Kemp v. Allstate Ins. Co.
| Decision Date | 24 August 1979 |
| Docket Number | No. 14386,14386 |
| Citation | 36 St.Rep. 1381,601 P.2d 20,183 Mont. 526 |
| Parties | Lucetta S. KEMP, Administratrix, Representative and Successor in Interest to Kim Karel Kemp, Deceased, Plaintiff and Respondent, v. ALLSTATE INSURANCE COMPANY, a corporation, and Mitchell A. Prim, Defendants and Appellants. |
| Court | Montana Supreme Court |
Henningsen, Purcell & Genzberger, P. C., Butte, Mark Vucurovich, argued and James E. Purcell, appeared, Butte, for defendants and appellants.
Poore Roth Robischon & Robinson, Butte, Urban Roth, argued and James P. Harrington, argued, Butte, for plaintiff and respondent.
Defendant Allstate Insurance Company appeals from a summary judgment entered in favor of the plaintiff in the District Court, Second Judicial District, Silver Bow County, applying Montana law to two insurance policies, one issued in New York and one issued in Vermont. The court "stacked" uninsured motorist coverages and construed other language in the policies to grant plaintiff a judgment of $200,000 against Allstate. Allstate contends that its liability under the policies is limited to $20,000.
On July 17, 1976, on Interstate 15, near the Montana Street Interchange in Butte, Montana, 19 year old Kim Karel Kemp was a passenger in a car which was struck from the rear by a vehicle operated by Mitchell A. Prim. Kemp was thrown from the automobile and sustained multiple injuries from which she died about an hour later.
The driver of the car in which Kim Kemp was a passenger, was a resident of Vermont, and the car was registered in Vermont. She had attended the University of Vermont for two years.
Kim Kemp's parents are residents of New York.
Mitchell A. Prim is a resident of Montana. It is conceded in this action that his negligence caused Kim Kemp's injuries. There is no doubt that Mitchell A. Prim was an uninsured motorist. Nevertheless, Kim Kemp's cause was in good hands. With Allstate as the issuing company, the vehicle in which Kim Kemp was a passenger was covered by an automobile insurance policy issued in Vermont, which policy included uninsured motorist coverage which Allstate concedes extended to Kemp. It also appears that Kim Kemp's parents, in New York, had a policy of insurance issued by Allstate. The Kemp policy covered family cars registered in New York. As with the Vermont policy, the New York policy contained uninsured motorist protection and Allstate again concedes this protection extended to Kim Kemp. In addition, the New York policy contained mandatory "no-fault" personal injury protection required under New York law.
The policy issued in Vermont to the driver of the car in which Kemp was a passenger covered two vehicles, for each of which separate premiums for uninsured motorist protection were paid. The policy issued in New York to Kemp's parents covered at least three vehicles, for each of which separate premiums for uninsured motorist protection (as well as for "no-fault" protection) had been assessed and paid.
At the time of the accident giving rise to this appeal, Montana's uninsured motorist statute required coverage in limits for bodily injury death of $25,000 for one person, on all policies issued in Montana, unless such coverage was rejected in writing by the insured. Section 40-4403, R.C.M.1947, now section 33-23-201 MCA. In New York and Vermont, however, the statutory amount was $10,000 for one person, and this figure was the limit stated in each of the policies involved here as to each vehicle covered. The limit of liability was $50,000 per person for no-fault coverage in the New York policy.
On December 29, 1976, a complaint was filed in the District Court, Silver Bow County, by the mother of Kim Karel Kemp, deceased, as administratrix, representative and successor in interest to the decedent, naming Allstate Insurance Company and Mitchell A. Prim as defendants, and stating claims in the nature of actions for wrongful death and survivorship. An amended complaint was later filed adding a claim for recovery under the "no-fault" provision of the New York policy.
On May 4, 1977, the District Court entered findings of fact, conclusions of law and judgment on behalf of the plaintiff against Mitchell A. Prim, upon evidence presented by the plaintiff in support of a default judgment. The judgment against Prim included $300,000, representing loss of future earnings and earning capacity, or in the words of the court, "extended economic loss in the sum of $300,000; general damages in the sum of $200,000; and punitive damages in the sum of $75,000 under section 93-2824, R.C.M.1947;" additionally, the District Court entered judgment against Prim under section 93-2810, R.C.M.1947, for the sum of $150,000, and for an additional punitive damages award in the sum of $75,000. The total judgment against Prim amounted to $800,000.
