Maso v. Farmers Ins. Co.

• Citation: 158 F.Supp.3d 793
• Decision Date: 27 January 2016
• Docket Number: Case No. 4:14-CV-1885-CEJ
• Parties: Joseph A. Maso and Jeannie Maso, Plaintiffs, v. Farmers Insurance Company, Inc., Defendant.
• Court: U.S. District Court — Eastern District of Missouri

158 F.Supp.3d 793

Joseph A. Maso and Jeannie Maso, Plaintiffs,

v.Farmers Insurance Company, Inc., Defendant.

Case No. 4:14-CV-1885-CEJ

United States District Court, E.D. Missouri, Eastern Division.

Signed January 27, 2016

Morry S. Cole, Gray and Ritter, P.C., St. Louis, MO, for Plaintiffs.

Russell F. Watters, Brown and James, P.C., Cynthia M. Juedemann, Armstrong Teasdale, LLP, St. Louis, MO, Scott D. Hofer, James P. Maloney, Foland and Wickens, P.C., Kansas City, MO, for Defendant.

MEMORANDUM AND ORDER

CAROL E. JACKSON

, UNITED STATES DISTRICT JUDGE

This matter is before the Court on the parties' cross-motions for summary judgment, pursuant to Fed. R. Civ. P. 56(a)

. Also before the Court is plaintiffs' renewed motion for leave to file an amended complaint. The issues are fully briefed.

I. Background

Plaintiff Joseph Maso was riding a motorcycle in St. Charles County, Missouri on July 24, 2014, when he crashed into a car driven by Supaporn Buske. Maso was injured in the crash, and he claimed losses in excess of $600,000. At the time of the accident the motorcycle was covered by a policy of insurance issued by defendant Farmers Insurance Company, Inc. Buske's insurer tendered its policy limit of $50,000.

Plaintiffs then filed a claim with defendant, invoking the motorcycle policy's provision for underinsured motorist (UIM) coverage. Defendant tendered the motorcycle policy's UIM limit of $100,000, which Maso and his wife Jeannie Maso accepted.

Plaintiffs have two additional insurance policies with defendant. One offers primary coverage for a 2007 Chevrolet Cobalt. The other offers primary coverage for a 2002 Chevrolet Monte Carlo and a 2009 Chevrolet Malibu. Like the motorcycle policy, each automobile policy provides per-person-per-occurrence coverage up to $100,000.

In their initial complaint, plaintiffs claimed that they were entitled to $200,000 in additional coverage for the accident, pursuant to the automobile policies' UIM provisions. According to the plaintiffs, the automobile policies provide UIM coverage for accidents involving the motorcycle when an insured under the automobile policies (here, Maso) is injured by a UIM. As plaintiffs read the motorcycle and automobile policies, the UIM coverage in each policy “stacks”¹ (i.e. , “inter-policy” stacking), such that defendant is liable up to the UIM limit of each policy, $300,000 in total, of which only $100,000 has been paid. Defendant filed a counterclaim seeking a declaration that its payment of the $100,000 UIM claim on the motorcycle policy satisfies in full its obligation to plaintiffs.

Plaintiffs then moved for leave to file an amended complaint. Each of the motorcycle and automobile policies provide up to $100,000 in uninsured motorist (UM) coverage. In the proposed first amended complaint, plaintiffs sought to add new claims that they were entitled to an additional $300,000 in UM coverage. In plaintiffs' view, the UM provisions in each policy are subject to inter-policy stacking, just as the UIM provisions. Moreover, plaintiffs contended that the UM and UIM provisions in each policy are subject to “intra-policy” stacking, such that plaintiffs have both a UM and a UIM claim on each policy. Accordingly, they sought UIM and UM coverage under all three policies, for a total obligation of $600,000.

At the time plaintiffs filed the motion for leave to amend, none of the policies were attached to the complaint. The Court denied leave to amend, holding that under Missouri's definition of a UM, plaintiffs' theory that Buske was a UIM (and had insurance for more than the statutory minimum amount) foreclosed a claim that she was simultaneously a UM. See Mo. Rev. Stat. § 379.203

(citing Mo. Rev. Stat. § 303.030 ); Geneser v. State Farm Mut. Auto. Ins. Co. , 787 S.W.2d 288, 291 (Mo.Ct.App.1989) (clarifying Cook v. Pedigo , 714 S.W.2d 949, 952 (Mo.Ct.App.1986) ).

Plaintiffs have now filed the instant renewed motion for leave to amend, to which they attached the motorcycle policy.² As a matter of contract interpretation, they argue, the motorcycle and automobile policies each define a UIM as a UM, such that UIM and UM intra-policy stacked coverage is possible, and applies here. All of the policies also permit inter-policy stacked UIM and UM coverage, according to plaintiffs. Alternatively, they contend any ambiguity on either question must be resolved in favor of coverage.

