Lang v. Nationwide Mut. Fire Ins. Co.

• Decision Date: 05 May 1998
• Docket Number: No. 72735,72735
• Parties: Raymond LANG and Rosemary Lang, Appellants, v. NATIONWIDE MUTUAL FIRE INSURANCE COMPANY, Respondents.
• Court: Missouri Court of Appeals

Page 828

970 S.W.2d 828

Raymond LANG and Rosemary Lang, Appellants, v. NATIONWIDE MUTUAL FIRE INSURANCE COMPANY, Respondents.

No. 72735.

Missouri Court of Appeals,

Eastern District,

Division Three.

May 5, 1998.

Motion for Rehearing and/or Transfer to

Supreme Court Denied July 8, 1998.

William R. Hirsch, Mark D. Hirschfeld, Clayton, for appellants.

Russell F. Watters, T. Michael Ward, St. Louis, for respondents.

AHRENS, Presiding Judge.

Raymond and Rosemary Lang ("the Langs"), appeal from the trial court's grant of summary judgment in favor of Nationwide Mutual Fire Insurance Company ("Nationwide"). The Langs contend the trial court erred in denying their claims for underinsured motorist benefits for the death of their son, Martin Lang, under a policy issued to the Langs by Nationwide. The trial court ruled that Nationwide owed the Langs no obligation under Endorsement 2355, which affords the Langs no more than $100,000 in underinsured motorist coverage and prohibits stacking the underinsured motorist coverage on each of the covered vehicles. We affirm.

The facts are undisputed. Martin Lang sustained fatal injuries as a result of an automobile collision involving tortfeasors Brian McKee and Earl Christine. Martin Lang was standing on a street corner in the City of St. Louis, when McKee's and Christine's vehicles collided nearby. McKee's automobile spun out of control and struck Martin Lang. The parties stipulated that the joint and concurrent negligence of McKee and Christine caused the death of Martin Lang. McKee had automobile liability insurance coverage in the amount of $100,000. Christine possessed automobile liability insurance coverage in the amount of $50,000.

The Langs owned three motor vehicles, each insured by Nationwide. The policy provided underinsured motorist coverage and uninsured motorist coverage in the amount of $100,000 per person and $300,000 per occurrence. The Langs paid separate premiums for underinsured motorist coverage for each of their three vehicles in accordance with the policy declaration page.

The Langs filed a petition for damages for the wrongful death of their adult son, including claims against tortfeasors McKee and Christine, and against Nationwide under the underinsured motorist coverage provisions. The Langs settled with McKee and Christine for payment of the tortfeasors' policy limits, totaling $150,000.

Nationwide filed a motion for summary judgment, asserting that based upon the undisputed facts and the subject insurance policy, there could be no available recovery under the underinsured motorist coverage provisions. The trial court sustained Nationwide's motion for summary judgment. The Langs appealed.

On appeal, this Court reviews the entire record in the light most favorable to the Langs, the parties against whom summary judgment was entered. ITT Commercial Finance Corp. v. Mid-America Marine Supply Corp., 854 S.W.2d 371, 376 (Mo. banc 1993). Summary judgment is frequently used in the context of insurance coverage questions. The interpretation of an insurance contract is a question of law. Krombach v. Mayflower Ins. Co. Ltd., 785 S.W.2d 728, 731 (Mo.App.1990). Summary judgment is particularly appropriate if the issue to be resolved is construction of a contract that is unambiguous on its face. Daniels Express and Transfer Co. v. GMI Corp., 897 S.W.2d 90, 91-92 (Mo.App.1995).

The language used in an insurance contract must be given its plain meaning. Robin v. Blue Cross Hospital Service, Inc., 637 S.W.2d 695, 698 (Mo. banc 1982). An insurance policy is ambiguous where there is duplicity, indistinctness, or uncertainty in the meaning of words used in the contract. Krombach v. Mayflower Ins. Co., Ltd., 827 S.W.2d 208, 210 (Mo. banc 1992). Absent an ambiguity, an insurance policy must be enforced according to its terms. Robin, 637 S.W.2d at 698. A court may not use its inventive powers to create an ambiguity where none exists or rewrite a policy to provide coverage for which the parties never contracted, absent a statute or public policy requiring coverage. Rodriguez v. General Acc. Ins. Co. of America, 808 S.W.2d 379, 382 (Mo. banc 1991). The fact that the parties disagree over the interpretation of a term in an insurance policy does not render the term ambiguous. Sanders v. Wallace, 884 S.W.2d 300, 302 (Mo.App.1994).

