United States Court of Appeals

For the Eighth Circuit

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No. 12-3881

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Kelly Jordan; Robert Jordan

lllllllllllllllllllll Plaintiffs - Appellants

v.

Safeco Insurance Company of Illinois

lllllllllllllllllllll Defendant - Appellee

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 Appeal from United States District Court 

for the Eastern District of Missouri - St. Louis

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 Submitted: September 26, 2013

 Filed: January 15, 2014

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Before MURPHY, MELLOY, and SHEPHERD, Circuit Judges.

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SHEPHERD, Circuit Judge.

Kelly Jordan appeals the district court’s grant of summary judgment in favor

of Safeco Insurance Company of Illinois. Jordan sued Safeco seeking to “stack” the

underinsured motorist coverage from various policies she and her husband, Robert

Jordan, had taken out with Safeco for their five vehicles. The district court

determined that the Missouri Supreme Court’s decision in Ritchie v. Allied Property
& Casualty Insurance Co., 307 S.W.3d 132 (Mo. 2009), which permitted the stacking

of underinsured motorist coverage, was limited to the special situation where the

insured is occupying a vehicle the insured does not own. We disagree with the

district court’s interpretation of Ritchie’s holding, and therefore we reverse the grant

of summary judgment and remand this matter for entry of partial summary judgment

in favor of Jordan and for further consideration consistent with this holding. 

I.

In 2009, Kelly Jordan was walking acrossthe street at an intersection when she

was struck by a car. Jordan suffered injuries and lost wages. The driver’s insurance

company paid its limit of $100,000 to Jordan and her husband. At the time of the

accident, Jordan was a named insured on three Safeco Insurance Company policies

covering five different vehicles she owned with her husband. The policies provided

for $100,000 in underinsured motorist coverage (UIM) for each of the five vehicles. 

Jordan sought payment of $500,000 from Safeco under a claim that the driver who

struck her was underinsured. Safeco paid Jordan $100,000 as UIM coverage but

refused additional payments, claiming the policies contained language that prohibited

the “stacking,” or combining, of the policies’ UIM coverage. 

The three policies contain identical language that forms the basis of the

disagreement between the parties. The clause of the policies most relevant to this

case is paragraph two of the “Underinsured Motorist Coverage: Other Insurance”

section (hereinafter, the “Other Insurance clause”). It provides:

2. Any underinsured motorist insurance we provide with respect to a

vehicle you do not own shall be excess over any collectible

underinsured motorist insurance.

(J.A. 119.) 

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Jordan brought suit in state court seeking payment of $500,000 in UIM

coverage, claiming that she should be able to recover $100,000 in UIM coverage for

each of the five vehicles she insured with Safeco. Jordan also sought the award of

state statutory penalties and attorneys’ feesfor Safeco’s alleged unreasonable refusal

to pay under the described policies. Safeco removed the action to federal court on the

basis of diversity jurisdiction. Safeco moved for summary judgment, arguing the

UIM coverage could not be stacked and therefore Jordan was not entitled to

additional payments nor did Safeco unreasonably refuse to pay under the policies. 

Jordan moved for partial summary judgment, seeking a declaration that the UIM

coverages under the relevant policies were subject to stacking. The district court

denied Jordan’s motion for partial summary judgment, granted Safeco’s motion for

summary judgment, and dismissed Jordan’s claims, holding that the Ritchie decision,

which permitted the stacking of UIM coverage under a similar Other Insurance

clause, only applies to situations where the insured is occupying a non-owned vehicle

and thus the Other Insurance clause in the Safeco policies was not applicable to

Jordan because she was a pedestrian. The district court further held that, absent the

applicability of the Other Insurance clause, the policies unambiguously prohibit the

“stacking” of UIM coverage. Jordan now appeals, arguing the district court

misapplied Ritchie. 

II.

