# FILED July 9, 1997 Cecil W. Crowson Ap pellate Cou rt Clerk CAROLYN R . FRAN KLIN and ) EDWARD J. FRANKLIN, ) ) Maury County Circ uit Plaintiffs, ) Case No. 6232 ) VS. ) ) REBECCA A.

KIMBERLY

and ) Appeal No. RAY KIMBERLY, ) 01A01-9701-CV-00009 ) Defendants , ) ) SERVED AS UN

INSURED M OTORIST ) CARRIERS : ) ) ST. PAUL INSURANCE COMPANY, ) a/k/a ECONOMY FIRE AND CASUALTY ) COMPANY, ) ) Appellant, ) ) TENNESSEE FARMERS MUTUAL ) INSURANCE COMPANY, ) ) Appellee. )

IN THE COURT OF AP PEALS OF

TENNESSEE MIDDLE SECT ION AT NASHV ILLE APPEALE D FROM T HE CI RCUIT COURT OF MAURY C OUNTY, TENNESSEE HONORABL E WILLIA M B. CAIN, JU DGE Kurtis J. Winstead #13084 CORNELI

US & COLL

INS 2700 Nashville City Center 511 Union Street Nashville, TN 37219 ATTORNEY FOR APPELL ANT, ST. PAUL I

NSURANCE COMPANY Lawrence D. Sands #11667 Edward Lawwe ll #3063 SANDS & SANDS LAWWELL DALE & GRAHAM P.O. Box 1660 P.O. Box 1017 Columbia, TN 38402-1660 Columbia, TN 38402-1017 ATTORNEY S FOR PL

AIN TIF FS, ATTORNEY FOR APPELL EE CAR OLYN R. AND EDW ARD J. FRA NKLIN TENN. FARMERS MUT. INS. CO.



### AFFIRMED A ND REMAND ED

HENRY F. TODD PRESIDING

JUDGE, MIDDL

E SECTION CONCUR: BEN H. CANTRELL , JUDGE, WILL IAM C. KOCH, JR., JUDGE-2-

CAROLYN R . FRAN KLIN and ) EDWARD J. FRANKLIN, ) ) Maury County Circ uit Plaintiffs, ) Case No. 6232 ) VS. ) ) REBECCA A.

KIMBERLY

and ) Appeal No. RAY KIMBERLY, ) 01A01-9701-CV-00009 ) Defendants , ) ) SERVED AS UN

INSURED M OTORIST ) CARRIERS : ) ) ST. PAUL INSURANCE COMPANY, ) a/k/a ECONOMY FIRE AND CASUALTY ) COMPANY, ) ) Appellant, ) ) TENNESSEE FARMERS MUTUAL ) INSURANCE COMPANY, ) ) Appellee. )



## O P I N I O N

Th is is an appeal from an interlocutory ruling which the Trial Judge rendered f inal as providedby T

RCP Rule54.02. The controversy on appeal is between

St . P au l In su ra nc e C om pa ny, a/k/a Economy Fire

and Casualty Company , (h ereaf ter St . Paul), and Tennessee Farmers Mutual Insurance Company (here after Tennessee Farme rs). The plaintiffs have filed a brief in support of their inte rest in the disposition

of the ap peal.

The background of the c ontrover sy i s as follow s: On May 11, 1993, St . Paul issued to Edna F ranklin, a policy

of automo

bile insurance on a 1980 Chevrolet Malibu providing uninsured/underinsured motorist coverage expiring on November 11, 1993. T

he policy contained the follo wing pr ovisions pe

rtinent to this appe al:

B. Ins ur ed as us ed in th is pa rt me an s: Yo u o r a ny m em be r o f yo ur fa mi ly.-3- - - - - Other insurance: A. If there is other app lica ble bodily injury liability or propert y damage liability

insurance w e will pay only our share of the loss. Our share is the proportion that our limit of liability bears to th e total of all applicable limits. Any insurance we provide for a vehicle y ou do not own shall be excess over any othe

r collectible insurance - D. Transfer of your interest in this policy. Your rights and

duties under this policy may not be assigned with outour written consent. However, if a named insur e d sh own in the Declarations dies, coverag e will be provided until the end of the policy per iod for:

- - - - 2. the legal represent ativ e of the deceased person as if a namedinsured shown in the Declarations. This applies only withrespec t to the re

present ative’s l egal r

esponsibi l it y to maintenance or use of your covered auto.

