Mass v. U.S. Fidelity and Guar. Co.

• Decision Date: 09 June 1992
• Docket Number: No. 14414,14414
• Citation: 222 Conn. 631,610 A.2d 1185
• Court: Connecticut Supreme Court
• Parties: Norman MASS, Executor (ESTATE of Sara Louise MASS), et al. v. UNITED STATES FIDELITY AND GUARANTY COMPANY. UNITED STATES FIDELITY AND GUARANTY COMPANY v. Norman MASS, Executor (ESTATE of Sara Louise MASS), et al.

Page 1185

610 A.2d 1185

222 Conn. 631

Norman MASS, Executor (ESTATE of Sara Louise MASS), et al. v. UNITED STATES FIDELITY AND GUARANTY COMPANY.

UNITED STATES FIDELITY AND GUARANTY COMPANY v. Norman MASS, Executor (ESTATE of Sara Louise MASS), et al.

No. 14414.

Supreme Court of Connecticut.

Argued Feb. 20, 1992.

Decided June 9, 1992.

Berdon, J., filed a dissenting opinion.

Vincent M. Musto, Bridgeport, for appellants (Norman Mass, Executor [Estate of Sara Louise Mass], et al.).

Thomas C. Thornberry, Bridgeport, for appellee (U.S. Fidelity and Guar. Co.).

Before SHEA, GLASS, COVELLO, BORDEN and BERDON, JJ.

GLASS, Associate Justice.

This is an appeal from the judgment of the trial court granting, in part, the application of the United States Fidelity and Guaranty Company (USF & G) to vacate an arbitration award, and denying the application of Norman Mass, as executor of the estate of Sara Louise Mass and on behalf of his minor children Daniel and Jessica (Mass), to vacate in part or modify the arbitration award. We affirm the judgment of the trial court.

Most of the facts essential to the disposition of this appeal were stipulated to by the parties. On April 18, 1988, an automobile operated by Sara Louise Mass, in which her two minor children, Daniel Mass and Jessica Mass, were passengers, was struck broadside on a residential street in Fairfield by an automobile driven by Christopher Flynn, who was intoxicated, while traveling at a speed in excess of fifty miles per hour. The accident resulted in the death of Sara Mass and in personal injuries to Daniel and Jessica Mass. On and prior to April 18, 1988, USF & G and Norman Mass, the husband of Sara and father of Daniel and Jessica, were parties to an automobile insurance contract. The contract, which covered the Masses' two automobiles, provided uninsured motorist coverage ¹ in the amount of $500,000 for each vehicle. The contract also provided for arbitration in case of a disagreement between the parties concerning uninsured motorist claims. On and prior to April 18, 1988, Norman and Sara Mass were also parties to another insurance contract with USF & G, denominated a "Personal Excess Policy," with a face value of $1,000,000, which listed the automobile insurance contract as underlying coverage. Because Flynn carried inadequate liability insurance, Mass sought uninsured motorist recovery under both USF & G policies.

On November 1, 1989, a panel of three arbitrators rendered a decision regarding the amount of insurance coverage available under the Masses' policies with USF & G and the amount of damages suffered by the estate of Sara Mass and the Masses' two minor children. The arbitrators ruled that $2,000,000 was available to the claimants: $500,000 on each of the Masses' two automobiles under the automobile insurance contract plus $1,000,000 under the personal excess policy. The arbitrators determined that the damages suffered were as follows: $1,700,000 by the estate of Sara Mass; $50,000 by Daniel Mass; and $50,000 by Jessica Mass.

Both USF & G and Mass applied to the trial court to vacate the arbitration award. In its application, USF & G asserted that the personal excess policy issued to the Masses did not, by its terms and conditions, provide uninsured motorist coverage, and, further, that USF & G was not obligated under General Statutes § 38-175c to provide such coverage. ² USF & G claimed therefore, that the arbitrators' ruling should be vacated to the extent that it concluded otherwise. In his application to the trial court, Mass sought to have the arbitrators' award vacated in part or modified to increase the amount of damages found to have been suffered by Sara, Daniel and Jessica Mass and of uninsured motorist coverage found to exist under the two USF & G policies. Mass claimed that the arbitrators incorrectly computed the amount of uninsured motorist coverage as $2,000,000, rather than $3,000,000, because they did not stack the $1,000,000 of coverage available under the personal excess policy. Mass also sought to have the amount of damages increased to at least $7,000,000.

