Farmers Ins. Exchange v. Stever, 92SC218

• Decision Date: 07 June 1993
• Docket Number: No. 92SC218,92SC218
• Citation: 854 P.2d 1230
• Parties: FARMERS INSURANCE EXCHANGE and Mid-Century Insurance Company, Petitioners, v. Tracy A. STEVER, Respondent.
• Court: Colorado Supreme Court

Page 1230

854 P.2d 1230

FARMERS INSURANCE EXCHANGE and Mid-Century Insurance Company, Petitioners, v. Tracy A. STEVER, Respondent.

No. 92SC218.

Supreme Court of Colorado En Banc.

June 7, 1993.

As Modified on Denial of Rehearing

July 6, 1993.

Hall & Evans, Eugene O. Daniels, Malcolm M. Mead, Denver, for petitioners.

Breit, Best, Richman and Bosch, P.C., Bradley A. Levin, John L. Breit, Denver, for respondent.

Wilcox & Ogden, P.C., Ralph Ogden, Denver, Kidneigh & Kaufman, P.C., Stephen C. Kaufman, Denver, for amicus curiae Colorado Trial Lawyers Assn.

Justice VOLLACK delivered the Opinion of the Court.

Petitioners, Farmers Insurance Exchange and Mid-Century Insurance Company (collectively referred to as "Farmers"), petition from the court of appeals opinion in Stever v. Farmers Insurance Exchange, No. 90CA2035 (Colo.App. Feb. 27, 1992), a decision not selected for publication. The court of appeals ruled that anti-stacking provisions contained in motor vehicle insurance policies providing underinsured motorist coverage were void as against public policy. We disagree, reverse the decision of the court of appeals, and remand for consideration of unresolved issues.

I.

Tracy Stever (Stever) was insured under three policies of automobile insurance issued by Farmers. Stever was the named insured in a policy of automobile insurance issued by Farmers which provided uninsured/underinsured motorist protection in the amount of $100,000 per person/$300,000 per accident. In addition, Stever was also insured under two automobile insurance policies issued by Farmers to Stever's mother and step-father, which each provided uninsured/underinsured motorist protection in the amount of either $25,000 per person/$50,000 per occurrence, or $100,000 per person/$300,000 per accident. ¹

On August 19, 1984, Stever was severely injured in a one-car automobile accident while riding as a passenger in an automobile driven by Mary Louise Light (Light). Light was insured under a policy of automobile insurance issued by Safeco Insurance Company (Safeco) to Light's father. The Safeco policy provided protection from liability for bodily injury suffered in an automobile accident in the amount of $50,000 per occurrence. Stever received $32,000 from Safeco as settlement for Stever's liability claims against Light. ²

Farmers agreed to pay Stever $68,000, which represented the difference between the maximum limit of uninsured/underinsured coverage available under any of the three Farmers policies ($100,000) and the $32,000 settlement with Safeco. Stever, however, contended that she was entitled to $100,000 in uninsured motorist protection under each of the three policies. In an effort to resolve this dispute, Stever and Farmers entered into a partial settlement and release in which Farmers paid the $68,000 to Stever on February 12, 1986, and agreed to pay an additional $20,000 on February 1, 1991, and $50,000 on February 1, 1996, in exchange for a release of Farmers in the amount of $100,000 under the underinsured motorist provisions of the three Farmers policies. Stever retained her right to initiate a declaratory judgment action under the partial settlement and release, and subsequently initiated such an action.

On March 1, 1990, Stever filed a motion for partial summary judgment claiming that, as a matter of law, she was entitled to receive $300,000 by stacking the full amount of underinsured motorist benefits available under each of the three policies issued by Farmers.

The district court disagreed and found that each of the policies contain identical "other insurance in the company" and "other insurance" provisions which unambiguously prohibit stacking of underinsured motorist coverages. ³ Further, the district court found that such anti-stacking provisions do not violate public policy.

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