- - - - 3. Automatic Termination . If y ou obtain other insurance on your covered auto, any

similar insurance provided by thi s policy will terminate as t

o that aut o on the effective date of the other insurance.

On July 28, 1993, the insured, Edna Franklin expired, and her son, Edward J. Franklin, took possession of the 1980 Chevrolet Malibu.

On Aug ust 18, 1993 , Edward J. Franklin caused Tennessee Fa rmers to add the 1980 Chevrolet Malibu to his existing policy on a nother motorvehicle owned by him. The Tennessee Farm policy contained the sa me provisions as those quoted above f ro m t he St . P au l p ol ic y. However, the amounts pay able under the two policies were not the same.

On October 21, 1993, while both policies remained in force, and while the 1980 Chevrolet Malibu was in the possession and control of Caroly n R. F ranklin, wife of Edward J. Franklin, the 19 80 Ch ev ro le t M al ib u w as st ru ck by a ve hi cl e o pe ra te d b y Re be cc a A . K im be rl y.-4- PROCEEDINGS IN THE TRIAL COURT

On September 1, 1994, Carolyn R. And Edward J. Franklin sued Rebecca A. Kimberly and E dwardJ. Kimberly

for per sonal inju

ries, se rving St. Paul and T ennesse e Farme rs as unname d uninsure d motorist insurers .

On September 22, 1994, Tennessee Farmers a n swered admitting uninsured motorist cov erage of $100,000.00 for injury to one person and maximum coverage of $3 00,000.00 fo r all bodil y in ju ri es , b ut de nyi ng li ab il it y.

On April 4, 19 96, St. Paul answered deny ing liability and asser

ting the automatic termination clause quoted above, admitting the existence of uninsured motorist coverage of $250,000.00 for one injury and $500,000.00 coverage for a ll injuries, and clai ming credit for $30,000.00 advance pay ment to the

plaintiff s.

On August 12, 1996, St. Paul filed a “Petition for Declara to ry J udgment and/or Summary Judgment,” supported by authentica ted copies of the two policies mentioned above and a deposition as to the f acts.

On September 11, 1996, Tennessee Farmers f iled a res ponse in opposition to St. Paul’s petition for summary judgment and requesting a declaration that the liability of the two insurers be proporti oned 2/7 to

Tenness ee Far

mers and 5/7 to St. Pau

l.

On Octobe

r 30, 1996 , the Tria

l Judge en

tered ju dgment a s follows: For the reasons specified in its letter dated October 2, 1996, which is hereby incor

porated into this decreeof judgment by reference, the court holds that the ONE HUNDRED THOUSAN

D DOL LARS ( $100,000. 00) uninsu red motor ist covera ge by Tennessee

Farmers Mutual Insura

nce Company reduced the uninsured motorist coverage provided by St. Paul-5- Insurance Company to the extent of O NE HUNDRED TH OUSAND DOLL

ARS ($100, 000.00) le aving St. Pa u l Insurance Compa ny p roviding ONE HUNDRED FI FTY THOUSAN

D DOL LARS ( $150,000. 00) uninsu red motor ist covera ge and Tennessee Farmers Mutual Insura nce Company ONE HUNDRED THOUSAND DOL LAR S ($100,000.00) underinsured

motorist coverage. The court f

urther finds that the proration clause in both policies is appl ica ble and therefore, the appli cable underinsur ed motoris t covera

ge is to be prorate d on the ba sis of 1.5 by St. Paul I nsurance Company to one by Tenne ssee Farmers Mutual I nsurance Company (60% to 40%) up to the fu ll exte nt of TWO HUNDRED FIFTY THOUSAND DO LLA RS ($ 25 0, 00 0. 00 ) i f n ec es sa ry. There being no just reason for delay , the court directs entry of this judgment as a finaljudgment on the declaration of righ ts of the underinsured m ot orist policies of St. Paul Insurance Comp any and Tennessee F armers I nsuranc e Company

in accordance with Rule 54.02 of the Tennessee Rules of

Civil Procedure.

