Court Opinion

ID: 9385586
Source: CourtListenerOpinion
Date Created: 2023-04-07 14:12:03.269698+00
Date Added: 2024-06-11T17:18:03.044658
License: Public Domain

2023 WI 28

                  SUPREME COURT             OF    WISCONSIN
CASE NO.:               2020AP189

COMPLETE TITLE:         ACUITY, a Mutual Insurance Co.,
                                  Plaintiff-Respondent-Petitioner,
                             v.
                        Estate of Michael Shimeta and Terry Scherr,
                                  Defendants-Appellants,
                        Partners Mutual Insurance Co.,
                                  Intervening Defendant.

                            REVIEW OF DECISION OF THE COURT OF APPEALS
                            Reported at 399 Wis. 2d 375, 965 N.W.2d 78
                                PDC No: 2021 WI App 64 - Published

OPINION FILED:          April 7, 2023
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:          September 30, 2022

SOURCE OF APPEAL:
   COURT:               Circuit
   COUNTY:              Milwaukee
   JUDGE:               Jeffrey A. Conen

JUSTICES:
KAROFSKY, J., delivered the majority opinion of the Court, in
which ANN WALSH BRADLEY, ROGGENSACK, and DALLET, JJ., joined.
ZIEGLER, C.J., filed a dissenting opinion, in which REBECCA
GRASSL BRADLEY, J., joined. HAGEDORN, J., filed a dissenting
opinion, in which REBECCA GRASSL BRADLEY, J., joined.
NOT PARTICIPATING:

ATTORNEYS:

       For the plaintiff-respondent-petitioner, there were briefs
filed by Christine M. Rice, Nicole R. Radler, and Simpson &
Deardorff,          S.C.,   Milwaukee.   There   was   an   oral   argument   by
Christine M. Rice.

       For the defendants-appellants, there was a brief filed by
Brett A. Eckstein and Cannon & Dunphy, S.C., Brookfield. There
was an oral argument by Brett A. Eckstein.
    An amicus curiae brief was filed by     James A. Friedman,
Daniel C.W. Narvey, and Godfrey & Kahn, S.C., Madison, for the
Wisconsin Insurance Alliance.

    An amicus curiae brief was filed by Mark L. Thomsen, Lynn
R. Laufenberg, and Gingras, Thomsen, & Wachs, LLP, Madison, for
the Wisconsin Association for Justice.

                                2
                                                                            2023 WI 28
                                                                    NOTICE
                                                      This opinion is subject to further
                                                      editing and modification.   The final
                                                      version will appear in the bound
                                                      volume of the official reports.
No.    2020AP189
(L.C. No.   2019CV5402)

STATE OF WISCONSIN                               :             IN SUPREME COURT

ACUITY, a Mutual Insurance Co.,

            Plaintiff-Respondent-Petitioner,

      v.
                                                                         FILED
Estate of Michael Shimeta and Terry Scherr,                          APR 7, 2023

            Defendants-Appellants,                                     Sheila T. Reiff
                                                                    Clerk of Supreme Court

Partners Mutual Insurance Co.,

            Intervening Defendant.

KAROFSKY, J., delivered the majority opinion of the Court, in
which ANN WALSH BRADLEY, ROGGENSACK, and DALLET, JJ., joined.
ZIEGLER, C.J., filed a dissenting opinion, in which REBECCA
GRASSL BRADLEY, J., joined.    HAGEDORN, J., filed a dissenting
opinion, in which REBECCA GRASSL BRADLEY, J., joined.

      REVIEW of a decision of the Court of Appeals.                    Affirmed.

      ¶1    JILL J. KAROFSKY, J.          This case arises from a tragic

automobile    accident       that    occurred    when      Douglas       Curley      lost

control of his vehicle, crossed the center line, and hit another

vehicle,    killing       Michael   Shimeta     and    seriously       injuring       his

passenger, Terry Scherr.            As a result of the accident, Curley's
                                                                                 No.    2020AP189

insurer      paid    Shimeta's         estate        (Shimeta)        and     Scherr   $250,000

each.      Shimeta and Scherr sought additional recovery under a

policy that Acuity had issued to Shimeta prior to the accident.

The policy included underinsured motorist (UIM) coverage with a

$500,000 limit for "each person" and a $500,000 limit for "each

accident."          At    issue     in    this       case       is   whether     Acuity's      UIM

coverage entitles Shimeta and Scherr to an additional $250,000

each from Acuity, or whether the payments Shimeta and Scherr

received      from       Curley's        insurer       reduced          their    recovery      to

nothing.       To    resolve      this     issue,          we    must    interpret      the    UIM

policy's     reducing       clause,       which       states         that    "[t]he    limit    of

liability shall be reduced by all sums . . . [p]aid because of

the bodily injury by or on behalf of persons . . . who may be

legally responsible."

    ¶2        We conclude that the reducing clause operates on an

individual basis to reduce the $500,000 "each person" limit of

liability by the $250,000 payment that Shimeta and Scherr each

received      from       Curley's      insurer.             Consequently,         Acuity      owes
Shimeta and Scherr $250,000 each.                          Accordingly, we affirm the

court   of    appeals'       reversal      of        the    circuit         court's1   grant    of

declaratory judgment for Acuity.

                                  I.     BACKGROUND
    ¶3        Michael Shimeta was tragically killed and Terry Scherr

was severely injured on November 22, 2018 when Douglas Curley

    1  The Honorable Jeffrey A. Conen of the Milwaukee County
Circuit Court presiding.

                                                 2
                                                                              No.    2020AP189

lost       control    of    his   pickup      truck     on    Highway    10     in   Portage

County, crossed the center line, flipped in the air, and landed

on top of Shimeta's Jeep.                    It is undisputed that Shimeta and

Scherr's injuries met or exceeded $1 million in damages.

       ¶4      Curley      was    insured       under    an     automobile          liability

insurance         policy    issued      by    Farmers    Insurance       Company.          The

policy provided coverage up to a $250,000 "per person" limit of

liability, and a $500,000 "per accident" limit of liability.                                In

accordance with this policy, Farmers paid Shimeta and Scherr

$250,000 each.

       ¶5      Shimeta      and    Scherr      were    also    covered       under     a   UIM

policy that Acuity issued to Shimeta.                         The policy's liability

limits      for    UIM     coverage     are    $500,000       for    "each    person"      and

$500,000 for "each accident."                      The policy includes a reducing

clause that states: "[t]he limit of liability shall be reduced

by all sums . . . [p]aid because of the bodily injury2 by or on

behalf of persons . . . who may be legally responsible."

       ¶6      The    parties      do   not    dispute       that    both     Shimeta      and
Scherr were insured under the UIM policy.                           Nor do they dispute

that       Curley's      truck    was   an    "underinsured          motor    vehicle"      as

defined by the policy.               In dispute is whether Acuity must still

pay $250,000 each to Shimeta and Scherr, or whether the $500,000

in combined payments from Farmers reduced Acuity's policy limits

to zero.

       In Acuity's policy, defined terms are in bold font.
       2                                                                               Those
terms are underlined in this opinion.

                                               3
                                                                       No.     2020AP189

    ¶7      Acuity        filed   an     action    for     declaratory        judgment,

asking the circuit court to find that Acuity was not obligated

to pay Shimeta and Scherr any UIM benefits under its policy

because    Shimeta    and     Scherr     had     already    received     a    total   of

$500,000    from   Farmers.            The    circuit    court    granted     Acuity's

motion, reasoning that Acuity's $500,000 maximum limit for "each

accident" was reduced to zero by Farmers' combined payments to

Shimeta and Scherr.           The court of appeals reversed, concluding

that the reducing clause operates on an individual basis to

reduce the limit of liability for "each person" by the payment

that "each person" insured under the policy received.                         We agree

with the court of appeals and conclude that the clause reduces

the "each person" limit by the payments an individual insured

received for his or her injuries.

