The Midwestern Indemnity Company v. Brooks et al
Filing
42
ORDER AND OPINION (1) DENYING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT AND (2) GRANTING PLAINTIFFS MOTION FOR SUMMARY JUDGMENT, 33 , 29 . Signed on 3/31/14 by District Judge Ortrie D. Smith. (Matthes, Renea)
IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
WESTERN DIVISION
THE MIDWESTERN INDEMNITY CO., )
)
Plaintiff,
)
)
vs.
)
)
MALISSA BROOKS and
)
BRADLEY BROOKS,
)
)
Defendants.
)
Case No. 13-0304-CV-W-ODS
ORDER AND OPINION (1) DENYING DEFENDANTS’ MOTION FOR SUMMARY
JUDGMENT AND (2) GRANTING PLAINTIFF’S MOTION FOR SUMMARY
JUDGMENT
Pending are cross motions for summary judgment. The Court hereby denies
Defendants’ motion (Doc. # 33) and grants Plaintiff’s motion (Doc. # 29).
I. BACKGROUND
The facts are undisputed. In September 2011, Plaintiff Malissa Brooks was
riding a bicycle on Missouri Highway 18 when she was struck by a car driven by Clyde
Lawrence. Malissa (or Malissa and her husband) filed suit against Lawrence in state
court; that suit was settled for the limits of his policy, or $50,000. This case involves the
Brooks’ claim against their own insurance company, which seeks recovery under the
underinsured motorist (“UIM”) provisions. That provision provides for $100,000 of
coverage. Defendants own five vehicles insured by Plaintiff, and they contend they are
entitled to $500,000 of coverage; Plaintiff contends the underinsured motorist provisions
do not stack and the maximum coverage is $100,000. Plaintiff has paid $100,000, the
amount it alleges to be the policy limit; the parties agree Defendants’ damages exceed
that amount.
Defendants’ argument relies heavily on the Declarations Page, which
summarizes the amounts and types of coverage and the premiums charged, but which
does not contain any actual language specifying the terms or conditions of the coverage
provided. Exhibit 1 to Complaint at 9-10. The Declarations Page indicates UIM
protection applies for each of Defendant’s cars. It further indicates the limit for UIM
coverage is $100,000 per person and $300,000 per accident.
Plaintiff’s argument relies heavily on the policy’s language, including particularly
the following provisions:
Limit of Liability
A.
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 show 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:
1.
2.
3.
4.
“Insureds”’;
Claims made;
Vehicles or premiums show in the Schedule or in the Declarations; or
Vehicles involved in the accident
*
*
*
Other Insurance
If there is other applicable insurance available under one or more policies or provisions
of coverage that is similar to the insurance provided by this endorsement:
1.
Any recovery for damages under all such policies or provisions of
coverage may equal but not exceed the highest applicable limit for any
one vehicle under any insurance providing coverage on either a primary or
excess basis.
*
*
*
Finally, Part F contains “General Provisions,” one of which states that
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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.
II. DISCUSSION
A moving party is entitled to summary judgment on a claim only if there is a
showing that “there is no genuine issue as to any material fact and that the moving party
is entitled to a judgment as a matter of law.” See generally Williams v. City of St. Louis,
783 F.2d 114, 115 (8th Cir. 1986). “[W]hile the materiality determination rests on the
substantive law, it is the substantive law's identification of which facts are critical and
which facts are irrelevant that governs.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
248 (1986). Thus, “[o]nly disputes over facts that might affect the outcome of the suit
under the governing law will properly preclude the entry of summary judgment.@
Wierman v. Casey=s Gen. Stores, 638 F.3d 984, 993 (8th Cir. 2011) (quotation omitted).
In applying this standard, the Court must view the evidence in the light most favorable to
the non-moving party, giving that party the benefit of all inferences that may be
reasonably drawn from the evidence. Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 588-89 (1986); Tyler v. Harper, 744 F.2d 653, 655 (8th Cir. 1984),
cert. denied, 470 U.S. 1057 (1985). However, a party opposing a motion for summary
judgment “may not rest upon the mere allegations or denials of the . . . pleadings, but
. . . by affidavits or as otherwise provided in [Rule 56], must set forth specific facts
showing that there is a genuine issue for trial.” Fed. R. Civ. P. 56(e).
“Stacking” refers to an insured’s ability to obtain multiple insurance coverage
benefits for a single injury. The issue of stacking arises primarily in two circumstances:
(1) when there are multiple insurers involved, such as when the insured has two
vehicles each insured by a different insurer, or (2) when there are multiple coverages in
a single policy, such as when an insured has multiple vehicles covered by a single
policy. Daughhetee v. State Farm Mut. Auto. Ins. Co., No. 13-1185, slip op. at 5 (Mar.
18, 2014) (citing Niswonger v. Farm Bureau Town & Country Ins. Co. of Mo., 992
S.W.2d 308, 313 (Mo. Ct. App. 1999)).
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This is a case of the second sort: Defendants argue they are entitled to stack
coverages because they have multiple cars insured by Plaintiff. The issue is one of
contract interpretation. As is true for all contracts, interpretation of an insurance
contract is a matter of law. Seeck v. Geico General Ins. Co., 212 S.W.3d 129, 123 (Mo.
