Opinion ID: 1752918
Heading Depth: 1
Heading Rank: 2

Heading: pretensive joinder

Text: The primary issue to be decided is whether the Nugents stated a present cause of action against American Family. If the Nugents failed to state a present cause of action against American Family, then venue in the City of St. Louis is improper as to Shelton if the joinder of American Family was pretensive. See State ex rel. Coca Cola v. Gaertner, 681 S.W.2d 445, 447 (Mo. banc 1984). In State ex rel. Toastmaster v. Mummert, 857 S.W.2d 869, 870-71 (Mo.App.1993), the court of appeals, citing this Court's opinion in Coca Cola, 681 S.W.2d at 447, correctly set forth the test for pretensive joinder: Venue is pretensive if (1) the petition on its face fails to state a cause of action against the resident defendant; or (2) the petition does state a cause of action against the resident defendant, but the record, pleadings and facts presented in support of a motion asserting pretensive joinder establish that there is, in fact, no cause of action against the resident defendant and that the information available at the time the petition was filed would not support a reasonable legal opinion that a case could be made against the resident defendant. State ex rel. Hoeft, 825 S.W.2d 65, 66 (Mo. App.1992); Bottger v. Cheek, 815 S.W.2d 76, 79 (Mo.App.1991). The standard is an objective one, appropriately denominated as a realistic belief that under the law and the evidence a [valid] claim exists. Id. The Nugents neither (1) pleaded the specific terms of American Family's underinsured motorist provision, or (2) incorporated by reference and attached the terms of the underinsured motorist provision to their petition. Therefore, this case must be analyzed under the second test set forth in Toastmaster because we are required to look beyond the pleading to determine whether joinder is pretensive. In analyzing this case under the second test, Shelton contends that the information available to the Nugents at the time they filed their petition did not support a reasonable legal opinion that a present cause of action existed against American Family. Coca Cola, 681 S.W.2d at 447-48; Toastmaster 857 S.W.2d at 871; Bottger, 815 S.W.2d at 80. Specifically, Shelton argues that the Nugents' insurance policy and the court of appeals' opinion in State ex rel. Sago v. O'Brien, 827 S.W.2d 754 (Mo.App.1992), require that an insured exhaust all applicable policy limits by settlement or obtain a judgment in excess of all applicable liability coverage before American Family is liable under their underinsured motorist provision. Shelton is correct. The American Family policy issued to the Nugents contained the following language in the underinsured motorist provision: We will pay compensatory damages for bodily injury which an insured person is legally entitled to recover from the owner or operator of an underinsured motor vehicle. The bodily injury must be sustained by an insured person and must be caused by accident and arise out of the use of the underinsured motor vehicle. You must notify us of any suit brought to determine legal liability or damages. Without our written consent we are not bound by any resulting judgment. We will pay under this coverage only after the limits of liability under any bodily injury liability bonds or policies have been exhausted by payment of judgments or settlements. This latter paragraph in the Nugents' policy requires that all liability coverage be exhausted by judgments or settlements before American Family is liable under its underinsured motorist provision. Thus, under the language in the Nugents' policy, they did not have a present cause of action against American Family because there was no settlement or judgment against Shelton in the underlying action. This is consistent with the interpretation of a similar underinsured provision in Sago, 827 S.W.2d 754, which was decided approximately seven months prior to when the Nugents' filed their lawsuit. The policy in Sago had a provision that stated: There is no coverage until the limits of liability of all bodily injury or liability bonds and policies that apply have been used up by payment of judgment or settlement. Id. at 755. The court of appeals concluded that the insured must meet the following three conditions before the underinsured motorist carrier is required to pay damages: (1) the insured incurred bodily injuries, (2) the injuries occurred as a result of an accident with an underinsured motorist, and (3) the insured is legally entitled to collect from the owner of the underinsured vehicle. Id. Sago implicitly includes a fourth requirement, which arises from the policy's language, that the limits of all applicable policies be exhausted by payment or settlement before liability exists under the terms of an underinsured motorist provision. [2] Id. In the absence of a settlement, the Sago court concluded that [t]hese conditions can only be met if there is a prior determination of damages and these damages exceed the limits of the existing liability coverages. Id. A plaintiff does not have a viable cause of action against the underinsured motorist carrier until these requirements are satisfied.