Snyder v. Am. Family Ins. Co.

• Decision Date: 22 August 2007
• Docket Number: No. 2006-0223.,2006-0223.
• Citation: 114 Ohio St.3d 239,871 N.E.2d 574,2007 Ohio 4004
• Parties: SNYDER, Appellant, v. AMERICAN FAMILY INSURANCE COMPANY, Appellee.
• Court: Ohio Supreme Court

871 N.E.2d 574

114 Ohio St.3d 239

2007-Ohio-4004

SNYDER, Appellant, v. AMERICAN FAMILY INSURANCE COMPANY, Appellee.

No. 2006-0223.

Supreme Court of Ohio.

Submitted January 9, 2007.

Decided August 22, 2007.

Lamkin, Van Eman, Trimble, Beals, & Dougherty, L.L.C., Timothy L. Van Eman, and Keri N. Yaeger, Columbus, for appellant.

Frost, Maddox & Norman Co., L.P.A., and Mark S. Maddox, Columbus, for appellee.

Weston Hurd, L.L.P., Carol K. Metz, and John G. Farnan, Cleveland, urging affirmance for amicus curiae Ohio Association of Civil Trial Attorneys.

Paul W. Flowers Co., L.P.A., and Paul W. Flowers, Cleveland, urging reversal for amicus curiae Ohio Academy of Trial Lawyers.

CUPP, J.

{¶ 1} This case presents two issues for resolution. The first issue is whether the 2001 amendment to Ohio's uninsured- and underinsured-motorist coverage law, R.C. 3937.18, contained in Am.Sub.S.B. No. 97, 149 Ohio Laws, Part I, 779, 779-786, effective Oct. 31, 2001 ("S.B. 97"), permits a motor vehicle insurance policy to exclude claims for uninsured-motorists benefits when the tortfeasor is statutorily immune from liability. If the answer to this first question is "yes," then the second issue we must address is whether an insurance policy that restricts coverage to amounts that the insured is "legally entitled to recover" from the uninsured motorist unambiguously provides that coverage will be denied when the uninsured tortfeasor is protected by a statutory immunity.

{¶ 2} For the reasons that follow, we conclude that R.C. 3937.18 does not prohibit enforcement of a policy that excludes claims for uninsured-motorist benefits when the tortfeasor is statutorily immune from liability. We also conclude that policy language restricting uninsured-motorist coverage to those amounts the insured is "legally entitled to recover" from the tortfeasor owner or operator of an uninsured motor vehicle unambiguously denies coverage for injuries caused by uninsured motorists who are immune from liability under R.C. Chapter 2744 or R.C. 4123.741. Accordingly, we affirm the judgment of the court of appeals.

I

A

{¶ 3} On November 2, 2002, appellant, Jennifer Snyder, a Columbus police officer, along with several other Columbus police officers, pursued a fleeing suspect during an emergency call. Snyder was on foot. A police cruiser driven by Officer Castro hit Snyder. The impact threw Snyder onto the hood of the cruiser and into the windshield. The parties do not dispute that Castro was negligent and that Snyder sustained injuries as a result of that negligence.¹

{¶ 4} After her injury, Snyder submitted to appellee, American Family Insurance Company, a claim for uninsured-motorist benefits pursuant to her personal motor vehicle liability insurance policy. Snyder's policy with American Family provided uninsured-motorist coverage of $100,000 per person and $300,000 per occurrence. That policy had first become effective on October 19, 2001. A renewal of the policy, dated October 19, 2002, was in force on the date of Snyder's injury.

{¶ 5} The pertinent language of the American Family policy provided: "[American Family] will pay compensatory damages for bodily injury which an insured person is legally entitled to recover from the owner or operator of an uninsured motor vehicle." (Boldface sic.) American Family denied coverage.

B

{¶ 6} Snyder sued American Family to recover uninsured-motorist benefits under the policy. Snyder argued that she was entitled to coverage because R.C. 3937.18 includes persons who have "immunity under Chapter 2744. of the Revised Code" within its definition of "uninsured motorists." See R.C. 3937.18(B)(5). Additionally, the statute, as amended in 2001, no longer requires the insured to be "legally entitled to recover" from the tortfeasor. American Family argued in the courts below that Snyder was not "legally entitled to recover" from either Officer Castro or the city of Columbus, as required by the policy, because of the tortfeasors' statutory immunity.