                                   II.       ANALYSIS

    ¶8      This case requires the court to interpret the language

of an insurance policy, which presents a question of law that we

review de novo.       Mau v. N.D. Ins. Rsrv. Fund, 2001 WI 134, ¶12,
248 Wis. 2d 1031, 637 N.W.2d 45.

    ¶9      Analyzing Acuity's UIM policy requires us to put the

disputed UIM policy language in context.                     To do so, we first

provide a brief overview of the purpose of UIM coverage and the

principles we use when interpreting UIM policies.                             Next, we

review the UIM policy language at issue in this case.                          We then

conclude that the policy's reducing clause, when read in the

context of the whole policy, reduces the limit of liability for
"each   person"      by    the    payments       received    by   each       individual
                                             4
                                                                               No.     2020AP189

insured.          We further determine that the policy's "each accident"

limit        of     liability        serves          as   an     additional          backstop,

establishing the maximum amount that Acuity will pay out for any

one accident.

                                    A.    UIM Background

       ¶10        As a general matter, the purpose of UIM coverage is to

protect "persons insured under that coverage who are legally

entitled to recover damages for bodily injury, death, sickness,

or    disease       from     owners      or   operators         of    underinsured       motor

vehicles."          Wis. Stat. § 632.32(2)(d) (2019-20).3                  This court has

identified two approaches to UIM coverage, both of which are

permissible under Wis. Stat. § 632.32(4m).                             Welin v. Am. Fam.

Mut.       Ins.     Co.,   2006     WI     81,       ¶¶24-27,     292    Wis. 2d 73,         717

N.W.2d 690.          Policies that follow the "separate fund" approach

provide a set amount of coverage for the insured's damages that

exceed       the    amount    the    insured         recovers    from    the     responsible

party.        State Farm Mut. Auto. Ins. Co. v. Langridge, 2004 WI

113, ¶16, 275 Wis. 2d 35, 683 N.W.2d 75.                             Policies that follow
the    "limits-to-limits"           approach——like            Acuity's     policy——provide

"a predetermined, fixed level of UIM recovery that is arrived at

by combining payments from all sources" legally responsible for

the insured's damages.                   Welin, 292 Wis. 2d 73, ¶49.                   To that

end,       Wis.    Stat.   § 632.32(5)(i)            allows     insurers    to       write   UIM

policies that "provide that the limits under the policy" shall

       All subsequent references to the Wisconsin Statutes are to
       3

the 2019-2020 version unless otherwise indicated.

                                                 5
                                                                                     No.     2020AP189

be reduced by "[a]mounts paid by or on behalf of any person or

organization       that    may    be    legally          responsible           for     the    bodily

injury or death for which the payment is made."

     ¶11    While our UIM cases provide a helpful framework for

interpreting policy language, we pause to note that a UIM policy

is a contract, and "[w]here the language of the policy is plain

and unambiguous, we enforce it as written . . . .                                      This is to

avoid     rewriting       the    contract           by   construction            and       imposing

contract     obligations         that     the        parties        did    not        undertake."

Danbeck    v.    Am.    Fam.     Mut.        Ins.    Co.,      2001       WI    91,        ¶10,    245

Wis. 2d 186, 629 N.W.2d 150 (internal citations omitted).                                           We

interpret    the    policy       language       as       a   reasonable         insured        would

understand it, and if the language is ambiguous, we construe it

in favor of the insured.               Id.     With these principles in mind, we

turn to the language of the contract at issue in this case.

                                 B.    Policy Language

     ¶12    We     begin    our        review       of       the    insurance          policy       by

examining the Declarations page.                     We next look to the UIM grant
of coverage, then we examine the definition of "underinsured

motor vehicle," and finally we analyze the Limits of Liability

section, which contains the reducing clause at issue in this

case.

     ¶13    The     policy's      Declarations               page   lists       the        types    of

coverage the policy provides, including "Underinsured Motorists"

coverage     for       "$500,000        Each        Person"         and        "$500,000          Each

Accident."         The     Declarations             page       does       not        provide       any
additional information about "Underinsured Motorists" coverage
                                               6
                                                                   No.    2020AP189

or what "Each Person" or "Each Accident" mean, so we turn next

to the Underinsured Motorists Coverage section in Part IV of the

policy for further clarification.

    ¶14    The    Underinsured      Motorists      Coverage      section     first

includes the following grant of coverage:

    We [Acuity] will pay damages for bodily injury which
    an insured person is legally entitled to recover from
    the owner or operator of an underinsured motor
    vehicle.    Bodily injury must be sustained by an
    insured person and must be caused by accident and
    result from the ownership, maintenance, or use of the
    underinsured motor vehicle.
Acuity   does    not    dispute    that:   (1)    Shimeta   and    Scherr     were

legally entitled to recover at least $1 million in damages for

bodily injury from Curley; (2) Shimeta and Scherr were both

"insured persons" under Acuity's policy; and (3) Shimeta and

Scherr   sustained      injuries   that    were   caused    by    the    accident.

Having established that both Shimeta and Scherr meet the initial

requirements set out in the grant of coverage, we next examine

the policy's definition of "underinsured motor vehicle."

    ¶15    The policy defines "underinsured motor vehicle" as a

vehicle covered by an insurance policy with a "limit for bodily

injury liability" that is "less than the limit of liability for

this coverage."        Acuity does not dispute that Curley operated an

"underinsured     motor    vehicle."       Curley's   automobile         liability

insurance provided coverage up to a $250,000 "per person" limit

of liability and a $500,000 "per accident" limit of liability.

                                       7
                                                                  No.     2020AP189

Under    a   split-limits     policy4       like   Curley's,     "an     insured's

objectively reasonable expectation is that the phrase 'limit for

bodily   injury    liability'       means    the   per   person       limit   of     a

tortfeasor's liability policy."              Filing v. Com. Union Midwest

Ins. Co., 217 Wis. 2d 640, 650, 579 N.W.2d 65 (Ct. App. 1998).

    ¶16      Although    Acuity     does     not   dispute     that    Curley       is

underinsured,     it    maintains    that     Shimeta    and   Scherr     are      not

entitled to recover under the policy because, under the Limits

of Liability section, the $500,000 in combined payments they

received from Farmers reduced the policy limits to zero.                           The

relevant     portion    of   the   Limits     of   Liability    section       is    as

follows:

    Limits of Liability

    1.   The Limit of Liability shown in the Declarations
    for each person for Underinsured Motorists coverage is
    our maximum limit of liability for all damages,
    including damages for care, loss of services or death,
    arising out of bodily injury sustained by any one
    person in any one accident. Subject to this limit per
    person,   the  Limit   of  Liability   shown  in   the
    Declarations  for   each  accident   for  Underinsured
    Motorists coverage is our maximum limit of liability
    for all damages for bodily injury resulting from any
    one accident.

    This is the most we will pay regardless of the number
    of:

    a. Insured persons;

    b. Claims made;

    4  Policies with different per person and per accident limits
are sometimes referred to as "split-limits" policies.         See
Folkman v. Quamme, 2003 WI 116, ¶7, 264 Wis. 2d 617, 665
N.W.2d 857.

                                        8
                                                                       No.      2020AP189

    c. Vehicles or premiums shown in the Declarations; or

    d. Vehicles involved in the accident.

    2.   The limit of liability shall be reduced by all
    sums:

    a. Paid because of the bodily injury by or on behalf of
       persons   or  organizations  who   may   be  legally
       responsible. This includes all sums paid under Part
       I – Liability; and

    b. Paid or payable because of the bodily injury under
       any of the following or similar law:

         (1)       Workers' compensation law; or

         (2)       Disability benefits law.
    ¶17       Paragraph 1 of this section defines the "each person"

and "each accident" limits set out in the Declarations page,

establishing that those limits are the maximum that Acuity will

pay for any one person in an accident, and for any one accident,

respectively.         Paragraph 1 also states that the "each accident"

limit    is    subject    to       the   "each   person"    limit.      Paragraph        2

includes      a     reducing       clause    providing      that    "the       limit    of

liability"        will   be    reduced      by   payments    from     those      legally
responsible for the insured's damages.

