State Farm Mutual Automobile Insurance Company v. Carlton

Decision Date11 May 2001
Citation867 So.2d 320
CourtAlabama Court of Civil Appeals

Ronald G. Davenport and R. Austin Huffaker, Jr., of Rushton, Stakely, Johnston & Garrett, P.A., Montgomery, for appellant.

Richard A. Lawrence, Montgomery, for appellee.


This case requires us to decide an issue of first impression in Alabama: whether a worker can receive uninsured-motorist ("UM") benefits under his family automobile liability policy when he is injured on the job by a negligent coworker who is immune to suit because of the exclusivity provisions of the Workers' Compensation Act ("the Act").

In October 1998, Nicholas Shane Carlton was injured in a motor-vehicle accident while acting within the scope of his employment with Montgomery Landscaping Contractors, Inc. Carlton was a passenger in a vehicle owned by his employer and driven by a coemployee. The coemployee-driver negligently turned in front of an oncoming vehicle. Carlton received workers' compensation benefits. He also sought benefits under a State Farm automobile policy that provided UM coverage.

State Farm refused to pay, insisting that Carlton could not fulfill the condition precedent to recovery of UM benefits—that he be "legally entitled to recover" from the negligent driver—because, State Farm says, Carlton was barred by the exclusivity and coemployee-immunity provisions of the Act from suing a coemployee for negligence. See §§ 25-5-52; 25-5-53; 25-5-11, Ala.Code 1975.

State Farm filed a declaratory-judgment action, seeking a determination that it was not liable under the UM provision of an automobile policy issued to Carlton's mother and including Carlton as an insured. Before he was served in State Farm's action, Carlton sued State Farm to collect the UM benefits of his mother's policy. In State Farm's declaratory-judgment action, Carlton answered and counterclaimed for the proceeds of the policy. The two cases were consolidated and the facts were stipulated by the parties. Each party moved for a summary judgment, with a supporting brief. The circuit court entered a judgment in favor of Carlton for $50,000, the limits of his mother's UM coverage. State Farm appealed to this court.

Section 32-7-23, Ala.Code 1975, mandates that every insurer in this state offer UM coverage in its automobile liability insurance policies, "for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles." (Emphasis added.) The State Farm policy that insures Carlton echoes the words of the UM statute: "We will pay damages for bodily injury an insured is legally entitled to collect from the owner or driver of an uninsured motor vehicle." (Emphasis added.) Carlton is barred by § 25-5-11, Ala.Code 1975, from suing his negligent coworker. Therefore, State Farm argues, it does not owe Carlton any UM benefits because Carlton is not "legally entitled to recover" from the negligent coworker.

At least 19 jurisdictions have considered the issue presented here, and 17 have concluded that an injured employee has no cause of action against his own UM insurer for on-the-job injuries arising out of the negligence of a fellow employee.1,2See generally John P. Ludington, Annot., Automobile Uninsured Motorist Coverage: "Legally Entitled to Recover" Clause as Barring Claim Compensable Under Workers' Compensation Statute, 82 A.L.R.4th 1096 (1990). Carlton argues that a line of cases decided by our supreme court would allow the negligent coworker—precisely because he is not amenable to suit—to be deemed the operator of an "uninsured motor vehicle," and would, therefore, require State Farm to pay Carlton the UM proceeds of his mother's automobile policy. See Hogan v. State Farm Mut. Auto. Ins. Co., 730 So.2d 1157 (Ala.1998)

(holding that a driver not amenable to suit because of the Guest Statute is deemed an "uninsured motorist"), overruled on other grounds by Williamson v. Indianapolis Life Ins. Co., 741 So.2d 1057 (Ala.1999); State Farm Mut. Auto. Ins. Co. v. Jeffers, 686 So.2d 248 (Ala.1996) (holding that a driver with governmental immunity is deemed an "uninsured motorist"); State Farm Auto. Ins. Co. v. Baldwin, 470 So.2d 1230 (Ala.1985) (same). All three casesHogan, Jeffers, and Baldwin—were decided in response to certified questions from federal courts.

In Baldwin, the first of the trio of cases, a United States Army sergeant at Fort Rucker was injured when an uninsured Government vehicle, driven by an employee of the United States Government, collided with the sergeant's motorcycle. It was undisputed that the civilian's negligence caused the accident. Nevertheless, the sergeant had no recourse against the civilian or the Government because of the Feres doctrine. See Feres v. United States, 340 U.S. 135, 71 S.Ct. 153, 95 L.Ed. 152 (1950)

(interpreting the Federal Tort Claims Act, 28 U.S.C. § 1346, to bar actions against the Government or its employees for injuries incurred by a member of the military arising out of and in the course of his military service).

