NATIONWIDE INSURANCE COMPANY OF AMERICA v. TANYA S. DUGGER and BILLY S. SWANSON, Defendants-Respondents ( 2016 )

NATIONWIDE INSURANCE )
COMPANY OF AMERICA, )
)
Plaintiff-Appellant, )
v. ) No. SD33484
) Filed: 1-28-16
TANYA S. DUGGER and )
BILLY S. SWANSON, )
)
Defendants-Respondents. )
APPEAL FROM THE CIRCUIT COURT OF BUTLER COUNTY
Honorable Michael M. Pritchett, Circuit Judge
AFFIRMED
Nationwide Insurance Company of America (Nationwide) appeals from a
judgment ordering it to pay Tanya Dugger (Tanya) and Billy Swanson (Billy) $25,000 in
uninsured motorist (UM) coverage for damages arising from the death of their daughter,
Victoria Swanson (Victoria).1 Tanya had an automobile policy with Nationwide
(hereinafter referred to as the Policy) that insured two vehicles. The Policy contained
anti-stacking language purporting to limit Tanya to a single payment of $25,000 for her
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Billy Swanson acknowledged service in the underlying case, but did not answer
or participate in these proceedings. Because Billy and Victoria share the same surname,
we refer to Tanya, Billy and Victoria by their first names for purposes of clarity.
UM coverage. The trial court concluded that the anti-stacking language was
unenforceable because it violated the public policy of this state established by § 379.203.2
We agree and affirm the judgment of the trial court.
Factual and Procedural Background
The material facts are undisputed. On June 5, 2012, Victoria was a passenger in
an uninsured automobile. Victoria was killed when that automobile was struck by a train.
The Policy was in effect on that date. Victoria met the Policy’s definition of an insured,
and the parties agree that the damages arising from Victoria’s death exceed $50,000.
According to the Declarations, the Policy insured two vehicles and included UM
coverage of $25,000 per person and $50,000 per accident. Those limits appear under a
heading: “Uninsured Motorists (Per Policy) Bodily Injury” (bold emphasis in original).
The Policy listed a single premium of $45.35 for UM coverage. The “Limit of Liability”
section of the UM Coverage Endorsement stated:
The limit of liability shown in the Declarations for each person for [UM]
Coverage is our maximum limit of liability for all damages, including
damages for care, loss of services or death, arising out of “bodily injury”
sustained by any one person in any such accident. …
This is the most we will pay regardless of the number of:
1. “Insureds”;
2. Claims made;
3. Vehicles shown in the Declarations; or
4. Vehicles involved in the accident.
(Bold emphasis added.)
By agreement of the parties, Nationwide paid $25,000 in UM benefits to Tanya
and Billy and then filed a declaratory judgment action to litigate the issue of whether it
owed another $25,000 from that coverage. Thereafter, Tanya and Nationwide filed cross
2
All references to statutes are to RSMo (2000). All references to rules are to
Missouri Court Rules (2015).
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motions for summary judgment. The trial court decided that the anti-stacking language in
the Policy was unenforceable because it violated Missouri public policy established by
§ 379.203. The court entered judgment against Nationwide and ordered it to pay an
additional $25,000 in UM coverage to Tanya and Billy. This appeal followed.
Standard of Review
Summary judgment is appropriate when there is no genuine issue of material fact,
and the moving party is entitled to judgment as a matter of law. Rule 74.04(c); ITT
Commercial Fin. Corp. v. Mid-Am. Marine Supply Corp., 854 S.W.2d 371, 380 (Mo.
banc 1993). The amount of UM coverage provided by Nationwide involves the
interpretation of its insurance policy and the application of § 379.203 to that policy. Both
are questions of law which we review de novo. See Karscig v. McConville, 303 S.W.3d
499, 502 (Mo. banc 2010); see Rutledge v. Bough, 399 S.W.3d 884, 886 (Mo. App.
2013).
Discussion and Decision
In Point I, Nationwide contends the trial court erred in granting summary
judgment because the Policy unambiguously provides a single unit of UM coverage on a
per-policy basis with a per-person limit of $25,000. We find no merit in this argument.
We begin our analysis by reviewing § 379.203. In relevant part, this statute
states:
No automobile liability insurance covering liability arising out of the
ownership, maintenance, or use of any motor vehicle shall be delivered or
issued for delivery in this state with respect to any motor vehicle
registered or principally garaged in this state unless coverage is provided
therein or supplemental thereto … in not less than the limits for bodily
injury or death set forth in section 303.030, for the protection of persons
insured thereunder who are legally entitled to recover damages from
owners or operators of uninsured motor vehicles because of bodily injury,
sickness or disease, including death, resulting therefrom.
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§ 379.203.1. The mandatory coverage amount is $25,000 per person and $50,000 per
accident. § 303.030.5. When two or more vehicles are provided with UM coverage via a
single policy, it is well-settled that the public policy expressed by § 379.203.1 prohibits
an insurer from limiting a named insured to recovering only one of the UM coverages,
even if the policy contains unambiguous language to that effect. Cameron Mutual Ins.
Co. v. Madden, 533 S.W.2d 538, 544-45 (Mo. banc 1976). This principle has been
repeatedly reaffirmed by Missouri appellate courts.3 Therefore, Nationwide’s argument
that its policy language unambiguously provides only one limit of UM coverage is
misdirected.