    ¶18       The    parties       agree    that,   under   paragraph      1    and    the

limits set in the Declarations page, Acuity will never pay more

than $500,000 to any individual insured for any one accident.

Additionally there is agreement that Acuity will never pay more

than $500,000 total for any one accident, regardless of the

number   of       insureds.        The   parties'    sole   dispute    is      over    the

reducing clause in paragraph 2.
                              C.    The Reducing Clause

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                                                                               No.    2020AP189

      ¶19   The parties dispute the meaning of two separate, but

related     parts       of   the        reducing      clause:    (1)        "the     limit   of

liability" and (2) "all sums . . . [p]aid because of the bodily

injury."

      ¶20   Shimeta and Scherr argue that "the limit of liability"

is the "each person" limit of liability.                          Alternatively, they

argue that "the limit of liability" is ambiguous because it does

not     specify     which       limit       applies,     and     the    court        construes

ambiguity     in        favor      of     the    insured.             See     Danbeck,       245

Wis. 2d 186, ¶10.            Acuity argues that "the limit of liability"

could    refer     to    either       the     "each    person"    or        "each    accident"

limit, "depending on the facts of the case," and in this case it

is the "each accident" limit.

      ¶21   Regarding the phrase, "all sums . . . [p]aid because

of the bodily injury . . ." Shimeta and Scherr argue that it

means all sums paid because of the bodily injury suffered by the

individual insured making the claim.                          Acuity argues that the

phrase means all sums paid for all injuries suffered by any
insureds injured in a single accident.

      ¶22   We agree with Shimeta and Scherr's interpretations and

conclude that the reducing clause operates to reduce recovery on

an individual basis.             That is, the reducing clause reduces the

"each    person"     limit      for      an   insured    by     all    payments       for    the

                                                10
                                                                              No.    2020AP189

insured's      injury.         To   explain     why,     we   will     analyze       the    two

phrases in turn.5

                          1.     "The Limit of Liability"

      ¶23      We start with the phrase "the limit of liability."                               On

first inspection, this phrase appears to be ambiguous.                                      The

policy    has    two    limits       of   liability——indeed,           this     section         is

called "Limits         of Liability," and paragraph 1 refers to the

"each person" and "each accident" limit separately and in turn.

But, unlike paragraph 1, the reducing clause does not specify

whether "the limit of liability" refers to the "each person"

limit     or   the    "each     accident"       limit.        Therefore,        it    is    not

immediately clear what "the limit of liability" means.

      ¶24      Ambiguity, as we have noted, is to be construed in

favor of the insured.               However, a phrase can seem ambiguous in

isolation,      but     become      unambiguous     from      the     perspective          of    a

reasonable insured when viewed within the context of a policy.

See   Badger     Mut.    Ins.       Co.   v.   Schmitz,       2002    WI   98,      ¶49,    255

Wis. 2d 61,      647     N.W.2d 223.            Here,    there       are   four      possible
interpretations of "limit of liability"——the phrase could mean:

      5Although we analyze the two disputed phrases separately,
we note that the phrases are interrelated and there are only two
proposed readings of the clause as a whole. The first, favored
by Shimeta and Scherr, is that the clause reduces the "each
person" limit for an insured by all payments for the insured's
injury.    The second, favored by Acuity, is that the clause
reduces the "each accident" limit by all payments made for all
insureds' injuries. Neither party argues that the "each person"
limit should be reduced by payments made on behalf of all
insureds, or that the "each accident" limit should be reduced by
payments made on behalf of just one insured.

                                               11
                                                                          No.       2020AP189

(1) both the "each person" and the "each accident" limit; (2)

either the "each person" or the "each accident" limit depending

on the facts of the case; (3) only the "each person" limit; or

(4) only the "each accident" limit.                      We analyze each of these

four    possible        interpretations       and    conclude      that       the    phrase

unambiguously refers to only the "each person" limit.

       ¶25    We    first    consider      whether       "the   limit    of    liability"

could mean both the "each person" and the "each accident" limit.

In doing so we immediately see that "the limit of liability"

(emphasis added) is phrased in the singular, rather than plural.

The "common and ordinary meaning" of the singular term "the

limit of liability" is one particular limit, rather than more

than one.         See Danbeck, 245 Wis. 2d 186, ¶10, ("The words of an

insurance policy are given their common and ordinary meaning");

see also Filing, 217 Wis. 2d at 650 (holding that an unspecified

"limit for bodily injury liability" in an Underinsured Motorist

definition referred to the "per person" limit, rather than both

limits).      From a reasonable insured's point of view, the limit
would   refer      to    a   singular      limit    of    "each    person"      or    "each

accident," not both.

       ¶26    If Acuity meant to refer to more than one limit, it

could use the word "limits," as it did in the title of the

section       ("Limits           of      Liability").              Wisconsin          Stat.

§ 632.32(5)(i),          which        authorizes    insurers       to    use    reducing

clauses      in    their     UIM      policies,    also     uses   the    plural        form

                                            12
                                                             No.     2020AP189

"limits."6     Because Acuity did not refer to the plural form

"limits," an insured is likely to understand that the reducing

clause is referring to only one limit.

     ¶27     We next consider whether "the limit of liability" in

the reducing clause refers to either the "each person" limit or

"each    accident"   limit   depending   on   the   facts   of     the   case.

Acuity argues, "[w]hen there is more than one injured insured,

paragraph 1 dictates that the 'limit of liability' to be reduced

is the each accident limit."        But neither paragraph 1 nor the

reducing clause actually say that the limit of liability to be

reduced changes depending on the number of injured insureds, and

Acuity has not pointed us to anywhere else in the policy that

does so.7

     6 Wisconsin Stat. § 632.32(5)(i) states that "A policy may
provide that the limits under the policy for uninsured motorist
coverage or underinsured motorist coverage for bodily injury or
death resulting from any one accident shall be reduced by any of
the following that apply" (emphasis added).
     7  The dissenting opinions assert that paragraph 1 of the
Limits of Liability section establishes that the "limit of
liability" is used in the singular to denote the most Acuity
will pay depending on the number of insureds and chosen
coverages.   See Chief Justice Ziegler's dissent, ¶50; Justice
Hagedorn's dissent, ¶61.    But paragraph 1 does not do so——as
stated previously, paragraph 1 uses "limit of liability" in the
singular to describe the each person and each accident limit
separately and in turn.   Paragraph 1 simply sets out the rules
we all agree on: (1) the each person "Limit of Liability" is the
"maximum limit of liability . . . arising out of bodily injury
sustained by any one person in any one accident," and (2) the
each accident "Limit of Liability" is the "maximum limit of
liability for all damages for bodily injury resulting from any
one accident." Paragraph 1 reinforces that there are two limits
of liability and does not answer the relevant question: which
"limit of liability" is the reducing clause referring to?

                                   13
                                                                                  No.     2020AP189

       ¶28    Given          the     language      of    the       reducing     clause,      it   is

unclear      how    a        reasonable      insured        would     understand        that   "the

limit" is different depending on the facts of the case, much

less   figure       out        how    the    facts       of    a    particular        case     would

determine which limit would be reduced.                             As we have reasoned in

previous UIM cases, "reducing clauses must be crystal clear in

the context of the whole policy.                            Otherwise, insureds are not

likely to understand what they are purchasing."                                    Badger Mut.

Ins. Co., 255 Wis. 2d 61, ¶46.                          There may, of course, be some

variation in recovery depending on the facts of a particular

case, but if the insurer intends for the coverage rules and

definitions to vary, the insurer must make the rules governing

that variation clear in its policy language so that the insured

understands what coverage he or she is actually purchasing.                                       See

id.

