Billings v. State Farm Mut. Auto. Ins. Co., Civ. A. No. 87-578-N.
| Decision Date | 25 February 1988 |
| Docket Number | Civ. A. No. 87-578-N. |
| Citation | 680 F. Supp. 778 |
| Court | U.S. District Court — Eastern District of Virginia |
| Parties | Wintford C. BILLINGS, Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant. |
Wayne Lustig, T. Scott Carnes, Richard N. Shaprio, Guy, Cromwell, Betz & Lustig, P.C., Virginia Beach, Va., for plaintiff.
John G. Crandley, Preston, Wilson & Crandley, Virginia Beach, Va., for defendant.
AMENDED ORDER
This case comes before the Court on Motions by both parties for summary judgment. Plaintiff seeks to "stack" underinsurance coverages for three vehicles insured under a single policy issued by defendant. The parties have submitted motions and supporting memoranda and this Court has heard oral argument. Therefore, this matter is ripe for disposition.
Plaintiff, Wintford C. Billings, sustained significant injuries when his car was hit by an automobile driven negligently by Clarence Oliver. Mr. Oliver was covered by his own insurance policy, issued by Erie Insurance Group, with bodily injury liability limits of $25,000 per person and $50,000 per accident. Plaintiff was insured by defendant, State Farm, under one policy covering three vehicles including the one in which plaintiff was a passenger at the time of the accident. Plaintiff's policy included uninsured motorist coverage, applicable to each of the three vehicles, in the amounts of $50,000 per person and $100,000 per accident. Both parties agree that Mr. Oliver's vehicle is underinsured in that the bodily injury insurance coverage applicable to his vehicle is less than the uninsured motorist coverage afforded plaintiff. See Va. Code Ann. § 38.1-381 (currently codified as § 38.2-2206).
The primary issue in this case is whether plaintiff can stack or combine the three uninsured bodily injury limits on his three vehicles to obtain a total coverage of $150,000, less the coverage available from Mr. Oliver's policy. Plaintiff asserts that although his three vehicles were all included on a single policy, he was billed separately for each of the uninsured motorist coverages and thus is entitled to "stack" three bodily injury limits. Plaintiff relies on the definition of "underinsured" contained in the applicable Virginia Code section. Defendant contends that the clear and unambiguous language of the policy prohibits such stacking and thus, under Virginia case law, plaintiff is entitled only to underinsurance coverage based on the uninsured coverage applicable to the vehicle plaintiff occupied at the time of the accident. A subsidiary issue is the amount of liability coverage considered available to plaintiff under Mr. Oliver's policy and thus to be subtracted from the coverage provided by State Farm.
This Court has diversity jurisdiction over the present action pursuant to 28 U.S.C. § 1332. Virginia law is applicable in this case. The parties agree that the applicable statute is Virginia Code § 38.1-381 as it was the statute in effect at the time of the accident. The relevant portion of the statute reads as follows:
A motor vehicle is underinsured when, and to the extent that, the total amount of bodily injury and property damage coverage applicable to the operation or use of such vehicle ... is less than the total amount of uninsured motorist coverage afforded any person injured as a result of the operation or use of such vehicle.
Va. Code Ann. § 38.1-381(c) (currently codified as § 38.2-2206(B)).
Plaintiff argues that in construing the above statute, the word "total" is significant and is used to indicate that an injured party is entitled to look to more than one coverage in the context of underinsurance protection. Although no published Virginia Supreme Court cases have interpreted the statute, plaintiff points to two Virginia lower court cases as standing for the proposition that underinsurance coverages can be combined in situations analogous to the instant case. However, these cases are not sufficiently similar to the case at bar to govern the outcome here.
The first case cited by plaintiff, Herbecq v. Virginia Farm Bureau Ins. Co., (June 17, 1987, Spotsylvania County Circuit Court) involves a plaintiff, Herbecq, who had an accident while driving her step-daughter's vehicle. The vehicle had uninsured motorists coverage of $25,000 per person. Additionally, Herbecq was a member of her daughter's household and her daughter owned a vehicle with uninsured motorist coverage of $25,000 per person. The court stated that the limits of both policies must be considered in determining the total amount of uninsured motorist coverage available to Herbecq for underinsurance purposes.
