Court Opinion

ID: 1059099
Source: CourtListenerOpinion
Date Created: 2013-10-09 18:34:17.262906+00
Date Added: 2024-06-11T13:05:24.010056
License: Public Domain

PRESENT: All the Justices

LENNA JO DYER
                                                OPINION BY
v.   Record No. 031532                    JUSTICE G. STEVEN AGEE
                                              APRIL 23, 2004
DAIRYLAND INSURANCE COMPANY

           FROM THE CIRCUIT COURT OF CHESTERFIELD COUNTY
                    Herbert C. Gill, Jr., Judge

      In this appeal we determine whether the plaintiff’s

recovery for the negligence of one tortfeasor under the

liability provision of an automobile insurance policy precludes

recovery under the underinsured motorist provision of the same

policy for the negligence of a joint tortfeasor.

                I. BACKGROUND AND PROCEEDINGS BELOW

      Lenna Jo Dyer (“Dyer”) was the passenger on a motorcycle

owned and operated by Kerry B. Atkinson (“Atkinson”).

Atkinson’s motorcycle was involved in a collision with a

motorcycle owned and operated by Ricky M. Roberts (“Roberts”).

As a result of the collision, Dyer received injuries and

suffered damages in excess of $100,000.   Atkinson and Roberts

were jointly and concurrently negligent and their negligence was

the proximate cause of the collision.

      Dairyland Insurance Company (“Dairyland”) insured the

Atkinson motorcycle under a policy providing bodily injury

liability coverage in the amount of $100,000 per claimant and
uninsured/underinsured motorist (“UM” or “UIM” respectively)

coverage of $100,000 per claimant.   Under the Atkinson policy,

Dairyland tendered to Dyer the full $100,000 of bodily injury

liability coverage based on Atkinson’s liability.    Dairyland

also insured the Roberts motorcycle under a policy providing

$25,000 of bodily injury liability coverage per claimant and

UM/UIM coverages in the same amount.     Dairyland tendered the

full $25,000 of bodily injury liability coverage to Dyer based

on Roberts’ liability under his policy.

     Dyer obtained a judgment against Roberts in the amount of

$275,000.   She then argued in the trial court that she was

entitled to $75,000 in UIM coverage under the Atkinson policy.

Dyer averred Roberts was underinsured in an amount equal to the

difference between his $25,000 of bodily injury liability

coverage and the $100,000 of UIM coverage under the Atkinson

policy.   Dairyland responded that it was not obligated to

provide Dyer with UIM coverage under the Atkinson policy because

it had already tendered the full amount of the bodily injury

liability coverage under that policy.    On cross-motions for

summary judgment the trial court held that Dairyland was not

obligated to provide UIM coverage to Dyer under the Atkinson

policy.   We awarded Dyer this appeal.

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                           II. ANALYSIS

     Code § 38.2-2206(A) requires an insurer under a motor

vehicle liability policy “to make payment for bodily injury

. . . caused by the operation or use of an underinsured motor

vehicle to the extent the vehicle is underinsured, as defined in

subsection B.”   Under that subsection:

     A motor vehicle is “underinsured” when, and to
     the extent that, the total amount of bodily
     injury and property damage coverage applicable to
     the operation or use of the motor vehicle and
     available for payment for such bodily injury or
     property damage . . . is less than the total
     amount of uninsured motorist coverage afforded
     any person injured as a result of the operation
     or use of the vehicle.

     Dyer argues she is underinsured under the Atkinson policy

as to the Roberts vehicle within the meaning of Code § 38.2-

2206(B).   She further contends the resolution of this case is

governed by this Court’s decision in Nationwide Mutual Ins. v.

Hill, 247 Va. 78, 439 S.E.2d 335 (1994).   We agree with Dyer.

     In Hill, Rebecca H. Henley (“Henley”), a passenger in a

vehicle driven by Mary Ann Forsyth (“Forsyth”), died in an

automobile accident involving another vehicle driven by Martin

W. Jones (“Jones”).   Henley’s estate obtained judgment in the

amount of $1,000,000, jointly and severally, against Forsyth’s

estate and Jones.   247 Va. at 80-81, 439 S.E.2d at 336.

     The Forsyth vehicle was insured under an automobile

liability policy issued by Nationwide Mutual Insurance Company

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(“Nationwide”) which provided $50,000 of bodily injury liability

coverage per claimant and UM/UIM coverage of the same amount.

Jones was uninsured.   Nationwide paid the full $50,000 of its

bodily injury liability to the Henley estate based on Forsyth’s

negligence, but denied UM coverage attributable to Jones’

negligence.   Id. at 81, 439 S.E.2d at 336.

     The administrator of Henley’s estate then filed a

declaratory judgment action asking for a determination that

Henley was insured under the UM provision of the Nationwide

policy because Jones was an uninsured motorist.       Nationwide

argued that the provisions in its UM endorsement required a set-

off of any payments received from the bodily injury liability

coverage against any recovery payable under the UM coverage.

