Shelby Mut. Ins. Co. v. Smith, 4-86-2802

• Decision Date: 11 May 1988
• Docket Number: No. 4-86-2802,4-86-2802
• Citation: Shelby Mut. Ins. Co. v. Smith, 527 So.2d 830, 13 Fla. L. Weekly 1107 (Fla. App. 1988)
• Parties: 13 Fla. L. Weekly 1107, 13 Fla. L. Weekly 1758 The SHELBY MUTUAL INSURANCE COMPANY, Appellant, v. Mary Lou SMITH, Appellee.
• Court: Florida District Court of Appeals

Page 830

527 So.2d 830

13 Fla. L. Weekly 1107, 13 Fla. L. Weekly 1758

The SHELBY MUTUAL INSURANCE COMPANY, Appellant, v.Mary Lou SMITH, Appellee.

No. 4-86-2802.

District Court of Appeal of Florida Fourth District.

May 11, 1988.

On Motion for Rehearing July 27, 1988.

Joan Fowler of Walton Lantaff Schroeder & Carson, and Patrick B. Flanagan of McAliley & Associates, West Palm Beach, for appellant.

Philip M. Burlington of Edna L. Caruso, P.A., and Kocha & Jones, P.A., West Palm Beach, for appellee.

PER CURIAM.

This is an appeal of a summary final judgment rendered by the Palm Beach County Circuit Court.We affirm.

AppelleeMary Lou Smith's amended complaint alleged that on or about March 9, 1985, Smith had been involved in an automobile accident caused solely by the fault of the other driver; that as a result of that accident she suffered permanent injuries including herniated discs, permanent disfigurement and permanent disability; and that the tortfeasor's insurance company paid to Smith the full limits of its insurance policy, $50,000, after Smith's insurer, appellantShelby Mutual had provided permission for her to accept those policy limits.

The amended complaint also alleged that Smith had a motor vehicle insurance policy with Shelby Mutual which provided for uninsured/underinsured motorist coverage of $25,000; and that despite her having filed a proper claim for uninsured motorist benefits, Shelby Mutual denied coverage and Smith had to bring this action to obtain those benefits.Smith's amended complaint also alleged a violation of section 624.155, Florida Statutes, i.e., unfair claims settlement practice.Furthermore, Smith sought damages, attorney's fees and costs.

Shelby Mutual filed an answer and counterclaim for Declaratory Relief.In its answer, Shelby Mutual admitted issuing the motor vehicle insurance policy to Smith and admitted the other material allegations of the amended complaint.However, it asserted as an affirmative defense that Smith's accident did not involve an "uninsured motor vehicle" as defined in section 627.727(3), Florida Statutes, and therefore she was not entitled to uninsured motorist coverage.In its counterclaim, Shelby Mutual sought declaratory relief determining that there was no uninsured motorist coverage for the subject accident, and it alleged that it was unsure of its rights under section 627.727, Florida Statutes, as amended in 1984, noting that there were no appellate opinions construing those amendments to the statute.

Smith filed a motion for summary judgment realleging the material allegations of her amended complaint and including therewith an affidavit supporting those allegations.Shelby Mutual did not file any affidavit or other sworn testimony contradicting Smith's affidavit.

The trial court entered an "Order/Summary Final Judgment" in favor of Smith concluding that she was entitled to $25,000 in uninsured motorist coverage under her policy with Shelby Mutual.The Order referred the parties to arbitration and the court retained jurisdiction for purposes of determining Smith's entitlement to attorney's fees and costs.This appeal followed.

The issue on appeal is whether the trial court erred in granting summary final judgment in favor of appellee Smith.Appellant Shelby Mutual contends the trial court erred in granting summary final judgment in favor of Smith as that, in effect, constituted an improper determination by the court that the tortfeasor's vehicle was an "uninsured motor vehicle" within the meaning of section 627.727(3), Florida Statutes(1983).Shelby Mutual argues that in light of the fact that the tortfeasor's vehicle had liability coverage in the amount of $50,000.00 and that Smith's vehicle had uninsured/underinsured motorist coverage in the amount of $25,000.00, it was improper for the trial court to conclude that the tortfeasor's vehicle met the statutory definition of "uninsured motor vehicle."