First, the court reiterated the legislative policy underlying the UM statute—to provide coverage "to protect those financially and ethically responsible enough to obtain automobile liability insurance from injuries caused by those not so responsible." Baldwin, 470 So.2d at 1233. The court stated that the UM statute is read into every insurance policy contract and, unless the statute itself restricts coverage, an individual policy may not restrict UM coverage.

Next, the court discussed an earlier decision of this court in State Farm Mutual Automobile Insurance Co. v. Griffin, 51 Ala.App. 426, 286 So.2d 302 (1973). Griffin had held that an insured was entitled to UM benefits if he could establish fault on the part of the uninsured motorist and damage, subject to any available policy defenses the insurer might have, as well as "substantive defenses that would have been available to the uninsured motorist." Griffin, 51 Ala.App. at 431, 286 So.2d at 306.

Acknowledging that, under Griffin, State Farm could assert the Feres-doctrine defense to deny liability to its insured, the supreme court stated the issue as follows "[T]his court must decide if the legislative policy of the uninsured motorist statute would allow State Farm to assert that defense and deny the otherwise valid claim of the Baldwins." Baldwin, 470 So.2d at 1234. The court concluded that the policy underlying the UM statute—to protect a person who is injured by a financially irresponsible motorist—would not allow the insurer to assert the defense and that the insured could recover UM benefits from State Farm.

The second case in the trio, Jeffers, also involved a driver who was immune from suit. In that case, Jeffers was injured when her vehicle collided with a vehicle being driven by a deputy sheriff. Unlike the vehicle in Baldwin, the vehicle in Jeffers was insured, but the deputy sheriff had substantive immunity. The court framed the issue as follows:

"[W]hether, under § 32-7-23(b), Ala. Code 1975, an insured motorist can be deemed to be an `uninsured motorist' when the injured party's claim against the insured motorist is barred by the doctrine of substantive immunity."

The court determined that the only material distinction between Jeffers and Baldwin was the fact that the vehicle in Jeffers was insured but the vehicle in Baldwin was uninsured.

Once again referring to the purpose underlying the UM statute, the court stated:

"`[T]he design of the statute is to protect [an] injured [person] who can prove that the accident did in fact occur and that he was injured as a proximate result of the negligence of [another] motorist who cannot respond in damages for such injuries.'"

Jeffers, 686 So.2d at 250 (quoting State Farm Fire & Cas. Co. v. Lambert, 291 Ala. 645, 649, 285 So.2d 917, 919 (1973)).

With one justice dissenting, the court held that "because of the application of substantive immunity, Deputy Anderson, in effect, was not insured." Jeffers, 686 So.2d at 250. Justice Houston dissented, pointing out that the UM statute addressed "uninsured motor vehicles," not "uninsured motorists." He stated:

"The mere fact that a vehicle insured for bodily injury liability is operated by someone who is immune from liability while operating that vehicle cannot make the vehicle an `uninsured motor vehicle.'"

Jeffers, 686 So.2d at 250 (Houston, J., dissenting).

In Hogan, the most recent of the trio of cases, an injured passenger was unable to recover against a negligent driver with whom she was traveling because the Alabama Guest Statute, § 32-1-2, Ala.Code 1975, allowed recovery only against willful or wanton drivers. Therefore, relying on Baldwin and Jeffers, the passenger sought UM benefits under her own automobile policy. The supreme court held that she was entitled to the proceeds of the policy. Also relying on Baldwin and Jeffers, the court determined that "[t]he passenger, even though she [was] precluded from suing the owner or the operator of the vehicle in which she was a passenger because of the provisions of the guest statute, may nevertheless be `legally entitled to recover damages' under the Uninsured Motorist Statute." 730 So.2d at 1159.

Justice Lyons dissented, stating that he thought the court, in Baldwin and Jeffers, had misapplied the language of the UM statute. Justice Lyons explained:

"I believe that whether an insured is `legally entitled to recover' depends entirely on the merits of the insured's claim against a tortfeasor under the laws of the state. However, today's decision, like Baldwin and Jeffers, has construed the phrase to mean `legally entitled to recover but for a defense that does not arise out of any wrongful conduct of the insured,' a defense such as immunity or an insured's status as a guest."
Hogan v. State Farm Mut. Auto.

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