Nationwide Mut. Ins. Co. v. Howard
| Citation | 288 S.C. 5,339 S.E.2d 501 |
| Decision Date | 13 May 1985 |
| Docket Number | No. 22424,22424 |
| Court | United States State Supreme Court of South Carolina |
| Parties | NATIONWIDE MUTUAL INSURANCE COMPANY, Petitioner, v. Gene Lindsey HOWARD and Northland Insurance Company, Defendants, of Whom Gene Lindsey Howard is Respondent. . Writ Issued |
F. Dean Rainey, Jr., of Rainey, Britton, Gibbes & Clarkson, P.A., Greenville, for petitioner.
Eugene C. Covington, Jr., of Foster, Covington & Patrick, Greenville, for respondent.
Nationwide Mutual Insurance Company (Nationwide) filed this action for declaratory judgment to determine its uninsured motorist coverage to Gene Lindsey Howard (Howard). The trial court held that Howard could add or "stack" multiple policies. The Court of Appeals affirmed. Nationwide Mut. Ins. Co. v. Howard, 284 S.C. 17, 324 S.E.2d 323 (Ct.App.1984).
As modified, we affirm.
Howard, injured when his truck was hit by an unidentified motorist, received a $500,000 judgment in a "John Doe" action. He owned eight vehicles covered by five liability insurance policies. Two of the vehicles, including the truck involved in the accident, were covered by a fleet policy with Northland Insurance Company (Northland). This policy was written in language commonly referred to as 15-30 and 5. Three other vehicles were covered under one Nationwide fleet policy, also written as 15-30 and 5. The remaining three vehicles were covered by separate, individual Nationwide policies. These policies were written in language commonly referred to as "single limit". Each of these single limit policies provided a coverage of $35,000.
Although the aggregate amount recoverable in each type policy is $35,000, they operate differently.
In the 15-30 and 5 policy, where one person is injured, coverage is limited to $15,000. A total of $30,000 is recoverable by two or more persons injured in the same accident. The $5,000 portion of the policy provides recovery for property damage in that maximum amount.
Under the single limit policy, one person is not limited to a recovery of $15,000 for personal injury, but may recover the entire amount of $35,000. Moreover, one person involved in an accident, even though not injured, may recover up to the amount of $35,000 for property damage.
Howard contends he is entitled to stack the entire $35,000 from each of the three single limit policies and $15,000 from each of the three vehicles covered by the fleet policy, for a total recovery of $150,000. Nationwide counters that the policies cannot be stacked or, if they can, only in the maximum amount of $15,000 each.
1. May policies containing uninsured motorist coverage in excess of basic limits be stacked under S.C.Code Ann. § 56-9-831 (Supp.1984)?
2. May the $35,000 single limit policies be stacked in full where only one person is injured?
3. Are policy provisions enforceable which require that any amounts payable be reduced by uninsured motorist coverage afforded by the vehicle involved in the accident? 1
Uninsured motorist coverage in excess of basic limits may not be stacked under S.C.Code Ann. § 56-9-831 (Supp.1984). The statute states, in pertinent part If ... an insured ... is protected by uninsured or underinsured motorist coverage in excess of the basic limits, the policy shall provide that the insured is protected only to the extent of the coverage he has on the vehicle involved in the accident. If none of the insured's or named insured's vehicles is involved in the accident, coverage is available only to the extent of coverage on any one of the vehicles with the excess or underinsured coverage. Coverage on any other vehicles shall not be added to that coverage.
This Court in Gambrell v. The Travelers Ins. Cos., 280 S.C. 69, 310 S.E.2d 814 (1983) and Garris v. Cincinnati Ins. Co., 280 S.C. 149, 311 S.E.2d 723 (1984) interpreted the first sentence to allow stacking of underinsured motorist coverage up to, but not in excess of, the basic liability limits of 15-30 and 5, defined in S.C.Code Ann. § 56-9-820 (1976). The same rule applies to stacking of uninsured motorist coverage.
Nationwide argues that under Gambrell and Garris, policies providing uninsured motorist coverage in excess of basic limits cannot be stacked at all. The Court of Appeals stated that "if 'an insured is protected by uninsured or underinsured motorist coverage in excess of the basic limits,' then stacking shall be proscribed." [Emphasis supplied]. 284 S.C. at 18, 324 S.E.2d at 324.
We clarify here any uncertainty as to our holdings in Gambrell and Garris: S.C.Code Ann. § 56-9-831 (Supp.1984) sets a cap on stacking in the amount of basic limits, and does not proscribe stacking of policies with coverage in excess of basic limits to the extent of this cap.
The Court of Appeals affirmed the trial court's holding that the three single limit policies could be stacked in the full amount of $35,000 each "because they contain no breakdown like the $15,000 and $30,000 policies." 284 S.C. at 20, 324 S.E.2d at 325.
Where an insured or named insured has a vehicle involved in an accident, two limitations upon stacking contained in S.C.Code Ann. § 56-9-831 (Supp.1984) apply. In Gambrell we construed the statute as to the first limitation; today we construe it as to the second.
S.C.Code Ann. § 56-9-831 (Supp.1984), as interpreted in Gambrell, permits an insured to stack coverage "up to, but not in excess of the basic liability limits of 15-30-5 required by S.C.Code Ann. § 56-9-820 (1976)." 280 S.C. at 73, 310 S.E.2d at 817.
We hold that whether the coverage is broken down does not affect this limitation on stacking.
The basic liability limits of 15-30 and 5, referred to in Gambrell, are contained in S.C.Code Ann. § 56-9-820 (1976):
No policy or contract of bodily injury liability insurance or of property damage liability insurance, covering liability arising from the ownership, maintenance or use of any motor vehicle, shall be issued or delivered in this State to the owner of such vehicle, ... unless it contains a provision insuring the persons defined as insured, against loss from the liability imposed by law for damages arising out of the ownership, maintenance or use of such motor vehicles, ..., with respect to each motor vehicle, as follows: fifteen thousand dollars because of bodily injury to or death of one person in any one accident, and, subject to such limit for one person, thirty thousand dollars because of bodily injury to or death of two or more persons in any one accident, and five thousand dollars because of injury to or destruction of property of others in any one accident. [Emphasis supplied].
Howard concedes that if the policies in question had been written as 15-30 and 5 they could only be stacked in maximum amounts of $15,000 each, or a total of $45,000. Indeed, he concedes that no amount of coverage in excess of basic liability limits is permitted to be stacked. His argument is that the aggregate amount of basic coverage in a 15-30 and 5 policy is $35,000; that when a single limit policy is written in that amount no part of the $35,000 constitutes excess even for a claim of one person only.
We do not agree with Howard's reasoning, the effect of which is to define basic limits as $35,000 where one person only is involved. Such a definition contradicts the plain meaning of S.C.Code Ann. § 56-9-820 (1976), which sets the basic limits of uninsured coverage required for protection of one person. It also is contra to Gambrell's interpretation of S.C.Code Ann. § 56-9-831 (1984) relating to excess coverage, referred to earlier in this opinion.
Again, we refer to the language of S.C.Code Ann. § 56-9-831 (Supp.1984):
If ... an insured ... is protected by uninsured or underinsured motorist coverage in excess of the basic limits, the policy shall provide that the...
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