Travelers Indem. Co. of Conn. v. Worthington
| Decision Date | 13 October 2017 |
| Docket Number | 1150370 |
| Citation | 252 So.3d 645 |
| Parties | TRAVELERS INDEMNITY COMPANY OF CONNECTICUT v. Angela WORTHINGTON |
| Court | Alabama Supreme Court |
Brenen G. Ely and Candace Hudson Newton of Ely & Isenberg, LLC, Birmingham, for appellant.
Joseph M. Cloud, Taylor Rouse, and Aaron C. Ryan of Conchin, Cloud & Cole, LLC, Huntsville, for appellee.
The defendant below, Travelers Indemnity Company of Connecticut ("Travelers"), appeals from the Limestone Circuit Court's denial of its postjudgment motion seeking to set aside a judgment entered on a jury verdict in favor of the plaintiff below, Angela Worthington. We affirm.
On April 27, 2011, Worthington was a passenger in a vehicle being driven by her husband. A friend of the Worthingtons and the Worthingtons' two minor children were also passengers in the vehicle. While the Worthingtons' vehicle was stopped at a nonfunctioning traffic light, it was struck in the rear by a vehicle being operated by Camille Thomas. Worthington and the other occupants in her vehicle were injured as a result of the accident.
At the time of the accident, the company Worthington's husband owned had a comprehensive insurance policy with Travelers that included uninsured-motorist ("UM") and underinsured-motorist ("UIM") coverage. The policy endorsement dealing with UM/UIM coverage provided, in pertinent part:
(Boldface type in original.)
On December 7, 2012, Worthington's husband, individually, and Worthington, individually and as mother and next friend of the two minor children, filed a complaint in the Limestone Circuit Court against Thomas and Travelers.1 The complaint included claims of negligence, wantonness, and negligence per se against Thomas. Worthington and her husband also included claims of loss of consortium. Finally, the complaint included a UM/UIM claim against Travelers.
On January 18, 2013, Travelers filed its answer to the complaint. In its answer, Travelers set forth affirmative defenses, but it did not set forth any policy-based defenses.
On October 28, 2014, Worthington's counsel notified Travelers' counsel that Worthington and Thomas had reached a proposed agreement to resolve Worthington's claims against Thomas for $56,250, plus mediation costs and filing fees. Travelers advised Worthington of its intent to maintain its rights under Lambert v. State Farm Mutual Automobile Insurance Co., 576 So.2d 160 (Ala. 1991), and advanced the amount of the proposed settlement to Worthington; Thomas was not released, and the action therefore proceeded with her remaining as a defendant.
On July 29, 2015, Worthington filed a motion for a partial summary judgment as to her negligence claim against Thomas.
Subsequently, counsel for Worthington sent a letter to counsel for Thomas that was dated August 7, 2015, that stated:
On August 10, 2015, counsel for Thomas contacted counsel for Travelers and informed him that Worthington had entered into a settlement agreement with Thomas's insurer, Allstate. The agreement provided that Worthington would accept $95,000 in exchange for Worthington's agreement to dismiss Thomas from the lawsuit with prejudice. At 11:13 a.m. on August 10, 2015, counsel for Worthington filed a letter informing the trial court that Worthington and Thomas had reached a pro tanto settlement and that the case would proceed as a UIM claim against Travelers. The letter also addressed scheduling issues that had arisen due to the death of the mother of one of the witnesses. In addressing scheduling, counsel for Worthington stated that, because a response to Worthington's motion for a partial summary judgment had not been filed, he assumed that liability would not be in question and that the only issue would be damages under the UIM policy.
At 4:28 p.m. on August 10, 2015, Worthington filed a motion in limine. Among other things, she sought to exclude any evidence, mention, reference, or attempt to introduce evidence of the settlement between Worthington and Thomas. In her motion, Worthington argued:
Travelers did not respond to the motion in limine. The record does not reflect a ruling by the trial court on the motion. In fact, the notation on the case-action-summary sheet includes an entry on August 13, 2015, that states: "C002–IN LIMINE/NO ACTION." However, Travelers asserts that it is undisputed that the trial court granted the motion in limine.
The case was called for trial at 9:00 a.m. on August 11, 2015. Travelers did not raise any arguments regarding the settlement agreement between Worthington and Thomas. Additionally, it never asserted that Worthington had forfeited her coverage under the policy by entering into the settlement agreement with Thomas without providing Travelers notice of the settlement and did not move to amend its answer to include a forfeiture-of-coverage defense. Subsequently, the trial court conducted voir dire, the jury was empaneled, and the trial was then recessed for the day at 2:00 p.m.
At 8:44 a.m. on August 12, 2015, Worthington and Thomas filed a "Stipulation and Agreement to Dismiss Fewer Than All Defendants" in which they represented that The trial court subsequently entered an order dismissing Worthington's claims against Thomas with prejudice and dismissing Thomas from the action.2 Travelers did not respond to this motion or object to Thomas's dismissal.
The trial of this case resumed at 9:00 a.m. on August 12, 2015. Again, Travelers did not raise any argument that Worthington had forfeited her UIM coverage by settling her claims against Thomas without first complying with the procedures set out in Lambert and in the UIM policy. In fact, after the trial court gave the jury its preliminary instructions, the following occurred during a bench conference:
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