Summary
In Gomolka, the insured (appellee) recovered the $100,000 liability coverage limit from the third party's automobile insurance carrier.
Summary of this case from Wood v. American Fam. Mut. Ins. Co.Opinion
No. 83-1951
Decided December 26, 1984.
Insurance — Motor vehicles — Stacking of uninsured/underinsured coverages.
APPEAL from the Court of Appeals for Cuyahoga County.
Eleanor R. Gomolka and her husband Leonard initially purchased automobile insurance from the appellant, State Automobile Mutual Insurance Company ("State Auto"), in 1970. The Gomolkas regularly renewed this insurance by making premium payments, and all terms of the insurance coverage, as amended after 1970, were in full force and effect on June 30, 1979. On that date, Leonard J. Gomolka, while driving one of the insured family vehicles, was involved in a collision with a vehicle operated by Duk K. Kim. Mr. Gomolka died as a result of this collision, and his children, who were passengers in the Gomolka vehicle, suffered injuries.
Kim had liability coverage with the Buckeye Union Insurance Company in the amount of $100,000, which was paid to the Gomolkas. Eleanor Gomolka, individually, and as executrix of her husband's estate, appellee herein, also sought additional compensation from State Auto under the terms of the uninsured motorist coverage set forth in the Gomolka's insurance policy. State Auto rejected appellee's claim upon the assertion that the Gomolkas' policy did not provide underinsured motorist coverage as a part of its uninsured motorist coverage. Appellee brought a declaratory judgment action against State Auto, and, ultimately, in Gomolka v. State Auto. Mut. Ins. Co. (1982), 70 Ohio St.2d 166 [24 O.O.3d 274] ( Gomolka I), we held that the Gomolkas' insurance policy with State Auto did, indeed, provide underinsured motorist coverage.
On remand to the Court of Common Pleas of Cuyahoga County, both parties filed motions for summary judgment on the issue of whether the Gomolkas were entitled to "stack" their uninsured/underinsured motorist coverage, having paid three full premiums therefor. State Auto argued that (1) the Gomolkas' uninsured/underindured motorist coverage was limited to $300,000 for "each accident" and could not be stacked, and (2) the $100,000 paid to appellee by Kim's insurer (Buckeye Union Insurance Company) could be "set off" against the $300,000 of uninsured/underinsured motorist coverage provided by State Auto, thus limiting State Auto's total obligation to appellee to a payment of $200,000.
Appellee asserted that because she and her husband had paid three full premiums for uninsured/underinsured motorist coverage on all of the family vehicles, these coverages could be stacked so that the total amount of coverage provided by their policy was equal to $900,000 ($300,000 x 3 for "each accident"). The trial court agreed with this interpretation of the policy's coverage limits, while apparently rejecting State Auto's assertion that the $100,000 payment by Kim's insurer could be set off directly against State Auto's coverage limits. Summary judgment was granted in favor of appellee.
On appeal, the Court of Appeals for Cuyahoga County addressed separately the issues of "stacking" and "setoff." The court noted that State Auto's policy contained no prohibition against stacking and held that the Gomolkas, having paid a "substantial triple premium," were entitled to stack their three separate uninsured/underinsured motorist coverages. The court of appeals also found that State Auto was entitled to set off the $100,000 paid to the appellee by Kim's insurer, but that this setoff properly could be made only against the total damages suffered by the appellee, not directly against State Auto's coverage limits. On these bases, the judgment of the trial court was affirmed.
The cause is now before this court upon the allowance of a motion to certify the record.
mansour, Gavin, Gerlack Manos Co., L.P.A., Mr. Ernest P. Mansour, Mr. Michael T. Gavin, Mr. Eli Manos, Messrs. Eardley Wantz and Mr. David J. Eardly, for appellee.
Messrs. Cronquist, Smith, Marshall Kagels and Mr. Jack F. Smith, for appellant.
The first issue presented for review in this appeal is whether the appellee properly can stack the uninsured/underinsured motorist coverages contained in her family's auto insurance policy. This issue is readily resolved by reference to our recent holding in Auto-Owners Mut. Ins. Co. v. Lewis (1984), 10 Ohio St.3d 156, in which we stated at paragraph one of the syllabus:
"Where an insured has paid separate premiums in a single policy providing several vehicles with uninsured motorist coverage, the insured is entitled to recover under the uninsured motorist provisions of the policy an amount up to the aggregate sum of the uninsured motorist coverages."
The appellee herein and her husband made regular payments to State Auto for insurance coverage on their family's three vehicles. Included within these payments were three separate premiums for uninsured/underinsured motorist coverage. As stated in Lewis, supra, at 158, "* * * [t]he purpose of uninsured motorist coverage * * * is to afford the insured additional protection in the event of an accident with an uninsured motorist, not to provide coverage to a vehicle. * * *" Thus, the appellee and her husband effectively purchased three separate coverages of $300,000 and were thereby entitled to a total of $900,000 coverage for damages resulting from any one accident — even when such accident involved only one of the three insured family vehicles.
