Opinion
EV 97-223-C-Y/H.
June 8, 1999.
ENTRY ON PARTIES' CROSS-MOTIONS FOR SUMMARY JUDGMENT
This case arises out of an automobile accident which claimed the life of Ronald Melton. Defendants/counter-claimants Shirley Melton, Michael Melton and Jason Melton ("defendants") claim damages for loss of consortium. Plaintiff American Ambassador Casualty Company ("American Ambassador") filed a motion for summary judgment, seeking a declaration by this court that the defendants are not entitled to underinsured motorist benefits for the death of Ronald Melton, separate and independent of the claim of Ronald Melton's Estate, which had already been satisfied. Defendants counterclaimed and filed a motion for summary judgment, seeking a declaration that they are, in fact, entitled to recover separate limits of liability for their losses as a result of Ronald Melton's death.
This court has jurisdiction over this cause of action pursuant to 28 U.S.C. § 1332.
I. Summary Judgment Standard
A party is entitled to partial summary judgment on a "claim, counterclaim, or cross-claim," Fed.R.Civ.P. 56(b) "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). In the case at bar, the material facts are not disputed and is therefore appropriate for a summary judgment determination.
II. Facts
Ronald Melton was killed in a motor vehicle accident on November 18, 1994, when the motor vehicle he was operating struck another motor vehicle being driven by Joann Arnold ("tortfeasor"). (Complaint, ¶ 5). The tortfeasor's insurance carrier paid to the Estate of Ronald Melton the sum of $50,000.00 — an amount equal to the per person limits of insurance under the tortfeasor's automobile insurance policy. (Complaint, ¶ 6). The tortfeasor's automobile insurance policy had limits of insurance in the amount of $50,000.00 per person and $100,000.00 per occurrence. (Defendant's brief, Ex. A). While the Estate of Ronald Melton did advance a claim against the tortfeasor and her insurance policy, there is no evidence that the defendants ever advanced a claim against the tortfeasor, or otherwise exhausted the remaining $50,000.00 in insurance remaining under the tortfeasor's automobile insurance policy.
At the time of the accident, Ronald Melton had an automobile policy in force and effect which was issued by American Ambassador, Policy No. AIN 0481878. The American Ambassador policy contained uninsured/underinsured motorist coverage in the amount of $100,000 per person and $300,000 per occurrence. (Complaint, Ex. A). It also contained the following policy provisions:
INDIANA — UNINSURED/UNDERINSURED AMENDATORY ENDORSEMENT PART C — UNINSURED MOTORIST COVERAGE IS AMENDED TO READ: "UNINSURED/UNDERINSURED MOTORIST COVERAGE"INSURING AGREEMENT
We will pay damages which a covered person is legally entitled to recover from the owner or operator of an uninsured motor vehicle or an underinsured motor vehicle because of:
1. Bodily Injury sustained by a covered person and caused by an accident; and
2. Property Damage 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 uninsured motor vehicle or the underinsured motor vehicle. Any judgment for damages arising out of a suit brought without our written consent is not binding on us.
"Covered Person" as used in this endorsement means:
1. You or any family member.
2. Any other person occupying your covered auto.
3. Any person for damages that person is entitled to recover because of bodily injury to which this coverage applies sustained by a person described in 1. or 2. above.
* * *
LIMITS OF LIABILITY
The limit of liability shown in the declarations for "each person" for bodily injury liability is our maximum limit of liability for all damages for 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 declarations for "each accident" for bodily injury liability is our maximum limit of liability for all damages for bodily injury resulting from any one accident. The limit of liability shown in the declarations for "each accident" for property damage liability is out maximum limit of liability for all damages to all property resulting from any one accident. This is the most we will pay regardless of the number of:
1. Covered persons;
2. Claims made;
3. Vehicles or premiums shown in the declarations; or
4. Vehicles involved in the accident.
Any amounts otherwise payable for damages under this coverage shall be reduced by all sums:
1. Paid because of the bodily injury or property damage by or on behalf of persons or organizations who may be legally responsible or under any collectible auto liability insurance, for loss caused by an accident with underinsured motor vehicle. This includes all sums paid under Part A of this policy; and
2. Paid or payable because of the bodily injury under any of the following or similar law:
a. worker's compensation law; or
b. disability benefits law.
Any payment under this coverage will reduce any amount that person is entitled to recover for the same damages under Part A of the policy.