Nationwide argues, however, that the public policy established by § 379.203 does
not apply here because the Policy purports to only charge a premium for one UM
coverage. According to Nationwide, it complied with the principle from Cameron
Mutual that “the law does not permit insurers to collect a premium for certain coverage”
and then take that coverage away. See Cameron Mutual, 533 S.W.2d at 545. We find
that argument unpersuasive. The public policy established by § 379.203 requires an
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See, e.g., Ritchie v. Allied Prop. & Cas. Ins. Co., 307 S.W.3d 132, 135 (Mo.
banc 2009) (when multiple policies or multiple UM coverages are in place, insurers are
prohibited from including policy language precluding stacking of the coverage provided
under multiple policies or coverage provisions); Krombach v. Mayflower Ins. Co., 827
S.W.2d 208, 212 (Mo. banc 1992) (the public policy expressed in § 379.203 prohibits
policy provisions from limiting the insured to recovery of only one UM coverage when
two cars are covered by a single policy); Kennedy v. Safeco Ins. Co. of Illinois, 413
S.W.3d 14, 15 n.2 (Mo. App. 2013) (Missouri public policy requires that UM coverages
must be allowed to be stacked, and contrary policy language denying such stacking is
unenforceable); Blumer v. Auto. Club Inter-Ins. Exch., 340 S.W.3d 214, 220 (Mo. App.
2011) (because a policy exclusion violated the public policy in § 379.203, the insured
was entitled to stack the UM coverages for the two insured vehicles); Nolan v. Am.
States Preferred Ins. Co., 851 S.W.2d 720, 724 (Mo. App. 1993) (public policy requires
UM coverage to be stacked when two vehicles are insured under a single policy); Husch
by Husch v. Nationwide Mut. Fire Ins. Co., 772 S.W.2d 692, 693-94 (Mo. App. 1989)
(the public policy in § 379.203 prohibits the insurer from limiting an insured to only one
of the UM coverages provided by a policy insuring two autos).
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insurer to provide UM coverage, but the statute does not condition the mandatory nature
of such coverage upon the explicit payment of a premium for it. In Oliver v. Cameron
Mutual Ins. Co., 866 S.W.2d 865 (Mo. App. 1993), the eastern district of this Court
rejected an argument like that made by Nationwide here:
Cameron also relies upon the language of the original Cameron case,
supra, that premised allowance for stacking upon the concept that separate
premiums were paid for the two vehicles. We are not convinced that
language was intended to impose a restriction based upon the appearance
of a separate charge in the declarations section of the policy.
Id. at 869. We agree with this conclusion and with the eastern district’s further
observation that “[a]ll coverages provided by a policy are presumably included in the
premium, either directly or indirectly.” Id. Because the anti-stacking language in
Nationwide’s policy violates the public policy established by § 379.203, that language is
unenforceable and the UM coverages in the policy can be stacked. See, e.g., Blumer, 340
S.W.3d at 219. Accordingly, the trial court did not err by entering summary judgment in
favor of Tanya for the additional $25,000 in UM coverage. Point I is denied.
In Point II, Nationwide contends it had no further obligation to provide UM
coverage beyond the first $25,000 per person limit because the public policy established
by § 379.203 does not require an insurer to issue separate units of UM coverage for each
vehicle listed in a single auto insurance policy. Nationwide cites Becker v. Allied Prop.
& Cas. Ins. Co., 422 S.W.3d 434 (Mo. App. 2013) and Chandler v. Allied Prop. & Cas.
Ins. Co., 443 S.W.3d 662 (Mo. App. 2014) to support its argument.
Nationwide’s argument fails because it ignores well-settled Missouri law allowing
stacking of UM coverages when multiple vehicles are insured by a single policy. See
fn.3, supra. The Becker and Chandler cases are distinguishable because they involved
underinsured motorist, liability or med-pay coverages. In Ritchie v. Allied Prop. & Cas.
Ins. Co., 307 S.W.3d 132 (Mo. banc 2009), our Supreme Court explained:
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Missouri statutes do not also mandate underinsured motorist coverage.
Consequently, “the existence of the [underinsured motorist] coverage and
its ability to be stacked are determined by the contract entered between the
insured and the insurer.” This means that if the policy language is
unambiguous in disallowing stacking, the anti-stacking provisions are
enforceable. “If, however, policy language is ambiguous [as to stacking],
it must be construed against the insurer,” and stacking will be allowed.
Id. at 135 (emphasis in original; citations omitted). That same review of the contract
language was used in Chandler to uphold the trial court’s ruling that the insured’s
liability and med-pay coverages could not be stacked. Chandler, 443 S.W.3d at 668; see
also O’Rourke v. Esurance Ins. Co., 325 S.W.3d 395, 398 (Mo. App. 2010) (holding
that the policy, which unambiguously prevented stacking of the liability coverage
provided by one policy insuring two vehicles, did not violate the Motor Vehicle Financial
Responsibility Law in § 303.190). Therefore, Becker and Chandler do not support
Nationwide’s argument that Tanya cannot stack the UM coverages of the two vehicles
insured by the Policy. Accordingly, the trial court did not err by entering summary
judgment in favor of Tanya for the additional $25,000 in UM coverage. Point II is
denied.
The judgment of the trial court is affirmed.
JEFFREY W. BATES, J. – OPINION AUTHOR
DANIEL E. SCOTT, P.J. – CONCUR
WILLIAM W. FRANCIS, JR., J. – CONCUR
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