The insurance policy issued by State Auto to the appellee herein and her husband contained no provision that reasonably can be construed to prohibit the stacking of uninsured/underinsured motorist coverages. R.C. 3937.18(G) (originally R.C. 3937.181[E]), which became effective after the events that gave rise to the instant case, specifically permits the inclusion of anti-stacking provisions in insurance policies providing uninsured motorist coverages.
The second issue presented is whether the $100,000 paid to the appellee by another insurer may be deducted by State Auto directly from the limits of the appellee's uninsured motorist coverage, or whether the terms of the appellee's coverage permit State Auto to set off the $100,000 only against the appellee's total damages. In other words, may State Auto reduce its total uninsured motorist coverage for the appellee's family to $800,000 ($900,000 in total stacked coverage minus $100,000 already paid to appellee by another insurer), or may State Auto only deduct the $100,000 payment to the appellee from appellee's total damages ( e.g., if appellee has one million dollars in damages, then $100,000 is set off against those damages and State Auto is still obligated to appellee for a full $900,000 of uninsured motorist coverage).
This issue is resolved by reviewing the express language of the policy that was issued by State Auto to the appellee and her husband. The relevant portion of the policy, contained in Part I, Limits of Liability, Paragraph C, states:
"Any amount payable under the Uninsured Motorists Coverage because of bodily injury sustained in an accident by a person who is an insured under this coverage shall be reduced by
"(1) all sums paid on account of such bodily injury by or on behalf of (i) the owner or operator of the uninsured highway vehicle * * *."
The appellant argues, in effect, that the words, "any amount payable" should be interpreted to mean "the total amount of coverage provided, if payable." The appellee, on the other hand, would interpret "any amount payable" to mean "any damages compensable." We find this latter interpretation clearly to be the most reasonable.
Appellant's "interpretation" is, in reality, an "insertion." State Auto would have the court read additional terms into its policy. The appellee's interpretation, however, equates "amount payable" to "damages compensable" by looking to the plain meaning of the policy's terms and by focusing on the nature and purpose of uninsured/underinsured motorist coverage. When purchasing this coverage, an insured expects to be protected against a loss caused by another that is not covered by that other person's insurer. Thus, an "amount payable" under uninsured/underinsured motorist coverage is an amount of damages suffered by the insured, which amount is greater than the insurance coverage held by the party causing the damages.
Even if there were some doubt as to the propriety of appellee's interpretation of her policy, however, this doubt still would be resolved in her favor. As we noted in Gomolka I, supra, at 174, "[l]anguage in a contract of insurance reasonably susceptible of more than one meaning will be construed liberally in favor of the insured and strictly against the insurer." Buckeye Union Ins. Co. v. Price (1974), 39 Ohio St.2d 95 [68 O.O.2d 56]. This rule of construction, in combination with the plain meaning of the policy terms in question, makes it clear that State Auto may only utilize the $100,000 payment to the appellee as a setoff against the total damages suffered by her family.
Accordingly, the judgment of the court of appeals is affirmed.
Judgment affirmed.
CELEBREZZE, C.J., W. BROWN, SWEENEY, C. BROWN and J.P. CELEBREZZE, JJ., concur.
LOCHER, J., dissents in part.
HOLMES, J., dissents.
Although I concur in the majority resolution of the second issue of this case dealing with setoff, I must dissent from that part of the opinion dealing with stacking of coverages. The reasons for my dissent were succinctly set forth in the dissent in Auto-Owners Mut. Ins. Co. v. Lewis (1984), 10 Ohio St.3d 156, 161 (Holmes, J., dissenting in part), in which I concurred. As was the case in Auto-Owners, supra, the insured should be bound by the terms of their insurance contract, which here provides for a $300,000 uninsured/underinsured coverage ceiling per accident.
Accordingly, I would reverse the judgment of the court of appeals on the first issue.
I hereby dissent from the majority concerning the first issue herein based upon the principles set forth in my dissenting opinion in Auto-Owners Mut. Ins. Co. v. Lewis (1984), 10 Ohio St.3d 156, 161-163.
I also dissent from the majority opinion concerning the second issue in that the "Limits of Liability," as contained in the insurance policy, are quite clear and unequivocal, and are not subject to judicial interpretation by this court. The limitation specifically states that "[a]ny amount payable under the Uninsured Motorists Coverage * * * shall be reduced by (1) all sums paid on account of such bodily injury by or on behalf of (i) the owner or operator of the uninsured highway vehicle * * *." This language is very clear and demonstrates the intent of the parties that the "amount payable" under the facts presented would be $300,000, the maximum sum payable for "each accident," less a setoff of $100,000, the amount paid by Buckeye Union Insurance on behalf of its insured, Duk Kim.