Court Opinion

ID: 9544827
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:02:13.66523+00
Date Added: 2024-06-11T15:13:42.044988
License: Public Domain

FELDMAN, Justice,
specially concurring.
I concur in the result, but arrive by a different and more direct path. While the majority holds today that the physical contact requirement of the “hit-and-run” provision in the uninsured motorist coverage is ambiguous and therefore satisfied by indirect contact, I would simply hold that the physical contact provision does not prevent recovery because it is in derogation of statute and is, therefore, void as against public policy.
It has long been the law in Arizona that an insurer cannot limit or restrict coverage required by law unless the restriction is allowed by the statute. Jenkins v. Mayflower Insurance Exchange, 93 Ariz. 287, 380 P.2d 145 (1963) (dealing with the Financial Responsibility Act, A.R.S. §§ 28-1101 to 28-1234, 28-1170). Therefore, the first issue which must be met in this case is the question of whether a restriction of uninsured motorist coverage by excluding some or all accidents caused by “hit-and-run” vehicles violates A.R.S. § 20-259.01, which requires motor vehicle liability insurers to provide uninsured motorist coverage with or supplemental to the liability coverage required by § 28-1170.
The resolution of the issue requires us to decide whether a hit-and-run automobile is an “uninsured motor vehicle” within the scope of A.R.S. § 20-259.01. If not, then the insurer may limit the hit-and-run coverage. Lawrence v. Beneficial Fire & Casualty Ins. Co., 8 Ariz.App. 155, 444 P.2d 446 (1968). However, if a “hit-and-run” automobile is an “uninsured motor vehicle” within the meaning of the statute, then the parties cannot detract from the coverage by requiring actual physical contact. Jenkins v. Mayflower Insurance Exchange, supra; Balestrieri v. Hartford Accident & Indemnity Insurance Co., 112 Ariz. 160, 540 P.2d 126 (1975).
In Balestrieri, we held that the statutory mandate for coverage was limited to those situations in which it could be ascertained that the alleged negligent vehicle was actually uninsured. Id. at 163, 540 P.2d at 129. Thus, the insurer was not required to cover “hit-and-run” situations where there was no way to establish that the unidentified vehicle was, in fact, an uninsured vehicle.
Three reasons were given for this conclusion. The first was that we found “... no statement of legislative intent to cast uncertainty upon our construction of the statute.” Id. The court noted that the original title of the act when first introduced in the state senate included words prescribing “an uninsured motorist and unknown motorist clause.” The opinion points out: “The fact that the phrase ‘unknown motorist’ was deleted from the statute in its enacted form indicates a conscious legislative design to exclude unidentified motorists from the act’s coverage.” Id. Subsequent research has revealed that this statement was incorrect. The words “unknown motorist clause” were part of the statute as enacted; they were deleted after enactment and before signature of the bill by the governor as the result of a clerical or drafting error in formulating the title to A.R.S. § 20-259.01. See Note, Uninsured Motorist Coverage, 14 Ariz.L.Rev. 600, 604 (1972). In fact, the proponents of the legislation had contemplated that the words “uninsured motor vehicle” would include “unknown” or unidentified vehicles. Id. n. 27.
The second premise for the Balestrieri decision was that the terms of the statute were clear and unambiguous in specifying coverage for injury caused by “uninsured motor vehicles.” The court pointed out:
It is a fundamental rule of statutory construction that plain, clear and unambiguous language of a statute is to be given that meaning unless impossible or absurd consequences may result. For us to ex*469tend coverage in this situation would be tantamount to rewriting and varying the plain language of the statute. This we are not empowered to do.
Balestrieri, supra at 163, 540 P.2d at 129 (citation omitted, emphasis supplied). This reasoning also does not support the decision because it is now apparent that the construction given the statute by Balestrieri creates an absurd loophole in the comprehensive legislative scheme of coverage for victims of motor vehicle accidents.
A.R.S. § 28-1170 specifies the coverage to be contained in a certified owner’s and nonowner’s liability policy. This court has previously held that the statute was applicable both before and after certification of the policy, basing that decision upon a finding of a legislative intent to provide “security against uncompensated damages” arising from motor vehicle accidents. Jenkins v. Mayflower Insurance Exchange, supra at 290, 380 P.2d at 147 (quoting Schecter v. Killingsworth, 93 Ariz. 273, 280, 380 P.2d 136, 140 (1963)). The legislature has confirmed this interpretation by its latest enactment of mandatory auto insurance under an affirmation plan. See 1982 Ariz.Legis. Serv., Ch. 298, §§ 12, 24 (West) (to be codified at A.R.S. § 28-1170). The legislature enacted the uninsured motorist statute (A.R.S. § 20-259.01) to “close the gap” in the Financial Responsibility Act by protecting those who are injured by the negligence of financially irresponsible motorists. Kraft v. Allstate Insurance Company, 6 Ariz.App. 276, 431 P.2d 917 (1967). From the beginning, our courts have given that statute a liberal construction in order to effectuate its remedial purpose. Allstate Insurance Company v. Pesqueria, 19 Ariz.App. 528, 508 P.2d 1172 (1973); Reserve Insurance Company v. Staats, 9 Ariz.App. 410, 453 P.2d 239 (1969); Geyer v. Reserve Insurance Company, 8 Ariz.App. 464, 447 P.2d 556 (1968). This liberal construction of the uninsured motorist statute was reinforced by the subsequent legislative amendments of that statute requiring the offer of coverage for injuries caused by “underinsured motor vehicles.” 1982 Ariz.Legis. Serv., Ch. 298 § 1 (West) (to be codified at A.R.S. § 20-259.01).
