Miller v. Lambert, 22957

• Decision Date: 26 October 1995
• Docket Number: No. 22957,22957
• Citation: 195 W.Va. 63,464 S.E.2d 582
• Court: West Virginia Supreme Court
• Parties: Denise MILLER, Plaintiff Below, v. Gregory LAMBERT, Defendant Below.

Page 582

464 S.E.2d 582

195 W.Va. 63

Denise MILLER, Plaintiff Below, v. Gregory LAMBERT, Defendant Below.

No. 22957.

Supreme Court of Appeals of

West Virginia.

Submitted Sept. 19, 1995.

Decided Oct. 26, 1995.

Syllabus by the Court

1. W.Va.Code, 33-6-31(b) (1988), provides minimum coverage for uninsured motorist protection equal to that contained in our financial responsibility law, W.Va.Code, 17D-4-2 (1979). W.Va.Code, 17D-4-2, requires a limit of $20,000 for bodily injury or death of one person and $40,000 for two or more persons injured or killed in any one accident. Uninsured motorist insurance coverage is mandatory.

2. The mandatory requirement of insurance coverage under W.Va.Code, 17D-4-2 (1979), takes precedence over any contrary or restrictive language in an automobile liability insurance policy.

3. A motor vehicle liability insurer which carries a single limit policy of $50,000 for uninsured motorist liability and pays the entire limit to one of two parties injured in the same accident is not exempt from the requirements of W.Va.Code, 33-6-31(b) (1988), which incorporates the mandatory insurance imposed by W.Va.Code, 17D-4-2 (1979), for uninsured motorist coverage.

4. "Under W.Va.Code, 55-7-7 [1982] the claim of a minor sibling of a victim of a wrongful death cannot be compromised without court approval." Syllabus Point 1, Jordan v. Allstate Insurance Co., 184 W.Va. 678, 403 S.E.2d 421 (1991).

5. "When the administrator of an estate of a wrongful death victim settles a claim under W.Va.Code, 55-7-7 [1982] with the tortfeasor's insurance carrier, but fails to seek court approval for the compromise of a minor's claim, the minor's primary cause of action is against the administrator and not the insurance carrier; but, if the administrator is insolvent, then the carrier is secondarily liable." Syllabus Point 2, Jordan v. Allstate Insurance Co., 184 W.Va. 678, 403 S.E.2d 421 (1991).

6. "When a certified question is not framed so that this Court is able to fully address the law which is involved in the question, then this Court retains the power to reformulate questions certified to it under both the Uniform Certification of Questions of Law Act found in W.Va.Code, 51-1A-1, et seq., and W.Va.Code, 58-5-2 [1967], the statute relating to certified questions from a circuit court of this State to this Court." Syllabus Point 3, Kincaid v. Mangum, 189 W.Va. 404, 432 S.E.2d 74 (1993).

Marion E. Ray, Hunt, Lees, Farrell & Kessler, Charleston, for Plaintiff.

Joanna I. Tabit, Steptoe & Johnson, Charleston, for Defendant.

MILLER, Retired Justice, sitting by temporary assignment: ¹

On September 5, 1988, the plaintiff, Denise Miller, who was fifteen years of age, was riding as a passenger in an automobile driven by Reba McCoy, her mother. The automobile was struck by another automobile operated by the defendant, Gregory Lambert, who had no automobile liability insurance coverage. As a result of the accident, the plaintiff was injured and her mother was killed. Subsequently, the administratrix of Mrs. McCoy's estate made a claim against Maryland Casualty Company which carried uninsured motorist coverage on the McCoy automobile in the amount of $50,000. This amount was paid along with $2,000 in medical benefits also provided pursuant to the policy. However, there was no court approval of the settlement under W.Va.Code, 55-7-7 (1982).

Subsequently, on September 1, 1993, the plaintiff filed suit against Mr. Lambert and sought to recover additional uninsured motorist coverage from Maryland Casualty Company as a result of her injuries. A copy of the suit papers were served on Maryland Casualty Company which answered on behalf of Mr. Lambert and also raised the issue that its uninsured motorist coverage was exhausted by its earlier payment to the administratrix of the mother's estate. Maryland Casualty Company asserts that its policy was a single limit policy which provided for a single payment, regardless of the number of persons injured. ²

On the other hand, the plaintiff contends that under our financial responsibility law, W.Va.Code, 17D-4-2 (1979), ³ and the provisions of our uninsured motorist coverage statute, W.Va.Code, 33-6-31(b) (1988), ⁴ an insurance carrier must provide as a mandatory minimum for uninsured motorist coverage the amount of $20,000 for any one person for bodily injury or death and $40,000 for two or more persons injured or killed in any one accident. Consequently, the single limit policy was contrary to the multiple limits statutorily required.