       ¶29    Because the term "limit of liability" is undefined in

the    policy,          it     is    given    its       plain       and   ordinary       meaning.

Hirschhorn         v.    Auto-Owners          Ins.      Co.,       2012   WI    20,     ¶28,      338
Wis. 2d 761, 809 N.W.2d 529.                    The reducing clause refers to "the

limit" as opposed to "either limit" or "a limit," and it does

not indicate in any way that the limit may vary.                                Therefore, the

common,      ordinary           meaning       of     "the       limit"     is     one     single,

particular limit.

       ¶30    Having           decided       that       a     reasonable        insured        would

understand "the limit of liability" to refer to one particular

limit of liability, rather than both limits or either limit, the
next question is whether the phrase unambiguously refers to the
                                                   14
                                                                            No.    2020AP189

"each person" limit, the "each accident" limit, or whether the

phrase is ambiguous.               We conclude that a reasonable insured

would understand "the limit of liability" to unambiguously refer

to the "each person" limit.

      ¶31    Reading "the limit of liability" to mean the "each

person"      limit     harmonizes          the       reducing       clause        and     the

underinsured motor vehicle definition.                        The policy defines an

underinsured motor vehicle as one whose "limit for bodily injury

liability is . . . less than the limit of liability for this

coverage."        Both the definition and the reducing clause refer to

"the limit of liability," and both compare the insured's limit

of   liability       with    the    limit       of   the     responsible       party——the

definition compares each limit in order to determine whether

there is coverage, and the reducing clause compares each limit

in order to determine the amount of recovery.                             Neither section

clearly     refers    to    the     each    person     limit,       the    each    accident

limit, or both.         Importantly, Acuity concedes that the "limit"

in   the    UIM    definition      refers       to   the    "each    person"      limit    of
liability——otherwise, Curley would not be underinsured as his

policy had equal "each accident" limits and lower "each person"

limits than Acuity's policy.

      ¶32    An     insured        would    reasonably         expect       "the     limit"

referred to in both sections to mean the same limit.                               If these

sections     referred       to    different      limits,       an   insured       would    be

understandably confused.             It makes little sense that a vehicle

could be "underinsured" when its policy limits are compared to
Acuity's     UIM    policy       limits    in    the       definitions      section,      yet
                                            15
                                                             No.     2020AP189

treated as equally insured when those same limits are compared

in the reducing clause.8       In the absence of more specificity, an

insured   would   reasonably   expect    that   when   similar     terms   are

similarly used to compare policy limits, those terms refer to

the same limit.    Therefore, we read the reducing clause's "limit

of liability" to mean the "each person" limit, consistent with

the UIM definition and consistent with what a reasonable insured

would expect.9

     8 Justice Hagedorn's dissent claims we put "too much stock"
in harmonizing the underinsured motor vehicle definition with
the reducing clause.      See Justice Hagedorn's dissent, ¶70.
However, it is well established that when the same or similar
language is used in a contract or insurance policy, the language
should be applied consistently. See Day v. Allstate Indem. Co.,
2011 WI 24, ¶57, 332 Wis. 2d 571, 798 N.W.2d 199 (explaining
that   the   insurer's  proposed   definition  of   a  term   is
"inconsistent with how the term is used in the context of
another policy provision").   Although both sections as a whole
may perform different functions, they both use the same phrase,
"limit of liability," in answering the same question——how do the
insured's limits of liability compare with those of the
responsible party?     A reasonable insured would read these
phrases consistently.

     Similarly, Chief Justice Ziegler's dissent asserts that by
interpreting the phrases consistently, we are creating a
"requirement that a vehicle qualifying as 'underinsured'
automatically means the insured receives payment."    See Chief
Justice Ziegler's dissent, ¶50.          We implement no such
requirement.    There will still be situations in which an
underinsured vehicle may not automatically qualify the insured
for payment——when the insured's recovery is reduced by payments
received from other sources, for instance.
     9  This interpretation is also consistent with Filing v.
Com. Union Midwest Ins. Co., 217 Wis. 2d 640, 579 N.W.2d 65 (Ct.
App. 1998), in which the court of appeals interpreted a UIM
policy's underinsured motor vehicle definition. Like the court
of appeals in Filing, which determined that the "limit for
bodily injury liability" referenced in the definition was the
                                    16
                                                                              No.     2020AP189

       ¶33    The     dissenting        opinions'       reading     of    the       reducing

clause as referring to the maximum amount that Acuity will pay

depending on the number of insureds and nature of the coverage

is a logical way that an insurance policy could work.                               However,

the language of this particular policy does not connect the

dots.        At    best,   the    dissenting       opinions      provide       us     with    an

alternative reasonable interpretation of "limit of liability."

When policy language is "susceptible to more than one reasonable

interpretation," it is ambiguous.                       Danbeck, 245 Wis. 2d 186,

¶10.    Ambiguity is resolved in favor of the insured, id., so the

result is the same regardless.

             2.    "All Sums Paid Because of the Bodily Injury"

       ¶34    We    now    turn    to   the    second        disputed    phrase       in     the

reducing clause and conclude that "all sums . . . [p]aid because

of the bodily injury" means payments made because of the bodily

injury suffered by the individual insured, rather than aggregate

payments for all bodily injuries suffered by all insureds.                                   The

clause states that the limit shall be reduced "by all sums"
"[p]aid because of the bodily injury by or on behalf of persons

or organizations who may be legally responsible."                                   At first

glance,      "by    all    sums"    appears        to   be    expansive,        but    it    is

immediately         qualified      by   the   phrase      "because       of    the     bodily

injury."          The policy defines "bodily injury" as "bodily injury

tortfeasor's "per person limit," we read the policy "from the
perspective of what the insured as an individual, not insureds
as a whole, could recover from the tortfeasor's liability
carrier," and similarly conclude that the reducing clause refers
to the "each person" limit. See Filing, 217 Wis. 2d at 649.

                                              17
                                                                        No.   2020AP189

to or sickness, disease or death of a person" (emphasis added).

This    definition        uses     the    singular——referring      to   one   person——

rather than the plural, which would encompass multiple injured

people.           Although       (despite    the    singular      phrasing)   "bodily

injury" does appear to be used elsewhere in the policy to refer

to injuries suffered by multiple insureds,10 the reducing clause

further uses an additional singular term, "the bodily injury"

(as opposed to, for example "bodily injuries" or "any bodily

injury").          Based on the singular word choice in the reducing

clause, we conclude that "all sums . . . [p]aid because of the

bodily injury" means all sums paid because of the bodily injury

to a singular insured.11

       ¶35    Like with the phrase "limit of liability," if we were

to accept that an insured could also read "the bodily injury"

broadly      so    that    it    referred    to    any   injury   sustained    by   all

insureds,         then    the    phrase    would   be    ambiguous.     We    construe

ambiguous language in favor of the insured, so the result here

would be the same.              Danbeck, 245 Wis. 2d 186, ¶10.
       ¶36    When reading the reducing clause as a whole, the most

reasonable interpretation is that the "each person" limit shall

       Paragraph 1 of the Limits of Liability section defines
       10

the each accident limit as the "maximum limit of liability for
all damages for bodily injury resulting from any one accident."

       We are not the first state high court to come to this
       11

conclusion.  See, e.g., Buell v. Am. Universal Ins. Co., 224
Conn. 766, 771, 621 A.2d 262 (1993) (determining that "the"
bodily injury in a reducing clause "refers only to the
claimant's bodily injury and not to the bodily injury of
others").

                                             18
                                                                 No.   2020AP189

be reduced by payments made because of the bodily injury to the

insured making the claim.       This reading does not make the "each

accident" limit superfluous.        The "each accident" limit remains

a cap on what Acuity itself will ever pay for bodily injury

resulting from any one accident.         Here, Acuity will pay no more

than that $500,000 limit.

