Title: Kramer v. Commonwealth
Citation: N/A
Docket Number: 010392
State: Virginia
Issuer: Virginia Supreme Court
Date: January 11, 2002

Present:  All the Justices 
 
ETHEL JUNE KRAMER, ADMINISTRATOR OF THE ESTATE OF 
  ROBERT JACK KRAMER, DECEASED 
 
v.  Record No. 010392  
OPINION BY JUSTICE DONALD W. LEMONS 
 
 
 
       January 11, 2002 
COMMONWEALTH OF VIRGINIA, ET AL. 
 
FROM THE CIRCUIT COURT OF THE CITY OF VIRGINIA BEACH 
H. Thomas Padrick, Jr., Judge 
 
 
On June 17, 1999, Robert Jack Kramer (“Kramer”) was 
employed by and acting within the scope of his employment 
with the Virginia Department of Transportation.  Kramer was 
in one of the Commonwealth’s trucks when it was struck by 
an uninsured motorist and Kramer was killed. 
 
On December 14, 2000 in a separate suit brought on 
behalf of the Estate, the Circuit Court of the City of 
Virginia Beach entered judgment against the uninsured 
motorist in the amount of $650,000 in compensatory damages, 
$350,000 in punitive damages and $8,547 in funeral 
expenses.  In this declaratory judgment action brought by 
the Commonwealth against Ethel June Kramer, Administrator 
of the Estate of Robert Jack Kramer, Deceased 
(“Administrator”) the Commonwealth conceded that Kramer’s 
estate is entitled to maximum coverage of $25,000 under the 
terms of the Commonwealth’s Risk Management Plan (“the 
Plan”)for uninsured motorist coverage, but denied that the 
Plan is liable for additional underinsured motorist 
coverage of $50,000.  The trial Court1 held that: 
[T]he maximum amount of coverage available to 
the Estate from the Commonwealth of Virginia in 
this matter, pursuant to Section 2.1-526.6 of 
the Code of Virginia, 1950, as amended, and 
pursuant to the Risk Management Plan of the 
Commonwealth of Virginia, is $25,000.00 of 
uninsurance coverage, and the Plaintiff is not 
entitled to any underinsurance coverage from 
the Commonwealth of Virginia. 
 
In this appeal, we consider the dispute between the parties 
concerning interpretation of the Plan. 
We are not bound by the trial court’s conclusions of 
law or its construction of terms of the Plan.  Rather, 
“[w]e have an equal opportunity to consider the words 
within the four corners of the disputed provision.”  Wilson 
v. Holyfield, 227 Va. 184, 188, 313 S.E.2d 396, 398 (1984).  
Therefore, we review the judgment of the trial court de 
novo. 
Under the terms of the Plan, the Commonwealth’s 
vehicles were insured for $100,000 of liability coverage. 
The coverage limits had been increased from $75,000 
effective July 1, 1993.  The entire provision for uninsured 
                                                          
 
1 The Honorable A. Bonwill Shockley rendered the letter 
opinion dated August 9, 2000.  The final order dated 
November 28, 2000 and the Written Statement of Facts dated 
January 11, 2001 were signed by The Honorable H. Thomas 
Padrick, Jr. 
 
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and underinsured (“UM/UIM”) coverage is contained in a 
single paragraph of the Plan that provides: 
Coverage applies to uninsured motorists 
exposures pursuant to Section 2.1-526.6.C. of 
the Code of Virginia.  Coverage is limited to 
$25,000 per person in any one accident, $50,000 
for two or more persons in any one accident and 
$20,000 for damage to or destruction of the 
property of others in any one accident.  
Underinsured motorists coverage is limited to 
$50,000 per person.  
 
On appeal, the Administrator argues:  (1) That the 
provisions of the Plan are in conflict with the 
requirements under Code § 38.2-2206 that UM/UIM coverage 
equal liability coverage unless rejected by the insured;2 
                                                          
 
2 Code § 38.2-2206 (A) provides in pertinent part: 
Except as provided in subsection J of 
this section, no policy or contract 
of bodily injury or property damage 
liability insurance relating to the 
ownership, maintenance, or use of a 
motor vehicle shall be issued or 
delivered in this Commonwealth to the 
owner of such vehicle or shall be 
issued or delivered by any insurer 
licensed in this Commonwealth upon 
any motor vehicle principally garaged 
or used in this Commonwealth unless 
it contains an endorsement or 
provisions undertaking to pay the 
insured all sums that he is legally 
entitled to recover as damages from 
the owner or operator of an uninsured 
motor vehicle, within limits not less 
than the requirements of § 46.2-472. 
Those limits shall equal but not 
exceed the limits of the liability 
insurance provided by the policy, 
unless any one named insured rejects 
 
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and (2) that UM/UIM coverage may be combined under the 
Plan. 
 