We review the district court’s interpretation of an insurance policy and its grant

of summary judgment de novo. See Secura Ins. v. Horizon Plumbing, Inc., 670 F.3d

857, 861 (8th Cir. 2012). A district court properly grantssummary judgment “if there

is no genuine issue of material fact and the insurers are entitled to judgment as a

matter of law.” Id. “State law governs the interpretation of insurance policies when

federal jurisdiction is based on diversity of citizenship.” Id. Both parties agree that

Missouri law applies to the policies in question. 

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A.

Missouri courts have held that there are public policy reasons for requiring

uninsured motorist coverage, and thus attempts by insurance companies to prohibit

the stacking of uninsured motorist coverage have been invalidated. Hall v. Allstate

Ins. Co., 407 S.W.3d 603, 607 (Mo. Ct. App. 2012). Because similar public policy

reasons are not present for UIM coverage in Missouri, however, policies can be

drafted in a manner that prohibits the “stacking,” or combining, of UIM coverage

from multiple policies. See Long v. Shelter Ins. Cos., 351 S.W.3d 692, 696-97 (Mo.

Ct. App. 2011); Lynch v. Shelter Mut. Ins. Co., 325 S.W.3d 531, 539 (Mo. Ct. App.

2010). When the language prohibiting “stacking” is clear and unambiguous, insureds

may recover UIM benefits from only a single policy as a matter of contractual right. 

Long, 351 S.W.3d at 697. 

Although courtsshould evaluate insurance policies as a whole, Seeck v. Geico

Gen. Ins. Co., 212 S.W.3d 129, 133 (Mo. 2007), issues arise in contract disputes

when policies contain clauses that claim to prohibit “stacking” and also contain

clauses that appear to authorize “stacking.” When this happens, an ambiguity occurs,

and courts are obligated to resolve the ambiguity in favor of the insured. See Manner

v. Schiermeier, 393 S.W.3d 58, 65 (Mo. 2013) (“Conflicts and inconsistencies

between different policy provisions, with one seeming to deny coverage but the other

seeming to grant it, will render a policy ambiguous, and such an ambiguity will be

interpreted in favor of the insured.”). Questions of contract interpretation are very

specific to the policiesinterpreted, and thus courts must exercise care in applying case

holdings that have interpreted policies not identical to the policy at issue. 

B.

The relevant policy language from the Other Insurance clause in this case and

inRitchie are essentially identical. Because the Missouri Supreme Court held that the

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Other Insurance provision in Ritchie created an ambiguity that permitted the stacking

of UIM coverage, Safeco argues that the Other Insurance clause in this policy only

applies to situations where, as in Ritchie, the insured is occupying a non-owned

vehicle. Safeco admitted at oral argument that if Jordan had been injured while

occupying a non-owned vehicle, Ritchie’s holding would apply and Safeco would be

obligated to pay the UIM coverage on all of the policies. Safeco argues, however,

that because Jordan was a pedestrian at the time of the accident, the Other Insurance

clause does not apply because it contains a non-owned vehicle occupancy

requirement. Safeco makes this occupancy argument on two grounds: (1) the Other 1

Insurance clause in the policies references “a vehicle you do not own” and courts

should thus read into this language an occupancy requirement, and (2) the Missouri

Supreme Court in Ritchie specifically limited its holding to situations where the

insured was occupying a non-owned vehicle. Safeco also argues that the Missouri

Court of Appeals has determined in Kennedy v. Safeco Insurance Co. of Illinois, 413

S.W.3d 14 (Mo. Ct. App. 2013), a case involving the same Safeco policy language

and comparable facts, that an ambiguity does not exist and thus the UIM coverage

may not be “stacked.” As explained below, none of these bases can withstand

scrutiny. 