                             III.   CONCLUSION

    ¶37     We affirm the court of appeals because we agree that

the policy's reducing clause operates on an individual basis to

reduce the "each person" limit of liability by the payment each

insured individually received from Curley's insurance.

    By    the   Court.—The   decision    of   the   court   of     appeals   is

affirmed.

                                    19
                                                                      No.    2020AP189.akz

    ¶38     ANNETTE       KINGSLAND       ZIEGLER,       C.J.    (dissenting).            I

dissent    because        the     majority       reads     Acuity's    policy     as    no

reasonable insured would, creating coverage out of thin air that

was never agreed upon.             Acuity's UIM insurance policy is simple.

Acuity agrees to pay up to a certain limit in the event its

insured is injured in an accident with a driver whose vehicle is

underinsured:      up     to    $500,000     per      person,   but    no     more     than

$500,000 for any one accident.                   This is one among five limits,

each listed in the "Limits of Liability" section of Acuity's

policy.    The per person and per accident limits work together as

one collective limit to Acuity's liability.                      But this limit is

reduced    "by    all     sums"    paid   by     or   on    behalf    of    the   legally

responsible party (the "tortfeasor") so the insured does not

receive duplicate payments.               Because the insureds in this case

received from the tortfeasor a combined amount equal to Acuity's

limit, the insureds received exactly the amount they would have

gotten from Acuity if the tortfeasor had no insurance at all,
and Acuity's liability is reduced to zero.                    Simple as that.

    ¶39     But     the     majority      complicates         this    simple      policy.

Though Acuity's policy discusses the per person and per accident

limits collectively as one singular "limit of liability," the

majority    reads       them    separately,        ignoring     the    structure        and

organization of the "Limits of Liability" section.                          The majority

then continues to overcomplicate Acuity's policy, imposing an

atextual requirement that a vehicle qualifying as "underinsured"
means the insured will receive payment under Acuity's policy in

                                             1
                                                                             No.      2020AP189.akz

every instance.             This is not how Acuity's policy operates.                             I

respectfully dissent.

                                                 I

       ¶40     "We interpret the provisions of an insurance policy

using the same principles applicable to contracts generally."

Kemper Independence Ins. Co. v. Islami, 2021 WI 53, ¶16, 397

Wis. 2d 394, 959 N.W.2d 912.                 "Where the language of a contract

is unambiguous and the parties' intentions can be ascertained

from the face of the contract, we give effect to the words they

employed."          Steadfast Ins. Co. v. Greenwich Ins. Co., 2019 WI 6,

¶21, 385 Wis. 2d 213, 922 N.W.2d 71.                         "Where the language of the

policy    is    plain       and    unambiguous,         we     enforce      it     as    written,

without resort to rules of construction or principles in case

law."     Fontana Builders, Inc. v. Assurance Co. of Am., 2016 WI

52, ¶37, 369 Wis. 2d 495, 882 N.W.2d 398 (quoting Danbeck v. Am.

Fam.    Mut.    Ins.       Co.,    2001     WI    91,       ¶10,    245    Wis. 2d 186,         629

N.W.2d 150).

       ¶41     We    must    read      policy        language       in     context,       not   in
isolation.          "Sometimes it is necessary to look beyond a single

clause    or    sentence          to   capture       the     essence       of    an     insurance

agreement."            Folkman         v.   Quamme,          2003    WI     116,        ¶21,    264

Wis. 2d 617,         665    N.W.2d 857.              This    may    require        examining     a

policy's organization and structure.                           Gohde v. MSI Ins. Co.,

2004 WI App 69, ¶12, 272 Wis. 2d 313, 679 N.W.2d 835 ("We first

look     at    the     organization         and       structure       of    the       policy.");

Remiszewski v. Am. Fam. Ins. Co., 2004 WI App 175, ¶24, 276
Wis. 2d 167, 687 N.W.2d 809 ("We further conclude that neither

                                                 2
                                                      No.   2020AP189.akz

the structure and organization of American Family's policy, nor

any provision therein, renders the reducing clause contextually

ambiguous.").

    ¶42   The entire "Limits of Liability" section from Acuity's

policy, including the reducing clause, is reproduced below:

    Limits of Liability

    1.    The Limit of Liability shown in the Declarations
          for   each   person   for  Underinsured Motorists
          coverage is our maximum limit of liability for
          all damages, including damages for care, loss of
          services or death, arising out of bodily injury
          sustained by any one person in any one accident.
          Subject to this limit for each person, the Limit
          of Liability shown in the Declarations for each
          accident for Underinsured Motorists coverage is
          our maximum limit of liability for all damages
          for   bodily   injury   resulting  from any   one
          accident.
          This is the most we will pay regardless of the
          number of:

          a.    Insured persons;

          b.    Claims made;

          c.    Vehicles   or    premiums    shown     in      the
                Declarations; or

          d.    Vehicles involved in the accident.

    2.    The limit of liability shall be reduced by all
          sums:

          a.    Paid because of the bodily injury by or on
                behalf of persons or organizations who may
                be legally responsible.    This includes all
                sums paid under Part I – Liability; and

          b.    Paid or payable because of the bodily injury
                under any of the following or similar law:

                (1)   Workers' compensation law; or
                                  3
                                                                No.   2020AP189.akz

                    (2)    Disability benefits law.

    3.      No one will be entitled to receive duplicate
            payments for the same elements of loss under this
            coverage  and   Part  I – Liability,   Part  II –
            Expenses for Medical Services or Part III –
            Uninsured Motorists coverage provided by this
            policy.

    4.      We will not make a duplicate payment under this
            coverage for any element of loss for which
            payment has been made by or on behalf of persons
            or organizations who may be legally responsible.

    5.      We will not make a duplicate payment to the
            extent amounts are paid or payable because of the
            bodily injury under any of the following or
            similar law:

            a.      Workers' compensation law; or

            b.      Disability benefits law.
Accounting    for    the    structure     and   organization    of    the   entire

"Limits of Liability" section in Acuity's UIM policy, it becomes

clear that the reducing clause reduces both the per person limit

and the per accident limit.

    ¶43     The     section   is    labeled     "Limits   of    Liability"     and

contains five paragraphs.            Each paragraph in some way limits
Acuity's liability to the insured.              The first paragraph does so

with reference to the per person and per accident limits; the

second paragraph being the reducing clause; and the last three

limit liability for various forms of duplicate payments.                      Each

one of these paragraphs thus operates as a limit to Acuity's

liability,    explaining      why   the    section   title     uses   the   plural

"Limits."        Each paragraph counts as one individual "limit of
liability."       This also explains why the reducing clause states

                                          4
                                                                           No.    2020AP189.akz

"[t]he limit of liability," in the singular, "shall be reduced."

It is because everything described in the first paragraph is one

singular "limit of liability" for purposes of the "Limits of

Liability" section.

       ¶44    Paragraph         1.'s    own   language     confirms         this       reading.

Immediately            after   the     subparagraph      describing         both        the   per

person    limit         and    the   per   accident      limit,      there       is     a   break

followed          by    the    statement,      "This      is        the    most        we     will

pay . . . ."            The break indicates that "the most [Acuity] will

pay"         is         everything         described           in         the          preceding

subparagraph:            both the per person limit and per accident limit,

which the policy describes collectively.                            Together, they form

one singular "limit of liability" listed among other limits in

the "Limits of Liability" section.                  Because the per person limit

and per accident limit constitute one "limit of liability," the

reducing clause requires that both of them be reduced "by all

sums" "[p]aid because of the bodily injury."

                                              II
       ¶45    Nowhere does the majority grapple with the "Limits of

Liability" section's structure and organization.                                 Its analysis

never even acknowledges the fact that the "Limits of Liability"

section contains three additional paragraphs after the reducing

clause.       This leads the majority to instead rely on a myopic

reading of the policy that in no way reflects how a reasonable

insured would understand it.