Id. at 83, 439 S.E.2d at 338.     We approved the trial court’s

determination that the set-off provisions of the Nationwide UM

endorsement violated Code § 38.2-2206 and were contrary to

public policy.   Nationwide was liable for payment of the full

policy amount as to each tortfeasor: $50,000 of bodily injury

liability coverage attributable to Forsyth and $50,000 of UM

coverage attributable to Jones.        Id. at 86, 439 S.E.2d at 339.

     Dairyland asserts on appeal that the outcome of this case

is not governed by Hill, but instead by two more recent cases,

Superior Insurance Co. v. Hunter, 258 Va. 338, 520 S.E.2d 646

(1999) and Kramer v. Commonwealth, 263 Va. 128, 556 S.E.2d 761

                                   4
(2002).   Dairyland avers these later cases bar Dyer from

recovering under both the bodily injury liability and UIM

provisions of the Atkinson policy.   We disagree.

     The issue in Hunter was whether the UIM “provision of a

tortfeasor’s automobile liability insurance policy is available

to satisfy claims of passengers in the tortfeasor’s vehicle who

are insured under the same policy and whose claims for damages

exceed the limits of the policy’s liability coverage.”      Hunter,

258 Va. at 340, 520 S.E.2d at 647.   We concluded that the

General Assembly, by virtue of Code § 38.2-2206, “did not intend

that a vehicle could be ‘underinsured’ with respect to itself.”

Id. at 344, 520 S.E.2d at 649.   Accordingly, the plaintiff in

Hunter had no claim to UIM coverage where the full bodily injury

liability coverage limit had been paid and there was only one

tortfeasor and one insurance policy.∗

     Likewise, Kramer involved a state employee killed by an

uninsured driver.   The Commonwealth’s Risk Management Plan only

provided $25,000 in UM coverage but allowed for $50,000 of UIM

coverage.   The decedent’s estate sought to combine and collect

both the UM and UIM coverages.   We reiterated the principle

expressed in Hunter that the Commonwealth’s Risk Management Plan

     ∗
       Some language in Hunter could be read to limit recovery
under both the bodily injury liability coverage and UIM
provisions of a single policy; however, that language must be
read in the context of a claim with one policy and one
tortfeasor.

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could not “be underinsured with respect to itself in order to

provide additional coverage.”   Kramer, 263 Va. at 133, 556

S.E.2d at 763.

     In contrast to Hunter and Kramer, the case at bar is the

result of the joint negligence of two tortfeasors, Atkinson and

Roberts, who were insured under separate policies.   Under the

plain terms of Code § 38.2-2206(B), the Roberts vehicle was

underinsured because his policy’s bodily injury liability

coverage was “less than the total amount of uninsured motorist

coverage [under the Atkinson policy] afforded any person [Dyer]

injured as a result of the operation or use of the vehicle.”

Dyer’s entitlement to the UIM coverage under the Atkinson policy

does not mean the Atkinson motorcycle was underinsured as to

itself.   Instead, it means that Roberts, a joint and several

tortfeasor, was underinsured and therefore Dyer is entitled to

the UIM coverage under the Atkinson policy.

     Hill is clear and commanding authority to apply the same

rule in the UIM setting, where joint tortfeasors and multiple

policies are present, as already applies to UM coverage.    If we

determined Hill was inapplicable to the case at bar, it would

create the discrepant circumstance in which Dyer would be in a

worse position than if Roberts had been uninsured.   The General

Assembly specifically eliminated this anomaly in the 1982

amendments to former Code §§ 38.1-381(b) and (c) which are now

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Code §§ 38.2-2206(A) and (B).    See Nationwide Mutual Insurance

Company v. Scott, 234 Va. 573, 576, 363 S.E.2d 703, 704 (1988).

       Dairyland also maintains that the Atkinson policy prohibits

an insured from collecting both liability and UIM coverage.

Because the policy was not entered into the record, we need not

address Dairyland’s argument in this regard.     Moreover, such a

provision would conflict with the requirements of Code §§ 38.2-

2206(A) and (B) as we explained above.     “The provisions of the

statute [Code § 38.2-2206] are part of [the] contract of

insurance, and we will not consider language in [a] policy that,

arguably, is inconsistent with the statute as we have construed

it.”    Id. at 577, 363 S.E.2d at 705.

                          III.   CONCLUSION

       This Court’s rationale in Hill applies with as equal force

to UIM coverage as it does to UM coverage.     We therefore hold

that Dyer is entitled to UIM coverage under the Atkinson policy

equal to the difference between Robert’s coverage under his

policy ($25,000) and the available UIM coverage under the

Atkinson policy ($100,000), a total of $75,000.     The trial court

thus erred in granting summary judgment to Dairyland and in

failing to grant summary judgment to Dyer.     Accordingly, we will

reverse the judgment of the trial court and enter final judgment

for Dyer.

                                         Reversed and final judgment.

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