Title: Morgan v. Farmers Insurance Exchange
Citation: 511 P.2d 902
Docket Number: C-342
State: Colorado
Issuer: Colorado Supreme Court
Date: July 9, 1973

511 P.2d 902 (1973) Elaine M. MORGAN, Petitioner, v. FARMERS INSURANCE EXCHANGE, an inter-insurance exchange, Respondent. No. C-342. Supreme Court of Colorado, En Banc. July 9, 1973. *903 Brenman, Sobol &amp; Baum, Stephen N. Berkowitz, Denver, for petitioner. Wolvington, Dosh, DeMoulin, Anderson &amp; Campbell, Denver, Laird Campbell, Denver, for respondent. Irvin M. Kent, Charles F. Brega, Kenneth N. Kripke, Denver, Colo. Trial Lawyers Association as amicus curiae. GROVES, Justice. We granted certiorari to review the Colorado Court of Appeals 2-1 decision in this matter reported in 31 Colo.App. 531, 506 P.2d 375 (1972). The Court of Appeals there held that insolvency of a tort-feasor's insurance carrier, occurring subsequent to the automobile accident, does not create coverage under the "uninsured motorist" provision of the injured party's insurance policy. We reverse. This was a declaratory judgment proceeding brought by the plaintiff Farmers Insurance Exchange. The defendant, Mrs. Morgan, was involved in an automobile accident on March 19, 1970. She obtained a judgment against George Solario, the other party to the accident. Solario was insured by Trans Plains Casualty Company which became insolvent following the rendition of the judgment.[1] Mrs. Morgan was insured by the plaintiff and made demand for payment under the uninsured motorist provisions of the policy issued to her. The policy issued by plaintiff defines an uninsured motor vehicle as follows: Some policies provide that denial of coverage by the tort-feasor's insurance company will cause the injured insured to be entitled to coverage under the uninsured motorist provision. This policy contained no such provision. The trial court concluded that the terms of the policy were unambiguous and that since Solario's policy was in effect at the time of the accident, Mrs. Morgan was not entitled to uninsured motorist coverage under her policy. The Court of Appeals affirmed, citing Dreher v. Aetna Casualty &amp; *904 Surety Co., 83 Ill.App.2d 141, 226 N.E.2d 287 (1967), and the Annotation in 26 A.L.R.2d 883. The following is taken from that opinion: The dissent in our Court of Appeals followed Tsapralis v. Public Employees Mutual Casualty Co., 77 Wash. 2d 581, 464 P.2d 421 (1970). The Colorado statute compels insurance companies writing motor vehicle liability policies to extend uninsured motorist coverage unless the insured shall reject such coverage. The General Assembly has made the following declaration of purpose: In oral argument, counsel for Mrs. Morgan stated in effect that this statement of purpose is stronger in its expressed intent to protect people from uninsured drivers than any similar statement of any statute of any other state. Be that as it may, we find the statement of policy most persuasive in concluding that Mrs. Morgan is entitled to uninsured motorist protection. The plaintiff has cited a number of cases involving similar fact situations in which it was held that the event of subsequent insolvency does not alter the fact that there was outstanding at the time of an accident insurance which precludes liability under the uninsured motorist provisions. Apotas v. Allstate Insurance Company, 246 A.2d 923 (Del.Supr.1968); Dreher v. Aetna Casualty &amp; Surety Co., supra; Rousso v. Michigan Educational Emp. Mutual Insurance, 6 Mich.App. 444, 149 N.W.2d 204 (1967); Topolewski v. Detroit Automobile Inter-Ins. Exchange, 6 Mich.App. 286, 148 N.W.2d 906 (1967); Baune v. Farmers Insurance Exchange, 283 Minn. 54, 166 N.W.2d 335 (1969); Swaringin v. Allstate Insurance Co., 399 S.W.2d 131 (Mo.App.1966); Hardin v. American Mutual Fire Insurance Co., 261 N.C. 67, 134 S.E.2d 142 (1964); and Stone v. Liberty Mutual Insurance Company, 55 Tenn.App. 189, 397 S.W.2d 411 (1965). Amicus Curiae call attention to the fact that several of the cases just cited relied on Federal Insurance Company v. Speight, 220 F. Supp. 90 (D.C.1963), which subsequently in effect was overruled by North River Insurance Company v. Gibson, 244 S.C. 393, 137 S.E.2d 264 (1964). The plaintiff has argued ably that, with one exception, the cases in point which permit recovery under the uninsured motorist provisions involve either a policy provision or a statute which permits recovery if subsequent to the accident the tortfeasor's insurance company denies coverage; and these cases hold that the subsequent insolvency is a denial of coverage. According to plaintiff's counsel, the only exception is Tsapralis v. Public Employees Mutual Casualty Company, supra. We elect to follow that opinion and the concurring opinion of Mr. Justice Roberts in Pattani v. Keystone Insurance Company, 426 Pa. 332, 231 A.2d 402 (1967). *905 In Tsapralis, it was said: In Pattani, supra, the majority opinion related back the insolvency to the time of the accident by reason of a denial-of-coverage provision. Mr. Justice Roberts wrote: We hold, therefore, that Mrs. Morgan was entitled to coverage under the uninsured motorist provision of the plaintiff's policy. The majority opinion of the Court of Appeals is reversed and the cause remanded to it for appropriate remand to the district court. HODGES, J., concurs in the result. LEE, J., dissents. [1] The record reflects that there were a Trans Plains Casualty Company and a Trans Plains Insurance Company, both of which became insolvent. While the Court of Appeals opinion refers to the Trans Plains Insurance Company, the record has been perfected here to show that actually Solario was insured by Trans Plains Casualty Company.