       ¶46    The majority distorts Acuity's policy to maximize the
insureds'         recovery      beyond     what    was    bargained             for.        After

                                              5
                                                                              No.   2020AP189.akz

incorrectly concluding that the reducing clause reduces either

the per person or the person accident limit, but not both, the

majority determines that "the limit" in "the limit of liability"

must       be    the    same     both    in   the    reducing       clause          and   in     the

underinsured motor vehicle definition.                        Majority op., ¶31.                 The

majority reasons, "It makes little sense that a vehicle could be

'underinsured' when its policy limits are compared to Acuity's

UIM policy limits in the definitions section, yet treated as

equally         insured      when    those    same   limits     are          compared     in     the

reducing clause."              Id., ¶32.

       ¶47       The majority conflates status as "underinsured" with

the need for payment.1                   Under Acuity's policy, a tortfeasor's

vehicle          is     "underinsured"        when      the     associated            liability

insurance policy's limit is "[l]ess than the limit of liability

for this coverage."                  A vehicle being "underinsured" does not

mean       the    UIM       policyholder      automatically         must        receive         some

payment from his insurer.                 All it means is that the tortfeasor's

policy          provides      less      coverage     than     the       insured's         policy.
Whether the tortfeasor's policy will ultimately pay the same

amount as an insured would receive under his own UIM policy is a

different             question       entirely.          After       a        limits-to-limits

comparison,            it    may     appear      that    there          is     some       set     of

circumstances where a tortfeasor's policy limit will not provide

the same amount of coverage as the insured's UIM policy.                                        But,

as is the case here, the insured may still receive from the

      Justice Hagedorn also identifies this error, a criticism
       1

on which I expand here.  See Justice Hagedorn's dissent, ¶¶70-
71.

                                                 6
                                                                                 No.    2020AP189.akz

tortfeasor the same amount he would have received under his own

UIM policy even if the tortfeasor's policy limit is "[l]ess than

the limit of liability for" the insured's UIM coverage.                                             The

majority rather, equates insurance with payment even where such

payment is unnecessary.2

      ¶48    The          correct     result       is        straightforward.               Acuity's

liability is limited to $500,000 for any one insured, but no

more $500,000 for any one accident.                           A singular, tragic accident

caused    "bodily          injury"    to     two       people       insured      under      Acuity's

policy.          Each      insured's       damages          from    their       injuries      exceed

$500,000.          The      injuries       were        caused       by    a    tortfeasor        whose

insurer     had       a    liability       limit        of     $250,000         per     person      and

$500,000 per accident.                Thus, both of the insureds in this case

received     only          $250,000     because             total    payments          reached      the

tortfeasor's per accident limit.                        Under Acuity's policy, because

the   reducing        clause        treats    the       per     person        and     per   accident

limits as one collective "limit of liability," they are both

reduced.         Both insureds received a combined total of $500,000
because     of    a       single    accident,          so    the    per       accident      limit    is

reduced to zero, meaning there is no coverage remaining for this

accident.

      2The majority adds more confusion by attempting to ease
this concern with the fact that payment may still be unnecessary
"when the insured's recovery is reduced by payments received
from other sources."    Majority op., ¶32 n.8.    Following the
majority's logic, no payment is necessary when the insured
receives a full recovery from the tortfeasor plus "other
sources," but payment is somehow required when the insured
receives the same amount from the tortfeasor alone.    Again, no
reasonable insured would understand Acuity's policy to operate
this way.

                                                   7
                                                                         No.    2020AP189.akz

       ¶49    The fact that the tortfeasor's per person limit caused

his vehicle to qualify as "underinsured" under Acuity's policy

does    not   change       this    result.           The   vehicle     was     underinsured

because, due to Acuity's limits-to-limits comparison approach,

it was possible that the insureds might not receive an amount

equivalent to the amount they would have received under Acuity's

UIM    policy.        If    one    insured       suffered      more    than    $250,000    in

damages and the other suffered less, this would mean that the

insured with more damages would recover less from the tortfeasor

than    he    would    from       Acuity    under      its   UIM      policy.      In    this

situation, the tortfeasor's vehicle would be underinsured, and

payment by Acuity would be necessary.                        It is possible that the

tortfeasor's         liability       insurance         would     not     have    paid     the

insureds      the     same    amount       the       insureds    would    receive       under

Acuity's policy, but that is not the case here, so payment by

Acuity is not necessary.              There is no need to read in confusion

to reach this sensible result.

                                             III
       ¶50    Acuity's policy is simple and straightforward.                              The

per    accident      and     per   person    limits        operate     together     as    one

collective "limit of liability" to establish the most Acuity

might pay.          Because the reducing clause reduces "the limit of

liability" "by all sums" paid to the insureds by the tortfeasor,

each component part of that collective limit likewise reduces.

In this case, the insureds received from the tortfeasor the

exact    amount      they    would    have       under     Acuity's      policy,    meaning
Acuity has no remaining liability.                         But the majority eschews

                                                 8
                                                                 No.   2020AP189.akz

this simple reading in favor of a complex one that no reasonable

insured   would    understand.            It    also   unwittingly     creates    a

requirement     that      a     vehicle        qualifying   as    "underinsured"

automatically     means       the   insured     receives    payment.      This   is

simply not how Acuity's policy operates.

    ¶51   For the foregoing reasons, I respectfully dissent.

    ¶52   I am authorized to state that Justice REBECCA GRASSL

BRADLEY joins this dissent.

                                          9
                                                                                No.    2020AP189.bh

      ¶53     BRIAN     HAGEDORN,           J.        (dissenting).                   Before    his

unfortunate         passing,    Michael          Shimeta        purchased           underinsured

motorist (UIM) coverage from Acuity.                           In that policy, Acuity

agreed   to    pay     claims    up     to       a    maximum        limit       of    liability:

$500,000      per    person,     but    no       more        than    $500,000          total    per

accident.      The operative language and design of these policies

is standard.          And basic logic tells us that the per accident

limit will reduce the amount individuals can recover in multi-

person accidents.         In practice, this means that the recovery for

any individual under Shimeta's policy with Acuity may not be the

full $500,000 if multiple insureds are injured.                                Everyone agrees

that this is how the policy works.

      ¶54     The UIM policy also has a standard reducing clause.

The whole concept of this kind of UIM coverage combined with a

reducing clause is for an insured to obtain "a predetermined,

fixed level of UIM recovery that is arrived at by combining

payments" "from all legally responsible sources."                                   Welin v. Am.

Fam. Mut. Ins. Co., 2006 WI 81, ¶49-50, 292                                    Wis. 2d 73, 717

N.W.2d 690      (quoting       another       source).               In    other       words,    the

insured has agreed to be paid a specific amount——first from

other legally responsible parties, with any remaining amounts

due   coming    from     Acuity.         So          the    reducing          clause    functions

consistent with the rest of the policy.

      ¶55     But the majority somehow finds that payments from the

tortfeasor's insurer should count as a reduction against only
the   per   person      limit.         In    so       doing,        the       majority    creates

complexity     where     none    is     found,             leading       it    to     misread   the
                                                 1
                                                                      No.    2020AP189.bh

policy.     In the end, the insureds here do not receive a fixed

level of UIM recovery arrived at by combining payments from all

legally responsible sources.           Instead, they receive double what

Shimeta's    policy    promises       as       a   total    payout     for     any   one

accident.    This may be good for Shimeta's estate and his injured

passenger,    but     it   is   not    what        the     policy    provides.         I

respectfully dissent.1

                                I.    THE POLICY

     ¶56    We begin with the policy language.2                     The declarations

page of the policy summarizes the coverage Shimeta purchased.

