Case Name: UNITED STATES FIDELITY & GUARANTY COMPANY v. JOHN DEERE INSURANCE COMPANY, Albert L. East, IV, Albert L. East, III and Ella May East
Court: Mississippi Supreme Court
Jurisdiction: Mississippi
Decision Date: 2002-08-29
Citations: 830 So. 2d 1145
Docket Number: No. 1999-CA-02032-SCT
Parties: UNITED STATES FIDELITY & GUARANTY COMPANY v. JOHN DEERE INSURANCE COMPANY, Albert L. East, IV, Albert L. East, III and Ella May East.
Judges: PITTMAN, C.J., SMITH, P.J., COBB AND CARLSON, JJ., CONCUR. DIAZ, J., DISSENTS WITH SEPARATE WRITTEN OPINION JOINED BY McRAE, P.J., EASLEY AND GRAVES, JJ.
Reporter: Southern Reporter, Second Series
Volume: 830
Pages: 1145–1151

Head Matter:
UNITED STATES FIDELITY & GUARANTY COMPANY v. JOHN DEERE INSURANCE COMPANY, Albert L. East, IV, Albert L. East, III and Ella May East.
No. 1999-CA-02032-SCT.
Supreme Court of Mississippi.
Aug. 29, 2002.
Rehearing Denied Dec. 5, 2002.
Michael Wayne Baxter, Charles G. Copeland, Janet G. Arnold, Ridgeland, attorneys for appellant.
Jan F. Gadow, Ridgeland, Ken R. Ad-cock, Jackson, Mark D. Morrison, Grenada, Brenda B. Bethany, C. Michael Elling-burg, Sr., Jackson, attorneys for appellees.

Opinion:
WALLER, J.,
for the Court.
¶ 1. This appeal involves the issue of whether the two commercial automobile liability insurance policies should be prorated according to the coverage limits of each policy or whether they should be paid out according to the priority of coverage. We find that the two policies should not be pro-rated because, under Mississippi law, the insurer for the owner of the vehicle involved in the accident is the primary insurer. Even though the "other insurance" clauses in the two policies are identical, they do not conflict. The "other insurance" clause simply establishes the order of priority of payments. The insurer of the vehicle is first in the paying line of uninsured motorist benefits.
FACTS
¶ 2. This appeal from the Circuit Court of the First Judicial District of Hinds County arises out of an automobile accident between Albert L. East, IV ("Bert") and Thomas Blalaek, an uninsured motorist. The accident was solely caused by Blalaek's negligence. Bert suffered minor physical injuries. Albert L. East, III ("Al"), who was riding as a passenger in the vehicle driven by Bert, sustained injuries which required plastic surgery, reconstructive surgery of the left hip, reconstructive surgery of the left rotator cuff and prostate surgery to allow urination.
¶ 3. Al and Bert owned car dealerships in Natchez and Jackson. The Natchez dealership was insured by John Deere Insurance Company, and the Jackson dealership was insured by United States Fidelity and Guaranty Company ("USF & G"). Al and Bert were both listed as insureds on each policy. The vehicle involved in the accident was owned by the Natchez dealership and was insured by John Deere. The John Deere policy covered 98 vehicles with $20,000.00 in uninsured motorist coverage per vehicle, totaling $1,960,000.00 in available UM coverage. The USF & G policy was purchased by the Jackson dealership to cover 583 vehicles with $25,000.00 in UM coverage per vehicle, totaling $14,575,000.00 in available UM coverage. The total available UM coverage under both policies was $16,535,000.00.
¶ 4. Each of the policies contains the following identical "other insurance" clause:
5. OTHER INSURANCE
a. For any covered "auto" you own, this Coverage Form provides primary insurance. For any covered "auto" you don't own, the insurance provided by this Coverage Form is excess over any other collectible insurance.
¶ 5. Bert and Al filed separate lawsuits against Blalaek alleging that his negligence caused the accident. Bert and Al also sued John Deere and USF & G, asserting claims for uninsured motorists benefits. Al's wife, Ella May, joined in Al's complaint and asserted a claim for loss of consortium.
¶ 6: USF & G answered the separate complaints and asserted that, while its insurance policy did apply to the accident, the UM benefits under the USF & G policy were excess over and above the John Deere UM coverage, which was primary.
