Progressive Specialty Ins. Co. v. Steele

• Decision Date: 22 June 2007
• Docket Number: 2051006.,2050960
• Citation: 985 So.2d 932
• Parties: PROGRESSIVE SPECIALTY INSURANCE COMPANY v. Jeamae STEELE, a minor by and through her mother, Jonita STEELE. Jeamae Steele, a minor by and through her mother, Jonita Steele v. Geico General Insurance Company.
• Court: Alabama Court of Civil Appeals

985 So.2d 932

PROGRESSIVE SPECIALTY INSURANCE COMPANY v. Jeamae STEELE, a minor by and through her mother, Jonita STEELE.

Jeamae Steele, a minor by and through her mother, Jonita Steele v. Geico General Insurance Company.

2050960

2051006.

Court of Civil Appeals of Alabama.

June 22, 2007.

Certiorari Denied December 7, 2007 Alabama Supreme Court 1061425.

Paul A. Miller and Lynn B. Randall of Lamar, Miller, Norris, Haggard & Christie, P.C., Birmingham, for appellant Progressive Specialty Insurance Company.

Daniel B. Feldman and Daniel Patrick Lehane of Feldman & Lehane, L.L.C., Birmingham, for appellant/cross-appellee Jeamae Steele, a minor, by and through her mother, Jonita Steele.

Jack Owen and Brooke Emfinger of Ball, Ball, Matthews & Novak, P.A., Montgomery, for appellee Gieco General Insurance Company.

PER CURIAM.

On June 27, 2005, Northern Steele ("the father") and his daughter, Jeamae Steele ("the child"), a minor child by and through the father, sued Deshonda Prowell ("the driver"). The complaint sought damages for injuries the child allegedly sustained in an accident that occurred on June 28, 2003, when the child and the vehicle the driver was operating collided. The complaint listed the owner of the vehicle as a fictitiously named party; the record does not show that the vehicle's owner, Deborah Coleman ("the owner"), was ever substituted as a named defendant in the action. The child's mother, Jonita Steele ("the mother"), was later substituted for the father, both individually and as the child's representative. The Steeles' action is currently pending before the trial court. The Steeles' action is not the subject of this appeal, although it led to the claims that are at issue before us.

On December 2, 2005, Geico General Insurance Company ("Geico"), the owner's automobile-liability insurance provider, filed a separate declaratory-judgment action against the driver, the owner, and the child, by and through the father; the answer filed on behalf of the child was filed by and through the child's mother. Geico sought a judgment declaring that it had no duty to defend against the child's action or to provide liability-insurance coverage to the driver because, according to Geico, the driver had unreasonably delayed in notifying it of the accident. Progressive Specialty Insurance Company ("Progressive"), the Steeles' uninsured/underinsured-motorist insurance provider, intervened as a defendant in Geico's declaratory-judgment action. Progressive subsequently filed a cross-claim complaint for a declaratory judgment against the child, by and through the father; the answer to Progressive's cross-claim complaint filed on behalf of the child was filed by and through the child's mother. Progressive sought a judgment declaring that it had no obligation to provide uninsured- or underinsured-motorist coverage to the Steeles because, according to Progressive, the Steeles had unreasonably delayed in notifying it of the accident.¹ The record shows that Progressive requested and was granted a jury trial on its cross-claim and that Geico's and Progressive's claims were reset for a jury trial.

Geico and Progressive each moved for a summary judgment on their respective claims. In a single order dated July 19, 2006, the trial court granted Geico's summary-judgment motion and denied Progressive's summary-judgment motion. As we discuss below, in doing so, the trial court effectively entered a final judgment in favor of the Steeles on Progressive's cross-claim regarding uninsured/underinsured-motorist coverage. With respect to Geico, the Steeles filed a timely appeal of the July 19, 2006, judgment to our supreme court in case number 2051006. Progressive separately filed a timely appeal of the July 19, 2006, judgment to our supreme court in case number 2050960. Both appeals were transferred to this court by the supreme court, pursuant to § 12-2-7(6), Ala.Code 1975. This court has consolidated the records of the two appeals, and we address both appeals in this opinion.

Factual and Procedural Background

The trial court's judgment set out the undisputed facts as follows:

"On March 20, 2003, Geico issued a policy of automobile liability insurance to [the owner] insuring her 2002 Ford Mustang. The insurance policy required written notice of any accident `as soon as possible after an occurrence.'

