Carpenter v. Hartford Fire Ins. Co.
| Decision Date | 07 January 2014 |
| Docket Number | No. CA 12–607 ML.,CA 12–607 ML. |
| Citation | 990 F.Supp.2d 180 |
| Parties | Kimberly CARPENTER, et al. v. HARTFORD FIRE INSURANCE COMPANY. |
| Court | U.S. District Court — District of Rhode Island |
OPINION TEXT STARTS HERE
Amato A. Deluca, Jeffrey A. Mega, Miriam Weizenbaum, Deluca & Weizenbaum, Ltd., Providence, RI, for Kimberly Carpenter, et al.
C. Russell Bengtson, Bengtson & Jestings, LLP, Providence, RI, for Hartford Fire Insurance Company.
This matter is before the Court on Plaintiffs' Objections to the Report and Recommendation issued by Magistrate Judge Sullivan on December 10, 2013 (Docket # 23). The Court has reviewed the Report and Recommendation and considered Plaintiff's objections, as well as Defendants' response to Plaintiff's objections.
While this Court agrees that the dispositive issue presented in this case is one of first impression, the Court finds that the Magistrate Judge's legal conclusions are fully supported by pertinent Rhode Island statutes and case law. Where, as here, the material facts 1 are not in dispute and the intent of the contracting parties is clear, the Court must refrain from reforming the agreement between Hartford and its insured.
The Court, therefore, adopts the Report and Recommendation in its entirety. Plaintiffs' Motion for Partial Summary Judgment (Docket # 11) is DENIED. Defendant's Motion for Summary Judgment is GRANTED. The Clerk is directed to enter judgment in favor of Defendant.
SO ORDERED.
Plaintiff Kimberly Carpenter, her husband and two children (collectively “Plaintiffs”) seek full compensation for the catastrophic injuries Mrs. Carpenter suffered in an automobile crash caused by an underinsured motorist while she was driving a car leased and insured by her employer, Quintiles Transnational Corp. (“Quintiles”). Having settled with the underinsured tortfeasors for the full amount of available coverage, Plaintiffs now seek underinsured motorist (“UIM”) coverage from Defendant Hartford Fire Insurance Company (“Hartford”), the issuer of Quintiles' liability insurance policy. Hartford has proffered payment of $75,000, the applicable UIM statutory minimum, which it contends is the limit of the UIM coverage that Quintiles purchased. Plaintiffs rejected this proffer based on their legal argument that, because Quintiles did not properly select minimal UIM coverage, by operation of law, Hartford is on the hook for the full UIM default limit, which must equal the bodily injury liability limit of $2 million under the Quintiles policy.
Before me for report and recommendation are the parties' cross-motions for summary judgment.1 ECF Nos. 11, 15.
Plaintiffs focus on the unambiguous requirement in the Rhode Island statute that compels the insurer to have its insured make the selection of less than the full limit of UIM coverage in writing. They ask this Court to hold that, despite the undisputed evidence of Quintiles' intent to purchase the lowest limit permissible ($75,000), Hartford's failure to procure a correct selection form—instead accepting one that mistakenly selected an option (no UIM coverage) prohibited by Rhode Island law—voided the selection so the policy reverts to the default coverage limit of $2 million. They also argue that Hartford failed to give timely notice to Quintiles of its UIM options.
Hartford counters that Quintiles' clearly expressed its intent to purchase the minimum UIM limit permissible under Rhode Island law, that Hartford properly interpreted its intent despite an error on the selection form and that there was a meeting of the minds between insurer and insured regarding the meaning of Quintiles' written selection. Accordingly, Hartford contends, its issuance of an endorsement providing for the minimum limit of UIM coverage ($75,000) is enforceable under Rhode Island law. Hartford further argues that its allegedly belated submission of the UIM notice after the effective date of the policy is legally immaterial.
The First Circuit has recently addressed a district judge's attempt to interpret the Rhode Island UIM coverage statute regarding the timing of the UIM claim, a topic on which there was a dearth of controlling precedent; it held that the better course for resolving such a question that implicates important state policy considerations is to certify it to the Rhode Island Supreme Court. See Am. States Ins. Co. v. LaFlam, 672 F.3d 38 (1st Cir.2012) (certified question answered, 69 A.3d 831 (R.I.2013)). While such an option is tempting for this case, with the comprehensive explication of the operative public policy considerations set out in the Supreme Court's answer to the certified question in LaFlam, I conclude that Rhode Island decisions, supplemented by guidance from “persuasive adjudications by courts of sister states [and] learned treatises,” provides more than adequate guidance to permit this Court to make an informed prophecy of what the Rhode Island Supreme Court would do if facing the same question. Blinzler v. Marriott Int'l, Inc., 81 F.3d 1148, 1151 (1st Cir.1996); Henry v. Sheffield, 856 F.Supp.2d 345, 350 (D.R.I.2012). Accordingly, based on the following analysis, I recommend that Plaintiffs' Motion for Partial Summary Judgment (ECF No. 11) be denied and Hartford's Motion for Summary Judgment be granted (ECF No. 15).