¶ 7. The lawsuits filed by the Easts were consolidated for all purposes. The Easts filed a motion for partial summary judgment requesting the circuit court to hold that the Easts were entitled to stack the uninsured motorists coverage limits for every automobile covered under both the John Deere and USF & G policies. The circuit court granted the motion.
¶ 8. John Deere filed a cross-motion for summary judgment seeking a ruling that uninsured motorist benefits under its policy and USF & G's policy should be prorated on a co-primary basis to cover damages the Easts sustained in the accident. USF & G responded to John Deere's cross-motion and filed its own motion for summary judgment, seeking a judgment that the John Deere policy provided primary coverage and the USF & G policy provided excess coverage for any damages recovered by the Easts.
¶ 9. The circuit court granted John Deere's motion for summary judgment and denied USF & G's motion for summary judgment, holding that coverage under the John Deere and USF & G insurance policies should be prorated on a co-primary basis to satisfy any judgment obtained by the Easts.
¶ 10. After a trial, the jury returned a verdict in favor of Bert East in the amount of $5,000.00, and in favor of A1 East in the amount of $500,000.00. Ella May East was awarded $0 damages on her claim of loss of consortium. Judgments against John Deere and USF & G were entered, along with a default judgment against Bla-lack, the uninsured motorist.
. ¶ 11. USF & G filed a motion for judgment notwithstanding the verdict, which was denied. The Easts also filed a motion for JNOV, or, in the alternative, for new trial or additur, which was also denied.
¶ 12. The circuit court granted John Deere's motion for entry of an amended judgment. The amended judgment provided for a pro rata sharing by John Deere and USF & G of the jury verdicts entered in favor of Al and Bert in proportion to the UM limits each insurance policy bore to the total coverage available, as follows:
1. Judgment is hereby granted in favor of A.L. East, III against United States Fidelity & Guaranty Company in the amount of $440,750.00 and in favor of A.L. East, III against John Deere Insurance Company in the amount of $59,250.00.
2. Judgment is hereby rendered in favor of A.L. East, IV against United States Fidelity & Guaranty Company in the amount of $4,407.50 and judgment is hereby entered in favor of A.L. East, IV against John Deere Insurance Company in the amount of $592.50.
Furthermore, the Easts were awarded post-judgment interest at a rate of 8% per annum.
¶ 13. USF & G appealed from the circuit court's denial of USF & G's motion for JNOV. The Easts have asked that they be granted post-judgment interest on the amount of the judgment, at a rate of 8% per annum and an award of the 15% statutory penalty under Miss.Code Ann. § 11-3-23 (1991). On cross-appeal, John Deere requests that we set aside post-judgment interest and require that USF & G pay all post-judgment interest. If USF & G is unsuccessful in its appeal, John Deere and the Easts also ask for an award of the 15% statutory penalty.
DISCUSSION
I. WHETHER THE CIRCUIT COURT ERRED IN GRANTING JOHN DEERE'S COUNTER MOTION FOR SUMMARY JUDGMENT.
II. WHETHER THE TRIAL COURT ERRED IN PRO-RATING THE DAMAGES BE TWEEN USF & G AND JOHN DEERE.
¶ 14. We employ a de novo standard of review when reviewing a trial court's grant of summary judgment. Leslie v. City of Biloxi, 758 So.2d 430, 431 (Miss.2000).
¶ 15. The circuit court granted John Deere's counter motion for summary judgment, finding that the two policies' "other insurance" clauses were in conflict and mutually repugnant and that "[e]n-forcement of the 'other insurance' clauses contained in both the USF & G and [John Deere] insurance contracts as written, [would] have the effect of having no coverage for the plaintiff." In addition to the identical "other insurance" clauses, both policies contained identical pro rata clauses which provided that benefits in such eases involving two policies should be pro rated according to the coverage limits of each policy.
¶ 16. The longstanding rule in Mississippi is that the insurer for the owner of the vehicle involved in the accident is the primary insurer. State Farm Mut. Auto. Ins. Co. v. Universal Underwriters Ins. Co., 797 So.2d 981, 983 (Miss.2001); Travelers Indem. Co. v. Chappell, 246 So.2d 498, 505 (Miss.1971). At the time of the accident, Bert lived in Natchez, Mississippi, and was part owner of the Natchez dealership. It is undisputed that Bert and A1 were going to the Natchez dealership in a car owned by the Natchez dealership when the accident occurred. It is also undisputed that on the date of the accident, the Natchez dealership was listed as a named insured under a commercial automobile liability insurance policy issued by John Deere and that the vehicle was a covered auto under the John Deere policy.