The trial court, relying on Cohn v. Pacific Employers Ins. Co., 213 Conn. 540, 569 A.2d 544 (1990), concluded that the personal excess policy did not extend the Masses' underlying uninsured motorist coverage because it (1) required that the insured be responsible for maintaining uninsured motorist coverage, and (2) lacked any agreement requiring USF & G to provide excess uninsured motorist coverage. The trial court therefore granted USF & G's application to vacate the arbitrators' award to the extent that the award included the personal excess policy. The trial court did not find the miscalculation of damages that Mass had claimed, however, and, therefore, denied Mass' application. This appeal to the Appellate Court followed. We transferred the appeal to ourselves pursuant to Practice Book § 4023.

On appeal, Mass claims that the trial court improperly failed to conclude that: (1) the personal excess policy provided uninsured motorist coverage; (2) $3,000,000 in uninsured motorist coverage was available under the two policies with USF & G; and (3) the estate of Sara Mass was entitled to at least $3,000,000 in damages. USF & G presents only one issue on appeal, which we shall address in conjunction with Mass' first claim: whether General Statutes § 38-175c requires that the personal excess policy that USF & G issued to the Masses provide uninsured motorist coverage when such coverage had already been provided in a separate policy purchased exclusively for automobile liability protection in accordance with § 38-175c.

Mass first claims that the trial court improperly failed to conclude that the personal excess policy issued by USF & G provided uninsured motorist coverage. Mass argues that the trial court misapplied this court's holding in Cohn v. Pacific Employers Ins. Co., supra, because the personal excess policy in this case is a liability policy, not an indemnity policy, as was the policy at issue in Cohn. Mass contends that since the personal excess policy covers liability for damages arising out of the operation of an automobile, ³ it is an "automobile liability policy" within the meaning of § 38-175c and, therefore, must provide uninsured motorist coverage pursuant to § 38-175c(a)(2). USF & G argues that the personal excess policy issued to the Masses was not required to provide uninsured motorist coverage under § 38-175c because such coverage had already been provided in accordance with § 38-175c in a separate automobile insurance contract. We are persuaded that the personal excess policy is not an "automobile liability policy" within the meaning of the statute, and, therefore that the trial court properly concluded that the policy is not required to provide uninsured motorist coverage.

In support of his argument, Mass places substantial reliance on the distinction between an indemnity policy and a liability policy that this court made in Cohn. In that case, we affirmed the conclusion of the trial court that an excess policy issued to the plaintiff was not an automobile liability policy within the meaning of § 38-175c because the terms of the policy unequivocally established that it was an indemnity policy. ⁴ What we did not decide in Cohn, however, was whether an excess policy whose language provided for liability must comply with the uninsured motorist statute. ⁵

Unlike the policy involved in Cohn, the personal excess policy issued to the Masses by USF & G did not require that the insured's liability be discharged before a cause of action against the insurer would accrue. Id., at 547, 569 A.2d 544. The policy provided that USF & G would pay damages on behalf of the insured, subject to certain exclusions. Uninsured motorist coverage was not specified in the list of exclusions. ⁶ The policy further provided that "[r]egardless of the number of insureds, claims or injured persons, the most [USF & G will] pay as damages resulting from one occurrence shall not exceed [$1,000,000]," but that "[i]f primary insurance and this policy cover an occurrence which results in personal injury or property damage, [USF & G will] pay damages which exceed the total applicable primary insurance limits." The declarations to the policy provided, inter alia, that the insured shall have "primary insurance" for "auto liability," with limits of $500,000 per accident or occurrence. ⁷ According to the evidence presented at the arbitration hearing, the Masses paid a total premium of $173 for the personal excess policy during the relevant policy period. The evidence also established that they paid a separate premium of $1000 for the automobile insurance contract for the six month period during which the accident occurred, of which fifty-four dollars went to uninsured motorist coverage.

Pursuant to § 38-175c(a)(2), an insurer is required to provide an insured with uninsured motorist coverage equal to the amount of automobile liability coverage purchased unless the insured elects a lesser amount in writing, although in no event may he elect less than the statutory minimum specified in General Statutes § 14-112(a). ⁸ In Travelers Indemnity Co. v Malec, 215 Conn. 399, 576 A.2d 485 (1990), we examined the legislative history and development of § 38-175c. "Prior to the enactment of § 38-175c; see Public Acts 1967, No. 510; [uninsured motorist] coverage, although available, was not required. Coverage was limited to the amount requested by the insured. In 1969, § 38-175c was amended to require parity of [uninsured motorist] coverage with the minimum limits of liability coverage required by General Statutes § 14-112(a). See Public Acts 1969, No. 202. In 1983, § 38-175c was again amended now to require parity of [uninsured motorist] coverage with the amount of liability coverage purchased by the insured unless the insured specifically requested a lesser amount. See Public Acts...