2007) (en banc). Ambiguities are to be construed in favor of the insured. Id. “An
ambiguity exists when there is duplicity, indistictness or uncertainty in the meaning of
the policy [and] is reasonably open to different constructions.” Gulf Ins. Co. v. Noble
Broadcast, 936 S.W.3d 810, 814 (Mo. 1997) (en banc). The presence of a broad
provision for coverage coupled with subsequent narrowing language does not create an
ambiguity. Todd v. Missouri United School Ins. Council, 223 S.W.3d 156, 162-63 (Mo.
2007) (en banc). Moreover, unlike the case with uninsured motorist coverage, Missouri
law permits anti-stacking provisions with respect to underinsured motorist coverage.
E.g., Jordan v. Safeco Ins. Co. of Ill., 741 F.3d 882, 884 (8th Cir. 2014); Ritchie v. Allied
Property & Cas. Ins. Co., 307 S.W.3d 132, 135 (Mo. 2009) (en banc).
The Limit of Liability provision is quite clear. It states that the per-person and
per-accident limits identified in the Declarations constitute the “maximum limit of
liability.” This is the maximum “regardless of the number of . . . [v]ehicles or premiums
shown in the
. . . Declarations.” In fact, Defendants do not suggest these provisions
are unclear. See Defendants’ Memorandum of Law (Doc. # 34) at 6. Instead,
Defendants contend the clear language is trumped by the Declarations Page: their
reasoning is that the Declarations Page reflects they purchased five separate policies
and the Limit of Liability presupposes only one policy was purchased. Defendants
reason that if Plaintiff’s argument is correct, then they did not need to pay for UIM
coverage on four of their five cars because, without stacking, the amount of UIM
coverage would be the same – rendering the second through fifth premiums illusory.1
Defendants’ argument suffers from three fatal flaws. First, it is the policy itself that
specifies the terms of coverage – not the Declarations page. Second, and relatedly, the
admittedly unambiguous policy specifically addresses this situation: regardless of the
number of vehicles or premiums reflected on the Declarations Page, Plaintiff’s
1
It may be that Defendants and a class of others similarly situated have a claim
for unjust enrichment, but that issue is beyond this case’s parameters.
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maximum liability is $100,000 per person and $300,000 per accident. This language is
sufficient to disallow stacking. Finally, even if Defendants’ characterization is correct
and they effectively purchased five separate policies (a fact that is neither established
nor compelled by anything in the Record), the General Provision specifies that
regardless of how many policies Defendants purchased from Plaintiff, Plaintiff’s liability
would not exceed the highest single limit. Defendants’ arguments effectively invite the
Court to create an ambiguity that does not exist in order to overcome the policy’s clear
language, but this is not permitted. Daughhetee, slip op. at 7. The Court is obligated to
give each provision a reasonable meaning, and this can be done – and when the
unambiguous policy is read as a whole it plainly prohibits stacking.
Defendants contend that Plaintiff was required to explicitly indicate on the
Declarations Page that stacking was not allowed and that to make that restriction
effective Plaintiff was required to charge for UIM coverage on only one car. For
support, they rely on Fanning v. Progressive NW Ins. Co., 412 S.W.3d 360 (Mo. Ct.
App. 2013). The Court disagrees with Defendant’s analysis of this case. First, unlike
the case at bar the Missouri Court of Appeals found certain provisions to be ambiguous
-- including the definitions of “underinsured motor vehicle.” This characteristic
immediately distinguishes both the policies at issue and the appropriate analysis for the
two cases. Second, the case involved language requiring set-offs from the
underinsured motorist – provisions not involved in this case. Fanning did not hold that
anti-stacking provisions must be included in the Declarations Page.
Defendants also attach much significance to the characterization of UIM
coverage as “floating.” All this means is that the coverage is personal and follows the
insured, regardless of whether the insured is in a vehicle. The fact that the coverage is
floating does not mean anything regarding stackability. Defendants also utilize this
characterization to defeat the General Provision from Part F, contending that it is relates
only to “coverages that are connected to autos.” This argument ignores the provision’s
language, the terms of which make it apply to all coverages applying to the same
accident.
This case is similar in many respects to Corrigan v. Progressive Insurance Co.,
411 S.W.3d 306 (Mo. Ct. App. 2013). There, the insured had a motorcycle insurance
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policy that insured two motorcycles, and the insured paid separate premiums for each
motorcycle. 411 S.W.3d at 309. The policy declared that the coverage did not stack,
regardless of the number of claims made, the number of motorcycles covered, or the
number persons injured. Id. at 312. The Missouri Court of Appeals held the antistacking provisions were not ambiguous and would be enforced. The Court sees little to
distinguish the two cases. The only difference of note is that the Declarations Page in
Corrigan explicitly stated the coverage did not stack, but Corrigan does not depend on
this fact.
III. CONCLUSION
The policy is unambiguous, and its unambiguous terms prohibit stacking of UIM
coverage. Plaintiff’s motion for summary judgment is granted and Defendants’ Motion
for Summary Judgment is denied.
IT IS SO ORDERED.
/s/ Ortrie D. Smith
ORTRIE D. SMITH, SENIOR JUDGE
UNITED STATES DISTRICT COURT
DATE: March 31, 2014
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