In the second case relied on by plaintiff, Integrity Ins. Co. v. Turnage, (April 11, 1986, Henrico County Circuit Court), Turnage, the injured plaintiff, was driving a rental car at the time of her accident. The rental car had $25,000 of uninsured motorist insurance per person and the plaintiff's personal vehicle also had $25,000 of uninsured motorist insurance per person. The court held that both coverages were available to the plaintiff for purposes of determining her underinsurance status. Judge Spinella reasoned that because the statute talked about the "total amount of uninsured motorist coverage" the plaintiff was not restricted to the coverage on any one vehicle. See discussion of Turnage in Virginia Trial Lawyers Association Law Letter and Journal, March 1987.
The Herbecq and Turnage cases differ significantly from the instant case in that they deal with combining coverages provided in completely different policies and from different sources, while the case at bar involves coverages on three vehicles covered by a single policy which contains limiting language. Thus, the interpretation of the underinsurance statute evidenced in Herbecq and Turnage is not necessarily applicable to the facts of the instant case.
However, Virginia case law provides persuasive guidance on whether plaintiff can stack the underinsurance coverage for each of his three vehicles. A number of Virginia cases have dealt with the issue of combining uninsured motorist coverages. In two 1972 cases, the Virginia Supreme Court established the principle that stacking of uninsured motorist coverages is permissible absent clear and unambiguous policy language to the contrary. See Cunningham v. Ins. Co. of North America, 213 Va. 72, 189 S.E.2d 832 (1972); Lipscombe v. Security Ins., 213 Va. 81, 189 S.E.2d 320 (1972). See also, Sturdy v. Allied Mut. Ins. Co., 203 Kan. 783, 457 P.2d 34 (1969). In both Cunningham and Lipscombe, the court held that uninsured motorist coverage in a multi-vehicle policy was increased according to the number of vehicles insured. However, the court also adopted the Sturdy rationale which allows plain and unmistakable language in a policy to prevent stacking. Cunningham, 213 Va. at 79, 189 S.E.2d at 836-37; Lipscombe, 213 Va. at 84, 189 S.E.2d at 323.
These basic principles were reaffirmed by the court in a 1981 case, Goodville Mut. Casualty Co. v. Borror, 221 Va. 967, 275 S.E.2d 625 (1981). Goodville involved a declaratory judgment motion to determine whether the uninsured motorist coverages on two vehicles insured in a single policy could be stacked to provide two times the minimum coverage for a single accident. In Goodville, Mr. Borror was driving his employer's uninsured pickup truck when he was struck and killed by the vehicle operated by Mr. Rector, also apparently uninsured. Mr. Borror was the named insured on a policy issued by Goodville which covered two of his automobiles. Mr. Borror had been charged separate premiums for the liability coverage on each of his automobiles but a separate premium was not allocated for uninsured motorist coverage. Goodville, 221 Va. at 968, 275 S.E.2d at 626. Mr. Borror's widow sought to stack the two $25,000 uninsured motorist coverages contained in the Goodville policy in order to satisfy any judgment she received from a wrongful death suit she had filed in connection with her husband's death.
The Virginia Supreme Court restated the rule in Virginia that "stacking of uninsured motorist coverage will be permitted unless clear and unambiguous language exists on the face of the policy to prevent such multiple coverage." 221 Va. at 970, 275 S.E.2d at 627. The court went on to examine the specific language contained in the Goodville policy. Under the Uninsured Motorist section, the policy included the following language, quoted by the court in its opinion:
Id. at 970, 275 S.E.2d at 627. The court noted that this language had been held not to be ambiguous in some jurisdictions and ambiguous in others. However, the Virginia Supreme Court, in agreeing with the former interpretation, stated the following:
We conclude that the language of Goodville's policy, viz., "regardless of the number of ... motor vehicles to which this insurance applies," is clear and unambiguous and requires the construction that stacking is not permissible. With the foregoing language, the policy plainly limits Goodville's UM liability for damages to any one person as a result of any one accident to $25,000. The mere fact that two vehicles are insured and two separate premiums are charged is of no consequence in light of the express language of the policy.
Id. at 971, 275 S.E.2d at 628.
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