Case Name: NATIONAL UNION FIRE INSURANCE COMPANY v. MISSISSIPPI INSURANCE GUARANTY ASSOCIATION
Court: Mississippi Supreme Court
Jurisdiction: Mississippi
Decision Date: 2008-09-04
Citations: 990 So. 2d 174
Docket Number: No. 2007-FC-01981-SCT
Parties: NATIONAL UNION FIRE INSURANCE COMPANY v. MISSISSIPPI INSURANCE GUARANTY ASSOCIATION.
Judges: SMITH, C.J., WALLER, P.J., CARLSON AND RANDOLPH, JJ., CONCUR. EASLEY, J., CONCURS IN PART WITHOUT SEPARATE WRITTEN OPINION. DIAZ, P.J., CONCURS WITH SEPARATE WRITTEN OPINION JOINED BY GRAVES, J.; EASLEY, J., JOINS IN PART. LAMAR, J., NOT PARTICIPATING.
Reporter: Southern Reporter, Second Series
Volume: 990
Pages: 174–186

Head Matter:
NATIONAL UNION FIRE INSURANCE COMPANY v. MISSISSIPPI INSURANCE GUARANTY ASSOCIATION.
No. 2007-FC-01981-SCT.
Supreme Court of Mississippi.
Sept. 4, 2008.
Todd Britton Murrah, attorney for appellant.
Clifford C. Whitney, III, R.E. Parker, Jr., Vicksburg, attorneys for appellee.

Opinion:
DICKINSON, Justice,
for the Court.
¶ 1. The United States Court of Appeals for the Fifth Circuit has certified to us the following question:
Miss. R.App. P. (20)(a).
Whether a solvent-carrier's insurance policy, which provides an "other-insurance" clause stating it is in excess to any other primary insurance, must be exhausted under Mississippi Code Annotated § 83-23-123, ahead of MIGA's statutory coverage of the insolvent-carrier's primary policy.
National Union Fire Ins. Co. v. Miss. Ins. Guar. Ass'n., 507 F.3d 309, 312 (5th Cir.2007).
BACKGROUND FACTS
¶ 2. A patient sued her doctors, who were both covered under two insurance policies, one issued by Pennsylvania Hospital Indemnity Company ("PHICO"), and the other by National Union Fire Insurance Company ("NUFIC"). Between the two policies, there is no dispute that PHI-CO's policy was primary.
¶ 3. After assuming the legal defense of both doctors and then settling with one, PHICO was declared insolvent. The Mississippi Insurance Guaranty Association ("MIGA") immediately assumed the defense of the remaining doctor and then proceeded to evaluate its liability for the claim, concluding it had no duty to pay prior to exhaustion of coverage under the NUFIC policy.
¶ 4. NUFIC disagreed and filed a declaratory judgment action in the United States District Court for Southern District of Mississippi. MIGA responded with a counterclaim for declaratory judgment. Both parties filed motions for summary judgment. The district court granted summary judgment to MIGA. NUFIC appealed, which led to the certified question recited above, which we will now address.
ANALYSIS
¶ 5. The NUFIC policy includes the following "other-insurance" provision:
A loss covered under this policy may also be covered under another policy you have. If it is, our policy will apply only in excess of such other coverage no matter how such other coverage is described. This clause will not apply to coverage which is expressly stated to apply in excess of this specific policy.
NUFIC claims that — because MIGA stands in the shoes of PHICO — this provision relieves it of any duty to pay the claim until benefits under the PHICO policy are paid by MIGA. As further authority for its position, NUFIC cites the following statutory language:
[MIGA shall] [b]e deemed the insurer to the extent of its obligations on the covered claims and to such extent shall have all the rights, duties, and obligations of the insolvent insurer as if the insurer had not become insolvent.
Miss.Code Ann. § 83 — 23—115(l)(b) (Rev. 1999). This provision, NUFIC argues, means that MIGA must pay the claim exactly as PHICO would have been required to do, had it not become insolvent. We disagree.
