Title: VELTE v ALLSTATE INS CO

State: montana

Issuer: Montana Supreme Court

Document:

N o . 14574 IN THE S U P R E M E COUHT O F THE STATE O F rnrnANA 1979 C O N N I E J. VELTE et al. , Plaintiffs and Appellants, -VS- ALLsI'ATE INSURANCE COMPANY, Defendant and Respondent. Appeal from: D i s t r i c t Court of the Thirteenth Judicial District, Honorable Charles Luedke, Judge presiding. Counsel of Record: For Appellants: E m J. Dolve, Jr., Billings, Wntana Calvin A.Calton, Billings, Wntana Rodd HamMn argued, Billings, mntana For Respondent: Anderson, Symnes, B - , Gerbase, Cebull & Jones, Billings, plbntana Richard F. Cebull, Billings, Wntana Subsnitted: March 19, 1979 -- -- Decided: APR 1 7 1979 T - Filed: .' " i ' ' , - Mr. Justice Gene B. Daly delivered the Opinion of the Court. This is an appeal brought by the survivors and the personal representative of the estate of Oscar F. Johnson. Johnson was killed as the result of an automobile collision in Billings, Montana, in July 1976. At the time of the accident, Johnson was a passenger in an automobile driven by John Schaefer and insured by defendant Allstate Insurance Company. Schaefer's policy with Allstate had a liability limit of $10,000 as well as an uninsured motorist endorse- ment. The other automobile involved in the accident was not insured. Johnson's heirs and personal representative filed claims with Allstate, which in turn offered to pay the claimants the policy limit of $10,000, applicable to the injury or death of one person. The heirs and personal representative contended they were entitled to more compen- sation, arguing that the Motor Vehicle Safety Responsibility Act, at section 53-438, R.C.M. 1947, now section 61-6-103 MCA, required the insurer to pay at least $25,000 in compen- sation for Oscar Johnson's death. At Allstate's suggestion, appellants commenced a declaratory action in the District Court, Yellowstone County, seeking to have the policy limits declared to be $25,000 rather than $10,000. The ~istrict Court ruled in favor of defendant Allstate's motion to dismiss on September 7, 1978. In a memorandum accompanying that order, the District Court stated the issue presented to it as whether the law required liability coverage of at least $25,000, regardless of the agreed-upon terms of the policy: "The complaint seeks t o e s t a b l i s h t h a t Montana l a w r e q u i r e s motor v e h i c l e l i a b i l i t y coverage f o r bodily i n j u r y t o be i n t h e sum of $25,000 regardless of any lesser s t a t e d l i m i t s i n t h e issued policy ($10,000 i n t h i s c a s e ) . . ." On appeal t h e h e i r s and personal representative present a new theory--namely, t h a t s e c t i o n 40-4403, R.C.M. 1947, now s e c t i o n 33-23-201 MCA, e n t i t l e s them t o g r e a t e r compensation than t h e s t a t e d l i a b i l i t y l i m i t s of t h e A l l s t a t e policy. Appellants contend t h a t s e c t i o n 40-4403 r e q u i r e s an i n s u r e r t o provide a t l e a s t $25,000 per person and $50,000 per accident of uninsured motorist coverage and t h a t they a r e t h e r e f o r e e n t i t l e d t o $15,000 of t h a t coverage under t h e uninsured motorist endorsement of Johnson's policy with A l l s t a t e . W e conclude t h a t t h e D i s t r i c t Court c o r r e c t l y decided t h e i s s u e presented t o it, and t h a t appellants may n o t r a i s e , f o r t h e f i r s t time on appeal, t h e i s s u e of whe- t h e r they are e n t i t l e d t o uninsured motorist b e n e f i t s under Schaefer's policy. A. Appellant's s t a t u t o r y l i m i t s arqument. The i s s u e of whether an automobile owner must have a p a r t i c u l a r amount of l i a b i l i t y insurance o r l i a b i l i t y insur- ance covering p a r t i c u l a r s i t u a t i o n s has been before t h i s Court on s e v e r a l previous occasions. I n Northern Assurance Company of America v. Truck Insurance Exchange (1968), 151 Mont. 132, 439 P.2d 760, t h e i s s u e was whether an exclusion i n a l i a b i l i t y policy was c o n s i s t e n t with