non-duplicative compensatory damages that would enable a jury to return
a verdict for him.
Given the listed medical expenses, the nature of the injuries and the
allegations of future medical expense, pain and suffering, lost wages, and lost earning capacity,
the Court finds that there is sufficient evidence in the record that a reasonable jury could find
Plaintiff has suffered damages in excess of $100,000.
3. Cooperation and Legal Action Clauses
Amica also asserts that Plaintiff is not entitled to coverage because Amica suffered
prejudice when Plaintiff failed to comply with the Policy.
Specifically, Amica argues that
Plaintiff did not submit to an examination under oath or provide complete documentation
concerning his medical treatment or damages, and then brought suit before there was full
compliance with the terms of the policy. Plaintiff responds denying this allegation and detailing
multiple instances of cooperation (Doc. 27 at 8-9). In support of his assertions, Plaintiff has
provided the Court with communications between Plaintiffs counsel and Amica and its counsel
(See infra). Plaintiff does not assert that the relevant provisions are ambiguous.
Under Missouri law, to deny coverage under a cooperation clause, an insurer must prove
(1) a material breach of the cooperation clause, (2) the existence of substantial prejudice as a
result of the breach and (3) the exercise of reasonable diligence to secure the insured's
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cooperation. Med. Protective Co. v. Bubenik, 594 F.3d 1047, 1051 (8th Cir. 2010). The Policy
provides in relevant part that Amica has "no duty to provide coverage under this policy if the
failure to comply with the following duties is prejudicial to us" (Doc. 22-1 at 24). Those duties
include an authorization for Amica to obtain medical and other pertinent reports and submission
to an examination under oath (Id. at 24-25). The Policy also includes a legal action clause that
states, "No legal action may be brought against us until there has been full compliance with all the
terms of this policy" (Id. at 25).
The Court finds that there is sufficient evidence that a reasonable jury could find Plaintiff
did not materially breach the cooperation clause. The evidence in the record indicates that
Plaintiff attempted to schedule his examination under oath and to supply his medical and other
Plaintiff has provided the Court with correspondence indicating he attempted to
schedule the examination under oath (Docs. 27-9, 27-10, & 27-11).
represents that initially Plaintiff was not capable of giving a statement (Doc. 27-8) and that, after
the filing of this litigation, neither Amica nor its counsel addressed whether an examination
under oath was still needed or provided any dates (Doc. 27 at 9). Further, the exhibits submitted
by Plaintiff indicate that counsel provided the then-current medical records to Plaintiff (Docs.
22-2, 27-5, 27-6), photographs of the vehicle (Doc. 27-4), several photographs of Plaintiffs
injuries (Docs. 27-4), a photograph of the scene (Doc. 27-6), a marked google map indicating the
location of the accident (Doc. 27-7) and responded to questions (See Doc. 27-6). There is not
any indication that Amica made requests for additional information that was not provided by
Plaintiff. Med Protective Co., 594 F.3d at 1053. Therefore, the Court finds that there remains
an issue of material fact regarding whether Plaintiff materially breached the cooperation clause
of the Policy. As such, a reasonably jury could also find that Plaintiff did not breach the legal
action clause. Greer v. Zurich Ins. Co., 441 S.W.2d 15, 30 (Mo. 1969) (finding substantial
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compliance a policy's notice clause sufficient to overcome its legal action clause). See also
Tresner v. State Farm Ins. Co., 913 S.W.2d 7, 10 (Mo. 1995) (en bane).
C. Count II: Bad FaithNexatious Refusal
Amica next asserts that Plaintiff's vexatious refusal claim must fail as there is no
evidence of recalcitrance and there was no pre-suit demand that fell within policy limits.
Plaintiff responds that if the Court finds Plaintiffs arguments concerning the ambiguities of the
offset and anti-stacking language, then the Court should allow the vexatious refusal claim to go
forward (Doc. 27 at 7).
Under Missouri law, Plaintiff must establish that (1) he had an insurance policy with
Amica, (2) Amica refused to pay, and (2) Amica's refusal was without reasonable cause or
excuse. Mo. REv. STAT. § 375.420 (2014); Dhyne v. State Farm Fire and Cas. Co., 188 S.W.3d
454, 457 (Mo. 2006). See also De Witt v. Am. Family Mut. Ins. Co., 667 S.W.2d 700, 710 (Mo.
1984) ("To support the imposition of the penalty under the statute, plaintiff must show that the
insurer's refusal to pay the loss was willful and without reasonable cause, as the facts would
appear to a reasonable and prudent person.") "There is no vexatious refusal when the insurer has
reasonable cause to believe and does believe there is no liability under its policy and that it has a
meritorious defense." Macheca Transp. Co. v. Phila. lndem. Ins. Co., 649 F.3d 661, 674 (8th
Cir. 2011) (citing Wood v. Safeco Ins. Co. of Am., 980 S.W.2d 43, 55 (Mo. Ct. App. 1998)).
"The existence of a litigable issue will not preclude a penalty, however, if the insurance
company's attitude is show to be vexatious and recalcitrant." Watters v. Travel Guard Intern.,
136 S.W.3d 100, 109 (Mo. Ct. App. 2004). "This determination must be made by viewing the
facts as they appeared at the time of the refusal to pay." State Farm Mut. Auto. Ins. Co. v.
Shahan, 141F.3d819, 824 (8th Cir. 1998).
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As previously discussed, the Court determined the anti-stacking language to be
unambiguous and the applicable UIM coverage limit to be $100,000.
demands were always for $400,000. No demand was ever made within or at the $100,000 policy
limit. Therefore, the Court finds Amica's denial of Plaintiffs demand of $400,000 to settle the
claim not unreasonable and that Amica is entitled to judgment as a matter of law.
IT IS HEREBY ORDERED that Defendant's Amica Mutual Insurance Company's
Motion for Summary Judgment (Doc. 20) is GRANTED, in part.
Count II is hereby
DISMISSED with prejudice.
Dated this 30th day of March, 2015.
ITED STATES DISTRICT JUDGE
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