Sugden v. Bock

• Decision Date: 31 January 2002
• Docket Number: No. 01-1284.,01-1284.
• Citation: 641 N.W.2d 693,251 Wis.2d 344,2002 WI App 49
• Parties: Raymond G. SUGDEN, individually and as Special Administrator of the Estate of James A. Sugden, and Albert E. Sugden, by his Guardian ad Litem, Gregory R. Wright, and Karen C. Sugden, Plaintiffs-Appellants, v. Cory R. BOCK, Defendant-(In T.ct.), AMERICAN FAMILY MUTUAL INSURANCE COMPANY, Defendant-Respondent.
• Court: Wisconsin Court of Appeals

251 Wis.2d 344

2002 WI App 49

641 N.W.2d 693

Raymond G. SUGDEN, individually and as Special Administrator of the Estate of James A. Sugden, and Albert E. Sugden, by his Guardian ad Litem, Gregory R. Wright, and Karen C. Sugden, Plaintiffs-Appellants,¹ v. Cory R. BOCK, Defendant-(In T.ct.), AMERICAN FAMILY MUTUAL INSURANCE COMPANY, Defendant-Respondent.

No. 01-1284.

Court of Appeals of Wisconsin.

Submitted on briefs November 8, 2001.

Decided January 31, 2002.

On behalf of the plaintiffs-appellants, the cause was submitted on the briefs of Gregory R. Wright of Gregory R. Wright Law Offices, S.C., Montello.

On behalf of the defendant-respondent, the cause was submitted on the brief of David J. Pliner of Corneille Law Group, L.L.C., Madison.

Before Vergeront, P.J., Dykman and Roggensack, JJ.

¶ 1. DYKMAN, J.

Albert Sugden, Karen Sugden, and Raymond Sugden, individually and as special administrator of the Estate of James Sugden, appeal from an order and judgment granting the motion for summary judgment of the Sugdens' insurer, American Family Mutual Insurance Company, and dismissing all of the Sugdens' claims against American Family. After an accident that killed James Sugden and injured Albert, American Family paid its policy limits to the Sugdens. The Sugdens contend, however, that they are entitled to at least an additional $25,000 by way of stacking the limits of the several policies they hold with American Family. Although each of the insurance policies contains an anti-stacking provision, the Sugdens argue alternatively that: (1) the provisions are not valid under Wisconsin law; or (2) American Family waived or is estopped from enforcing the provisions. We conclude that the anti-stacking provisions in the American Family policies are lawful under WIS. STAT. § 632.32(5)(f) (1999-2000)² and that American Family has not waived nor is it estopped from asserting these provisions. We therefore affirm.

Background

¶ 2. For the purposes of American Family's motion for summary judgment, the facts are undisputed. On September 27, 1998, James and Albert Sugden were bicycling on County Highway P when they were struck by an automobile driven by Cory Bock. James was killed, and Albert was injured.

¶ 3. Because Bock had no automobile insurance, the Sugdens sought to recover under the uninsured motorist provisions of their insurance policies with American Family Mutual Insurance Company. American Family had issued four automobile policies to the Sugden family on four different cars: two to James and Albert's father, Robert, one to their mother, Karen, and one to their sister, Marcella. Each policy had uninsured motorist limits of $25,000 per person and $50,000 per occurrence.

¶ 4. American Family offered to settle James's claim by making two payments totaling $50,000: $25,000 under one of Raymond's policies and $25,000 under Marcella's policy. American Family's claim representative told the Sugdens' attorney that the payments were intended to satisfy James's claim and that additional coverage remained with respect to Albert's injuries. The Sugdens accepted American Family's settlement offer under these terms.

¶ 5. The Sugdens sued both American Family and Cory Bock on January 11, 1999. American Family moved for summary judgment, arguing that it had paid the limits under its policy. The circuit court granted the motion, concluding that $50,000 "is the maximum exposure that American Family faces," and that "there is no theory of estoppel or waiver that is going to allow any kind of increase in coverage." The Sugdens appeal.

Opinion

A. Validity of Anti-Stacking Clauses

[1]

¶ 6. We review the circuit court's decision granting summary judgment under a de novo standard. Magyar v. Wisconsin Health Care Liability Ins. Plan, 2001 WI 41, ¶ 8, 242 Wis. 2d 491, 625 N.W.2d 291. Because there are no disputed facts, the only issue is whether American Family is entitled to judgment as a matter of law. See WIS. STAT. § 802.08. In making this determination, the first question is whether the four American Family policies prohibit stacking policy limits in a manner recognized under Wisconsin law.³ The Sugdens argue that they do not, and therefore Albert is entitled to receive $25,000 under each of the four policies. American Family disagrees and points to the following language contained in the Uninsured Motorists section in each policy of the Sugdens:

LIMITS OF LIABILITY

The limits of liability of this coverage as shown in the declarations [25,000 per person, 50,000 per accident] apply, subject to the following:

1. The limit for "each person" [$25,000] is the maximum for all damages sustained by all persons as the result of bodily injury to one person in any one accident.