t h e s t a t u t o r y policy of t h e Motor Vehicle Safety Responsibility A c t . The Court reasoned t h a t t h e exclusion w a s "not v i o l a t i v e of public policy" because t h e law required l i a b i l i t y insurance i n only c e r t a i n s p e c i f i e d instances, and t h a t a policy which t h e owner v o l u n t a r i l y obtained w a s n o t s u b j e c t t o t h e cover- age requirements of t h e S a f e t y Responsibility Act. 151 Mont. a t 136-37, 439 P.2d a t 763. I n Boldt v. S t a t e Farm Mutual Automobile Insurance Co. (1968), 151 Mont. 337, 443 P.2d 33, an i n j u r e d p l a i n t i f f sought t o have a c l a u s e i n a l i a b i l i t y p o l i c y declared void because it c o n f l i c t e d with t h e Safety Responsibility A c t . The Court again r u l e d t h a t t h e A c t ' s requirements " a r e n o t a b s o l u t e b u t a r e a p p l i c a b l e under c e r t a i n circumstances and a r e s u b j e c t t o c e r t a i n l i m i t a t i o n s and exceptions." 151 Mont. a t 341, 443 P.2d a t 35. The Court reasoned t h a t t h e l a w required an automobile owner t o c a r r y l i a b i l i t y insur- ance a s proof of f i n a n c i a l r e s p o n s i b i l i t y i n only c e r t a i n s p e c i f i e d circumstances, and otherwise " i s n o t required t o p o s t proof of f u t u r e f i n a n c i a l r e s p o n s i b i l i t y a t a l l . " 151 Mont. a t 343, 443 P.2d a t 36. Since an owner may n o t be required t o purchase l i a b i l i t y insurance a t a l l , t h e Court concluded t h a t t h e requirements a p p l i c a b l e t o p o l i c i e s i s s u e d and c e r t i f i e d as proof of f i n a n a c i a l r e s p o n s i b i l i t y had no a p p l i c a t i o n t o p o l i c i e s which owners v o l u n t a r i l y obtain. 151 Mont. a t 343-44, 443 P.2d a t 36. See a l s o , Universal Underwriters Insurance Co. v. S t a t e Farm Mutual Automobile Insurance Co. (1975), 166 Mont. 128, 134, 531 P.2d 668, 672. Appellants argued before t h e D i s t r i c t Court t h a t s e v e r a l amendments t o s e c t i o n 53-438 changed t h e a p p l i c a t i o n of t h e s t a t u t e making it a p p l i c a b l e t o a l l automobile l i a - b i l i t y p o l i c i e s i s s u e d i n Montana. They make no mention of t h a t argument i n t h e i r b r i e f s on appeal, however. Under t h e r u l e e s t a b l i s h e d i n Northern Assurance and Boldt, t h e argument t h a t t h e Safety Responsibility A c t r e q u i r e s t h e i n s u r e r t o i s s u e l i a b i l i t y p o l i c i e s with no less than $25,000 coverage must be r e j e c t e d . I n t h i s case, a s i n Northern Assurance and Boldt, t h e owner v o l u n t a r i l y obtained t h e l i a b i l i t y coverage. There i s no s t a t u t o r y b a s i s upon which t o r e q u i r e t h i s voluntary policy t o be construed as providing more than t h e $10,000 coverage which i t s t e r m s show. B. Appellants' Uninsured Motorist Argument. Appellants argue t h a t s e c t i o n 40-4403 r e q u i r e s t h e i n s u r e r t o provide a t l e a s t $25,000/50,000 uninsured m o t o r i s t coverage along with any l i a b i l i t y p o l i c y it i s s u e s , and t h a t they a r e e n t i t l e d t o $15,000 compensation from t h e owner's uninsured m o t o r i s t policy with A l l s t a t e . Their p o s i t i o n i s t h a t because t h e owner had only $10,000 of l i a b i l i t y cover- age, he was uninsured t o t h e e x t e n t of t h e d i f f e r e n c e be- tween h i s l i a b i l i t y coverage and t h e uninsured m o t o r i s t coverage required by t h e s t a t u t e . A review of t h e b r i e f s of both p a r t i e s before t h e D i s t r i c t Court i n d i c a t e s t h i s argument is r a i s e d f o r t h e f i r s t t i m e on appeal. The D i s t r i c t Court w a s presented with, and decided only, t h e question of whether t h e S a f e t y Responsibility A c t ' s coverage requirements applied t o t h e owner's l i a b i l i t y policy. Therefore, a p p e l l a n t s may n o t now raise t h e i