¶ 17. On the date of the accident, USF & G insured the Jackson dealership and Al, a named insured, under a commercial automobile liability policy. It is undisputed that the vehicle involved in the accident was not owned by the Jackson dealership. USF & G would be liable for any judgment in excess of John Deere's limits of coverage; however, the damages awarded the Easts did not exceed John Deere's limits of coverage.
¶ 18. While the "other insurance" clauses are identical, they do not conflict. The "other insurance" clause simply establishes the order of priority of payments. John Deere is first in the paying line of uninsured motorist benefits since its policy insures the Natchez dealership, the owner of the vehicle involved in the accident. See State Farm Mut. Auto. Ins. Co. v. Universal Underwriters Ins. Co., 601 F.Supp. 286, 289-90 (S.D.Miss.1984) (under Travelers Indem. Co. v. Chappell, 246 So.2d 498, 505 (Miss.1971), the insurance policy issued to the owner of the vehicle provides primary coverage). This precedent is consistent with authorities in other jurisdictions. See Hlasnick v. Federated Mut. Ins. Co., 136 N.C.App. 320, 524 S.E.2d 386, 391 (2000), aff'd in part and review improvidently allowed in part, 353 N.C. 240, 539 S.E.2d 274 (2000) ("Pro rata" coverage is not applicable because the two policies by their own express terms, did not provide coverage on the same basis.). See also Hamilton Mut. Ins. Co. v. United States Fid. & Guar. Co., 926 S.W.2d 466 (Ky.Ct.App.1996); Swank v. Chrysler Ins. Corp., 282 Mont. 376, 938 P.2d 631 (1997).
¶ 19. Justice Diaz, in his dissent, argues that Chappell is distinguishable from the case sub judice because Chappell involved a general liability policy, and uninsured motorist policies cannot be considered secondary or primary. However, in Dixie Ins. Co. v. State Farm Mut. Auto. Ins. Co., 614 So.2d 918, 922 (Miss.1992), a case involving uninsured motorist coverage, we held that the trial court correctly decided the host driver's uninsured motorist insurer was the primary insurer. See 1 Alan I. Widiss, Uninsured and Underinsured Motorist Insurance § 13.3, at 725 (Rev.2d ed.1999). One reason offered for this rule is to require primary insurers to pay what is mandated pursuant to the provisions of its policy and required by statute. See Mississippi Farm Bureau Mut. Ins. Co. v. Garrett, 487 So.2d 1320, 1322 (Miss.1986). See also Preferred Risk Ins. Co. v. Insurance Co. of North America, 824 F.Supp. 614, 619 (S.D.Miss.1993) (applying Mississippi law) (holding that secondary insurer would "incur liability pursuant to the provisions of its policy only as a provider of excess coverage and is not required to share pro rata responsibility for [the insured's] injuries").
¶20. We find that the circuit court committed reversible error in granting summary judgment to John Deere and denying USF & G's motion for summary judgment. This finding moots the issue of the .imposition of the statutory penalty against USF & G. The post-judgment interest awarded by the circuit court should be paid by John Deere, as USF & G was successful in its appeal.
CONCLUSION
¶ 21. Because longstanding Mississippi jurisprudence has provided that the insurance policy covering the owner of a vehicle involved in an accident is deemed to have primary coverage, the circuit court's judgment and its order granting summary judgment in favor of John Deere are reversed, and this case is remanded for entry of a new judgment against John Deere Insurance Company only. Post-judgment interest is assessed against John Deere Insurance Company.
¶ 22. REVERSED AND REMANDED.
PITTMAN, C.J., SMITH, P.J., COBB AND CARLSON, JJ., CONCUR. DIAZ, J., DISSENTS WITH SEPARATE WRITTEN OPINION JOINED BY McRAE, P.J., EASLEY AND GRAVES, JJ.
. The Easts cross-appealed the circuit court's denial of their motion for JNOV, or, in the alternative, for new trial or for additur and the granting of John Deere's motion to amend judgment. However, the Easts voluntarily filed to dismiss their cross-appeal, and an order was granted dismissing that cross-appeal.