Elam v. Hartford Fire Insurance Co., 00-900

• Decision Date: 26 April 2001
• Docket Number: 00-900
• Citation: 42 S.W.3d 443
• Parties: CARLOS ELAM, APPELLANT, VS. HARTFORD FIRE INSURANCE COMPANY, APPELLEE.SUPREME COURT OF ARKANSAS 26 April 2001 APPEAL FROM THE FRANKLIN COUNTY CIRCUIT COURT, NORTHERN DISTRICT NO.JOHN S. PATTERSON, JUDGE, REVERSED AND REMANDED. JIM HANNAH, Associate Justice Appellants Carlos and Arbra Elam appeal the Franklin County Circuit Court's grant of summary judgment to Elam's employer's commercial automobile insurance carrier, Appellee Hartford Fire Insurance Company (Hartford), denying underinsured motorist insurance (UIM) coverage to Elam for injuries he sustained during his employment with Fred Dorwart d/b/a Mountain Ridge Farms. We reverse and remand. Facts On
• Court: Arkansas Supreme Court

CARLOS ELAM, APPELLANT VS HARTFORD FIRE INSURANCE COMPANY, APPELLEE

No. 00-900

SUPREME COURT OF ARKANSAS

26 April 2001

APPEAL FROM THE FRANKLIN COUNTY CIRCUIT COURT, NORTHERN DISTRICT NO. CIV-98-94, HON. JOHN S. PATTERSON, JUDGE, REVERSED AND REMANDED.

JIM HANNAH, Associate Justice

Appellants Carlos and Arbra Elam appeal the Franklin County Circuit Court's grant of summary judgment to Elam's employer's commercial automobile insurance carrier, Appellee Hartford Fire Insurance Company (Hartford), denying underinsured motorist insurance (UIM) coverage to Elam for injuries he sustained during his employment with Fred Dorwart d/b/a Mountain Ridge Farms. We reverse and remand.

Facts

On November 3, 1995, Carlos Elam, a now 63-year-old farm manager for Mountain Ridge Farms, was injured when he was struck by a trailer pulled by a truck as it was pulling away from Elam. According to Elam's various accounts of the incident, he was washing one of his employer's farm trucks when John Milam of Milam Heating and Air Conditioning Company drove up in his work truck and stopped to talk to Elam about installing some equipment on the farm. Milam remained in his truck while speaking with Elam, who was standing between Milam's truck and the farm truck. The trucks were close enough for Elam to touch both trucks at the same time. The men discussed the work to be done, and then, according to Elam, he turned back to the farm truck to continue washing it and Milam pulled away quickly. In doing so, Elam was hit by Milam's attached trailer that Elam did not see being pulled behind Milam's truck. However, as Hartford notes in its brief, Elam testified in his May 1999 deposition that he was actually reaching for the truck's door pull to get in when he was hit by Milam's trailer. Elam also argues in his brief that he was reaching for the door pull to get in the truck when he was hit.

Elam sustained injuries from the accident, and was treated by numerous doctors through his workers' compensation claim. While the doctors found that had sustained a work-related injury, he received differing disability ratings, one as high as 40 percent to the body as a whole, and one as low as 10 percent to the body as a whole. One of the treating physicians found him totally disabled from working, while another determined that with retraining, he could go back to some type of lighter work. Notably, all of the treating doctors found that, although not problematic before the injury, Elam suffered from spinal stenosis, or narrowing of the spine, and perhaps degenerative disc disease brought on by aging, which contributed to his post-injury back problems. He made a workers' compensation claim and received medical and indemnity benefits before settling his workers' compensation claim against Mountain Ridge Farms and its workers' compensation insurance carrier on January 29, 1997, for $30,000 plus an additional $5,987.60 for related expenses. The workers' compensation carrier, ITT Hartford Insurance Company (a different insurance division from Hartford, the appellee), also agreed to waive its subrogation rights. On December 10, 1997, Elam settled a third-party claim against Milam and his insurance carrier for $50,000, which represented the total available insurance from Milam, after providing the required notice to Hartford. Elam and his wife also settled a third-party claim under their own UIM policy with Southern Farm Bureau Casualty Insurance Company for $10,000 on April 23, 1998. Finally, Elam was found to be disabled by the Social Security Administration due to his injuries as he has been unable to work since the injury.

On November 2, 1998, Elam filed a complaint against his employer's farm vehicle insurance carrier, Hartford, requesting payment under the UIM policy, taking into account the $50,000 and $10,000 already paid by the other automobile policies. He also alleged that workers' compensation and social security benefits could not be offset because they were collateral resources. Hartford had $1,000,000 in available coverage under the policy. Hartford answered on November 24, 1998, and denied coverage under the UIM policy, claiming that the policy specifically excludes coverage to employees who also recover workers' compensation benefits.

