Clark v. Scarpelli

• Decision Date: 11 April 2001
• Docket Number: No. 00-374., No. 00-206
• Citation: 744 NE 2d 719,91 Ohio St.3d 271
• Parties: CLARK, ADMR., APPELLANT, ET AL., v. SCARPELLI ET AL.; MID-CENTURY INSURANCE COMPANY, APPELLEE.
• Court: Ohio Supreme Court

91 Ohio St.3d 271

744 NE 2d 719

CLARK, ADMR., APPELLANT, ET AL., v. SCARPELLI ET AL.; MID-CENTURY INSURANCE COMPANY, APPELLEE.

Nos. 00--374.

Supreme Court of Ohio.

Submitted November 29, 2000.

Decided April 11, 2001.

Lamkin, Van Eman, Trimble, Beals & Rourke and Thomas W. Trimble; Crew, Buchanan & Lowe and Jeffrey A. Swillinger, for appellant.

Smith, Rolfes & Skavdahl Co., L.P.A., Matthew J. Smith and James P. Nolan II, for appellee.

Elk & Elk Co., L.P.A. and Todd O. Rosenberg, urging reversal for amicus curiae, Ohio Academy of Trial Lawyers.

DOUGLAS, J.

On October 16, 1996, Shane T. Parker died as a result of injuries sustained in a one-car collision in Montgomery County, Ohio. The automobile in which Shane was an occupant was owned by his mother, appellant, Cheryl Clark. At the time of the accident, appellant was insured through a policy of automobile liability insurance issued by appellee, Mid-Century Insurance Company. Appellant's policy with Mid-Century included an uninsured and underinsured motorist coverage provision with limits of $100,000 for each person and $300,000 for each occurrence.

On January 24, 1997, in the Court of Common Pleas of Montgomery County, appellant filed a cause of action individually and as administrator of her son's estate.¹ In the complaint, appellant sought wrongful death damages pursuant to R.C. Chapter 2125 on behalf of herself and other statutory wrongful death beneficiaries. The complaint also included a survival claim on behalf of Shane's estate and a declaratory judgment action against appellee seeking underinsured motorist benefits.

On December 23, 1998, the trial court entered its decision granting in part and denying in part appellee's motion for summary judgment. The trial court found that reasonable minds could only conclude that James Scarpelli, the alleged tortfeasor, was the driver of the vehicle at the time of the accident. The tortfeasor's liability carrier subsequently settled with appellant for the $100,000 per person limit and appellant dismissed all claims against tortfeasor Scarpelli. Relevant to the matters before this court, the trial court held that appellant and the other wrongful death beneficiaries were not entitled to underinsured motorist benefits because a provision of the Mid-Century policy unambiguously reduced all claims arising out of the death of one person to the single, "each person" policy limit of $100,000. The trial court therefore held that since the each-person policy limit of the Mid-Century policy matched the per-person limit of the tortfeasor's automobile liability policy, underinsured motorist benefits were not available.

Appellant appealed the trial court's judgment to the Montgomery County Court of Appeals. The court of appeals primarily focused on two specific issues raised by the parties. The first issue concerned the parties' conflicting interpretations of the setoff language in R.C. 3937.18(A)(2), specifically the meaning of the "amounts available for payment" language set forth in the statute. Before the court of appeals, appellant argued that the phrase "amounts available for payment" means the amount "actually available" for payment from the tortfeasor. In contrast, appellee contended that the phrase requires a policy-limit-to-policylimit comparison and if the tortfeasor's liability limits are the same as the underinsured motorist coverage limits, then no recovery is available. The second issue involved whether the language of the Mid-Century policy purporting to limit all wrongful death beneficiary claims to the single each-person limit is unambiguous and thus valid or ambiguous and thus invalid.

In regard to the first issue, the court of appeals decided in favor of appellant and held, in effect, that if the actual amount available under the tortfeasor's liability policy to each insured is less than the Mid-Century underinsured motorist coverage limit, the insureds should recover the difference up to the total of the appropriate limit of coverage. The court of appeals noted that comparing the amount actually received from the tortfeasor with the limits of the insureds' underinsured motorist coverage, instead of a limits-to-limits comparison, is "the only interpretation of R.C. 3937.18(A)(2) which comports with statutory public policy." On the second question, the court of appeals considered whether each wrongful death beneficiary was entitled to recover for his or her individual claims under the separate, each-person limit of the Mid-Century policy up to the maximum $300,000 each-occurrence limit, or whether all claims were restricted to the $100,000 each person limit. An aggregate total of $100,000 had been received and distributed among the four wrongful death beneficiaries, each receiving less than the each-person underinsured motorist coverage limit. In resolving this issue, the court of appeals found that the language of the Mid-Century policy clearly and unambiguously restricted all wrongful death claims to the single each-person limit. Thus, the amount recovered from the tortfeasor's liability carrier, $100,000, was set off against the each-person limit of underinsured motorist coverage of the Mid-Century policy, $100,000, thereby precluding Shane's wrongful death beneficiaries access to underinsured motorist benefits.

