Garris v. Cincinnati Ins. Co.
| Decision Date | 17 January 1984 |
| Docket Number | No. 22028,22028 |
| Citation | 280 S.C. 149,311 S.E.2d 723 |
| Court | South Carolina Supreme Court |
| Parties | Frances Y. GARRIS, Administratrix of the Estate of Thomas H. Garris, and Patty J. Huntley, Administratrix of the Estate of Roderick L. Huntley, Plaintiffs, v. The CINCINNATI INSURANCE COMPANY, Defendant. Frances Y. GARRIS, Administratrix of the Estate of Thomas H. Garris, and Patty J. Huntley, Administratrix of the Estate of Roderick L. Huntley, Plaintiffs, v. The STATE AUTOMOBILE MUTUAL INSURANCE COMPANY, Defendant. Frances Y. GARRIS, Administratrix of the Estate of Thomas H. Garris, and Patty J. Huntley, Administratrix of the Estate of Roderick L. Huntley, Plaintiffs, v. The ALLSTATE INSURANCE COMPANY, Defendant. |
C. Dexter Powers, Lawrence B. Orr, of Bridges, Bridges & Orr; and James C. McLeod, Jr., Florence, for defendants.
John P. Gardner, Jr., and Daniel B. Causey, III, Darlington, for plaintiffs.
Under the provisions of Rule 46 of the Rules of Practice of the South Carolina Supreme Court, the following questions have been certified to this Court by the United States District Court for the District of South Carolina:
1. What is the definition of underinsured motorists coverage as used in § 56-9-831 of the Code of Laws of South Carolina (1976)?
2. Does § 56-9-831 of the Code of Laws of South Carolina (1976) require that "basic limits" of underinsured motorist coverage of $15,000/30,000/5,000 be offered to all automobile policy holders as well as underinsured motorist coverage up to the limits of the insured's liability coverage?
3. If the statute requires the insurer to offer underinsured motorist coverage in the "basic limits" of $15,000/30,000/5,000, can such coverage on each of the vehicles insured under each Defendant's policy be stacked?
This district court action is a declaratory judgment action brought to determine whether underinsurance is available to the estates of Thomas H. Garris and Roderick Lee Huntley.
Mr. Huntley and Mr. Garris were killed in an automobile accident in Florence County on July 7, 1979. Mr. Huntley was driving a truck owned by Bryce Mechanical Contractors (Bryce) and Mr. Garris was a passenger in the truck. As Mr. Huntley approached a curve, a vehicle driven by David R. Turner, traveling at extremely high speed, crossed the center line and hit the truck. Mr. Turner had a blood alcohol level of .27%. The question of liability is clear.
Mr. Turner's vehicle was covered by a policy of liability insurance with the minimum coverage of $15,00/30,000/5,000 (15/30/5) which was issued by Allstate Insurance Company (Allstate). The damages in this case far exceed Mr. Turner's coverage.
The Bryce truck involved in the accident was insured by Cincinnati Insurance Company (Cincinnati) under a policy which provided coverage for seventeen vehicles. At the time of the accident, Mr. Garris owned a policy of liability insurance issued by Allstate which provided coverage for four vehicles, and Mr. Huntley owned a policy of liability insurance issued by State Automobile Mutual Insurance Company of Columbus, Ohio (State) which provided coverage for two vehicles.
QUESTION I:
What is the definition of underinsured motorist coverage as used in Section 56-9-831 of the Code of Laws of South Carolina (1976)?
Section 56-9-831 provides in pertinent part:
[Automobile insurance] carriers shall also offer, at the option of the insured, underinsured motorist coverage up to the limits of the insured liability coverage to provide coverage in the event that damages are sustained in excess of the liability limits carried by an at fault insured or underinsured motorist. (Emphasis added).
The purpose of construing a statute is to ascertain the intention of the legislature. See cases collected in 17 West's South Carolina Digest, Statutes, Key No. 181(1). Where the terms of a statute are clear and unambiguous, there is no room for construction and courts must apply them according to their literal meaning. Home Building & Loan Association v. City of Spartanburg, 185 S.C. 313, 194 S.E. 139 (1938). The language of the statute clearly indicates underinsured motorist coverage is optional coverage provided by an automobile insurance carrier for instances where damages are sustained by an insured in excess of the liability limits of the at fault driver.
Defendants Cincinnati, Allstate, and State, relying on an Interpretive Bulletin issued by the Department of Insurance, contend the coverage is limited to situations where the insured's underinsurance coverage is greater than the at fault motorist's liability coverage because the amount of the recovery from the insured's underinsurance coverage is offset by the amount of recovery from the at fault motorist.
An Interpretive Bulletin is not binding on the courts. Underinsured motorist coverage is controlled by and subject to our underinsured motorist act, and any insurance policy provisions inconsistent therewith are void, and the relevant statutory provisions prevail as if embodied in the policy. See Ferguson v. State Farm Mutual Automobile Ins. Co., 261 S.C. 96, 198 S.E.2d 522 (1973).
In Ferguson this Court held an insurance policy provision which allowed the amount paid under uninsured motorist coverage to be offset by amounts paid or payable under Workers' Compensation law illegal, contrary to public policy, and of no force and effect. This Court followed the general rule that an uninsured motorist endorsement providing for the reduction of workers' compensation benefits received by the insured was void or invalid and unenforceable on the ground that such provision reduced the effective coverage below that required by the statute and was contrary to public policy. While underinsured motorist coverage is not mandated by statute, we think it is contrary to public policy to offset the amount an insured can recover under his underinsured motorist coverage by the at fault motorist.
Accordingly, we hold underinsured motorist coverage is optional coverage provided by an insurance carrier in the event damages are sustained by the insured in excess of the at fault driver's liability coverage, recovery therefrom being additional to any recovery from the at fault motorist, total recovery not to exceed the amount received from the damages sustained.
QUESTION II:
Does Section 56-9-831 of the Code of Laws of South Carolina (1976) require that "basic limits" of underinsured motorist coverage of $15,000/30,000/5,000 be offered to all automobile policy holders as well as...
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