Multiple coverages are listed in the standard way, as providing

a certain payout for "Each Person" and a second amount for "Each

Occurrence" or "Each Accident."                For example, Shimeta purchased

uninsured motorist coverage for bodily injury in the amount of

$500,000 per person and $500,000 per accident.                      And as relevant

here, the UIM coverage is "$500,000 Each Person" and "$500,000

Each Accident."

     1 I understand Chief Justice Ziegler's dissent to make
largely the same arguments I present here, and therefore I
substantially agree with it.
     2 Because insurance policies are contracts, our primary goal
in interpreting them is "to give effect to the intentions of the
parties."   Wadzinski v. Auto-Owners Ins. Co., 2012 WI 75, ¶11,
342 Wis. 2d 311, 818 N.W.2d 819.    "The parties' intentions are
presumed to be expressed in the language of the policy."      Id.
We therefore begin the inquiry with the policy's language. See,
e.g., Secura Ins. v. Lyme St. Croix Forest Co., LLC, 2018
WI 103, ¶17, 384 Wis. 2d 282, 918 N.W.2d 885.      "Generally, we
interpret a policy's terms as they would be understood from the
perspective of a reasonable person in the position of the
insured." Id.

                                           2
                                                         No.   2020AP189.bh

    ¶57   The relevant policy language in the UIM endorsement

comes   under   the   bolded3   heading   "Limits   of   Liability"    and

provides in relevant part:

    1.   The Limit of Liability shown in the Declarations
    for each person for Underinsured Motorists coverage is
    our maximum limit of liability for all damages,
    including damages for care, loss of service or death,
    arising out of bodily injury sustained by any one
    person in any one accident. Subject to this limit for
    each person, the Limit of Liability shown in the
    Declarations  for   each  accident   for  Underinsured
    Motorists coverage is our maximum limit of liability
    for all damages for bodily injury resulting from any
    one accident.

    This is the most we will pay regardless of the number
    of:

          a. Insured persons;

          b. Claims made;

          c.   Vehicles    or       premiums    shown     in     the
          Declarations; or

          d. Vehicles involved in the accident.

    2.   The limit of liability shall be reduced by all
    sums:

          a. Paid because of the bodily injury by or on
          behalf of persons or organizations who may be
          legally responsible. This includes all sums paid
          under Part I – Liability; and

          b. Paid or payable because of the bodily injury
          under any of the following or similar law:

                (1) Workers' compensation law; or

                (2) Disability benefits law.

    3  Following our style guide, bolded terms in the policy are
underlined in this dissent.

                                    3
                                                                               No.    2020AP189.bh

      ¶58     Several       observations           are    in     order.          This     entire

section      uses     the     phrase       "limit        of     liability"           throughout.

Paragraph 1 uses that phrase four times, and refers back to the

amount itemized in the declarations.                          The policy explains that

the   most    an    insurer       will   pay,      called       the    "maximum        limit    of

liability," will turn on the policy coverages purchased and the

number of insureds entitled to payment for a single accident.

One   limit    is     governed      by   the       "each       person"    coverage        amount

purchased.         And the "each accident" limit is the maximum limit

Acuity      will    pay     for   bodily     injury        "resulting          from     any    one

accident."         This means that when two or more persons are injured

in one accident, the "each accident" limit could, depending on

the policy purchased, operate as a cap that limits the recovery

for any one insured.              And if that wasn't plain enough——because

that pattern is how this whole policy operates——the paragraph

doubles      down    and     declares      that      no    matter      how      many     insured

persons are injured, claims are made, or vehicles are involved

or covered, the per accident limit is "the most we will pay
regardless."

      ¶59     This UIM coverage, then, works together as a seamless,

integrated,        perfectly      understandable           whole.         If    this     were    a

$100,000 per person, $300,000 per accident policy, for example,

the   per    person       limit    might    be      the       more    commonly        applicable

limit, and the per accident limit reached less often.                                   But this

is a $500,000 per person and $500,000 per accident policy.                                      So

here, the per accident limit may come into play more often than
a policy with a different mix of coverages.                            While the coverage

                                               4
                                                                       No.    2020AP189.bh

purchased and nature of an accident will dictate how the math

works, the policy will always have a definitive maximum limit of

liability——a dollar figure that serves as a cap on Acuity's

liability.         This limit need not be one or the other.                              For

example, in this $500,000 per person and per accident policy,

where one insured is injured in the same accident, the "limit of

liability" is $500,000.                 There's no need to choose between the

two limits.         The point is, there will always be a fixed dollar

amount      that    is    the     most     Acuity     will     pay,   however       it    is

calculated.

      ¶60    This can be seen in a straightforward way in the same

page of the policy as the "Limits of Liability" section.                                 The

UIM   policy       provides      that    other   applicable      insurance         coverage

could likewise reduce the amount owed.                   Under paragraph 3 of the

"Other Insurance" section, the policy says its obligation to pay

primary      or    excess       coverage     will     extend    to    "our     limit      of

liability"        under    the    policy.        In    other     words,      the    policy

understands there will always be a fixed dollar "limit"——phrased
in the singular——that will be owed to the insured.                        Whether that

limit will be established by the per person limit or the per

accident limit will again depend on the coverages purchased and

the number of insureds that are injured in any one accident.

      ¶61    Turning to the reducing clause in paragraph 2 of the

"Limits of Liability" section, it too employs the same language

as paragraph 1.           It refers to the "limit of liability."                    And we

already know what that phrase means:                   it is the most Acuity will
pay, whether determined by the per person or per accident limit

                                             5
                                                           No.   2020AP189.bh

(or both if identical), depending on the chosen coverages and

number of injured persons.            And the reducing clause says that

this limit "shall be reduced by all sums" paid by someone or

some       entity   "who   may   be    legally    responsible"——like     the

tortfeasor who caused the accident in this case.4

       ¶62    Applying the policy is straightforward.        The reducing

clause operates to reduce Acuity's liability under its policy,

whatever that limit might be.              In this case, the tortfeasor's

insurer paid $500,000 in combined payments to Shimeta's estate

and the passenger in his car; both are insureds under the policy

seeking coverage for bodily injury resulting from one accident.

And since Acuity agreed to pay no more than $500,000 for any one

accident under the terms of this particular policy, Acuity's

"limit of liability" is reduced per the reducing clause to zero.

       ¶63    A reasonable insured would not be confused by any of

this.       It is exactly how this UIM policy is designed to work.

Shimeta bargained and paid for this precise level of coverage.

Once again, the whole point of this type of "limits-to-limits"
UIM policy is to "put the insured in the same position he or she

would have occupied had the tortfeasor's liability limits been

the same as the UIM limits purchased by the insured."5               Welin,

       The policy further says that it shall be reduced by
       4

anything paid or payable under workers compensation law,
disability benefits law, or any similar law.

       If the tortfeasor in this case had the liability limits
       5

Shimeta   purchased——$500,000  per  person   and   $500,000  per
accident——then Shimeta and his passenger would have received the
same thing they were given here:    $500,000 total.   That's why
Shimeta's estate already received exactly what he originally
bargained for.

                                       6
                                                                          No.   2020AP189.bh

292    Wis. 2d 73,        ¶26.        The   policy        self-consciously      offers   "a

predetermined, fixed level of UIM recovery that is arrived at by

combining payments from all sources."                         Id., ¶49. The reducing

clause ensures that the insureds receive only the fixed sum they

bargained for.            Nothing more, nothing less.                 It does this by

promising to pay up to the limit of liability, minus payments

from       other    responsible       parties       or    under   other   relevant     laws

providing compensation.6

                              II.    THE MAJORITY'S MISTAKES

       ¶64       The majority, however, misses all of this and designs

a more generous insurance policy than the one Shimeta bargained

for.       The majority begins its analysis of the reducing clause by

rightly focusing on the phrase "limit of liability."                              Majority

op., ¶23.          But instead of interpreting that phrase consistent

with       the   rest    of    the    policy,       the   majority   proclaims      itself

stumped.           So it hypothesizes four possibilities for what it

could mean.             The majority reasons "Limit of liability" could
refer to:          "(1) both the 'each person' and the 'each accident'

limit; (2) either the 'each person' or the 'each accident' limit

depending on the facts of the case; (3) only the 'each person'

limit; or (4) only the 'each accident' limit."                       Id., ¶24.

