Nelson v. Employers Mut. Cas. Co.

• Decision Date: 20 May 1974
• Docket Number: No. 235,235
• Citation: 63 Wis.2d 558,217 N.W.2d 670
• Parties: Lois NELSON, Plaintiff-Appellant, v. EMPLOYERS MUTUAL CASUALTY COMPANY and Mutual Service Casualty Insurance Company, Defendants-Respondents.
• Court: Wisconsin Supreme Court

Page 670

217 N.W.2d 670

63 Wis.2d 558

Lois NELSON, Plaintiff-Appellant, v. EMPLOYERS MUTUAL CASUALTY COMPANY and Mutual Service Casualty Insurance Company, Defendants-Respondents.

No. 235.

Supreme Court of Wisconsin.

May 20, 1974.

Galloway, Olson, Boltz & Steinbrinck, Green Bay, for plaintiff-appellant.

Lontkowski & Lontkowski, Green Bay, for defendants-respondents.

HALLOWS, Chief Justice.

The Employers Mutual policy provided, among other things, under its uninsured-motorist coverage and medical-payment coverage, it would pay all sums which the insured shall be legally entitled to recover as damages from the operator of an uninsured highway vehicle because of bodily injury sustained by the insured. The coverage was limited to $10,000 per person and $20,000 per accident and further provided that under the uninsured-motorist bodily-injury coverage, the company was not obligated to pay any part of the damage the insured was entitled to recover from the operator of an uninsured highway vehicle which represented expenses for medical services paid or payable under the medical-payments coverage of the policy. The medical-payment coverage was limited to $500. Employers Mutual coverage for bodily injury caused by an uninsured motorist was considered primary coverage and was paid to the full extent of $10,000 in the settlement; $300 was paid under the medical-payment coverage.

The Mutual Service policy provided insurance coverage for a member of the household driving a non-owned car, and its uninsured-motorist coverage clause provided as follows:

'To pay all sums which the insured or his legal representative shall be legally entitled to recover as damages from the owner or operator of an uninsured automobile because of bodily injury, sickness or disease, including death resulting therefrom . . . sustained by the insured, caused by accident and arising out of the ownership, maintenance or use of such uninsured automobile . . '

The policy provided the company's liability under its uninsured-motorist coverage for bodily injury was $10,000 per person and $20,000 per accident except where an insured simultaneously claims under both the uninsured-motorist coverage and the medical-payments coverage, in which case, 'any loss payable under uninsured motorist coverage to or for any person shall be reduced by all sums paid on account of such bodily injury under (medical payments).' The policy also provided in respect to uninsured-motorist coverage as it applied to the facts of this case that such coverage was excess:

'With respect to bodily injury to an insured while occupying an automobile not owned by the named insured the insurance hereunder shall apply only as excess insurance over any other similar insurance available to such occupant, and this insurance shall then apply only in the amount by which the applicable limit of liability of this Part exceeds the sum of the applicable limits of liability of all such other insurance.'

The medical payments coverage is limited to $500 per person, payable 'to or for the named insured and each relative who sustains bodily injury . . . caused by accident, while occupying or through being struck by an automobile, or trailer of any type.' Besides these limitations on coverage, the policy contains an 'Other Insurance' provision applicable to the medical payments coverage, providing as follows:

'If there is other automobile medical payments insurance against a loss covered by (the medical payments coverage) of this policy the company shall not be liable under this policy for a greater proportion of such loss than the applicable limit of liability stated in the declaration bears to the total applicable limit of liability of all valid and collectible medical payments insurance; provided, however, the insurance with respect to a . . . non-owned automobile shall be excess insurance over any other valid and collectible automobile medical payments insurance.' (emphasis added)

Thus, for one in Miss Nelson's position, Mutual Service's policy provides for excess coverage both for bodily injury and for medical payments and for a reduction of its uninsured-motorist coverage.

