American Auto. Ins. Co. v. Bartlett
| Decision Date | 18 November 1977 |
| Parties | AMERICAN AUTOMOBILE INSURANCE COMPANY, Appellant, v. Jerry BARTLETT, Administrator of the Estate of Mary C. Bartlett, Appellee. |
| Court | United States State Supreme Court — District of Kentucky |
Robert C. Hobson, John P. Sandidge, Woodward, Hobson & Fulton, Louisville, for appellant.
Carl J. Bensinger, Louisville, for appellee.
Reversing
American Automobile Insurance Company appeals from a judgment in the sum of $9,000.29 on the uninsured motorist provision of a policy issued by American to Bartlett. We reverse.
Mary C. Bartlett, a passenger in an automobile driven by Mary Thacker, suffered injuries resulting in her death when an unknown vehicle, coming into contact with the Thacker automobile, caused Mary Thacker to lose control of her automobile and strike a utility pole.
The Thacker automobile was covered by a policy of liability insurance issued by Aetna Casualty & Surety Company with a single person liability maximum of $25,000 and in addition uninsured motorist coverage of $10,000 for each person.
Mary Bartlett was covered by an insurance policy issued by American in favor of her and her husband, Jerry Bartlett, which provided for medical payments and uninsured motorist coverage of $10,000 for each person in addition to other coverage not relevant here.
Jerry Bartlett, as administrator of the estate of Mary Bartlett, settled with Aetna for the sum of $25,000. The settlement transaction took a curious turn. Aetna sent Bartlett a "Release in Full," the terms being for the consideration of $25,000.00, released Mary Thacker and Henry Thacker from all claims, damages, etc., "from an accident to the estate of Mary C. Bartlett," together with a check for $25,000. Instead of signing the release as presented, Bartlett inserted into the release, "It is specifically agreed and understood that this does not release any claim of Jerry Bartlett and the estate of Mary C. Bartlett for any uninsured motorist claim nor any subrogation rights that may inure to the insured motorist carrier." This amended release was signed October 25, 1974.
We can imagine the reaction when Aetna received this version of the release. According to the insertion, Aetna did not have a release at all. The settlement figure amounted to policy limits on a single person, but Aetna still remained exposed on the $10,000 uninsured motorist coverage. The situation was further complicated by the fact that Bartlett's lawyer cashed the $25,000 settlement check before returning the release form with the insertion to Aetna. We are advised of this by Bartlett's lawyer.
Aetna demanded that the release be executed as forwarded to Bartlett or return the $25,000. According to the Aetna representative, he and Bartlett's lawyer then agreed upon the following:
"IN WITNESS WHEREOF, we have hereunto set out hands this 15
day of Feb, 1975.
IN THE PRESENCE OF
Signed by Signed by
Raymond R. Roeland Jerry W. Bartlett
------------------ ---------------------------
ADMINISTRATOR OF THE
ESTATE OF MARY C. BARTLETT
DECEASED
Signed by
Carl J. Bensinger
---------------------------
CARL J. BENSINGER.'
The existence of this document came to light during a deposition for discovery given by Jerry Bartlett on May 29, 1975. The reluctance of Bartlett's lawyer to give a copy of this document to American was overcome when on the day of trial, June 19, 1975, the trial court ordered it done.
After the amended release was executed by Bartlett on October 25, 1974, Bartlett filed suit against American November 30, 1974, on the uninsured motorist provision of American's policy on Mary Bartlett. One month prior to trial, American tendered an amended answer and a third party complaint against Aetna alleging that according to the "Other Insurance" clause of the policy, Aetna's coverage was primary and American's was secondary; that is, American's liability applied only to any amounts recovered in excess of Aetna's coverage.
The clause referred to is as follows:
The trial court declined to permit the filing of the amended answer and the third party complaint for the reason that it was too late. After the indemnification agreement was produced, American again moved that the pleading be filed, but this motion was overruled by the trial court.
It is apparent that determination of the primary coverage and secondary coverage was considered to be a question of law. We gather this from a conference between the trial court and the lawyers prior to trial:
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