Seeck v. Geico General Ins. Co., No. SC 87995.

• Court: United States State Supreme Court of Missouri
• Writing for the Court: Laura Denvir Stith
• Citation: 212 S.W.3d 129
• Parties: Tamara SEECK, Appellant, v. GEICO GENERAL INSURANCE CO., Respondent.
• Docket Number: No. SC 87995.
• Decision Date: 30 January 2007

212 S.W.3d 129 Tamara SEECK, Appellant,
v.
GEICO GENERAL INSURANCE CO., Respondent. No. SC 87995. Supreme Court of Missouri, En Banc. January 30, 2007.

[212 S.W.3d 131]

Gary A. Growe and Andrew J. Scavotto, St. Louis, for Appellant.

Kevin B. Behrndt, St. Louis, for Respondent.

Leland F. Dempsey, Kansas City, for Amicus Curiae Missouri Association of Trial Attorneys.

Susan Ford Robertson and Emily W. Little, Columbia, for Amicus Curiae Missouri Organization of Defense Lawyers.

LAURA DENVIR STITH, Judge.

Tamara Seeck appeals the trial court's entry of summary judgment in favor of Geico General Insurance Company in Ms. Seeck's suit seeking $50,000 in underinsured motorist coverage under her Geico policy. The trial court held that the policy did not provide coverage. This Court disagrees. Geico's argument that other policy provisions do not appear to provide coverage is not dispositive because the policy's other insurance clause would cause an ordinary insured of average understanding to believe that excess coverage exists where, as here, the insured's injuries exceed the coverage provided by the primary insurance on the occupied motor vehicle. At a minimum, this creates an ambiguity in the policy that, under settled Missouri law, must be resolved in favor of the insured. The judgment is reversed, and the case is remanded.

I. FACTUAL AND PROCEDURAL BACKGROUND

Ms. Seeck sustained serious cervical spine injuries as a passenger in a motor vehicle that was rear-ended by a negligent motorist. Her injuries are permanent, chronic, and progressive. The negligent driver who caused the collision was insured with Farmers Insurance Group.

Farmers tendered a release and settlement agreement resolving Ms. Seeck's claims against Farmers and the negligent driver for $50,000, the full amount of coverage available under the Farmers policy. Ms. Seeck and Farmers signed the release and settlement agreement that included a specific, handwritten clause that expressly reserved her right to seek underinsured motorist benefits from her own insurance carrier, Geico.

Ms. Seeck then filed a claim seeking coverage up to the $50,000 limit provided in the "Underinsured Motorist Coverage" (UMC) policy amendment to her Geico policy. When Geico refused coverage, Ms. Seeck filed the instant suit. The parties stipulated that the policy would pay Ms. Seeck $50,000 if the policy's underinsured motorist coverage applied, but Geico argued it did not apply. After briefing and argument, the trial court entered summary judgment for Geico. Ms. Seeck appealed to the Court of Appeals, Eastern District, which transferred the case to this Court after opinion.¹

II. DISCUSSION

A. Standard of Review

212 S.W.3d 132

Whether to grant summary judgment is an issue of law that this Court determines de novo. American Std. Ins. Co. v. Hargrave, 34 S.W.3d 88, 89 (Mo. banc 2000). The interpretation of an insurance policy is a question of law that this Court also determines de novo. Martin v. United States Fid. & Guar. Co., 996 S.W.2d 506, 508 (Mo. banc 1999); McCormack Baron Mgt. Servs., Inc. v. American Guarantee & Liab. Ins. Co., 989 S.W.2d 168, 171 (Mo. banc 1999). In construing the terms of an insurance policy, this Court applies "the meaning which would be attached by an ordinary person of average understanding if purchasing insurance," id., and resolves ambiguities in favor of the insured. Martin, 996 S.W.2d at 508.

B. Ambiguity of the Geico Policy.

The key issue before the Court is whether the Geico policy is ambiguous. "An ambiguity exists when there is duplicity, indistinctness, or uncertainty in the meaning of the language in the policy. Language is ambiguous if it is reasonably open to different constructions." Gulf Ins. Co. v. Noble Broadcast, 936 S.W.2d 810, 814 (Mo. banc 1997). Absent an ambiguity, an insurance policy must be enforced according to its terms. Rodriguez v. General Accident Ins. Co., 808 S.W.2d 379, 382 (Mo. banc 1991). If, however, "policy language is ambiguous, it must be construed against the insurer." Gulf Ins. Co., 936 S.W.2d at 814.

The excess or other insurance clause that Ms. Seeck argues provides coverage declares, in pertinent part:

When an insured is occupying a motor vehicle not owned by the insured . . . this insurance is excess over any other insurance available to the insured and the insurance which applies to the occupied motor vehicle is primary.

This provision expressly states that the Geico policy provides "excess" coverage over "any" other insurance available to the insured and that it is excess to any "primary" coverage provided by insurance that applies to the occupied motor vehicle. Ms. Seeck recovered $50,000 from Farmers under the tortfeasor's insurance policy covering the occupied motor vehicle. She now makes a claim on Geico to provide excess coverage to this primary insurance.

This Court agrees that an "ordinary person of average understanding," McCormack Baron, 989 S.W.2d at 171, would interpret the excess insurance clause to mean that since Ms. Seeck has obtained recovery under the primary Farmers insurance policy applicable to the occupied vehicle but has additional damages, she is entitled to coverage under the excess insurance clause of her own Geico policy.

Geico argues that this Court should not reach this issue, but rather should hold that the tortfeasor's vehicle does not come within the definition of "underinsured motor vehicle" in the Geico policy, which defines an underinsured vehicle as one whose "limit for bodily injury liability is less than the limit of liability for this [the Geico] coverage." Similarly, Geico argues, there should be no coverage because the policy's limit of liability clause provides that recovery under the policy will be reduced by the amounts paid by insurance carried by the party at fault for the accident.² Therefore,

212 S.W.3d 133

as both the Farmers and the Geico policy provided $50,000 in insurance coverage, Geico argues, its underinsured motorist coverage never came into effect, the limits of liability provision reduced coverage to nothing, and this Court should not consider the meaning of the excess insurance clause.

Geico's argument is inconsistent with well-settled Missouri law requiring a court not to interpret policy provisions in isolation but rather to evaluate a policy as a whole. See, e.g., Central Sur. & Ins. Corp. v. New Amsterdam Cas. Co., 359 Mo. 430, 222 S.W.2d 76, 78 (1949). As this Court held in Lutsky v. Blue Cross Hosp. Serv., Inc., 695 S.W.2d 870, 875 (Mo. banc 1985), "[i]f a contract promises something at one point...