The narrow issue presented is whether the Mutual Service policy's excess and reducing clauses are in derogation of sec. 204.30(5), Stats., as that statute read at the time of the accident. ¹

The brief of Nelson seeks to have this court interpret this statute so as to provide that insurance involving an uninsured motorist may be stacked, that is, that all uninsured motorist insurance available must in effect by made primary insurance no matter what the amount of the coverage and no maximum limit of recovery provision in any policy can be reduced by the fact there is other insurance available. The majority of jurisdictions considering their uninsured-motorist coverage statute have interpreted it to mean that the section did not provide a maximum amount of coverage and the uninsured-motorist coverage in each policy applicable could not be reduced so as to leave the plaintiff with recovery only in the amount stated in the statute that each policy must provide. ^{2 2} A minority view construes their statutes as not prohibiting excess clauses and reducing clauses in uninsured-motorist coverage. ³ This problem has been a subject of considerable discussion and it would serve no good purpose for this court to replow this field which almost every state has cultivated. ⁴

We do not consider this case to be one of first impression but rather to be ruled by our reasoning in Leatherman v. American Family Mut. Ins. Co. (1971), 52 Wis.2d 644, 190 N.W.2d 904, and Scherr v. Drobac (1972), 53 Wis.2d 308, 193 N.W.2d 14. In Leatherman this court had before it the question of whether a plaintiff who had been injured in an accident involving an insured motorist and an uninsured motorist could recover the excess of his judgment over the amount paid by the insured motorist from his own insurance company under its uninsured motorist coverage clause. The plaintiff's insured's policy provided, however, that any amount payable to him under the uninsured motorist policy was to be reduced by all sums paid to the insured by or on behalf of a jointly-liable insured motorist. This court took the view that the issue in the case was whether the uninsured motorist provision guaranteed payment to the plaintiff only to the extent that all other sources had not yielded the recovery to which the plaintiff would otherwise be entitled under the uninsured motorist coverage or whether it guaranteed recovery equivalent to that which would have been had if the uninsured motorist had been minimally insured. This court took the first alternative and recognized that the reducing clause applied and since the judgment exceeded the amount of the policy limit, the $10,000 paid by the insured motorist was applicable and automatically reduced recovery under the insured's policy. Although the issue was not squarely presented, the court upheld impliedly the validity of the reducing clause and stated the argument that such a clause was invalid was more properly addressed to the legislature.

The same situation was presented in Scherr v. Drobac, supra, except the insured expressly contended the reducing clause violated sec. 204.30(5), Stats. 1967, and was therefore invalid. The court again held that once other sources yielded the amount of the uninsured-motorist coverage available to the plaintiff under the uninsured-motorist feature of his own policy, the uninsured-motorist coverage in his policy was not available to him. Thus, Scherr followed Leatherman. While it can be argued that these cases dealt more with the question of under-insurance, viewed from the plaintiff's standpoint, rather than with the question of uninsurance, the reasoning in these cases is applicable to the present case. We are not inclined to reverse that reasoning or to make artificial distinctions. The question is not public policy, who paid insurance premiums or any other issue but what sec. 204.30(5), Stats. 1967, requires in way of uninsured-motorist coverage.

It is argued that the legislature meant that uninsured-motorist coverage, if provided under this section, had to provide absolutely the amount of coverage stated in the section. Thus the amount of coverage provided by statute was the minimum for each policy and not the maximum coverage afforded in fact by several policies. It is contended this view is correct because after our decision in Leatherman, sec. 204.30(5)(a), Stats.1967, was amended by the legislature by ch. 72, Laws of 1973. This section now expressly provides that the uninsured-motorist coverage shall not be reduced by the terms thereof to provide the insured with less protection than would be afforded him of he were injured by a motorist insured under an automobile policy containing the limits provided in this subsection. We do not hereby construe this section or intimate any interpretation; we point out the amendment because of the argument made.

This amendment has no interpretative effect upon our construction of the statute as it read in 1967. Assuming the amendment allows stacking of uninsured-motorist coverages, the argument that the statute of 1967 allowed stacking because the legislature provided for it in 1973 cuts both ways. Just as valid is the argument that the legislature passed the 1973 amendment because the 1967 statutes did not so provide or that the legislature did not think about the problem when it enacted the 1967 statute and therefore omitted covering it. Of course, it is possible the legislature did think of the problem but the statute is poorly drawn that its intention is not expressed in such words that this court can reasonably find its intention. The intention of the legislature is not enough. Interpretation of ambiguous legislative language at best is in hindsight. Legislative intent must be conveyed in language sufficient for this court to...