The circuit court, faced with these questions, certified two inquiries to this Court. The first question related to whether the multiple limit coverage required under W.Va.Code, 17D-4-2, and W.Va.Code, 33-6-31(b), would preclude exhausting an insurance carrier's single limit coverage in its insurance policy in a settlement with one injured person to the detriment of a second injured person. The circuit court answered this question affirmatively. ⁵ The second question is whether the insurance carrier acted in good faith in settling the wrongful death claim of the mother for the policy limits, which would preclude the plaintiff's case. This question was answered negatively. ⁶

I.

The first certified question as to the extent of any further available coverage involves an analysis of W.Va.Code, 33-6-31(b), ⁷ and its impact on a single limit policy where the limit was exhausted. This section applies to uninsured motorist coverage that an insurance carrier is required to have as an endorsement or provision in its policy. W.Va.Code, 33-6-31(b), provides a minimum coverage for uninsured motorist protection equal to that contained in our financial responsibility law, W.Va.Code, 17D-4-2. ⁸ This section requires a limit of $20,000 for bodily injury or death of one person and $40,000 for two or more persons injured or killed in any one accident. We have recognized that uninsured motorist coverage is mandatory. See, e.g., Marshall v. Saseen, 192 W.Va. 94, 450 S.E.2d 791 (1994).

Moreover, in several cases, we have held that the mandatory requirement of insurance coverage under W.Va.Code, 17D-4-2, takes precedence over any contrary or restrictive language in an automobile liability insurance policy. For example, in Jones v. Motorists Mutual Insurance Co., 177 W.Va. 763, 356 S.E.2d 634 (1987), the insurance policy had a specific exclusion for the owner's teenage son who was in a "high risk" insurance category. While driving the car, the son had an accident causing damage. Relying on the exclusion, the insurer refused to cover the loss. However, we held that this exclusion could not override the mandatory limits imposed under our financial responsibility law. In the Syllabus of Jones, we stated:

"A 'named driver exclusion' endorsement in a motor vehicle liability insurance policy in this State is of no force or effect up to the limits of financial responsibility required by W.Va.Code, 17D-4-2 [1979]; however, above those mandatory limits, or with regard to the property of the named insured himself, a 'named driver exclusion' endorsement is valid under W.Va.Code, 33-6-31(a) [1982]."

See also Dairyland Ins. Co. v. East, 188 W.Va. 581, 425 S.E.2d 257 (1992).

In Dotts v. Taressa J.A., 182 W.Va. 586, 390 S.E.2d 568 (1990), we determined that an intentional tort exclusion in a motor vehicle liability insurance policy could not override the required coverage under W.Va.Code, 17D-4-2. In addition to the general language of W.Va.Code, 17D-4-2, setting out the limits of the financial responsibility law, we note that these limits are contained in W.Va.Code, 17D-4-12(b)(2) (1979), and are required to be a part of any motor vehicle policy issued in this State. ⁹

The specific issue in this case was addressed by the Supreme Court of Minnesota in Dorn v. Liberty Mutual Fire Insurance Co., 401 N.W.2d 662 (Minn.1987). There, the insurer issued an automobile liability policy providing a single limit of $60,000 for both liability and uninsured motorist coverage. As here, a mother and daughter were involved in an automobile accident with a third party who had no liability insurance. The daughter, who was driving, was seriously injured and was paid the entire policy limit for the uninsured motorist coverage. The mother almost two years later presented a claim for her injuries and was advised that the uninsured limits were exhausted. She then filed suit against Liberty Mutual claiming that its single limit policy violated the financial responsibility law, which required coverage for $25,000 for any one person and $50,000 for two or more persons in any one accident. The Minnesota court without extended discussion set this law in Syllabus Points 1 and 2:

"1. The insurance policy limits for uninsured motorist coverage cannot be exhausted by the first claimant from a multi-person accident.

"2. The extra coverage available to a later claimant is the $25,000 required by statute."

See also In the Matter of Michigan Mut. Ins. Co. (Miller), 170 A.D.2d 102, 573 N.Y.S.2d 305 (1991).

A related problem was discussed in Bush Leasing, Inc. v. Gallo, 634 So.2d 737 (Fla.App.1994), involving a Florida statute which required automobile lessors to carry liability insurance with limits of $100,000 per person and $300,000 per accident for bodily injury. The purpose of the statute, if such limits were carried, was to relieve an automobile lessor from dangerous instrumentality liability. Bush Leasing required a lessee to purchase a single limit liability policy of $500,000. The Florida court concluded this coverage did not meet the statutory requirement: "[T]he policy does not necessarily provide equivalent coverage for other parties who are injured in the same accident. We are, therefore, unable to conclude that Bush is exempt from liability pursuant to section 324.021(9)(b), Florida Statutes." 634 So.2d at 741.

From the foregoing, we conclude that a motor vehicle liability insurer...