As of 1984, sections 627.727(1), (2) and (3), Florida Statutes, provided:

(1) No motor vehicle liability insurance policy shall be delivered or issued for delivery in this state with respect to any specifically insured or identified motor vehicle registered or principally garaged in this state unless uninsured motor vehicle coverage is provided therein or supplemental thereto for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness, or disease, including death, resulting therefrom.However, the coverage required under this section is not applicable when, or to the extent that, any insured named in the policy rejects the coverage in writing.When a motor vehicle is leased for a period of 1 year or longer and the lessor of such vehicle, by the terms of the lease contract, provides liability coverage on the leased vehicle, the lessee of such vehicle shall have the sole privilege to reject uninsured motorist coverage or to select lower limits than the bodily injury liability limits.Unless the named insured, or lessee having the privilege of rejecting uninsured motorist coverage, requests such coverage or requests higher uninsured motorist limits in writing, the coverage or such higher uninsured motorist limits need not be provided in or supplemental to any other policy which renews, extends, changes, supersedes, or replaces an existing policy with the same bodily injury liability limits when the named insured or lessee had rejected the coverage.When the named insured or lessee has initially selected limits of uninsured motorist coverage lower than his bodily injury liability limits, higher limits of uninsured motorist coverage need not be provided in or supplemental to any other policy which renews, extends, changes, supersedes, or replaces an existing policy with the same bodily injury liability limits unless the named insured requests higher uninsured motorist coverage in writing.The rejection or selection of lower limits shall be made on a form approved by the Insurance Commissioner.The form shall fully advise the applicant of the nature of the coverage and shall state that the coverage is equal to bodily injury liability limits unless lower limits are requested or the coverage is rejected.The heading of the form shall be in 12-point bold type and shall state: "You are electing not to purchase certain valuable coverage which protects you and your family or you are purchasing uninsured motorist limits less than your bodily injury liability limits when you sign this form.Please read carefully."If this form is signed by a named insured, it will be conclusively presumed that there was an informed, knowing rejection of coverage or election of lower limits.The insurer shall notify the named insured at least annually of his options as to the coverage required by this section.Such notice shall be part of the notice of premium, shall provide for a means to allow the insured to request such coverage, and shall be given in a manner approved by the department.The coverage described under this section shall be over and above, but shall not duplicate, the benefits available to an insured under any workers' compensation law, personal injury protection benefits, disability benefits law, or similar law; under any automobile medical expense coverage; under any motor vehicle liability insurance coverage; or from the owner or operator of the uninsured motor vehicle or any other person or organization jointly or severally liable together with such owner or operator for the accident; and such coverage shall cover the difference, if any, between the sum of such benefits and the damages sustained, up to the maximum amount of such coverage provided under this section.The amount of coverage available under this section shall not be reduced by a setoff against any coverage, including liability insurance.Such coverage shall not inure directly or indirectly to the benefit of any workers' compensation or disability benefits carrier or any person or organization qualifying as a self-insurer under any workers' compensation or disability benefits law or similar law.

(2) The limits of uninsured motorist coverage shall be not less than the limits of bodily injury liability insurance purchased by the named insured, or such lower limit complying with the rating plan of the company as may be selected by the named insured.The limits set forth in this subsection, and the provisions of subsection (1) which require uninsured motorist coverage to be provided in every motor vehicle policy delivered or issued for delivery in this state, do not apply to any policy which does not provide primary liability insurance that includes coverage for liabilities arising from the maintenance, operation, or use of a specifically insured motor vehicle.However, an insurer issuing such a policy shall make available as a part of the application for such policy, and at the written request of an insured, limits up to the bodily injury liability limits contained in such policy.

(3) For the purpose of this coverage, the term "uninsured motor vehicle" shall, subject to the terms and conditions of such coverage, be deemed to include an insured motor vehicle when the liability insurer thereof:

(a) Is unable to make payment with respect to the legal liability of its insured within the limits specified therein because of insolvency; or

(b) Has provided limits of bodily injury liability for its insured which are less than the limits applicable to the injured person provided under uninsured motorist's coverage applicable to the injured person.

Prior to the 1984amendments, section 627.727(1) allowed for the setoff of a tortfeasor's liability coverage against the injured party's underinsured...