First, Safeco argues that we should read the Other Insurance clause’s reference

to “vehicle you do not own” as requiring the insured to be occupying a non-owned

vehicle at the time of the accident. Safeco concedes that UIM coverage was personal

Safeco also argues that there are multiple, overlapping clauses in the policy

1

that clearly prohibit stacking. This argument does not prevail for Safeco because, as

illustrated by Ritchie, where even one clause can be reasonably interpreted to provide

for the stacking of UIM coverage in certain circumstances despite repeated, general

references in the policy stating otherwise, an ambiguity is created. See Ritchie, 307

S.W.3d at 138 (“Any conflict between [the limit of liability provision and the other

insurance provision] creates an ambiguity that is resolved in favor of the insureds.”). 

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and thus followed Jordan as she was a pedestrian. Accordingly, Safeco paid out

$100,000 in UIM coverage to Jordan. But, then Safeco inconsistently contends that

the “excess” provision of the Other Insurance clause is meant to provide insurance

coverage to the insured only in circumstances when the insured is involved in the

“occasional and sporadic use of vehicles not owned by the insured.” Safeco

emphasizes that “the Safeco policies only insured the vehicles scheduled on the

policies’ Declarations and any non-owned vehicle that an insured under the policies

might use or occupy.” Safeco maintains that to interpret the policy otherwise would

be an unauthorized rewriting of the policies and a distortion of the policies’ intent to

only insure Jordan while she was occupying a vehicle she owns or a vehicle she does

not own. In support of its argument, Safeco relies on Ritchie and Clark v. American

Family Mutual Insurance Co., 92 S.W.3d 198 (Mo. Ct. App. 2002). 

The Other Insurance clause in the Safeco policies states, “Any underinsured

motorist insurance we provide with respect to a vehicle you do not own shall be

excess over any collectible underinsured motorist insurance.” While it may be that

most situations in which the insured is able to collect under this provision involve

cases where the insured is occupying an uninsured vehicle, nothing in the plain

language of the clause mandates the occupancy of a non-owned vehicle. The clause,

as written, issilent asto occupancy. This silence speaks volumes when one considers

that the policies specifically define “occupying” but then exclude this defined term

from the Other Insurance clause. Further, Safeco does not dispute that it provided

UIM coverage to Jordan with respect to the injuries she suffered from being struck

by the underinsured motorist. In light of this ambiguity, we are obligated to read the

policy against Safeco and in favor of Jordan. Ritchie, 307 S.W.3d at 135. 

Safeco cites Clark assupportive ofits argument that the Other Insurance clause

language necessarily requiresthatJordan have occupied a non-owned vehicle. Clark,

however, demonstrates why the policy language here is ambiguous. In Clark, the

relevant clause provided, “But, any insurance provided under this endorsement for

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an insured person while occupying a vehicle you do not own is excess over any

similar insurance.” 92 S.W.3d at 201 (emphasis in original). Thus, the Clark policy

did contain a specific occupancy requirement. Whatever Safeco intended when it

included the phrase “to a vehicle you do not own,” we simply do not read an

occupancy requirement into the plain language of that clause. As explained below,

we also find unpersuasive Safeco’s attempt to rely on language from Ritchie in

support of an occupancy requirement. 

Safeco maintains that the Missouri Supreme Court in Ritchie limited its

holding to situations in which the insured is occupying a non-owned vehicle. The

Other Insurance provision at issue in Ritchie stated, “Any coverage we provide with

respect to a vehicle you do not own shall be excess over any other collectible

underinsured motorist coverage.” 307 S.W.3d at 137. The Missouri Supreme Court

then interpreted the policy to mean “underinsured coverage under the policy ‘shall be

excess over any other collectible underinsured motorist coverage’ when, as in this

case, the insured is injured while riding in a non-owned vehicle.” Id. While this

language arguably supports Safeco’s argument that the Other Insurance clause only

applies to circumstances where the insured is occupying a non-owned vehicle, the

occupancy question was not at issue in Ritchie. Accordingly, whether the policy in

Ritchie required occupancy of a non-owned vehicle was not specifically decided by

the Missouri Supreme Court. See Blunkall v. Heavy& Specialized Haulers, Inc., 398

S.W.3d 534, 544 (Mo. Ct. App. 2013) (explaining that expressions of opinion by the

court that are not necessary for deciding the case are “obiter dicta” and not binding

precedent). Thus, it would not be appropriate to read into the Ritchie holding a

judicially-created occupancy requirement. 