       In fact, the policy provides that Acuity "will not make a
       6

duplicate payment under this coverage for any element of loss
for which payment has been made by or on behalf of
persons . . . who may be legally responsible."    The majority's
conclusion results in exactly the type of duplicate payment the
policy prohibits.

                                                7
                                                                      No.   2020AP189.bh

       ¶65    The majority first rejects the idea that both limits

are referred to because the reducing clause uses the singular

"limit of liability."            Id., ¶¶25-26.          Moving on to option two,

the majority explains that it can't be right either because

"neither paragraph 1 nor the reducing clause actually say that

the limit of liability to be reduced changes depending on the

number of injured insureds."               Id., ¶27.        Except that it does.

Paragraph       1   immediately     preceding       the    reducing     clause      uses

"limit of liability" in the singular for both, and explicitly

says     that       the    "maximum       limit     of      liability        for    all

damages . . . resulting from any one accident" supersedes the

per person limit.          The per accident limit is the maximum Acuity

"will pay regardless of the number of . . . Insured persons" who

are injured and entitled to recovery.

       ¶66    The majority then postulates a reasonable insured is

simply not going to understand which limit applies.                           Majority

op., ¶28.       I suppose it's true that few insureds truly grasp how

their policies work.            Insurance policies tend not to be evening
reading      material     for    most     people.        But   this    isn't    rocket

science, and a reasonable insured wouldn't be confused.                        Shimeta

bargained for a maximum recovery defined as $500,000 per person,

and at most, $500,000 per accident regardless of the number of

injured persons.          The entire policy issued to Shimeta, including

standard liability insurance, uninsured motorist coverage, and

the    UIM   endorsement        contain    the   same     structure.        Under   the

majority's logic, reasonable people just can't understand what
it means for a policy to have a maximum dollar limit (the "limit

                                            8
                                                                                No.    2020AP189.bh

of liability") that can vary depending on coverages purchased

and the facts of a case.

       ¶67     The   majority        compounds      its      errors        by    positing       that

since    the    "limit       of    liability"           in   the     reducing          clause    is

singular,       it    can     only     refer       to    "one      particular           limit    of

liability, rather than both limits or either limit."                                    Id., ¶30.

It then concludes we must choose the "each person" limit because

that     harmonizes         the      definition          with        the        definition       of

underinsured motor vehicles.                 Id., ¶31.             Since caselaw, rather

than a definition in the policy, establishes that a vehicle is

underinsured, the majority concludes we must read it the same

way.     Id., ¶32.          Finally, the majority misconstrues the policy

further by saying that because the reducing clause uses the

phrase    "the       bodily       injury"    in     the      singular,          it     should    be

understood as reducing payments only for a singular insured's

per person coverage.               Any other proposed reading of "limit of

liability"      or    "the        bodily    injury"          would    be        ambiguous,      the

majority reasons, and therefore read in favor of the insured.
Id., ¶¶33, 35.         None of this correct.

       ¶68     First, neither basic grammar nor logic dictate that

because "limit of liability" is used in the singular, only one

of the two possible limits must be referred to.                                       Rather, the

policy is consistent that there will always be a maximum dollar

limit to Acuity's liability depending on the coverages purchased

for per person and per accident, and depending on the facts of

the case.

                                               9
                                                                          No.    2020AP189.bh

       ¶69    Second, the majority's emphasis on "the bodily injury"

is likewise atextual.           The policy always uses "bodily injury" in

the singular and bolded.             This is because "bodily injury" is a

defined term in the policy referring to a type of damage that

triggers liability and coverage.               The policy does the same thing

with   "property       damage"——another        type    of     damage       that       may   be

covered in the policy and is separately defined.                          Both here and

throughout     the     rest    of   the   policy,      even       where    two       or   more

insured      persons    are    injured,      the   phrase     "bodily           injury"     is

always bolded and used in the singular.                 The majority's emphasis

on the definite article "the" does not transform this standard

definition-invoking           language    into     a   clue       that     the       reducing

clause is meant to operate in a way totally divorced from the

entire operation of this fixed coverage UIM policy.

       ¶70    Finally, the majority puts too much stock in the fact

that whether underinsurance is triggered looks only to the per

person    limit.        Acuity      agrees   based     on     a    court        of    appeals

decision that the tortfeasor's limit should be compared with the
policy's per person limit for purposes of answering the initial

question of whether the policy is triggered.                       See Filing v. Com.

Union Midwest Ins. Co., 217 Wis. 2d 640, 649-50, 579 N.W.2d 65

(Ct. App. 1998) (holding that the tortfeasor's liability limits

should be compared with the per person limits under the policy).

But that means little here.                  The reasoning of the court of

appeals in Filing rested less on a careful interpretation of the

language than on its sense that the insured expected potential
coverage apart from how many are injured in an accident.                                    Id.

                                          10
                                                                              No.    2020AP189.bh

It   also      discussed        the    many     "absurd      results"        that     would       be

occasioned by interpreting the policy the other way.                                 Id. at 647

& n.3.         While I am not suggesting the outcome was incorrect,

Filing       has    little       to    say     analytically          about     the     question

presented here.

       ¶71     Whether      Acuity       must    pay    and     in    what     amount        is    a

different       question         altogether      from       whether     UIM     coverage          is

triggered in the first instance.                     To determine if any portion of

the coverage is reduced, we must look to the relevant policy

language.          And as we've explained, paragraph 1——directly before

the reducing clause in paragraph 2——specifically references both

limits.         "[A]    reasonable           insured    would       understand        that    the

reducing       clause      in    [paragraph      2]    of     the    Limit     of     Liability

section        of    the        UIM    endorsement        qualifies          the      insurer's

obligation to pay the maximum limit of liability as described

in . . . [paragraph 1]."                    Ruenger v. Soodsma, 2005 WI App 79,

¶23,     281       Wis. 2d 228,        695    N.W.2d 840.             Thus,     whether       UIM

coverage is triggered in the first instance isn't doing the
analytical work the majority thinks it is.

                                      III.     CONCLUSION

       ¶72     While insurers can draft policies moving forward that

satisfy      the     majority's        perplexity,      the     language       the        majority

misinterprets          today      will      impact    current       policies        across    the

state.       The majority misses the mark by trying to figure out

which limit the phrase "limit of liability" in the reducing
clause      applies      to.          The    answer    is     apparent:             The    policy

                                                11
                                                                         No.    2020AP189.bh

consistently     describes        itself     as    having     one    maximum          dollar

limit,    a   "limit    of    liability,"       which    could      be    triggered      by

either of the two limits depending on the coverages purchased

and the facts of the case.                 And the reducing clause provides

that     Acuity's    liability       limit      must    be    reduced          when   other

responsible parties provide compensation.

       ¶73    Here, Shimeta purchased UIM coverage in the amount of

$500,000 per person and $500,000 per accident.                           An unfortunate

accident      occurred,      leaving    Shimeta        dead   and        his     passenger

injured,      both     insureds      under      the     policy.           Collectively,

Shimeta's     estate    and    his   injured      passenger       received        $500,000

from the tortfeasor's insurance.                  The reducing clause requires

that this $500,000 be deducted from Acuity's limit of liability,

which under these facts and this coverage is $500,000 for this

one accident.        Therefore, the predetermined, fixed sum Shimeta

bargained for was paid out, and Acuity has no further liability

under the policy.        I respectfully dissent.

       ¶74    I am authorized to state that Justice REBECCA GRASSL
BRADLEY joins this dissent.

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    No.   2020AP189.bh

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