s s u e of uninsured m o t o r i s t coverage. I t i s w e l l s e t t l e d t h a t a p a r t y "may n o t change h i s theory on appeal t o t h i s Court from t h a t advanced i n t h e t r i a l court." Chamberlain v. Evans (1979), - Mont . I 591 P.2d 237, 240, 36 St.Rep. 419, 423-24. See a l s o , Sturdevant v. M i l l s (19781, - Mont. , 580 P.2d 923, 925, 35 St.Rep. 839, 842. Appellants argue, however, t h a t t h e theory of uninsured m o t o r i s t coverage p r e s e n t s a ques- t i o n of law only, and t h e r e f o r e need n o t be presented t o t h e D i s t r i c t Court i n advance of t h e appeal. They urge f u r t h e r t h a t a d e c l a r a t o r y judgment a c t i o n p r e s e n t s a unique s i t u a - t i o n , because such an a c t i o n i s brought s o l e l y f o r t h e purpose of determining i s s u e s of law, and t h a t an a p p e l l a t e c o u r t may consider t h e s e i s s u e s d e novo. -- The Uniform Declaratory Judgments Act, s e c t i o n 93-8907, R.C.M. 1947, now s e c t i o n 27-8-312 MCA, provides t h a t " [ a l l 1 o r d e r s , judgments and decrees under t h i s a c t may be reviewed as o t h e r o r d e r s , judgments and decrees." Only one Montana d e c i s i o n d i r e c t l y construes s e c t i o n 93-8907 and t h a t deci- s i o n concerns a p p e l l a t e review of f a c t u a l findings: " I n a d e c l a r a t o r y judgment a c t i o n . . . t h e d i s t r i c t c o u r t determines i s s u e s of f a c t i n t h e same manner a s i s s u e s of f a c t i n o t h e r pro- ceedings. Section 93-8909, R.C.M. 1947. W e review t h e a c t i o n of t h e d i s t r i c t c o u r t t h e same a s i n o t h e r proceedings. Section 93-8907, R.C.M. 1947." S t a t e Highway Commission v. West Great F a l l s Flood Control and Drainage D i s t r i c t (1970), 155 Mont. 157, 171, 468 P.2d 753, 761. Courts i n o t h e r Uniform Declaratory Judgments Act j u r i s d i c t i o n s have considered more p r e c i s e l y t h e i s s u e of whether an a p p e l l a n t has more l a t i t u d e t o a l t e r h i s theory on appeal i n a d e c l a r a t o r y a c t i o n than i n o t h e r types of c i v i l a c t i o n s , and have concluded t h a t he does not. Board of Supervisors of F a i r f a x County v. W i l l i a m s (1975), 216 Va. 49, 216 S.E.2d 33, 39 n. 3; City of S t . Louis v. Missouri Commission on Human Rights (Mo. 1974), 517 S.W.2d 65, 71; Crowe v. Wheeler (Colo. 1968), 439 P.2d 50, 53; Goldberg v. Valve Corporation of America (1967), 89 Ill.App.2d 383, 233 N.E.2d 85, 90. I n each of t h e s e d e c i s i o n s t h e c o u r t s r u l e d t h a t they would n o t determine l e g a l i s s u e s which t h e p a r t i e s f a i l e d t o p r e s e n t t o t h e t r i a l c o u r t , e i t h e r by o b j e c t i o n o r by pleadings. I t i s c l e a r t h a t appellants here have changed t h e i r theory on appeal. A t t h e D i s t r i c t Court l e v e l , they sought a d e c l a r a t i o n t h a t s e c t i o n 53-438, R.C.M. 1947, required t h e i n s u r e r t o provide Schaefer with $25,000 of motor vehicle l i a b i l i t y coverage (paragraphs V - V I I of complaint, and paragraph 1 of prayer f o r judgment). On appeal, they s t a t e an e n t i r e l y d i f f e r e n t theory, involving an uninsured mo- t o r i s t claim: "Because A l l s t a t e f a i l e d t o provide l i a b i l i t y coverage equalling t h e minimum amount set a t s e c t i o n 53-438, R.C.M. [1947], (Supp. 1977), Schaeffer should be considered an uninsured d r i v e r and Velte, e t a l . , are e n t i t l e d - t o recover under t h e uninsured motorist s e c t i o n of -- t h e A l l s t a t e policy." (Emphasis added.) The r u l e applied t o new t h e o r i e s r a i s e d on appeal i s t h e same f o r a c t i o n s brought under t h e Declaratory Judgment Act a s it i s f o r o t h e r c i v i l a c t i o n s . Therefore, w e w i l l n o t determine a p p e l l a n t s ' uninsured motorist claim. The judgment of t h e D i s t r i c t Court i s affirmed. W e concur: Q4-45 u s t i c e s