Opinion ID: 2519812
Heading Depth: 3
Heading Rank: 1

Heading: The Physical Contact Requirement

Text: Cynthia challenges the superior court's ruling that Progressive had no duty to pay her claim for UM/UIM benefits arising from the unknown driver's negligence because the unknown driver's car did not collide with Smith's pick-up. Although she acknowledges that Progressive's policy required physical contact, Cynthia argues that this requirement should not have been enforced because it is undisputed that Koby Smith's accident was caused by an unidentified vehicle whose driver failed to stop at the scene of the accident. [3] But the trial court's ruling enforcing the Progressive policy's physical contact requirement was mandated by Alaska law. In 1984 Alaska's Motor Vehicle Safety Responsibility Act (MVSRA), to which all automobile policies must conform, [4] was amended by the addition of a section relating to uninsured and underinsured motorists coverage. Alaska Statute 28.20.445(f) provides: If both the owner and operator of the uninsured vehicle are unknown, payment under the uninsured and underinsured motorists coverage shall be made only where direct physical contact between the insured and uninsured or underinsured motor vehicles has occurred. A vehicle that has left the scene of the accident with an insured vehicle is presumed to be uninsured if the person insured reports the accident to the appropriate authorities within 24 hours. [5] The Alaska Mandatory Automobile Insurance Act (AMAIA) contains similar language. Alaska Statute 28.22.201(b) reads: If both the owner and operator of a vehicle are unknown, payment under the uninsured and underinsured motorists coverage may be made only where direct contact between the motor vehicles has occurred. A vehicle and operator that have left the scene of an accident with another vehicle are presumed to be uninsured if the insured person reports the accident to the appropriate authorities within 24 hours. [6] Thus, under both the MVSRA and the AMAIA an insured can only receive UM/UIM payments for accidents involving an unknown vehicle if there was physical contact between the vehicles. The UM/UIM coverage in Cynthia's Progressive policy contained a clause that matched these statutory provisions. The Progressive policy defined uninsured or underinsured motor vehicle to include: a hit and run vehicle which strikes an INSURED PERSON, YOUR INSURED CAR, or, in the case of BODILY INJURY, a vehicle which an INSURED PERSON is OCCUPYING which causes BODILY INJURY to an INSURED PERSON or PROPERTY DAMAGE to YOUR INSURED CAR arising from an ACCIDENT where there is physical evidence of contact between the INSURED PERSON or YOUR INSURED CAR and the hit and run vehicle, provided that: 1) the operator or owner cannot be ascertained at the time of the ACCIDENT and remains unknown, 2) the INSURED PERSON or someone on his or her behalf shall have reported the ACCIDENT to the appropriate law enforcement agency within 24 hours. The policy further specified: If both the owner and operator of the uninsured vehicle are unknown, payment under the Uninsured and Underinsured Motorist Coverage shall be made only where direct physical contact between the INSURED and the UNINSURED or UNDERINSURED MOTOR VEHICLES has occurred. Cynthia concedes that Smith's truck did not physically contact the unknown vehicle and that the literal terms of her UM/UIM policy precluded recovery for the unknown driver's actions. But she nonetheless argues that Progressive's physical contact clause should not be enforced because she offered extrinsic proof of the presence of the phantom vehicle. Cynthia points out that other courts have been willing to set aside physical contact policy clauses when corroborative evidence demonstrates the presence and responsibility of an unknown vehicle. She argues that we should follow these cases because a physical contact clause serves no useful purpose in these circumstances and enforcing it allows an insurer to breach its duty of good faith and fair dealing. But Progressive correctly observes that when courts from other jurisdictions have been willing to invalidate physical contact requirements in policy clauses, they have generally done so under statutory regimes that differ from Alaska's. As Widiss explains in his treatise UNINSURED AND UNDERINSURED MOTORIST INSURANCE, although physical contact requirements are a legitimate mechanism for preventing fraud by foreclos[ing] claims arising from accidents that were allegedlybut not actuallycaused by the operation of an unidentified vehicle, [7] many courts have declined to