Taft v. Cerwonka

• Decision Date: 05 August 1981
• Docket Number: No. 79-336-A,79-336-A
• Citation: 433 A.2d 215
• Parties: Earl W. TAFT et al. v. Eric R. CERWONKA et al. Earl W. TAFT et al. v. ALLSTATE INSURANCE COMPANY. ppeal.
• Court: Rhode Island Supreme Court

Page 215

433 A.2d 215

23 A.L.R.4th 1

Earl W. TAFT et al. v. Eric R. CERWONKA et al.

Earl W. TAFT et al. v. ALLSTATE INSURANCE COMPANY.

No. 79-336-Appeal.

Supreme Court of Rhode Island.

Aug. 5, 1981.

Revens & DeLuca, Ltd., Amato A. DeLuca, Warwick, for plaintiffs.

Charles H. Anderson, Providence, for defendant Allstate Ins. Co.

OPINION

MURRAY, Justice.

The plaintiffs, Earl W. Taft and his wife, Marian F. Taft, brought this civil action to recover for the alleged wrongful death of their daughter, Beverly A. Taft (Beverly), alleging that the negligence of the defendant Eric A. Cerwonka (Cerwonka) in operating a motor vehicle was the proximate cause of their daughter's death. Because the defendant Cerwonka, and the defendant Richard A. Miller (Miller), the owner of the vehicle, were uninsured at the time of the fatal mishap, the plaintiffs also filed a complaint against their insurer, Allstate Insurance Company (Allstate) under the uninsured-motorist provisions of their policy. Prior to trial, the two suits were consolidated.

The facts giving rise to this action are as follows. In the fall of 1976, Beverly, a ninth-grade student at Winman Junior High School, lived at home with her parents in the Potowomut section of Warwick. Beverly's friend, Lauren Cesana (Lauren), who attended Tollgate High School, also lived at home with her parents in that same section of the city. At approximately 6:30 p. m. on the evening of November 2, 1976, Lauren walked from her home to the Taft residence to meet Beverly. Approximately thirty minutes after Lauren's arrival, Beverly and Lauren left the Taft residence and walked to Angelo's, a neighborhood variety store which, according to Lauren, was a gathering place for local youths. After another half-hour or forty-five minutes had elapsed, Beverly and Lauren decided to visit some friends. Because the home of the friends they desired to visit was not within walking distance and because neither Beverly nor Lauren had a driver's license, they decided to look for someone to offer them a ride.

A few minutes after the girls' decision, along came defendant Cerwonka driving a 1965 Buick Skylark that was owned by his roommate, defendant Miller. According to Lauren, who was an acquaintance of Cerwonka, he parked the car and went into Angelo's to purchase a soda. Before he entered Angelo's, Cerwonka offered a ride to Lauren and Beverly and they accepted.

It is not disputed that shortly after the trio left Angelo's and proceeded up Ives Road, Cerwonka lost control of the vehicle; as a result, it left the road, first striking a guy wire attached to a utility pole and immediately thereafter striking the pole itself. Beverly, who was seated next to the front-seat passenger door, died as a result of the injuries she sustained in the collision.

Prior to trial, plaintiffs moved for partial summary judgment on the issue of whether they would be able to "stack" the uninsured-motorist coverage provided for each automobile on the one policy underwritten by defendant Allstate. Such motion was granted by a justice of the Superior Court. ¹ The matter then proceeded to trial in the Superior Court. After all parties had rested, defendant Allstate moved for a directed verdict, stating "that if there is a verdict for the plaintiff, and I see no reason why at this juncture that the verdict for the plaintiff should not be entered, that the jury be instructed and directed that the verdict should be the minimum verdict of five thousand dollars * * *." The trial justice denied this motion and then gave his instructions to the jury, which returned a verdict in favor of plaintiffs in the sum of $33,000. Subsequently, Allstate moved for a new trial on the issue of damages, and it also moved the court to enter judgment against it in the amount of $10,000, the amount it contended was the limit of its liability under the policy issued to plaintiffs. The trial justice's denial of these motions and his entry of judgment in the amount of $20,000 (the aggregate limits of Allstate's liability) against defendant Allstate forms the basis of its present appeal.

I

In passing upon defendant's contention, we are called upon to determine an issue of first impression in this jurisdiction. That issue is whether plaintiffs should be permitted to "stack" the uninsured-motorist coverage provided for each of the two automobiles insured by Allstate.

Because the fact situations in "stacking" cases tend to be similar and because the Rhode Island uninsured-motorist statute ² is typical of those in other jurisdictions, decisions of other courts that have confronted this issue merit analysis here. In those jurisdictions where intra-policy stacking has been allowed, ³ courts have advanced one or more of three general theories in support of their decisions. See Comment, Intra-Policy Stacking of Uninsured Motorist and Medical Payments Coverage: To Be or Not To Be, 22 S.D.L.Rev. 349 (1977). One theory advanced is the theory that the applicable provisions of the insurance contract are ambiguous and that such ambiguities are to be resolved against the insurer. For example, in Jeffries v. Stewart, 159 Ind.App. 701, 309 N.E.2d 448 (1974), the Supreme Court of Indiana found an ambiguity in that the separability clause and the limits-of-liability clause conflicted with each other. The court resolved the ambiguity in favor of the insured and allowed him to stack the limits of liability. See Id. at 709, 309 N.E.2d at 453.