Thereafter, appellant filed a motion requesting the court of appeals to certify its decision as in conflict with the Fifth District Court of Appeals' decision in Farmers Ins. of Columbus, Inc. v. Atkinson (Oct. 29, 1992), Stark App. No. C8931, unreported, 1992 WL 318886. The court of appeals agreed and entered an order certifying a conflict.

This cause is now before this court upon our determination that a conflict exists (case No. 00-374) and upon the allowance of a discretionary appeal (case No. 00-206).

On October 20, 1994, the General Assembly enacted Am.Sub.S.B. No. 20 ("S.B. 20"), which effectuated changes to R.C. 3937.18, that section of the Revised Code providing for the mandatory offering of uninsured and underinsured motorist coverage. 145 Ohio Laws, Part I, 204, 240. R.C. 3937.18(A)(2), as amended by S.B. 20, provided²:

"Underinsured motorist coverage, which shall be in an amount of coverage equivalent to the automobile liability or motor vehicle liability coverage and shall provide protection for an insured against loss for bodily injury, sickness, or disease, including death, suffered by any person insured under the policy, where the limits of coverage available for payment to the insured under all bodily injury liability bonds and insurance policies covering persons liable to the insured are less than the limits for the insured's uninsured motorist coverage. Underinsured motorist coverage is not and shall not be excess insurance to other applicable liability coverages, and shall be provided only to afford the insured an amount of protection not greater than that which would be available under the insured's uninsured motorist coverage if the person or persons liable were uninsured at the time of the accident. The policy limits of the underinsured motorist coverage shall be reduced by those amounts available for payment under all applicable bodily injury liability bonds and insurance policies covering persons liable to the insured." (Emphasis added.) 145 Ohio Laws, Part I, 210-211.

The first issue that we must address involves the practical application of the setoff provision regarding underinsured motorist coverage in R.C. 3937.18(A)(2). This setoff provision was amended by S.B. 20 to provide that "[t]he policy limits of the underinsured motorist coverage shall be reduced by those amounts available for payment under all applicable bodily injury liability bonds and insurance policies covering persons liable to the insured." Our consideration of this matter will focus specifically on the "amounts available for payment" language of the statute.

We begin, as we do in all cases involving statutory construction, by ascertaining the intent of the General Assembly in enacting a statute and giving effect to that intent. Cochrel v. Robinson (1925), 113 Ohio St. 526, 149 N.E. 871, paragraph four of the syllabus. "If the meaning of the statute is unambiguous and definite, it must be applied as written and no further interpretation is necessary." State ex rel. Savarese v. Buckeye Local School Dist. Bd. of Edn. (1996), 74 Ohio St.3d 543, 545, 660 N.E.2d 463, 465. In order to determine the intent of the General Assembly in enacting legislation the court must give effect to the words used in the statute. Bernardini v. Conneaut Area City School Dist. Bd. of Edn. (1979), 58 Ohio St.2d 1, 4, 12 O.O.3d 1, 3, 387 N.E.2d 1222, 1224. However, where the words of the statute are ambiguous, a court is charged with construing the language in a manner that reflects the intent of the General Assembly. Cochrel, 113 Ohio St. 526, 149 N.E. 871, paragraph four of the syllabus.

A statute is ambiguous when its language is subject to more than one reasonable interpretation. State v. Jordan (2000), 89 Ohio St.3d 488, 492, 733 N.E.2d 601, 605. Initially, we note that the phrase "amounts available for payment" is not defined in R.C. 3937.18. Since the enactment of S.B. 20 on October 20, 1994, much confusion has surrounded R.C. 3937.18. Predictably, and perhaps unavoidably, the General Assembly's promulgation of S.B. 20 has spawned an increasing amount of litigation involving uninsured and underinsured motorist coverage. The changes to R.C. 3937.18(A)(2) brought about by S.B. 20 have resulted in conflicting interpretations by various trial and appellate courts throughout Ohio, leading to a state of uncertainty among insurers and insureds concerning underinsured motorist coverage. Here, the statutory language at issue is susceptible of at least two conflicting interpretations. The arguments raised in this matter are a testament to the resultant confusion surrounding the statutory language. Thus, we must...