Court Opinion

ID: 9717450
Source: CourtListenerOpinion
Date Created: 2023-08-26 07:03:37.200864+00
Date Added: 2024-06-11T18:23:52.945370
License: Public Domain

SHIRLEY S. ABRAHAMSON, J.
(concurring in part, dissenting in part). Like the majority, I would affirm that part of the court of appeals decision affirming the circuit court’s dismissal of the complaint. The circuit court’s findings that on the basis of the record in this case the release executed by the plaintiff released any claim for bad faith should be upheld on appellate review.
Unlike the majority, however, I would also affirm the court of appeals decision remanding to the trial court the question of whether the claim was frivolous. Such a remand comports with our prior cases which provide that *632the issue of frivolousness is determined by the trial court after a hearing. Furthermore, there are issues here worthy of consideration by the trial court in making its determination. I shall mention only two.
Even though the plaintiff’s complaint was dismissed, the trial court should consider whether there is a reasonable basis in law for the plaintiff’s claim that the signing of a release does not bar a subsequent suit for the tort of bad faith. Whenever an insurance company issues a check, even one for full policy limits, it generally demands a release and there may be a reasonable argument to be made that a release does not preclude a later bad faith claim.
In addition, while I agree with the majority that the insurance company’s contractual liability to pay arises only if the person injured is legally entitled to recover damages from the owners or operators of the uninsured motor vehicle, I conclude that the trial court should consider whether there is a reasonable basis in the law for plaintiff’s position that the “reduction clause” in the insurance policy violates the legislative policy embodied in secs. 631.43(1) and 632.32(4) (a), Stats. 1981-82. The reduction clause requires that the recovery under the uninsured motorist coverage be reduced by amounts paid by other sources jointly or severally liable with the owner or operator of the uninsured vehicle.
Plaintiff’s position does call for an extension, modification, or reversal of existing law. In the Drake, Leatherman, Scherr, and Nelson cases (p. 623), this court held that “reduction clauses” in uninsured motorist provisions are valid and that a plaintiff’s recovery from an insurance company must be reduced by the amount recovered from other sources. The plaintiff in this case argues that the Drake, Leatherman, Scherr, and Nelson cases are no longer good law.
*633The trial court might find that there is a reasonable basis in the law for the plaintiff’s argument which would allow her to recover the $15,000 uninsured motorist coverage even if she recovered $15,000 from another source, so long as she did not recover an amount greater than her total damages.
Drake, Leatherman, Scherr, and Nelson were decided either before the uninsured motorist statute was adopted or under the old version of the statute. Furthermore, the court of appeals recently concluded in Landvatter (cited by the majority at p. 624 on a different point) that under the new insurance statutes the holdings in Leatherman, Scherr, and Nelson that a reduction clause does not contravene public policy are erroneous. In Landvatter the two sources under which recovery was sought were two policies both having uninsured motorist coverage. In this case the two sources under which recovery was sought were a policy providing uninsured motorist coverage and another source. It is reasonably arguable that Landvatter is applicable only to the fact situation in that case. On the other hand it is also arguable that the four old cases do not draw any distinction between the two fact situations and that the factual distinction is not significant. Moreover, arguably under the new statutes the legislature intended to prohibit an insurance company from reducing its liability under an uninsured motorist provision when the claimant has not fully recovered for the loss incurred.
Citing the old cases without any analysis of new developments in insurance law, the majority states that the plaintiff could not have recovered the full amount of her uninsured motorist coverage if she had recovered a judgment from another tortfeasor. It then concludes that the plaintiff’s position was frivolous.
This court generally does not decide that a claim was frivolous but instead permits the trial court to give ade*634quate consideration to the issues involved. I see no reason to deviate from this practice in this case. I conclude that this court should remand this case to the trial court where a hearing may be held to determine whether the plaintiff’s claim was without a reasonable basis in law and could not be supported by good faith argument for an extension, modification, or reversal of existing law.
For the reasons set forth I would affirm the decision of the court of appeals.