Another theory cited in support of stacking is that the particular jurisdiction's uninsured-motorist statute requires such a result. Representative of this class of cases is Tucker v. Government Employees Insurance Co., 288 So.2d 238 (Fla.1974). In that case, the Supreme Court of Florida held that their uninsured-motorist statute, Fla.Stat.Ann. § 627.727 (West 1977) "does not disclose any statutory basis for a 'stacking' exclusion in a policy combining auto liability coverage for two or more automobiles of the named insured with uninsured motorist coverage included." Id. at 241. ⁴ Another court in Holloway v. Nationwide Mutual Insurance Co., 376 So.2d 690 (Ala.1979), held that the jurisdiction's uninsured-motorist statute mandated stacking for the primary insured.

A final theory is the double-premiums theory, under which courts have held that the payment of separate premiums for uninsured-motorist coverage for each vehicle covered by the policy entitles the insured to stack the limits of liability for each insured vehicle of the policy. A recent case espousing this view is Kemp v. Allstate Insurance Co., Mont., 601 P.2d 20 (1979).

In the jurisdictions where intra-policy stacking has not been allowed, courts have attempted to discredit each of the above theories. In Grimes v. Concord General Mutual Insurance Co., N.H., 422 A.2d 1312 (1980) the Supreme Court of New Hampshire discarded the double-premium theory, stating:

"Neither can we agree, with confidence that the plaintiff is paying an extra premium without receiving something in return. When an insured owns two vehicles that are constantly available for use, not only by him, but by members of his family and others, the risk that someone operating one of those vehicles will be involved in an accident with an uninsured motorist is obviously greater than if only one vehicle were available for use. Consequently, an insurance carrier's exposure to that risk may be enhanced. Other courts have recognized that the second premium paid on the second car does afford some extra protection that otherwise would not exist." (Citations omitted.) Id. 422 A.2d at 1315.

The court went on to hold that their uninsured-motorist statute did not require intra-policy stacking. ⁵

We note that the Grimes case is part of a significant minority of authority. See Hampton v. Allstate Insurance Co., 126 Ariz. 403, 616 P.2d 78 (1980); Sharples v. General Casualty Co. of Illinois, 85 Ill.App.3d 899, 41 Ill.Dec. 176, 407 N.E.2d 674 (1980); Pettid v. Edwards, 195 Neb. 713, 240 N.W.2d 344 (1976). ⁶ However, the clear trend of late has been in favor of stacking. See Holloway v. Nationwide Mutual Insurance Co., 376 So.2d 690 (Ala.1979); Safeco Insurance Companies v. Vetre, 174 Conn. 329, 387 A.2d 539 (1978); Davis v. Hughes, 229 Kan. 91, 622 P.2d 641 (1981); Ohio Casualty Insurance Co. v. Stanfield, 581 S.W.2d 555 (Ky.1979); Breaux v. Government Employees Insurance Co., 373 So.2d 1335 (La.App.1979); United States Fidelity and Guarantee Co. v. Pearthree, 389 So.2d 109 (Miss.1980); Linderer v. Royal Globe Insurance Co., 597 S.W.2d 656 (Mo.App.1980); Kemp v. Allstate Insurance Co., Mont., 601 P.2d 20 (1979); Blocker v. Aetna Casualty and Surety Co., 232 Pa.Super. 111, 332 A.2d 476 (1975); Landvatter v. Globe Security Insurance Co., 100 Wis.2d 21, 300 N.W.2d 875 (1980). We find the reasoning of the courts in the mainstream of this trend to be the more logical and equitable of the two approaches.

It is not disputed that plaintiffs paid two separate premiums for uninsured-motorist coverage; nevertheless, Allstate contends that to allow stacking is to render a "tortured" construction of the policy and of our uninsured-motorist statute. To give credence to Allstate's contentions, however, would defeat the reasonable expectations of a policyholder.

"It is reasonable to expect the same coverage where comparable premium dollars are paid to insure the same two cars, for convenience, under a single policy. A combination coverage should not be the predicate for an exclusion of coverage. Such a result would allow a simple change in form to defeat the insured's reasonable expectation, as well as the substance of law." (Citation omitted.) Allstate Insurance Co. v. Maglish, 94 Nev. 699, 703, 586 P.2d 313, 315 (1978).

Indeed if plaintiffs had insured their automobiles under two separate policies and had paid uninsured-motorist premiums for each car, they would be entitled to $20,000 in uninsured-motorist coverage from...