The subject policy contains a per person limit for underinsured motorist coverage in the amount of $100,000, as stated in the

policy declarations. The "Limits of Payment" section in Endorsement 2355 to Lang's policy sets out the amounts payable for underinsured motorist losses in relevant part as follows:

LIMITS OF PAYMENT

We agree to pay losses up to the amounts stated in the Declarations. The following applies to these limits:

1. The bodily injury limit shown for any one person is for all legal damages, including all derivative claims, claimed by anyone arising out of and due to bodily injury to one person as a result of one occurrence.

The per-person limit is the total amount available when one person sustains bodily injury, including death, as a result of one occurrence. No separate limits are available to anyone for derivative claims, statutory claims or any other claims made by anyone arising out of bodily injury, including death, to one person as a result of one occurrence. (emphasis in original).

Subject to this per-person limit, the total limit of our liability shown for each occurrence is the total amount available when two or more persons sustain bodily injury, including death, as a result of one occurrence. No separate limits are available to anyone for derivative claims, statutory claims or any other claims arising out of bodily injury, including death, to two or more persons as a result of one occurrence.

2. Coverage applies as stated in the Declarations. The insuring of more than one person or vehicle under this policy does not increase our Underinsured Motorists payment limits. In no event will any insured be entitled to more than the highest limit applicable under any policy issued by us.

3. The limits or damages payable under this coverage, whichever are less, shall be reduced by:

(a) any amount paid by or for any liable parties, including amounts paid or payable under the Bodily Injury Liability coverage of this policy.

* * *

The Nationwide underinsured motorist policy also contained the following "other insurance" clause which provided, in relevant part:

OTHER INSURANCE

If there is other insurance:

1. For bodily injury suffered by an insured while occupying a motor vehicle you do not own, we will pay the insurance loss not covered by other insurance. However, this insurance will apply only in the amount by which the limited liability for this coverage exceeds the applicable limit of liability of the other insurance.

2. Except as stated above, if there is other insurance similar to this coverage under any other policy, we will be liable for only our share of the loss. Our share is our proportion of the total insurance limits for the loss.

3. In any event, if more than one policy applies, total limits applicable will be considered not to exceed the highest limits amount of any one of them.

Nationwide contends it owed no obligation to pay underinsured motorist benefits to the Langs under Endorsement 2355 because the sums paid in the amount of $150,000 by the tortfeasors for the bodily injuries to a single person (Martin Lang) which arose out of a single occurrence (the automobile collision) exceeded the $100,000 per person limit of underinsured motorist coverage under the policy. The Langs disagree, contesting this analysis with four arguments.

The Langs first contend a conflict between the "Other Insurance" provisions and the "setoff" clause in paragraph three of the "Limits of Payment" section creates an ambiguity, that should be construed to favor coverage under the formula provided in the "Other Insurance" provisions. Specifically, paragraph two of the "Other Insurance" provisions reads, "[e]xcept as stated above, if there is other insurance similar to this coverage under any other policy, we will be liable for only our share of the loss. Our share is our proportion of the total insurance limits for the loss." The Langs argue that paragraph two is applicable in the instant case because the tortfeasors had other insurance. The Langs rely primarily on Zemelman v. Equity Mut. Ins. Co., 935 S.W.2d 673 (Mo.App.1996). If applicable, the Langs argue the only reference to policy limits in the "Other Insurance" provisions states, "if more than one policy applies, total limits applicable will be considered not to exceed the highest limits amount of any one of them." Therefore, the Langs claim they are entitled to actual damages arising from the loss. We disagree.

The instant case is distinguishable from Zemelman. The Zemelman policy described the underinsured motorist coverage as "excess over any other collectible insurance." Zemelman, 935 S.W.2d at 675 (emphasis added). The applicable portion of Endorsement 2355 does not contain similar language. The Western District found in Zemelman that the policy's other insurance provisions could "reasonably be interpreted to provide underinsured coverage as excess to amounts recovered from the tort-feasor." Id. at 677. The applicable portion of Endorsement 2355 does not mention "excess over any collectible insurance." Instead, Endorsement 2355 limits its underinsured motorist coverage to a relative "proportion" of the available limits compared with "other insurance similar to this coverage" and restricts its underinsured motorist coverage from exceeding the highest limits contained in any other policy. We find no ambiguity in or conflict between the "other insurance" provision and the "setoff clause" in this case.

In addition, paragraph two of the "Other Insurance" provisions does not apply to the Langs' situation. The critical language of paragraph two requires the "other...