strictly enforce clauses in policies requiring physical contact: Courts in approximately half the states have concluded that insurers are not entitled to enforce the `physical contact' requirement because it is in derogation of the uninsured motorist legislation and is therefore void. [8] Yet almost all of these courts have construed the disputed policy provisions in the absence of a statute that requires physical contact. It appears that only West Virginia has judicially adopted the rule proposed by Cynthia by allowing a claimant to satisfy an express statutory physical contact requirement with extrinsic evidence of a miss-and-run accident. In Hamric v. Doe the West Virginia Supreme Court concluded that absolute enforcement of the physical contact requirement is contrary to public policy and that the physical contact requirement should not prevent recovery when there is sufficient independent third-party evidence to conclusively establish that the sequence of events leading to an injury was initially set in motion by an unknown hit-and-run driver or vehicle. [9] But in reaching this decision, Hamric simply adopted the reasoning in Girgis v. State Farm Mutual Automobile Insurance Co., [10] an Ohio case decided in the absence of a statutory physical contact requirement. [11] With the exception of Hamric, courts in jurisdictions whose UM/UIM statutes include express physical contact requirements invariably hold that the UM/UIM coverage does not apply in a miss-and-run casethat there must be some actual contact with the unknown vehicle. [12] Orpustan v. State Farm Mutual Automobile Insurance Co. exemplifies the reasoning of these courts. [13] There, the California Supreme Court enforced a statutory physical contact requirement despite clear proof that the claim was not fraudulent, [14] concluding that the legislature had made a permissible policy choice in adopting the requirement: The statute makes proof of `physical contact' a condition precedent in every case for the recovery of damages caused by an unknown vehicle. There are no exceptions. If it is advisable that the statute be changed, the solution lies within the province of the Legislature. [15] Here, Cynthia's argument parallels Hamric 's public policy analysis. But as mentioned above, Hamric 's analysis is unpersuasive because it relies on a case decided in a state that had no statutory physical contact requirement. Cynthia also relies on the Oregon Court of Appeals's decision in To v. State Farm Mutual Insurance, [16] which declined to enforce a policy's physical contact clause and, instead, allowed a miss-and-run claim to be  `corroborated by competent evidence other than the testimony of the insured or any person having an uninsured motorist claim resulting from the accident.' [17] But To reached this decision against the backdrop of a recently enacted statute that had repealed Oregon's former physical contact requirement and replaced it with a corroboration requirement. [18] Here, by contrast, to accept corroborative evidence as a substitute for physical contact, we would need to override the express terms of AS 28.20.445(f) and AS 28.22.201(b). Cynthia thus essentially asks us to nullify a legislative choice on public policy grounds. Yet statutes themselves reflect the state's public policy; hence, we have recognized that public policy ... cannot override a clear and unequivocal statutory requirement. [19] On their face, Alaska's physical contact statutes are absolute and unambiguous. [20] Yet because Alaska does not follow the plain meaning rule, the plain language of these provisions does not itself end the inquiry. [21] Under Alaska's sliding-scale approach to statutory construction, strong legislative history may support a different meaning. [22] But [when] a statute's meaning appears clear and unambiguous, ... the party asserting a different meaning bears a correspondingly heavy burden of demonstrating contrary legislative intent. [23] Here, Cynthia fails to identify any legislative history suggesting that the statutory physical contact requirement was intended to have limited application. Since Cynthia has rested her case on general public policy considerations and has failed to establish any legislative history suggesting that these provisions were meant to have limited application, we find her arguments unpersuasive. Because the Progressive policy's physical contact clause comports with the express requirements of Alaska law, we affirm the superior court's decision precluding Cynthia and Heidi's estate from claiming UM/UIM payments for negligence attributable to the unknown driver.