Thus, by the interaction of legislation and judicial decision, Arizona has created a scheme of required liability insurance, compulsory uninsured motorist coverage and available underinsured coverage. No contractual exceptions are allowed in the policy unless permitted by statute. The obvious and avowed design in this comprehensive scheme is that a legislatively prescribed minimum source of compensation shall be available to “protect the public from financial hardship” caused by financially irresponsible drivers. Schecter v. Killings-worth, supra. No “gap” in that scheme exists in Arizona law except for that allowed by Balestrieri, which holds that a victim who had the misfortune to have been injured as the result of the negligence of a driver who did not stop to identify himself is not covered. I can conceive of no reason why the legislature would have intended this small class of claims to be excluded from the scheme of compensation.
No radical change in philosophy or interpretation is required for this court to correct the error made in Balestrieri. While the Balestrieri opinion gives as its third basis the conclusion that the statute “. . . contemplates that proof of the identity of the owner or operator of the uninsured motor vehicle should be shouldered by the insured [because] otherwise it could not be ascertained whether the alleged negligent vehicle was [actually] uninsured” (112 Ariz. at 163, 540 P.2d at 129), that rationale is contrary to a previous decision of this court. In Porter v. Empire Fire & Marine Insurance Company, 106 Ariz. 274, 475 P.2d 258 (1970), we held that even though it was known that a negligent driver was actually “insured,” he would be considered “uninsured” for the purposes of A.R.S. § 20-259.-01 where the full minimum amount required by the statute was “unavailable” to the victim because the policy limits were to be divided among several victims. If a tortfeasor known to be insured can be considered as “uninsured” in order to achieve the objectives of the statute, it requires no great leap of the imagination to conclude *470that an unidentified driver who might be either insured or uninsured must be considered as “uninsured” when the absence of such identification makes the protection required by the statute “unavailable” to the victim. It is “absurd” that an insured driver can be considered “uninsured” where necessary to achieve the legislative purpose, but an “unidentified” driver must be presumed “insured” despite the frustration of the legislative intent to provide a source of compensation for each person entitled to recover damages.
The purpose of the physical contact requirement to hit-and-run coverage is to protect insurance carriers from the danger of paying fraudulent claims. No doubt the insurer does need protection from fraudulent claims, but it is extremely doubtful that the physical contact requirement has much efficacy in that regard. Someone dishonest and sophisticated enough to invent a phantom vehicle in order to support a claim under the hit-and-run provisions of his uninsured motorist coverage will hardly be deterred by the necessity of having to use a hammer or screwdriver to create some evidence of physical contact on his car. A. Widiss, A Guide to Uninsured Motorist Coverage § 2.41, pp. 141 — 43 (Supp.1981).
I have no quarrel with the idea that some standard of corroboration is needed to support the claimant’s contention that there was a hit-and-run motorist. That corroboration is best provided by requiring the claimant to convince the finder of fact (whether it be judge, jury or arbitrator) that the accident was caused by the negligence of some other driver who then disappeared.
Summing up his comments on the hit- and-run problem, Professor Widiss makes the following observations:
... [Djuring the past five years, courts in an increasing number of states have concluded (1) that even though there is no specific reference to accidents caused by unknown motorists in the uninsured motorist statute, the statutory mandate contemplates coverage for such accidents, and (2) that any provisions in the insurance contracts restricting coverage for accidents caused by unknown motorists to instances where there was a “physical contact” is in derogation of the protective purposes of the statute.
Id. at 160.
. . . [A] general reconsideration of the appropriateness of the physical contact requirement also now seems warranted. This is not to suggest that the proverbial “flood gates” to claims should be opened. So long as the coverage is keyed to the fault of an unknown motorist, there certainly needs to be some means for assuring that insurance companies are provided adequate evidence in support of the alleged negligence of the unidentified driver. The claimant should undoubtedly bear the initial burden of proof [that there was another vehicle], and the insurance company should certainly be assured the right to raise fraud or collusion as a defense to any claim.
The coverage for accidents involving unknown motorists has been framed in terms which allow recoveries for injuries that occur in accidents where there is some evidence of a minute contact, but no evidence from impartial witnesses, and denied coverage where there is no contact even though there may be many impartial witnesses. Maintaining this approach to the coverage seems likely to invite continuing dissatisfaction with and disputes over the scope of protection afforded to insureds that will almost surely lead not only to appellate litigation, but ultimately legislative consideration of this problem.
Id. at 162.
As noted above, we have already had such legislative consideration in Arizona. In view of the legislative intent to cover “unknown vehicles” as a subdivision of uninsured motor vehicles, and the illogical consequences which result from the interpretation given the statute in Balestrieri, I would overrule that decision and hold that the physical contact requirement for coverage for injuries resulting from the negligence of a hit-and-run driver is in deroga*471tion of the uninsured motorist statute and is therefore void. Substantial authority exists for this position. A growing number of jurisdictions now hold that a policy requirement of “physical contact” is void as against public policy even where, as in Arizona, the uninsured motorist statute speaks only in terms of “uninsured” and not unknown motor vehicles. See State Farm & Casualty Co. v. Lambert, 291 Ala. 645, 285 So.2d 917 (1973); Farmers Insurance Exchange v. McDermott, 34 Colo.App. 305, 527 P.2d 918 (1974); Brown v. Progressive Mutual Insurance Co., 249 So.2d 429 (Fla.1971); DeMello v. First Insurance Co. of Hawaii, Ltd., 55 Hawaii 519, 523 P.2d 304 (1974); Simpson v. Farmers Ins. Co., Inc., 225 Kan. 508, 592 P.2d 445 (1979); Webb v. United Services Automobile Ass’n., 227 Pa.Super. 508, 323 A.2d 737 (1974).