918 N.E.2d 135 (Ohio 2009), 2009-0122, State Farm Mut. Automobile Ins. Co. v. Grace

Docket Nº:2009-0122.
Citation:918 N.E.2d 135, 123 Ohio St.3d 471, 2009-Ohio-5934
Opinion Judge:O'DONNELL, J.
Party Name:STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY et al. v. GRACE et al.
Attorney:Baker & Hostetler, L.L.P., Rodger L. Eckelberry, Columbus, Michael K. Farrell, Cleveland, Mark A. Johnson, and Robert J. Tucker, Columbus, for petitioners. Kisling, Nestico & Redick, L.L.C., Gary W. Kisling, Alberto R. Nestico, Akron, Robert W. Redick, Cuyahoga Falls, and Thomas Vasvari, Akron; a...
Judge Panel:MOYER, C.J., and LUNDBERG STRATTON, O'CONNOR, LANZINGER, and CUPP, JJ., concur. PFEIFER, J., concurs separately. PFEIFER, J., concurring.
Case Date:November 17, 2009
Court:Supreme Court of Ohio
 
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Page 135

918 N.E.2d 135 (Ohio 2009)

123 Ohio St.3d 471, 2009-Ohio-5934

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY et al.

v.

GRACE et al.

No. 2009-0122.

Supreme Court of Ohio.

November 17, 2009

Submitted Sept. 1, 2009.

Page 136

Baker & Hostetler, L.L.P., Rodger L. Eckelberry, Columbus, Michael K. Farrell, Cleveland, Mark A. Johnson, and Robert J. Tucker, Columbus, for petitioners.

Kisling, Nestico & Redick, L.L.C., Gary W. Kisling, Alberto R. Nestico, Akron, Robert W. Redick, Cuyahoga Falls, and Thomas Vasvari, Akron; and Feazell & Tighe, L.L.P., and Austin Tighe, Austin, TX, for respondent Angela Webb.

Seaman Garson, L.L.C., James DeRoche, and David H. Krause; and Law Offices of Glenn D. Feagan and Glenn D. Feagan, Cleveland, for respondents Laura Grace, Elizabeth Garcia, Ladon Ruffin, and Dorian Jones.

Dworken & Bernstein Co., L.P.A., Patrick J. Perotti, and Nicole T. Fiorelli, Painesville; and Schottenstein Law Offices and Edwin E. Schottenstein, Columbus, for respondent Patricia Schwab.

O'DONNELL, J.

{¶ 1} The United States District Court for the Northern District of Ohio, Eastern Division, has certified the following question of state law for our resolution: " Does Ohio Revised Code Section 3937.18, as amended in 2001 by S.B. 97 (effective October 31, 2001), permit insurers to include an express limitation of coverage in an automobile insurance policy that precludes payments made under Uninsured/Underinsured Motorist coverage for medical expenses that are paid or payable under the Medical Payments coverage purchased in the same policy?" Stated differently, the question is whether an insurance carrier may decline to pay medical expenses pursuant to UM/UIM coverage when those same medical expenses have previously been paid or will be paid pursuant to the medical payments coverage in the same policy.

{¶ 2} We answer in the affirmative and hold that R.C. 3937.18(I), as amended by S.B. 97, permits an insurer to limit coverage so as to preclude payment pursuant to UM/UIM coverage for medical expenses that have previously been paid or are payable under the medical payment coverage in the same policy.

Facts and Procedural History

{¶ 3} We adopt the following factual and procedural history from the certification order submitted by the United States district court.

{¶ 4} Laura Grace, Elizabeth Garcia, Ladon Ruffin, Dorian Jones, Angela Webb, and Patricia Schwab (collectively, " the insureds" ), allege involvement in [123 Ohio St.3d 472] separate motor vehicle accidents with uninsured motorists. At the time of their respective accidents, each claimant had purchased an automobile insurance policy issued by either State Farm Mutual Automobile Insurance Company or State Farm Fire & Casualty Company (collectively, " State Farm" ) that included both uninsured- and underinsured-motorist (" UM/UIM" ) coverage and medical payments (" Med Pay" ) coverage in the same policy. Each claimant submitted a request for payment of medical expenses under both the UM/UIM and Med Pay coverages pursuant to the

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terms of their respective policies. 1

{¶ 5} State Farm declined to pay medical expenses under the UM/UIM coverage, asserting that such expenses were already paid or payable under the Med Pay coverage of the same policy. Grace, Garcia, Ruffin, and Jones together filed a putative class action against State Farm, and Webb and Schwab each filed individual putative class actions against State Farm. Each insured sought to represent a class of persons composed of all residents of the state of Ohio who (1) were insured persons under a policy of insurance issued by State Farm that included UM/UIM coverage and Med Pay coverage, for which State Farm charged separate premiums, (2) were insured persons under a policy of insurance comprised of State Farm's standard policy form or forms that included a purported " non-duplication" clause, and (3) suffered a bodily injury for which State Farm refused to provide medical payment benefits under both the UM/UIM and Med Pay portions of the policy.

{¶ 6} These underlying actions challenge the enforceability of the nonduplication clauses set forth in State Farm automobile insurance policies, which purportedly preclude payment pursuant to the UM/UIM coverage for medical expenses that are paid or payable under the Med Pay coverage purchased in the same policy.

{¶ 7} The parties do not dispute that the declarations page of each policy identified separate limits of coverage for UM/UIM and Med Pay coverage, or that State Farm charged separate premiums for each of these coverages. Each of the challenged policies contained an endorsement form 6083VV, or a substantially identical form, containing the following " non-duplication" clause limiting the UM/UIM coverage:

{¶ 8} " Non-Duplication

[123 Ohio St.3d 473] {¶ 9} " We will not pay under Uninsured Motor Vehicle Coverage any medical expenses paid or payable under:

{¶ 10} " (1) Medical Payments Coverage of this policy, or

{¶ 11} " (2) The medical payments coverage, no fault coverage, personal injury protection, or other similar coverage of any other motor vehicle policy." (Boldface sic.)

{¶ 12} Each policy also contained a separate " non-duplication" clause within the Med Pay portion of the policy, stating:

{¶ 13} " Non-Duplication

{¶ 14} " No person for whom medical expenses are payable under this coverage shall recover more than once for the same medical expense under this or similar vehicle insurance." (Boldface and italics sic.)

{¶ 15} Confronted with State Farm's motions for judgment on the pleadings alleging that the nonduplication clauses contained in the subject insurance policies are valid and enforceable as a matter of law, the United States district court certified the instant question of state law to this court pursuant to Sup.Ct.Prac.R. XVIII. We accepted the certified question and agreed to answer it. Grace v. State Farm Mut. Auto. Ins. Co., 121 Ohio St.3d 1422, 2009-Ohio-1296, 903 N.E.2d 322.

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Argument of the Parties

{¶ 16} State Farm contends that R.C. 3937.18, as amended by Am.Sub.S.B. No. 97 (" S.B. 97" ), 149 Ohio Laws, Part I, 779, effective October 31, 2001, expressly permits insurers to insert exclusionary or limiting provisions into the UM/UIM...

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