"Progressive issued an automobile liability insurance policy to [the father] and that policy was in effect on June 28, 2003. The Progressive policy provided the Steeles with uninsured or underinsured motorist coverage and it required notice of any accident `as soon as practicable.'

"On June 28, [2003, the owner's] niece, [the driver], was operating [the owner's] Mustang with permission and was involved in an collision with [the child], a minor child of [the father]. It is contended that [the child] ran into the side of the [owner's] vehicle and suffered personal injuries. The Birmingham police department came to the scene and investigated the incident. [The driver] retrieved the Geico Insurance card from the glove compartment of the car and presented it along with her suspended driver's license to the investigating officer. [The driver] did not inform either Geico or her aunt, [the owner], of the accident and [the father] did not inform Progressive.

"On June 27, 2005, two years after the accident, [the child], through her father and next friend, [the father], instituted an action against [the driver] in the Circuit Court of Jefferson County, CV-05-3760. Geico first received notification of the accident on July 5, 2005, when [the Steeles'] counsel sent it a courtesy copy of the complaint along with the accident report. The Steeles did not notify Progressive of the June 28, 2003, accident until July 5, 2005. It is from these undisputed facts that the issue of whether there is insurance coverage from either of these insurers [arises]."

Additionally, the parties presented conflicting evidence regarding the events that immediately followed the accident. The mother and the father testified at deposition that the child was lying on the ground, seriously injured, and that they immediately called for emergency medical assistance. The father testified that he contacted the driver by telephone within a short time after the accident and advised her that the child was seriously injured and in the hospital. The driver, however, testified at deposition that immediately following the accident the child stood up, was walking, and seemed uninjured. The driver also testified that someone contacted the nearby fire department, that a fire truck came to the scene, and that a single fireman checked the child for injuries. In describing the accident, the driver stated that there was a "dent" in the vehicle, but that it was not very big and was, in her opinion, "a scuff." The driver testified that she waited at the scene of the accident for 30 to 40 minutes before the police officer told her that she could leave. She stated that during that time the child seemed to be uninjured. The driver denied talking with the father after the accident.

The driver testified that she did not inform the owner or Geico of the accident because she did not receive a traffic citation as a result of the accident; because she did not believe that the child was hurt; because she did not believe the accident was serious enough to report; and because she did not believe that she caused the accident, which, she asserted, resulted from the child's running into the vehicle. The owner of the vehicle testified that had she known about the accident, she would have given notice to Geico.

The father testified that he did not inform Progressive of the accident because his child, not his insured vehicle, was involved in the accident. As a result, the father argued, he did not believe that his policy with Progressive would provide coverage for the accident. Both the mother and the father testified that they received a copy of the declarations page of the policy with Progressive, but they did not receive a full copy of the policy before the accident.

Progressive submitted an affidavit of its claims specialist who was familiar with the claim. The affidavit showed that Progressive's general practice and procedure included contacting the drivers and owners of all vehicles involved in an accident. Based on this evidence, Progressive argued that had it been informed by the Steeles of the accident, it would have contacted Geico, the owner, and the driver regarding the possible claims that could have resulted from the accident. According to Progressive, it was prejudiced as a result of the Steeles' delay because, if Geico is not liable because it was not provided timely notice of the accident, it could be required to pay full uninsured-motorist benefits instead of simply being required to pay any possible underinsured-motorist benefits.

The trial court entered a summary judgment in Geico's favor, finding that the driver's delay in notifying Geico was unreasonable as a matter of law. The trial court denied Progressive's motion for a summary judgment. However, it also made findings regarding the ultimate issues related to Progressive's cross-claim. Specifically, the trial court found that the Steeles' delay in notifying Progressive was unreasonable but that Progressive had not shown that it was prejudiced by the delay.

Analysis

A. Case No. 2051006

We first address the appeal from the trial court's summary judgment for Geico based on its finding that the driver's delay in notifying Geico was unreasonable as a matter of law.² The Steeles argue on appeal that the trial court erred because, they argue, the driver's failure to notify Geico of the accident was not unreasonable as a matter of law and the evidence created genuine issues of material fact.³

"`In reviewing the disposition of a motion for summary judgment, "we utilize the same standard as the trial court in determining whether the...