Todd v. Nationwide Mut. Ins. Co.

• Decision Date: 08 June 2010
• Docket Number: No. 31041.,31041.
• Citation: 999 A.2d 761,121 Conn.App. 597
• Court: Connecticut Court of Appeals
• Parties: Erica TODDv.NATIONWIDE MUTUAL INSURANCE COMPANY.

121 Conn.App. 597

999 A.2d 761

Erica TODDv.NATIONWIDE MUTUAL INSURANCE COMPANY.

No. 31041.

Appellate Court of Connecticut.

Argued March 22, 2010.

Decided June 8, 2010.

William F. Gallagher, New Haven, with whom, on the brief, was Hugh D. Hughes, for the appellant (plaintiff).

Miles N. Esty, Hamden, for the appellee (defendant).

FLYNN, C.J., and HARPER and BORDEN, Js.^*

BORDEN, J.

In this action for underinsured and conversion coverage benefits, the plaintiff, Erica Todd, appeals from the summary judgment rendered by the trial court in favor of the defendant, Nationwide Mutual Insurance Company. The plaintiff claims that the court improperly granted the defendant's motion for summary judgment. We agree and, accordingly, reverse the judgment of the trial court.

The following facts and procedural history are undisputed for purposes of the plaintiff's appeal. On May 31, 2000, the plaintiff was involved in an automobile accident in which her vehicle, which was covered by the defendant's underinsured and conversion coverage policy, was struck by another vehicle that was operated by Christopher Bernacchi. Bernacchi's vehicle was a leased vehicle that was owned by American Honda Finance Corporation (Honda) and insured by Pacific Employers Insurance Company (Pacific) under a liability policy with limits of $1 million. The plaintiff brought an action alleging negligence against Bernacchi and alleging that Honda was vicariously liable for Bernacchi's negligence. The plaintiff also alleged that Bernacchi was an authorized driver of the leased vehicle. Bernacchi had a liability policy with GEICO with limits of $100,000. Bernacchi's carrier paid the plaintiff the $100,000 limit of his policy, and the plaintiff settled with Honda for $275,000 through its carrier, Pacific.

The plaintiff then brought this action against the defendant for underinsured and conversion coverage benefits. The plaintiff, purportedly having discovered that Bernacchi had not been an authorized driver of the leased vehicle at the time of the accident, alleged the payment of $100,000 by Bernacchi's carrier and, further, that the “plaintiff has exhausted all bodily injury liability bonds or insurance policies applicable at the time of the accident, in accordance with [General Statutes] § 38a-336a.... The owner of the motor vehicle that was being operated by the legally liable operator ... Bernacchi, was [Honda], which had no legal obligation to pay under current law as ... Bernacchi was not an authorized driver under the leasing agreement. Said company, however, made a contribution to the settlement of $275,000, rendering the total payment of $375,000.” The defendant moved to strike the complaint for failure to allege exhaustion of all applicable policies and, thus, for failure to state a claim under General Statutes § 38a-336, the uninsured and underinsured motorists statute. The court Cosgrove, J., denied the motion to strike, ruling, first, that the applicable statute was § 38a-336a, the underinsured motorists conversion coverage statute, rather than § 38a-336, the uninsured and underinsured coverage statute; and, second, that taking all the plaintiff's allegations as true, including that Bernacchi was not an authorized driver under the lease agreement, “the plaintiff adequately alleged the exhaustion of all applicable liability bonds and policies.”

The defendant then filed a motion for summary judgment, claiming that the plaintiff had not exhausted “all bodily injury liability bonds or insurance policies applicable at the time of the accident in accordance with [§ 38a-336a],” namely, the Pacific policy. In support of its motion, the defendant produced two affidavits. The first was the affidavit of John F. McDevitt, an employee of ACE USA, an affiliate of Pacific. McDevitt stated that the Pacific policy “provided liability insurance coverage with limits of $1,000,000,” and that Pacific, “as the liability insurer of [Honda] paid $275,000 out of its available coverage of $1,000,000 under [the policy] to [the plaintiff] to settle the aforementioned lawsuit.” The second affidavit in support of the motion for summary judgment was that of Diane Adams, an employee of Honda, who stated that its vehicle was covered on the date of the accident by the Pacific policy with a limit of $1 million.

In its memorandum of law, the defendant relied solely on the facts that the Pacific policy had a limit of $1 million and that only $275,000 of that limit had been paid. It did not address the plaintiff's factual claim that Bernacchi had not been an authorized driver under the leasing agreement. Instead, regarding the plaintiff's claim that, as the defendant characterized it, “Honda was not obligated to make such a payment,” namely, the $275,000 settlement, the defendant relied on a trial court decision in which the court had ruled, in effect, that acceptance of a settlement from a third party's liability carrier by an insured under an uninsured motorists coverage policy precludes the insured from recovering uninsured motorists benefits.¹ The plaintiff did not file any affidavits but filed a memorandum of law in opposition to the defendant's motion, relying solely on the prior ruling of the court on the motion to strike under the doctrine of the law of the case. See Carothers v. Capozziello, 215 Conn. 82, 107, 574 A.2d 1268 (1990). The defendant then filed a reply to the plaintiff's memorandum in opposition to summary judgment, bringing to the court's attention the fact that the plaintiff had, in the negligence action against Bernacchi, alleged that Bernacchi was an authorized driver of the leased vehicle. The court Hon. George W. Ripley II, judge trial referee, relying on a trial court decision cited by the defendant Smith v. New Hampshire Ins. Co, Superior Court, judicial district of Tolland, Docket No. CV-93-54227-S, 1994 WL 468284 (August 23, 1994), granted the defendant's motion for summary judgment, finding that the defendant “has shown that [Honda] settled with [the plaintiff] for $275,000, out of a $1 million policy. It is uncontested that [the plaintiff] accepted the settlement and received the $275,000 from ... Honda. [The plaintiff's] acceptance of this settlement precludes the recovery of underinsured [motorists] benefits, as the applicable liability policies have not been exhausted.” This appeal followed.

The plaintiff claims that the defendant has failed to establish that the Pacific policy covering Honda's leased vehicle was an “ ‘applicable policy’ ” within the meaning of § 38a-336a because there is still a genuine issue of fact regarding whether Bernacchi was an authorized driver of the vehicle. We agree.

“As a preliminary matter, we set forth the appropriate standard of review. In seeking summary judgment, it is the movant who has the burden of showing the nonexistence of any issue of fact. The courts are in entire agreement that the moving party for summary judgment...