{¶ 7} It is not disputed that the city and Officer Castro are immune from liability under R.C. Chapter 2744, Ohio's Political Subdivision Tort Immunity Act. Specifically, the parties do not dispute that the city is immune under R.C. 2744.02(B)(1)(a),² which provides a defense to liability if the claimant's injury occurred as a result of a police officer responding to an emergency call. Nor is it disputed that Officer Castro is immune from liability under R.C. 2744.03(A)(6),³ because Castro was within the scope of her employment when the injury occurred. There is also no dispute that Officer Castro is immune from liability under R.C. 4123.741, the fellow-servant immunity statute. The fellow-servant immunity statute precludes an employee from bringing suit against a fellow employee for injury incurred in the course and scope of the injured employee's employment when the injury is compensable under the workers' compensation statutes. See R.C. 4123.741.⁴

{¶ 8} The trial court granted Snyder's motion for partial summary judgment and denied American Family's motion for summary judgment. Rejecting American Family's argument that an earlier version of R.C. 3937.18 applied, the trial court applied the 2001 version of the statute.⁵ The trial court then held that the city of Columbus and Officer Castro were "uninsured motorists" as defined in R.C. 3937.18(B)(5), because they had immunity under R.C. Chapter 2744. The trial court further ruled that R.C. 3937.18 protected Snyder from being denied uninsured-motorist benefits on the basis that she was not "legally entitled to recover" from the city and Officer Castro. The trial court opined that it would be illogical for an uninsured-motorist policy to preclude recovery based on an immunity defense, because the 2001 statute specifically includes tortfeasors "immune under R.C. Chapter 2744" within the definition of "uninsured motorist." See R.C. 3937.18(B)(5).⁶ The parties stipulated to the amount of Snyder's damages, and the trial court entered final judgment for Snyder.

{¶ 9} On appeal, the Franklin County Court of Appeals reversed. It ruled that R.C. 3937.18 as amended in 2001 did not preclude insurers from limiting uninsured-motorist coverage to amounts that the insured was legally entitled to recover from the tortfeasor. Snyder v. Am. Family Ins. Co., 10th Dist. No. 05AP-116, 2005-Ohio-6751, 2005 WL 3484221, ¶ 21-25. The court of appeals reasoned that "[t]he fact that the legislature removed its own `terms and conditions that preclude coverage' from the statute does not mean that no such terms and conditions are permitted to be placed in policies with UM coverage." Id. at ¶ 22.

{¶ 10} The appeals court concluded that R.C. 3937.18(I), which permits policies to exclude claims for uninsured-motorist coverage under specified circumstances, "[left] to the parties whether any preconditions or exclusions to coverage will govern their relationship." Id. As applied to the present case, the appellate court ruled that the policy's "legally entitled to recover" provision required that the insured must be able to obtain a judgment against the tortfeasor. Id. at ¶ 23. Because Snyder could not recover against Columbus or Officer Castro due to their immunity under R.C. Chapter 2744 (as to both tortfeasors) and R.C. 4123.741 (as to Officer Castro), Snyder failed to meet the policy's "legally entitled to recover" precondition to coverage. Id. at ¶ 18, 23, and 25.

{¶ 11} Snyder appealed the court of appeals' judgment to this court, and we granted review.

{¶ 12} In this court, Snyder asserts that the term "legally entitled to recover" as used in American Family's policy is void because it contradicts the terms of the statute, the 2001 version of R.C. 3937.18. Snyder's second contention is that the phrase "legally entitled to recover," which is undefined in the policy, is ambiguous and must therefore be construed narrowly and in favor of the insured. Snyder's third proposition is that because the tortfeasors herein qualify as "uninsured motorists" under the statutory definition of R.C. 3937.18(B)(5), Snyder is entitled to recover uninsured-motorist benefits under the policy. For clarity of analysis, we address Snyder's first and third propositions together.

II

A

{¶ 13} The General Assembly extensively amended R.C. 3937.18 in 2001, in S.B. 97.⁷ For example, before S.B. 97, the statute required insurers to offer uninsured- and underinsured-motorist coverage to all persons who obtained motor vehicle liability insurance policies in Ohio. See, e.g., former R.C. 3937.18, 148 Ohio Laws, Part V, 11380.

{¶ 14} Among the significant changes in the 2001 amendment was the removal of the requirement that insurers must offer uninsured- or underinsured-motorist coverage to persons purchasing motor vehicle liability insurance. Instead, the law now provides that an insurer "may, but is not required to," include uninsured-motorist coverage or underinsured-motorist coverage, or both, in a motor vehicle policy. See R.C. 3937.18(A). The General Assembly expressly stated that its intention was to eliminate the mandatory offering of uninsured- and underinsured-motorist coverage and the imposition of any such coverage implied as a matter of law. See S.B. 97, Sections 3(B)(1), (2), and (4), 149 Ohio Laws, Part I, 779, 788-789.

{¶ 15} Additionally, the 2001 statute for the first time permits policies with uninsured-motorist coverage to limit or exclude coverage under circumstances that are specified in the policy even if those circumstances are not also specified in the statute. See R.C. 3937.18(I). Division (I) of the statute provides: "Any policy of insurance that includes uninsured motorist coverage, underinsured motorist coverage, or both uninsured and underinsured motorist coverages may include terms and conditions that preclude coverage for bodily injury or death suffered by an insured under specified circumstances, including but not limited to any of the...