Opinion ID: 2803697
Heading Depth: 2
Heading Rank: 1

Heading: Jessica N. Woznicki

Text: 1 Although the insurance policies at issue use both the term “uninsured” and “underinsured,” under the statutes at issue, “underinsured” motor vehicles fall under the definition of “uninsured motor vehicles.” Md. Code (1995, 2011 Repl. Vol., 2014 Supp.), § 19-509 of the Insurance Article. Accordingly, we shall track the language of the statute and use the term “uninsured motor vehicle” or “UM.” Woznicki’s dispute with GEICO arises out of injuries sustained in a motor vehicle collision between Woznicki and James Bowman Houston (“Houston”), which occurred on November 12, 2010. Woznicki was struck, while operating an automobile in Cecil County, after Houston failed to yield the right-of-way while making a turn. It is undisputed that the accident was caused entirely by the negligence of Houston. At the time of the accident, Houston was insured by Nationwide Insurance Company (“Nationwide”) under a motor vehicle liability insurance policy which carried a liability limit of $20,000. Woznicki was covered by a motor vehicle liability insurance policy issued by GEICO.2 Under the insurance policy, GEICO provided uninsured/underinsured motorist (“UM/UIM”) coverage of $300,000. As a condition to UM coverage under the GEICO policy, Woznicki was required to notify GEICO of any settlement offer which would exhaust the tortfeasor’s liability insurance policy limits and obtain GEICO’s consent to settle prior to accepting any such settlement with the tortfeasor. For a discussion of the policy language see infra. As a result of the injuries sustained during the accident, Woznicki asserted a claim against Houston, through her then-counsel, Ben T. Castle (“Castle”), a Delaware attorney. Nationwide offered to settle all claims for $20,000—Houston’s liability policy limit—in exchange for a release of all claims against Nationwide and Houston at some time in March, 2 The GEICO policy is issued to Cary and Jeanne Cover, with Woznicki listed as an additional driver. 2 2011. In a letter dated March 29, 2011, Nationwide wrote to Castle stating “[t]he enclosed Release of All Claims document confirms our settlement with you/your client.” On the same day, Castle sent a letter to the GEICO claims adjuster handling the matter, Ms. Rebecca Davis, stating, in part: At this time it appears that the driver of the car that caused the accident injuring Ms. Woznicki, James Houston, has only limited liability coverage through Nationwide Insurance Company. We will provide more information as it becomes available. The letter does not mention the Nationwide settlement offer letter received by Castle on the same day. Central to the dispute between Woznicki and GEICO before this Court, Castle contacted GEICO by phone at some point on or about July 7, 2011,3 and obtained, what Castle and Woznicki characterize as GEICO’s oral consent to settle without prejudice to any potential UM claim against GEICO. Castle, who was unable to reach Ms. Davis, the claims adjuster assigned to Woznicki’s case, could not recall who he spoke with about the matter. Castle only remembered that the person was a woman. By letter dated July 7, 2011, Woznicki executed a Release of all claims against Houston. The same day, Castle wrote to GEICO, stating: The tortfeasor’s insurance carrier, Nationwide, has a limited bodily injury liability policy of $20,000 and has tendered those limits to the injured 3 The exact date of this conversation is unclear. Castle, in his deposition, could not recall the precise date of the conversation and no records of the conversation have been produced. 3 driver, Jessica Woznicki. We are writing to request GEICO’s consent to acceptance of the settlement. Enclosed for your file is a copy of the Nationwide Policy insuring tortfeasor, James B. Houston, and the Release in exchange for the $20,000. GEICO responded on August 15, 2011, denying “any and all Underinsured Motorist (UIM) coverage to [Woznicki] . . . because [Woznicki] failed to obtain our consent to settle, which is required by both [§ 19-511 of the Insurance Article] and [Section IV of] the policy contract.” Woznicki, represented by new counsel, filed a Complaint and Demand for Jury Trial against GEICO on April 3, 2012, for breach of the insurance policy. Woznicki sought to hold GEICO liable for damages in excess of the $20,000 she received from Nationwide. After filing its answer, GEICO moved for summary judgment on the grounds that Woznicki was precluded from receiving UM benefits under the insurance policy because she failed to obtain GEICO’s consent to settle as required by Maryland law and the insurance policy. Following a hearing on the matter, the trial judge granted GEICO’s motion. Judge J. Frederick Price explained from the bench: It’s clear and undisputed that Section 19-511 was not complied with. In other words, there is—the plaintiff’s attorney did not comply with that section. And that’s also referenced—incorporated into the policy; therefore, the terms of the policy were not complied with. That’s undisputed, I believe. But the court finds that there could be a question of waiver. And I believe that these matters could be waived. The question then arises is does the vague reference to a telephone conversation constitute—or viewed in a light most favorable to the plaintiff, does that constitute sufficient evidence to be material in a decision. 4 And quite simply, the court finds that under the facts of this case that that reference to a telephone call, with nothing more than has been put forth today, does not constitute sufficient evidence to be material, to affect the decision. The Court of Special Appeals upheld the decision of the trial court. Woznicki v. GEICO Gen. Ins. Co., 216 Md. App. 712, 90 A.3d 498 (2014). Specifically, the intermediate appellate court concluded that (1) an insurer could waive the requirements of Section 19-511 of the Insurance Article, (2) Woznicki failed to demonstrate a dispute as to material fact concerning whether GEICO had waived such requirements, and (3) GEICO was not required to demonstrate prejudice caused by Woznicki’s breach of Section 19-511 or the insurance policy in order to deny her UM coverage.