II. Legal Standard

Rule 56(a) of the Federal Rules of Civil Procedure

provides that summary judgment shall be entered if the moving party shows “that there is no genuine dispute as to any material fact and the movant is entitled to a judgment as a matter of law.” In ruling on a motion for summary judgment the court is required to view the facts in the light most favorable to the non-moving party and must give that party the benefit of all reasonable inferences to be drawn from the underlying facts.AgriStor Leasing v. Farrow , 826 F.2d 732, 734 (8th Cir.1987). The moving party bears the burden of showing both the absence of a genuine issue of material fact and its entitlement to judgment as a matter of law. Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ; Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 586–87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). Once the moving party has met its burden, the non-moving party may not rest on the allegations of his pleadings but must set forth specific facts, by affidavit or other evidence, showing that a genuine issue of material fact exists.United of Omaha Life Ins. Co. v. Honea , 458 F.3d 788, 791 (8th Cir.2006) (quoting Fed. R. Civ. P. 56(e) ). Rule 56 “mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial.” Celotex Corporation v. Catrett , 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).

III. Discussion

It is undisputed that Maso qualifies as an insured person under all three policies. The parties also agree that coverage under the automobile policies is not foreclosed by the mere fact that Maso's motorcycle is not listed in the declarations in either of those policies. Because the parties have not fully briefed the question and it would not change the outcome, the Court assumes arguendo that the automobile policies do not define insured vehicles so as to exclude coverage for accidents involving two-wheeled vehicles, i.e. , motorcycles. See Bush v. Shelter Mut. Ins. Co. , 412 S.W.3d 336, 340–41 (Mo. Ct. App. 2013)

(“Before stacking can be an issue, there must first be applicable coverages to stack.... Thus, in any case potentially involving stacked coverages, the initial step for both insured and all potential insurers should be an analysis of whether there are multiple ... coverages applicable.” (quotation marks and citations omitted)). Finally, the parties raise only the UIM and UM coverage available under the three policies as potential avenues for recovery. It is this issue to which the Court confines its discussion.

Missouri law applies in this diversity case. See Owners Ins. Co. v. Hughes , 712 F.3d 392, 393 (8th Cir.2013)

. In Missouri, “[t]he interpretation of an insurance policy is a question of law.” Seeck v. Geico Gen. Ins. Co. , 212 S.W.3d 129, 132 (Mo.2007) (en banc). “When interpreting the language of an insurance contract,” a court is to “give[ ] the language its plain meaning.” Shahan v. Shahan , 988 S.W.2d 529, 535 (Mo.1999) (en banc) (citation omitted). Missouri courts “'appl[y] the meaning which would be attached by an ordinary person of average understanding if purchasing insurance....”' Farmers Ins. Co. v. Wilson , 424 S.W.3d 487, 491–92 (Mo.Ct.App.2014) (quoting Seeck , 212 S.W.3d at 132 ).

“An ambiguity exists when there is duplicity, indistinctness, or uncertainty in the meaning of the language in the policy. Language is ambiguous if it is reasonably open to different constructions.” Seeck , 212 S.W.3d at 132

(quotation marks and citations omitted). “[I]f a contract promises something at one point and takes it away at another, there is [likewise] an ambiguity.” Miller v. Ho Kun Yun , 400 S.W.3d 779, 786 (Mo.Ct.App.2013) (quotation marks and citation omitted). “Absent an ambiguity, an insurance policy must be enforced according to its terms. If, however, policy language is ambiguous, it must be construed against the insurer.” Seeck , 212 S.W.3d at 132 (quotation marks and citations omitted).

“The mere fact that the parties disagree as to the meaning of a term or clause in an insurance policy does not give rise to an ambiguity.” Hall v. Allstate Ins. Co. , 407 S.W.3d 603, 607 (Mo.Ct.App.2012)

(citation omitted). To determine whether a policy contains an ambiguity, it must be “read as a whole, and the risk insured against is made up of both the general insuring agreement as well as the exclusions and definitions.” Midwestern Indem. Co. v. Brooks , 779 F.3d 540, 546 (8th Cir.2015) (citing Todd v. Mo. United Sch. Ins. Council , 223 S.W.3d 156, 163 (Mo.2007) (en banc)). That is so because “[d]efinitions, exclusions, conditions, and endorsements are necessary provisions in insurance policies.” Wilson , 424 S.W.3d at 493 (quotation marks and citation omitted). However, “[p]olicy provisions designed to cut down, restrict, or limit insurance coverage already granted, or introducing exceptions or exemptions must be strictly construed against the insurer,” id. at 494, and the insurer “also bears the burden of showing that the exclusion applies.” Wasson v. Shelter Mut. Ins. Co. , 358 S.W.3d 113, 124 (Mo.Ct.App.2011) (quotation marks and citation omitted).

Under the applicable Missouri canons of insurance construction, “the court must 'endeavor to give each provision a reasonable meaning and to avoid an interpretation that renders some provisions useless or redundant.”...