DEFINITIONS
"Family member" means a person related to you by blood, marriage, or adoption who is a resident of your household. This includes a ward or foster child. (Complaint, Ex. A). The policy does not define "bodily injury."
The Estate of Ronald Melton asserted a claim for underinsured motorist benefits against American Ambassador which tendered to the Estate a sum of $50,000.00 — the maximum amount payable under the per person limits of insurance under the American Ambassador policy. Thereafter, defendants asserted that they were entitled to exhaust the per occurrence limits of insurance of $300,000.00 because each of them had separate claims for "bodily injury" as that term is defined in the American Ambassador policy. This lawsuit thereafter ensued.
III. Discussion
This court is called upon to declare and determine whether each of the defendants have separate claims for "bodily injury" as that term is defined under the American Ambassador insurance policy, and whether each of the defendants can individually maintain a claim for underinsured motorist benefits under the American Ambassador policy. For the reasons set forth below, the court declares and determines that American Ambassador's contractual obligation to pay underinsured motorist benefits for the subject occurrence was satisfied when it tendered to the Estate of Ronald Melton the sum of $50,000.00 — the per person limits of insurance under the American Ambassador policy. The court further declares and determines that each of the defendants do not have separate claims for "bodily injury" which would entitle them to recover underinsured motorist benefits under the policy.
A. Extent of American Ambassador's Liability For Underinsured Motorist Benefits
Defendants argue that they each have separate consortium claims arising out of the death of Ronald Melton, and that each of those claims is a claim for "bodily injury" as that term is used under the American Ambassador policy. For this reason they argue that per occurrence limit of $300,000.00 under the American Ambassador policy should apply. For the reasons described below, the American Ambassador policy is not susceptible to such an interpretation.
The rule in Indiana is that derivative consortium claims do not constitute separate bodily injuries. Medley v. Frey, 660 N.E.2d 1079, 1081 (Ind.Ct.App. 1996); Montgomery v. Farmers Insurance Group, 585 F. Supp. 618, 619 (S.D.Ind. 1984). In Frey, Charles Medley and his wife, Mary, were involved in a car accident in which Charles was the only one who sustained bodily injury. The Indiana Court of Appeals noted a "number of jurisdictions" have considered similar issues and have held that "a claim for loss of consortium is not included within the policy definition of "bodily injury" and is subject to the per person limits paid to the injured spouse." Id. at 1081. The Court therefore held that the per person limit of coverage under the Medley's automobile insurance policy applied.
Similarly, the court in Montgomery considered whether consortium claims implicated a separate bodily injury in the "per accident" limit. In entering summary judgment for the insurance company, the court stated:
In this instance, only one person sustained bodily injury. While two persons assert claims for damages, the claim of the second is for loss of consortium arising from the bodily injury of the first. Mrs. Montgomery's claim is part of the damages arising out of bodily injury sustained by one person in any one occurrence, and therefore is encompassed within the $25,000.00 limit. The $50,000.00 limit could apply only if Mrs. Montgomery had sustained bodily injuries.585 F. Supp. at 619.
Courts in other jurisdictions have arrived at the same conclusion. National Farmers Union Property and Casualty Company v. Zuber, 824 F. Supp. 1017 (D.Wyo. 1993); Federal Kemper Insurance Company v. Karlet, 428 S.E.2d 60 (W.Va. 1993); Farmers Insurance Company, Inc. v. Rosen, 839 P.2d 71 (Kan.App. 1992); Remedies v. Lopez, 560 So.2d 118 (1990); Izzo v. Colonial Penn Insurance Company, 524 A.2d 641 (Conn. 1987). Landsinger v. American Family Mutual Insurance Company, 417 N.W.2d 899 (Wisc.App. 1987); State Farm Mutual Automobile Insurance Co. v. Descheemaeker, 444 N.W.2d 153 (Mich.App. 1989); Cross v. Country Companies, 544 N.E.2d 1246 (Ill.App. 1989).
Defendants cite Shaefer v. Allstate Insurance Company, 668 N.E.2d 913 (Ohio 1996) in support of their argument. Although the court is aware of this precedent, the court is not inclined to overrule binding Indiana precedent which appears to be in accord with the clear weight of authority addressing this issue.
