State Farm Auto. Ins. Co. v. Greer

• Decision Date: 18 July 1989
• Docket Number: No. 70212,70212
• Citation: 777 P.2d 941,1989 OK 110
• Parties: 55 Ed. Law Rep. 316, 1989 OK 110 STATE FARM AUTOMOBILE INSURANCE COMPANY, Plaintiff, v. Melissa GREER and Frank Greer, Defendants.
• Court: Oklahoma Supreme Court

Page 941

777 P.2d 941

55 Ed. Law Rep. 316, 1989 OK 110

STATE FARM AUTOMOBILE INSURANCE COMPANY, Plaintiff, v. Melissa GREER and Frank Greer, Defendants.

No. 70212.

Supreme Court of Oklahoma.

July 18, 1989.

James K. Secrest, II, Tulsa, for plaintiff.

Dale Warner and John S. Sharp, Tulsa, for defendants.

HODGES, Justice.

The United States District Court for the Northern District of Oklahoma has certified a question of law to this Court pursuant to the Oklahoma Uniform Certification of Questions of Law Act, 20 O.S.1981 § 1601 et seq. The question certified for answer is:

Is the definition of uninsured motor vehicle that excludes any land motor vehicle owned by any government or any of its political subdivisions or agencies void as against public policy?

We answer in the affirmative.

Frank Greer was the named insured on four policies of automobile insurance issued by State Farm Automobile Insurance Company (hereinafter "State Farm"). Three of the policies provided for uninsured motorist coverage of $25,000 per person and $50,000 per accident. The fourth policy provided for uninsured motorist coverage of $100,000 per person and $300,000 per accident. All of these policies were in effect when Greer's natural daughter, Melissa Greer, was injured while a passenger in a vehicle owned by Oklahoma State University (hereinafter "university").

Melissa Greer sued the university, the driver of the vehicle and State Farm in Payne County District Court on the theory that the university and the driver were underinsured motorists as defined by 36 O.S.1981 § 3636 at the time of the accident and, therefore, she should be entitled to the uninsured motorist coverage provided by the State Farm policies issued to Frank Greer. In response State Farm brought this action seeking declaratory relief that the university vehicle in which Melissa Greer was a passenger when the accident occurred was not an uninsured motor vehicle as defined in the State Farm insurance policies issued to Frank Greer.

The Greers contend that the definition of uninsured motor vehicle that appears in the policies and excludes any "land motor vehicle owned by any government or any of its political subdivisions or agencies" is void as against the public policy expressed in 36 O.S.1981 § 3636.

Oklahoma has clearly mandated the inclusion of uninsured motorist coverage in automobile insurance policies by using the specific legislative language found in 36 O.S.1981 § 3636. Subsection (C) is applicable in this situation and reads as follows

(C) For the purposes of this coverage the term "uninsured motor vehicle" shall include an insured motor vehicle where the liability insurer thereof is unable to make payment with respect to the legal liability of its insured within the limits specified therein because of insolvency. For the purposes of this coverage the term "uninsured motor vehicle" shall also include an insured motor vehicle, the liability limits of which are less than the amount of the claim of the person or persons making such claim, regardless of the amount of coverage of either of the parties in relation to each other.

In reviewing this language we are mindful that the insurance coverage contract required by the statute is to be liberally construed in favor of the object to be accomplished. Aetna Insurance Company v. Zablotsky, 481 P.2d 761 (Okla.1971). The primary purpose of including uninsured motorist coverage in an insurance policy is to protect the insured from the effects of personal injury resulting from an accident with an uninsured/underinsured motorist. Uptegraft v. Home Ins. Co., 662 P.2d 681 (Okla.1983). More specifically, uninsured motorist coverage allows an insured to be indemnified if the insured is unable to recover fully from the negligent motorist. Karlson v. City of Oklahoma City, 711 P.2d 72 (Okla.1985).

Oklahoma's statutory determination of what is included under the term "uninsured motor vehicle" does not specifically exclude any class of vehicles. Other jurisdictions with statutory language similar to that of subsection (C) have found that insurance policy provisions specifically excluding government vehicles from the category of uninsured motor vehicle are against public policy and, therefore, are void and unenforceable. Hillhouse v. Farmers Ins. Co., Inc., 226 Kan. 68, 595 P.2d 1102 (1979); Higgins v. Nationwide Mutual Insurance Co., 291 Ala. 462, 282 So.2d 301 (1973); State Farm Mutual Automobile Ins. Co. v. Carlson, 130 Ga.App. 27, 202 S.E.2d 213 (1973). Our past surveys of various Oklahoma insurance policy provisions have consistently held that language inserted by the insurer in the policy which purports to dilute the legislatively mandated uninsured motorist coverage is void and unenforceable as it violates the public policy espoused in 36 O.S.1981 § 3636. State Farm Mut. Auto. Ins. Co. v. Wendt, 708 P.2d 581 (Okla.1985); Heavner v. Farmers Ins. Co., 663 P.2d 730 (Okla.1983); Lake v. Wright, 657 P.2d 643 (Okla.1982) Porter v. MFA Mut. Ins. Co., 643 P.2d 302 (Okla.1982); Biggs v. State Farm Mut. Auto. Ins. Co., 569 P.2d 430 (Okla.1977).

In its brief State Farm directs our attention to Francis v. Intern. Serv. Ins. Co., 546 S.W.2d 57 (Tex.1976) and Commercial Union Ins. Co. v. Delaney, 550 S.W.2d 499 (Ky.1977). Both cases upheld the validity of policy provisions that specifically exclude government vehicles from the category of uninsured motor vehicles. The Francis case is distinguishable in that the decision of the court relied on the Texas Uninsured Motorist Act language that expressly authorizes the exclusion of vehicles whose operators are uninsured and the court's finding that this exclusion was in furtherance of the purpose of the Act. The Oklahoma statute contains no such language. In Delaney the Kentucky Supreme Court relied on the language used in the Kentucky uninsured motorist statute which defined the term "uninsured motor vehicle" as being "subject to the terms and conditions of such [uninsured motorist] coverage ..." Nothing similar to this language is found in the Oklahoma statute. We do not find either of these cases persuasive as regards State Farm's position.

An insured must be allowed to look to the insurer when the liability limits of a negligent motorist prevent the insured from recovering fully from the injuries suffered. Allowing a provision such as the one before us to thwart that objective would be a major deviation from the original legislative intent of 36 O.S.1981 § 3636(C). This provision is a blatant attempt to limit the effect of 36 O.S.1981 § 3636. As such we must find it to be against public policy and, therefore, void and unenforceable. Brown v. United States Auto Ass'n, 684 P.2d 1195 (Okla.1984).

CERTIFIED QUESTION ANSWERED.

LAVENDER, SIMMS, DOOLIN, ALMA WILSON, KAUGER and SUMMERS, JJ., concur.

HARGRAVE, C.J., concurs in result.

OPALA, V.C.J., dissents.

OPALA, Vice Chief Justice, dissenting.

The court holds today that insurers are not allowed to exclude from uninsured/underinsured motorist policy coverage vehicles owned by "any government or any of its political subdivisions or agencies." I must recede from this view.

Mandatory inclusion of coverage for the vehicles in controversy here is woven from the fiber of thin air. Nothing in § 3636 ¹ commands insurers, explicitly or implicitly, to provide the protection imposed by today's opinion. In the context of UM coverage, publicly owned vehicles constitute both statutorily and constitutionally a totally separate class. ² Because government tortfeasors enjoy limited liability, all of their vehicles...