After the judgment against Prim was entered, plaintiff moved for summary judgment against Allstate on the issue of the amount of coverage Allstate was obligated to provide under the two policies. Plaintiffs motion requested the court to order that Montana law controlled; that the uninsured motorist coverages for all the vehicles in both policies could therefore be "stacked"; that the "no fault" coverage in the New York policy was applicable and could also be stacked for each of the three vehicles conceded to be included under the New York policy; and that therefore plaintiff was entitled to judgment in the sum of $200,000. The $200,000 figure breaks down as follows:
Vermont policy uninsured motorist coverage: 2 cars at $10,000 = $ 20,000
New York policy uninsured motorist coverage: 3 cars at $10,000 = $ 30,000
New York policy "no-fault" coverage: 3 cars at $50,000 = $150,000
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TOTAL = $200,000
On April 27, 1978, an order granting plaintiffs motion for summary judgment was entered by the District Court. It granted all the relief requested in plaintiff's motion for summary judgment and awarded plaintiff the sum of $200,000, plus costs of the action. From that order of summary judgment, Allstate has brought this appeal.
Implicit in the summary judgment is that the applicable amount of uninsured motorist coverage is the $10,000 figure provided in Vermont and New York rather than the $25,000 figure in the Montana statute. Plaintiff has not cross-appealed or otherwise raised any objection to the order. Plaintiff does contend in her brief on appeal, that "should the court decide that by operation of law, the uninsured limits are expanded to $25,000.00 per automobile, then the sum of $125,000.00 would be due . . ." In other words, plaintiff's ideal total recovery would be $275,000; five stacked uninsured motorist coverages of $25,000 and three stacked coverages of the $50,000 limit under the New York policy "no-fault" provision.
The threshold issue we must address is whether the District Court erred in applying Montana law to the policies rather than applying New York law and Vermont law respectively. We conclude that it did not as to the uninsured motorist coverage.
Allstate maintains that this case is controlled by the rule of Lex loci contractus. Accordingly, Allstate would have us apply Vermont law to the Vermont policy and New York law to the New York policy. Plaintiff, on the other hand, contends that Lex loci contractus is an archaic doctrine which has lost its usefulness and should no longer be adhered to. Plaintiff urges us to adopt the revisionist position of the Restatement (Second) of Conflict of Laws § 6, whereby choice of law questions are resolved by analyzing the "contracts" and applying the law of the state with the most significant relationship to the parties, the transaction or occurrence with regard to the issues in dispute.
Neither party has correctly interpreted the affect in this case of section 13-712, R.C.M.1947, now section 28-3-102 MCA, which provides:
"A contract is to be interpreted according to the law and usage of the place where it is to be performed; or, if it does not indicate a place of performance, according to the law and usage of the place where it is made."
That statute is not a declaration of the rule of Lex loci contractus, as Allstate maintains. Rather, it is a declaration that generally a contract is to be interpreted under the rule of Lex loci solutionis, the law of the place of performance. Under the statute, it is only when the contract does not indicate a place of performance that the interpretation would fall under the rule of Lex loci contractus. In this situation, we look to the contract to determine if there is a place of performance indicated; if there is, the law of the place of performance controls under our statute, and there is no need to determine the law of the place where the contract was made, nor to adopt the "grouping of contacts", or "the center of gravity" approach to determine the applicable law.
To determine the place of performance, we turn to the respective insurance contracts. Under the uninsured motorist coverage, the following language appears:
"Allstate will pay all sums which the insured or his legal representative Shall be legally entitled to recover as damages from the owner or operator of an uninsured automobile because of bodily injury . . . including death . . . sustained by the insured, caused by accident arising out of the ownership, maintenance or use, of such uninsured automobile . . . " (Emphasis added.)
The territory to which the uninsured motorist coverage applies is described thusly:
"This coverage applies only to accidents which occur on and after the effective date hereof, during the policy period, and outside the State of New York but within the United States of America, its territories or possessions, or Canada." (Emphasis added.)
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