Court Opinion

ID: 9673333
Source: CourtListenerOpinion
Date Created: 2023-08-24 04:10:14.556824+00
Date Added: 2024-06-11T18:16:21.608791
License: Public Domain

Tom Glaze, Justice, dissenting. Today’s decision clearly conflicts with our recent holding in Shelter Mut. Ins. Co. v. Bough, 310 Ark. 21, 834 S.W.2d 637 (1992). There, we adopted the general rule that while an insurer is not entitled to subrogation unless the insured has been made whole for his loss, the insurer should not be precluded from employing its right of subrogation when the insured has been fully compensated and is in a position where the insured will recover twice for some of his or her damages. In other terms, the rule has been stated that subrogation is not available to the insurer where the loss exceeds the amount recovered from the insurer and the wrongdoer. To this effect, see 6A Appelman, Insurance Law & Practice § 4095 at p. 275 (1972 and Supp. 1992). Couch relates the principle that equity requires that the insured be made whole before the insurer’s right to subrogation arises. 16, Couch on Insurance, 2d Rev. ed. § 61, 20 (1983). In the present case, the proof showed that the insured’s total damages amounts to at least $60,000, but he has received only $11,482.08 from his insurer, Arkansas Blue Cross & Blue Shield, and $25,000 from the wrongdoer’s insurer. Thus, the insured, Mr. Higginbotham, has received a total of $36,482.08, and no proof reflects this amount came close to paying him for his entire loss. The majority court attempts to distinguish the rule in Bough by stating that the situation here involved “conventional subrogation” and that the insurer’s and insured’s rights are determined purely on contractual terms. However, the rule appears settled that subrogation is recognized or denied upon equitable principles without differentiation between “legal subrogation” which arises by application of principles of equity and “conventional subrogation” arising from contract or the acts of the parties. Garrity v. Rural Mut. Ins. Co., 11 Wis.2d 537, 253 N.W.2d 512 (1977). As the Garrity court further stated, the conventionally subrogated or contractual insurer has no share in the recovery from the tortfeasor if the total amount recovered by the insured from the insurer does not cover his loss. Maryland Casualty of Baltimore, Md. v. Cincinnati, C., C. & St. L. Ry. Co., 74 Ind.App. 272, 124 N.E. 774 (1919); Providence Washington Insurance Co. v. Hogges, 67 N.J.Super. 475, 171 A.2d 120 (1961); Hardware Dealers Mutual Fire Ins. Co. v. Ross, 129 Ill.App.2d 217, 262 N.E.2d 618 (1970); Lyon v. Hartford Accident and Indemnity Co., 25 Utah 2d 311, 480 P.2d 739 (1971). In my view, the rule we adopted in Bough is applicable to the situation before us now, and accordingly we should reverse. Holt, C.J. and Corbin, J., join this dissent.