In an effort to bypass the applicable law, defendants argue that since the policy does not define the term "bodily injury," the term is ambiguous. The court does not agree. The terms in an insurance policy are to be construed and interpreted like those of any other contract. Smith v. Allstate Insurance Company, 681 N.E.2d 220, 223 (Ind.Ct.App. 1997). Where policy language is clear and unambiguous, policy terms are to be given their plain and ordinary meaning. Erie Insurance Exchange v. Stephenson, 674 N.E.2d 607, 609 (Ind.Ct.App. 1997). "Contractual language is ambiguous when it is susceptible to more than one interpretation and reasonably intelligent persons would differ as to its meaning. Moreover, no rule of insurance policy construction mandates that each and every contractual term be defined. Courts will not deem a contract's language ambiguous merely because each party to a dispute favors a different interpretation." Jones v. Western Reserve Group/Lightning Rod Mutual Insurance Company, 699 N.E.2d 711, 714 (Ind.Ct.App. 1998) (citations omitted).
Applying those rules of construction to the case at bar, the court finds the term "bodily injury" has a plain and ordinary meaning. Reasonable minds would agree that the term "bodily injury" means injury to one's physical body. See id. And in the context of the policy language itself — "Bodily injury sustained by a covered person and caused by an accident" — reasonable minds would agree that in order to recover under the policy, one must have sustained injury to one's body as a result of the accident upon which the claim was based.
Moreover, interpreting the term "bodily injury" as requiring some form of physical injury to the body is consistent with how Indiana treats claims for personal injury. Indiana does not recognize claims for personal injury in the absence of some physical impact or injury. See Shuamber v. Henderson, 579 N.E.2d 452 (Ind. 1991). Accordingly, Indiana courts have declined to equate claims for emotional injury as claims for "bodily injury." Wayne Township Board of School Commissioners v. Indiana Insurance Company, 650 N.E.2d 1205, 1210 (Ind.Ct.App. 1995) (term "bodily injury" in comprehensive general liability insurance policy does not include emotional damage that does not arise from bodily touching). See also Davidson v. Cincinnati Insurance Company, 572 N.E.2d 502, 506 (Ind.Ct.App. 1991) (claims of slander and malicious prosecution do not fall within definition of "bodily injury").
For the reasons cited above, the court finds the result reached in Frey, Montgomery, and the other cited cases is the controlling law. None of the defendants sustained bodily injury; rather, they base their claims solely on derivative consortium claims. Because none of the defendants suffered bodily injury, their claims do not constitute a separate "bodily injury" as defined under the American Ambassador policy. Accordingly, Ronald Melton was the only person who sustained "bodily injury" as a result of the subject occurrence, and American Ambassador satisfied its contractual obligation to pay underinsured motorist benefits upon tendering to the Estate of Ronald Melton the sum of $50,000.00 — the per person limits of underinsured motorist benefits under the American Ambassador policy.
B. Exhaustion of Tortfeasor's Underinsured Motorist Coverage
Even to the extent that each defendant possessed a separate and independent claim for "bodily injury," they cannot advance those claims for underinsured motorist benefits under the American Ambassador policy until they exhaust the remaining $50,000.00 per occurrence limits of insurance under the tortfeasor's insurance policy. Under I.C. 27-7-5-4, an underinsured motor vehicle is defined as a motor vehicle "where the limits of coverage available for payment to the insured under all bodily injury liability policies covering persons liable to the insured are less than the limits for the insured's underinsured motorist coverage." The Indiana Supreme Court has interpreted this provision as an "exhaustion" provision. Tate v. Secura Insurance, 587 N.E.2d 665, 669 (Ind. 1992).
Accordingly, even if defendants consortium claims could be defined as separate and independent claims for "bodily injury," any claim for underinsured motorist benefits under the American Ambassador policy would not be ripe unless and until such time as the defendants exhaust the remaining $50,000.00 per occurrence limits of insurance of the tortfeasor's insurance policy.
IV. Conclusion
For the reasons articulated in the court's opinion, the grants plaintiff's Motion for Summary Judgment and denies defendants' Motion for Summary Judgment. The court declares and determines that: 1) the underinsured motorist benefits under Policy No: AIN 0481878 are payable exclusively to the Estate of Ronald Melton; and 2) Shirley Melton, Michael Melton and Jason Melton have no compensable claim for underinsured motorist benefits under the said policy, for damages arising out of the November 18, 1994 accident.
So ordered this 8th day of June, 1999.
FINAL JUDGMENT
The court, having entered summary judgment in favor of plaintiff, American Ambassador Casualty Company, and against the defendants, Shirley Melton, Michael Melton, and Jason Melton on plaintiff's Complaint for Declaratory Judgment, now enters final judgment in favor of American Ambassador Casualty Company.So ordered this day of June, 1999.