2. Subject to the limit for "each person," the limit for "each accident" is the maximum for bodily injury sustained by two or more persons in any one accident.

We will pay no more than these maximums no matter how many vehicles are described in the declarations, or insured persons, claims, claimants, or vehicles are involved.

The limits of liability of this coverage may not be added to the limits of liability of any similar coverage under any other policy an insured person or any member of an insured persons household may have.

(Emphasis added.)

¶ 7. The Sugdens do not argue that the anti-stacking provisions in the insurance policies are vague or ambiguous, or in any way fail to make clear that the policies prohibit stacking with regard to uninsured motorist coverage. Nor could they. The policies clearly state that the limits of coverage under one policy "may not be added" to the limits of coverage under another policy. However, the Sugdens contend that the language used in the American Family policies is not recognized in the Wisconsin Statutes, and therefore has no effect.

¶ 8. Before 1995, anti-stacking clauses were prohibited by WIS. STAT. § 631.43(1). Currently, however, WIS. STAT. §§ 631.43(3) and 632.32(5) permit insurance policies in Wisconsin to limit stacking in a number of specified ways. American Family contends that § 632.32(5)(f) applies in this case. It provides:

A policy may provide that regardless of the number of policies involved, vehicles involved, persons covered, claims made, vehicles or premiums shown on the policy or premiums paid the limits for any coverage under the policy may not be added to the limits for similar coverage applying to other motor vehicles to determine the limit of insurance coverage available for bodily injury or death suffered by a person in any one accident.

Section 632.32(5)(f).

[2]

¶ 9. We agree with American Family that the language in the policy falls within WIS. STAT. § 632.32(5)(f). We have repeatedly noted that an anti-stacking provision in an insurance policy need not be a word-for-word mirror of the statute. See Gragg v. American Fam. Mut. Ins. Co., 2001 WI App 272 ¶ 8, 248 Wis. 2d 735, 637 N.W.2d 477; Hanson v. Prudential Prop. & Cas. Ins. Co., 224 Wis. 2d 356, 370, 591 N.W.2d 619 (Ct. App. 1999). Most recently in Gragg, we considered whether another policy properly precluded stacking under WIS. STAT. § 632.32(5)(f), and concluded that it did. 2001 WI App 272 at ¶¶ 10-11. That provision provided: "The total limit of our liability under all policies issued to you by us shall not exceed the highest limit of liability under any one policy." Id. at ¶ 3. Like the policy in Gragg, the provisions in the Sugden policies do not match the language in WIS. STAT. § 632.32(5)(f), but nevertheless "may be enforced to prevent stacking." Id. at ¶ 11.

[3]

¶ 10. The Sugdens contend that the anti-stacking clauses in their policies cannot fall within WIS. STAT. § 632.32(5)(f) because to do so would make other, more specific provisions in the statute, such as § 632.32(5)(g),⁴ "superfluous" since all anti-stacking provisions could fall under paragraph (f). But this is an argument that paragraph (f) is written too broadly and should be directed at the legislature, not the judiciary. It does not explain how the American Family policies fail to meet the requirements of the statute. We therefore reject the Sugdens' argument that Wisconsin law prohibits the anti-stacking provisions contained in the American Family policies.

B. Waiver and Estoppel

¶ 11. Next, the Sugdens contend that, if the policies do prohibit stacking, American Family waived these provisions or is estopped from asserting them. They contend that American Family waived the anti-stacking provisions when it voluntarily stacked Raymond's and Marcella's policies in order to settle James's claim and then told the Sugdens that coverage still remained for Albert.

¶ 12. For the purpose of its summary judgment motion, American Family does not dispute the Sugdens' allegations regarding the representations of American Family's agent. It also does not dispute that these actions would generally constitute waiver. Rather it argues that anti-stacking provisions are coverage clauses, and therefore cannot be waived.

[4]

¶ 13. Both parties acknowledge that the rule in Wisconsin is that a "coverage clause of either an inclusionary or exclusionary nature going to the scope of the coverage assumed cannot be waived" while "a forfeiture clause furnishing a ground for forfeiture or defeasance of liability or a no-action clause can be waived." Shannon v. Shannon, 150 Wis. 2d 434, 454, 442 N.W.2d 25 (1989). They disagree, however, over what kind of clause an anti-stacking provision is. The Sugdens argue that because a car accident "is part of the basic risk covered under the policy," then the anti-stacking provision "is a `forfeiture clause,' which attempts to limit or defeat coverage." American Family asserts that anti-stacking provisions are not forfeiture clauses because they "do not take away coverage which would otherwise exist; to the contrary, they help to define the scope of coverage in the first instance by confirming that the policy limit is, indeed, the...