I. FACTS2
On August 22, 2007, while driving a company-leased car in connection with her work for Quintiles, Mrs. Carpenter was side-swiped by a driver negligently operating a vehicle owned by Willow Tree Landscaping, Inc. ECF No. 17 ¶ 14. Plaintiffs sued Willow Tree and the driver; the suit settled for $500,000, the maximum limits of Willow Tree's liability policy. Id. ¶ 15. Plaintiffs then turned to Hartford for additional compensation under the UIM coverage provided by Quintiles' liability policy. Id. ¶ 16. Hartford offered $75,000, which it maintains is the policy limit for Quintiles' UIM coverage. The parties do not dispute that the Willow Tree settlement, combined with the $75,000 offered by Hartford, is less than the full amount of Plaintiffs' damages potentially compensable under Hartford's UIM coverage.3
Mrs. Carpenter's employer, Quintiles, is a large multi-national biotech and pharmaceutical company that leases and owns vehicles throughout the United States. The undisputed evidence establishes that Quintiles enlisted Aon Risk Services of Pennsylvania (“Aon”) to serve as its insurance broker in connection with the renewal of its primary casualty and umbrella/excess casualty insurance for Quintiles' domestic operations, including those in Rhode Island. ECF No. 16–1 at 2, 6; ECF No. 16–3 ¶¶ 4, 6. Aon and Quintiles prepared, and Aon, acting for Quintiles, submitted to Hartford, a “Primary/Excess Casualty Submission” (the “Policy Submission”) that outlined Quintiles' needs and preferences for insurance coverage throughout the United States for the policy period from April 1, 2007, through April 1, 2008.4 ECF No. 13 ¶ 8; ECF No. 16–3 ¶¶ 4–5. The purpose of the Submission was to get “an insurance quote for Quintiles insurance program, including uninsured motorist bodily injury coverage;” qualified insurance carriers were asked to submit quotes by March 14, 2007. ECF No. 16–1 at 6; ECF No. 16–3 ¶ 5.
The Policy Submission indicates that Quintiles wanted $2 million of “Liability–Combined Single Limit” coverage for its business automobile liability insurance. ECF No. 16–2 at 12. The Submission also clearly and unambiguously expresses Quintiles' intent that, consistent with applicable law in each state in which it did business, it wanted minimal UIM coverage:
Uninsured/Underinsured Motorists Coverage: For all states, where permitted to do so, the insured has elected to reject uninsured and/or underinsured motorists coverage. In those states where the rejection of coverage is not permitted, the lowest permissible coverage limits apply.
ECF No. 16–2 at 15 (emphasis in original); see also id. at 12.
On April 3, 2007, a month before the policy issued, but two days after its effective date, Hartford presented its responsive proposal regarding the Quintiles insurance program. ECF No. 22–1. With respect to UIM coverage, the proposal offered coverage of $2 million, the same as the limit for automobile liability. It also included a blank waiver form entitled “Supplemental Application–Uninsured Motorists Coverage–Medical Payments Coverage–Your Choices in Rhode Island” (the “Supplemental Application”).5 ECF 22–1 at 5–8; ECF No. 22 at 3–4. This form accurately notified Quintiles of its options regarding the selection of a lower limit for UIM coverage 6 under Rhode Island law; it includes Hartford's recommendation that Quintiles opt for UIM coverage at the same limit as its liability coverage ($2 million). ECF No. 22–1 at 5. It also included check-boxes for Quintiles to select a lower limit or, if permitted by law, to completely reject UIM coverage, and a blank for a signature from an authorized Quintiles representative to make the selection. Id. at 7–8. Finally, it included standard language from the Rhode Island Department of Business Regulation informing Quintiles of its right to reject under certain circumstances or to select reduced UIM coverage in Rhode Island, including the dangers inherent in doing so. Id. at 7.
On May 3, 2007, Hartford issued the Quintiles insurance policy, setting the premium at $467,325, with bodily injury liability coverage for business automobiles of $2 million. ECF No. 13 ¶ 6, 10; ECF No. 14 at 2. With respect to UIM coverage, the policy refers to a to-be-issued endorsement (Form HA2102). ECF No. 14 at 3. On May 22, 2007, Aon sent to Quintiles copies of Hartford's Supplemental Application waiver forms for all states, this time with a sample prepared by Aon that reflected Quintiles' intent as expressed in the Policy Submission to either reject UIM coverage outright or to select minimal UIM coverage consistent...
To continue reading
Request your trial
-
Vittorioso v. ACE Am. Ins. Co.
...80.)ACE strongly disagrees that the Court is bound by Aramark's Coverage Selection Form. Relying heavily on Carpenter v. Hartford Fire Ins. Co. , 990 F.Supp.2d 180 (D.R.I.2014), it argues that the R&R should have overlooked the Form and deferred to Aramark's intent, which was to purchase th......