Ritchie relies heavily on Niswonger v. Farm Bureau Town & Country

Insurance Co. of Missouri, 992 S.W.2d 308 (Mo. Ct. App. 1999), in support of its

decision. In Niswonger, the Other Insurance provision provided, “any insurance

provided under this endorsement for a person insured while occupying a non-owned

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vehicle is excess of any other similar insurance.” 992 S.W.2d at 315. Because of this

policy language, which explicitly requires occupancy, the Niswonger court held,

“[w]hile the UIM ‘anti-stacking’ provisions of the policy here in question might

perhaps have to be deemed unambiguous in nearly any other factual situation, that

does not necessarily mean they are unambiguous in the particular factual situation

now before us, where the accident occurred while [the insured] was occupying a nonowned vehicle.” Id. Thus, it is obvious the Missouri Supreme Court when deciding

Ritchie simply took the language from the Niswonger decision which contained

reference to occupancy only because the policy at issue in Niswonger also contained

an occupancy requirement. Accordingly, we reject Safeco’s argument that the

Missouri Supreme Court in Ritchie limited its holding to situations where the insured

is occupying a non-owned vehicle at the time the injury is suffered. 

Finally, Safeco argues that Kennedy, a Missouri Court of Appeals decision that

is squarely on point—factually, legally, and contractually—with this case, controls. 

In Kennedy, the Missouri Court of Appeals held thatstacking of Safeco UIM policies

is not permitted, reasoning that no matter what the Other Insurance clause stated, no

reasonable layperson could believe it overrides the other multiple provisions in the

policy prohibiting stacking. Kennedy, 413 S.W.3d at 17-18. To be certain, this

reasoning is appealing; however, we are unable to follow it because the Missouri

Court of Appeals failsto distinguish the Safeco policies considered in Kennedy from

the policy at issue in Ritchie, which also contained express clauses that barred

stacking of UIM coverage. We note the Safeco policy contains more “no-stacking”

clauses than were contained in the policy at issue in Ritchie, but we fail to see how

that fact alone negates the rule, emphasized in Ritchie, that where “excess coverage

was promised at one point and taken away at another” an ambiguity is created and the

courtsshould allow for stacking of the policies. 307 S.W.3d at 138 (citing Seeck, 212

S.W.3d at 133). Despite the “no-stacking” provisionsfound in the Ritchie policy, the

Missouri Supreme Court held that the policy could be reasonably interpreted to allow

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stacking when the accident falls under the Other Insurance provision which fails to

include the “no-stacking” provisions found elsewhere in the policy. 

When the Missouri Court of Appeals decided Kennedy, it based its decision on

the fact that the Safeco policies contained several “no-stacking” clauses throughout

the policy and thus concluded that no reasonable policyholder could interpret the

Other Insurance clause as overcoming the “no-stacking” restrictions. This reasoning,

however, was not persuasive to the Missouri Supreme Court in Ritchie, and therefore

we cannot adopt it in this case. See Blankenship v. USA Truck, Inc., 601 F.3d 852,

856 (8th Cir. 2010) (holding that when a federal court sits in diversity, it must apply

the governing precedent from the state’s highest court, and when there is no case

directly on point, the federal court must predict how the state supreme court would

rule if faced with the same question). The Missouri Supreme Court declined to

transfer Kennedy. Thus, we must predict what outcome we believe the Missouri

Supreme Court would reach in this situation, and from its holding in Ritchie, we

believe it would reject the Missouri Court of Appeals decision in Kennedy. 

III.

Accordingly, we reverse the district court’s grant of summary judgment in

favor of Safeco. We remand this matter to the district court with instructions to grant

Jordan’s motion for partial summary judgment and to conduct further proceedings

consistent with this decision. 

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