¶ 6. MIGA is not an insurance company, but rather a guaranty association created by the Legislature to provide protection to claimants and policyholders of insolvent insurance companies. Miss.Code Ann. § 83-23-103 (Rev.1999). MIGA's duties and responsibilities are strictly controlled by statute. Upon reviewing all of the provisions of the Mississippi Insurance Guaranty Association Law, Mississippi Code Annotated Section 83-23-101 to-235, we conclude that MIGA's obligation to stand in the shoes of PHICO under Section 83-23 — 115(l)(b) is subject to the limitations and qualifications found within the other statutes in the Mississippi Insurance Guaranty Association Law, in which is found Section 83-23-123(1), which states quite clearly:
Any person having a claim against an insurer under any provision in an insurance policy other than a policy of an insolvent insurer, which is also a covered claim, shall be required to exhaust first his right under such policy.
Miss.Code Ann. § 83-23-123(1) (Rev.1999). This provision, in effect, eliminates from MIGA's statutory guaranty any obligation to pay a claim prior to the exhaustion of all other-insurance, other than coverage under true excess policies.
¶ 7. In support of its argument, NUFIC argued to the Fifth Circuit that our prior decision in Caldwell means it is not required to "drop down" and provide primary coverage in the place of PHICO, an insolvent primary insurer. The distinction between Caldwell's true excess insurance policy and the NUFIC policy (which is a primary policy with an "other insurance" provision) was not lost on the Fifth Circuit, which stated that
the excess provision in the Caldwell policy is worded differently than in NUFIC's. Indeed, MIGA asserts the provisions in Caldwell is "true excess" insurance while NUFIC's policy contains only an "other insurance" clause.
National Union Fire Ins. Co., 507 F.3d at 311.
¶ 8. The rationale in Caldwell was clear. A true excess earner did not contract to provide primary coverage, and cannot be made to do so simply because the primary carrier becomes insolvent. The same cannot be said of NUFIC, which contracted for primary coverage. The NUFIC policy's "other-insurance" clause did not transform it into a true excess policy when PHICO became insolvent.
ANSWER TO THE CERTIFIED QUESTION
¶ 9. In response to the question certified to us by the Fifth Circuit, we hold that a solvent carrier's insurance policy which is not a true excess policy, and which provides an "other-insurance" clause stating it is in excess to any other primary insurance, must nevertheless be exhausted prior to MIGA's statutory duty to provide coverage under an insolvent-carrier's primary policy.
¶10. CERTIFIED QUESTION ANSWERED.
SMITH, C.J., WALLER, P.J., CARLSON AND RANDOLPH, JJ., CONCUR. EASLEY, J., CONCURS IN PART WITHOUT SEPARATE WRITTEN OPINION. DIAZ, P.J., CONCURS WITH SEPARATE WRITTEN OPINION JOINED BY GRAVES, J.; EASLEY, J., JOINS IN PART. LAMAR, J., NOT PARTICIPATING.
. The author of the concurring opinion states that he authored "this case's original opinion." Although the statement is technically true, it needs to be clarified. The author of the concurring opinion was originally assigned to circulate an opinion to the Court for consideration, but his proposed opinion never received a majority of the votes.
. When it shall appear to . any United States Court of Appeals that there may be involved in any proceeding before it questions or propositions of law of this state which are determinative of all or a part of that cause and there are no clear controlling precedents in the decisions of the Mississippi Supreme Court, the federal court may certify such questions or propositions of law of this state to the Mississippi Supreme Court for rendition of a written opinion concerning such questions or propositions of Mississippi law.
. We understand the question presented assumes the 'solvent-carrier's insurance policy" includes primary coverage and an 'other-insurance" clause (discussed below).
. For a more detailed factual background, see Id. at 310-12.
. For instance, MIGA's coverage limits are controlled by statute, not by the insolvent company's policy. Miss.Code Ann. § 83-23-115(l)(a) (Rev.1999).
. In Caldwell Freight Lines, Inc. v. Lumbermens Mutual Casualty Co., 947 So.2d 948, 955 (Miss.2007), we held that a true excess insurer (one who contracts only to provide coverage in excess of that available under the terms of another policy) is not required to "drop down" and provide primary coverage in the place of an insolvent primary insurer.