CONTENTIONS OF THE PARTIES ON APPEAL

St. Paul sta

tes the iss ue on app eal as f ollows: I. Did the Tr

ial Court e

rr in find ing that the autom atic termination provision

in the St. Pa

ul policy did not ope

rate to relieve St. Paul of u nderi nsured motorist liability for the accident which occurred on Octobe r 21, 1993?
In a mplifica tion, St. Paul states: St. Paul is app ealing

th e Circuit Court’s declaration that the automatic termination provision of its automobile insurance policy did not app ly to

totally relieve St. Paul of

underinsured motorist coverage in this case.
No applicable Tennessee authority is cited or found. In Taxter v. Safeco Insurance Company of America , Wash., (Wash. Ct. App. 1986), 721 P.2d 972, cert. Denied, 108 Wash.2d 1037 (1987), the Taxter’s held a Safeco automobile policy whi ch expired on November 25, 1983, but a grace periodallowed 30 days f

or renewal. On December 2, the T axters procured a similar policy from Ranier, another insurer. They intended to ca ncel the Safeco policy , but did not do so. On December-6-

13, 1983, the

Taxter’svehicle

was involv ed in a co llision with a vehicl e opera

ted by a Mr. Russe

ll. At the suggestion of the Safeco agent, the Taxters paid the premium for renewal of the Safec o po li cy. Safeco paid

the Taxters $3,997.70 property da mages but declined further pay ment, relying

upon its policy which pr

ovid ed for pror ation of liability of insurers wher e coverages overlapped. The Wash ingto n appe llat e court s grant ed sum mary judgm ent to Safeco stati ng:

[1] Here, while theinsures d id not communicate their intent to r ep lace the policy , Safeco’s policy terms provide the necessary mutual consent. These terms provide: If you ([the insured] obtain other insurance on your co ve re d a ut o, an y s im ilar insurance providedb y t his policy

will terminate as t

o t hat auto on the effective date of the o the r insurance. (Italics ours.) We cannot ignore the languag e in the contract nor revise the contract under the theory of construi ng i t. Farmers ins.. Co. v. Miller , 87 Wash.2d 70, 73, 549 P.2d 9 126 (1976). The Taxters cons ented to these terms when they obtained the Safeco policy . They ca nnotclaim lack

of notice when they

had eithe r actua l or const ructive knowledg e of it. We conclude the Safec o polic y terminated to the extent the Rainier policy provided similar cove rage.
- - - - The insure r and in sured ha ve the ri ght to specify

in their insurance contract the method by which it can be terminated. Department

of Labor & I

ndu s. v. Northwestern Mut. Fire Ass’n., 13 Wash.2d 288, 291, 124 P.2d 944 (1942).

We note, however, that both policies in the Taxter case provided the same amount of uninsured motorist coverage. The covera ge was not only similar but identical. So, even under the rule we a dopt today

the result in Taxter

would be the same.

We diverge from the holding in Taxter , howeve r, to the extent thatthe Washington court’s decision stands for the proposition that coverage in any amount cancels the entire amount of that
covera ge in the original policy. St. Paul’s policy says “cove

rage” in its policy

will terminate when “any simila r insu ranc e” is obta

ined on the same auto mobil e. We

think simila

r in this context may have more than one meaning. I t may mean

“similar in kind” or “similar in kind and amount.” One-7-

standardrefer

ence de fines simi lar as “ne arly cor responding; resembling in many respects; somewhat like; having a general likene ss.” (citing authorities). Black’s Law Dictionary , 4th Ed. Th

e same source, however, cites other authorities for the meaning of “e xa ct ly like; iden

tical; exa ctly corresponding” (at least in all essential par ticulars). ld
.

A contr act of insurance is strictly c onstrued in favor of the insured. Gridig v. Tennessee Farmers Mutual In s. Co ., 891 S.W.2d 909 (Tenn. App. 1994). Where one meaning of a policy term provides coverage and an other meani ng would defeat coverag e, we will adopt the meaning that preserves the co verage for the insured. Tata v. Nichols , 848 S.W.2d 649 (Tenn. 1993). Therefore,
we hold that the insurance coverage in the two policie s is similaronly to the extent of the amount of co ve ra ge in th e s ec on d p ol ic y .
Although the St. Paul policy was issued in I ndiana, it is not argued

that Indiana law differ s from Ten nessee l aw in any

materia l respect.

The judgment of the Trial Court is affirmed and the cause is remanded to the Tria l Courtfor further proceedings in conformity with this opinion.
Judgmentis rendered

agains t St. Paul Insurance Company for costs of this appeal for which execution may issue. AFFI RMED AND REMANDED

_____________________________________ HENRY F. TODD PRESIDING

JUDGE, MIDDL

E SECTION CONCUR:

_____________________________________ BEN H. CANTRELL , JUDGE

_____________________________________ WILL IAM C. KOCH, JR., JUDGE-8-