On August 26, 1999, Hartford filed its first motion for summary judgment, arguing several points. First, Hartford asserted that Elam's claim was barred under the exclusive-remedy doctrine of Arkansas's Workers' Compensation Act. Hartford next argued that the workers' compensation statutes do not allow claims by employees against their employer's UIM policies. Hartford further argued that Elam's claims were not covered under the UIM policy. Finally, Hartford argued that there was no evidence of fault by Milam as required to recover under the UIM policy.

Elam responded by filing his first amended complaint on September 24, 1999, adding an additional claim of bad faith against Hartford. Elam also filed a motion to compel discovery on that date, arguing that Hartford had refused to provide copies of Elam's claim file and other requested documentation, claiming privilege in declining to produce those documents. Finally, also on September 24, 1999, Elam filed a motion for summary judgment and a response to Hartford's motion for summary judgment. In his motion, Elam countered Hartford's allegations in its motion. Elam argued that the Arkansas Workers' Compensation Act does not bar a claim for UIM coverage under an employer's policy where workers' compensation benefits have already been paid. Elam notes that the claim against the UIM carrier is not a claim against an "employer" as barred by the act. Elam also asserts that he fell within the policy requirements to be covered as an "occupier" of the farm truck because he was "using" the vehicle at the time of his injury. Elam also argued that evidence of Milam's negligence was overwhelming.

Hartford filed its answer to Elam's first amended complaint on September 30, 1999, again denying coverage under the policy. On October 11, 1999, Hartford filed a motion for summary judgment on Elam's first amended complaint, incorporating its previous motion for summary judgment and adding the additional arguments for summary judgment on the bad- faith claim. Hartford contended that Elam could not prevail on the bad-faith claim without any facts in support, and that Elam's motion for discovery to "discover" facts to support the bad-faith claim was not a proper use of discovery where there were no other facts other than denial of coverage to support the bad-faith claim. Hartford also filed a response to Elam's motion for discovery.

On October 13, 1999, Hartford responded to Elam's motion for summary judgment and on November 1, 1999, Elam responded to Hartford's motion for summary judgment on Elam's first amended complaint. On that same date, Elam filed his second amended complaint, apparently clarifying two terms of the first amended complaint regarding any good-faith denial of Elam's claim. Hartford again denied the allegations in the second amended complaint on November 4, 1999, and filed a motion for summary judgment on the second amended complaint that same day.

On February 4, 2000, the trial court heard oral arguments from the attorneys on the motions for summary judgment and the motion to compel discovery. On April 13, 2000, the trial court issued its order denying Elam's motion for summary judgment and granting Hartford's motion for summary judgment. The trial court did not include any discussion about the basis for its decision, and it did not rule on Elam's motion to compel discovery. Elam filed his notice of appeal on May 10, 2000.

Standard of Review

The parties filed opposing motions for summary judgment agreeing that there are no genuine issues of material fact remaining. As we have oft stated, summary judgment is to be granted by a trial court only when it is clear that there are no genuine issues of material fact to be litigated, and the party is entitled to judgment as a matter of law. Mashburn v. Meeker Sharkey Fin. Group, Inc., 339 Ark. 411, 5 S.W.3d 469 (1999). Once the moving party has established a prima facie entitlement to summary judgment, the opposing party must meet proof with proof and demonstrate the existence of a material issue of fact. The moving party is entitled to summary judgment if the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. Ark. R. Civ. P. 56; Estate of R. Donley v. Pace Indus., 336 Ark. 101, 984 S.W.2d 421 (1999). It is well settled that a trial court has wide discretion in matters pertaining to discovery, and thus we will reverse a trial court's ruling only when there has been an abuse of discretion. Wilson v. Neal, 332 Ark. 148, 964 S.W.2d 199 (1998); Parker v. Southern Farm Bureau Cas. Ins. Co., 326 Ark. 1073, 935 S.W.2d 556 (1996); Stein v. Lukas, 308 Ark. 74, 823 S.W.2d 832 (1992).

Elam argues five points on appeal. Elam first argues that the exclusive-remedy provision of the Arkansas Workers' Compensation Act, found at Ark. Code Ann. § 11-9-105(a) (Repl. 1996), does not bar his claim because he is not asserting a liability claim against his employer or workers' compensation insurance carrier as precluded under that statute, and case law from other jurisdictions that have faced this issue support allowing the UIM claim. Second, Elam argues that the Arkansas Workers' Compensation Act at Ark. Code Ann. § 11-9-410(B) (Repl. 1996), does not impliedly preclude UIM claims by an employee against his employer's UIM carrier. Next, Elam argues that his claims are covered under the UIM commercial automobile policy as specifically noted in the language of the policy and impliedly through the function of the policy. Elam also argues that there was...