The first issue was not presented to or resolved by 
the trial court.  We will not consider the issue for the 
first time on appeal.  Rule 5:25.  See Nichols v. Kaiser 
Found. Health Plan of the Mid-Atl. States, Inc., 257 Va. 
491, 498, 514 S.E.2d 608, 612 (1999). 
The second argument advanced by the Administrator is 
that, “[t]he appellant is entitled to combine the uninsured 
and underinsured coverage under the plain language of the 
Commonwealth’s Risk Management Plan.”  The Administrator 
argues that because the Commonwealth established separate 
levels of coverage for UM/UIM, “the implication is that the 
UM and UIM coverage[s] were to be treated separately and 
aggregated.”  The Administrator argues that uninsured 
                                                                                                                                                                             
the additional uninsured motorist 
insurance coverage by notifying the 
insurer as provided in subsection B 
of § 38.2-2202.  This rejection of 
the additional uninsured motorist 
insurance coverage by any one named 
insured shall be binding upon all 
insureds under such policy as defined 
in subsection B of this section. The 
endorsement or provisions shall also 
obligate the insurer to make payment 
for bodily injury or property damage 
caused by the operation or use of an 
underinsured motor vehicle to the 
extent the vehicle is underinsured, 
 
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motorist coverage of $25,000 should be combined with 
underinsured motorist coverage of $50,000, for a total of 
$75,000 coverage. 
 
The Plan states that “[a]ll terms, phrases and 
definitions used in the Plan shall be those used in the 
Code of Virginia, as amended.”  Definitions applicable to 
this controversy are found in Code § 38.2-2206 as follows: 
“Uninsured motor vehicle” means a motor 
vehicle for which (i) there is no bodily 
injury liability insurance and property 
damage liability insurance in the amounts 
specified by § 46.2-472, (ii) there is 
such insurance but the insurer writing the 
insurance denies coverage for any reason 
whatsoever, including failure or refusal 
of the insured to cooperate with the 
insurer, (iii) there is no bond or deposit 
of money or securities in lieu of such 
insurance, (iv) the owner of the motor 
vehicle has not qualified as a self-
insurer under the provisions of § 46.2-
368, or (v) the owner or operator of the 
motor vehicle is immune from liability for 
negligence under the laws of the 
Commonwealth or the United States, in 
which case the provisions of subsection F 
shall apply and the action shall continue 
against the insurer.  A motor vehicle 
shall be deemed uninsured if its owner or 
operator is unknown. 
 
    A motor vehicle is “underinsured” 
when, and to the extent that, the total 
amount of bodily injury and property 
damage coverage applicable to the 
operation or use of the motor vehicle and 
available for payment for such bodily 
                                                                                                                                                                             
as defined in subsection B of this 
section. 
 
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injury or property damage, including all 
bonds or deposits of money or securities 
made pursuant to Article 15 (§ 46.2-435 et 
seq.) of Chapter 3 of Title 46.2, is less 
than the total amount of uninsured 
motorist coverage afforded any person 
injured as a result of the operation or 
use of the vehicle. 
 
Code § 38.2-2206(B). 
Given the definitions applicable to this case, Kramer 
would have to have been killed by a tortfeasor who was 
insured, albeit inadequately so, in order to implicate 
underinsured motorist coverage under the Plan.  The 
evidence is to the contrary – Kramer was killed by a 
tortfeasor who was uninsured.  Uninsured coverage under the 
Plan is distinct and separate from underinsured coverage. 
 
Finally, in Superior Ins. Co. v. Hunter, 258 Va. 338, 
344-45, 520 S.E.2d 646, 649 (1999), we stated: 
Nonetheless, in construing Code § 38.2-2206 as 
a whole, we conclude, even under the facts of 
this case when only one insurance policy is 
involved, that the General Assembly did not 
intend that a vehicle could be “underinsured” 
with respect to itself.  In light of the 
provisions of subsection (A), it is clear that 
subsection (B) contemplates a situation in 
which there are at least two applicable 
insurance policies at issue: the liability 
coverage provided by a tortfeasor’s insurance 
policy, and the uninsured/underinsured motorist 
coverage provided by an injured party’s 
insurance policy. 
 
. . . . 
 
 
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Read together, subsection (A) and 
subsection (B) do not contemplate that, under 
the circumstances of this case, a claimant 
would be permitted to recover under both the 
liability and uninsured/underinsured motorist 
coverages of a single policy. 
 
Although Hunter involved a single policy and efforts to 
invoke both liability coverage and UM/UIM coverage under 
the same policy, the principle is nonetheless applicable 
here.  Under the Plan, uninsured coverage is limited to 
$25,000, while underinsured coverage is limited to $50,000. 
There is no additional policy of insurance against which to 
measure underinsured status.  Consistent with the principle 
recited in Hunter, the Plan cannot be underinsured with 
respect to itself in order to provide additional coverage. 
 
Accordingly, we hold that the trial court did not err 
in holding on this record that the maximum coverage 
available in this case under the Plan is $25,000 uninsured 
motorist coverage.  We will affirm the judgment of the 
trial court. 
Affirmed. 
 
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