Court Opinion

ID: 9847194
Source: CourtListenerOpinion
Date Created: 2023-09-24 03:55:31.972724+00
Date Added: 2024-06-11T09:17:02.887494
License: Public Domain

ANDERSON, J.
(dissenting in a separate opinion):
Because I agree with the disposition and reasoning of the master-in-equity, I VOTE to AFFIRM and adopt the analysis in his order as my dissent:

ORDER OF MASTER-IN-EQUITY CLYDE N. DAVIS, JR.

South Carolina Code Ann. § 38-77-150 mandates that all automobile insurance earners may not issue or deliver policies unless the policies contain a provision providing uninsured motorist coverage. The uninsured motorist statute is remedial and was enacted for the benefit of injured persons; the statute is to be liberally construed to accomplish this purpose. Gunnels v. American Liberty Ins. Co., 251 S.C. 242, 161 S.E.2d 822 (1968); Franklin v. Devore, 327 S.C. 418, 489 S.E.2d 651 (Ct.App.1997). Provisions inconsistent with uninsured motorist statutes are void. Kay v. State Farm Mut. Auto. Ins. Co., 349 S.C. 446, 562 S.E.2d 676 (2002).
*72The merit of Nationwide’s position in the case at hand hinges upon whether Nationwide can circumvent the requirement of South Carolina Code Ann. § 38-77-150 to deny James W. Smith, Jr. and Elizabeth Smith uninsured motorist coverage benefits simply because the vehicle was owned by James W. Smith, Jr. and James W. Smith, Sr. had no ownership interest in the Montero Sport. The evidence reveals that the Montero Sport was the primary means of transportation for the family that included James W. Smith, Jr., Elizabeth Smith, and James W. Smith, Sr. The evidence establishes that the vehicle was driven primarily by Elizabeth Smith who was a listed driver on the policy. James W. Smith, Sr. did not drive at all due to medical reasons. The vehicle was often used to transport James W. Smith, Sr. to and from doctors’ visits and to obtain prescriptions. The testimony reveals that this was done several times a month. James W. Smith, Sr. certainly derived a benefit from the Montero Sport. The Montero Sport and Elizabeth Smith were added to the policy, premiums for both were collected and retained by Nationwide, and Nationwide should not be allowed to avoid payment of an uninsured claim due to what amounts to a technicality.
This Court is persuaded by the decision of the South Carolina Supreme Court in Unisun Ins. Co. v. Schmidt, 339 S.C. 362, 529 S.E.2d 280 (2000), and holds that the insurable interest argument is irrelevant in this case, as we are dealing with uninsured coverage and not liability coverage. In the case of Schmidt, the South Carolina Supreme Court addressed a similar factual scenario. In Schmidt, the Defendant was injured while riding in a car driven by an unauthorized driver. Schmidt at 364-65, 529 S.E.2d at 281. The parties in Schmidt stipulated that January O’Neale’s father gave her a BMW with strict instructions not to let anyone else drive the car. Schmidt at 365, 529 S.E.2d at 281. On the date in question, Miss O’Neale and her friend Jennifer Hurst went to a party at the home of Christopher Schmidt. Id. During the party, Schmidt drove the BMW with Hurst asleep in the back seat. Id. Schmidt lost control of the vehicle, hit a tree and Hurst was injured. Id. The parties agreed that Schmidt did not have permission to drive the vehicle, but that Hurst’s use of the BMW at all times was consensual. The insurance carrier for the BMW was State Farm, and they successfully denied *73liability coverage due to the fact that Schmidt did not have permission to operate the vehicle. Id. Hurst then attempted to collect under the uninsured coverage of the State Farm policy covering the BMW. Hurst argued that since she was a permissive occupant, she was covered. The trial court sided with Hurst, but the South Carolina Court of Appeals reversed. The Court of Appeals held that for Hurst to be an insured under the statutory definition of insured, she must be a guest in a vehicle “to which the policy applied.” Schmidt at 365, 529 S.E.2d at 281. The Court of Appeals held that when Schmidt drove off in the vehicle without permission, the State Farm policy no longer applied to the vehicle. Id. Based on their conclusion, the Court of Appeals never addressed whether the BMW was an uninsured motor vehicle.
The South Carolina Supreme Court then reversed the Court of Appeals. The South Carolina Supreme Court first looked at the definition of insured under South Carolina Code Ann. § 38-77-30(7) which defines insured to mean:
the named insured and, while resident of the same household, the spouse of any named insured and relatives of either, while in a motor vehicle or otherwise, and any person who uses with the consent, expressed or implied, of the named insured the motor vehicle to which the policy applies and a guest in the motor vehicle to which the policy applies or the personal representative of any of the above.
The South Carolina Supreme Court then stated that the Court of Appeals had erred in concluding that the O’Neale vehicle was not a vehicle “to which the policy applied.” Schmidt at 366-67, 529 S.E.2d at 282. The Court then held that the “ ‘motor vehicle to which the policy applies’ is ‘the motor vehicle designated in the policy’ ” Schmidt at 367, 529 S.E.2d at 282 (citing Davidson v. Eastern Fire & Cas. Ins. Co., 245 S.C. 472, 141 S.E.2d 135, 138 (1965)). The South Carolina Supreme Court then stated that the words “to which the policy applies” are words of identification and not words of exclusion as used by the Court of Appeals. Schmidt at 367, 529 S.E.2d at 282. The South Carolina Supreme Court then looked at the definition of an uninsured vehicle and concluded that the O’Neale vehicle qualified as an uninsured vehicle pursuant to South Carolina Code Ann. § 38-77-30(13) and that Hurst was covered under the uninsured portion of the *74policy. Id. The Supreme Court stated that the purpose of the uninsured motorist law is “to provide benefits and protection against the peril of injury or death by an uninsured motorist to an insured motorist and his family ...” Schmidt at 368, 529 S.E.2d at 283 citing Ferguson v. State Farm Mut. Auto Ins. Co., 261 S.C. 96, 100, 198 S.E.2d 522, 524 (1973).
Applying the holding of the South Carolina Supreme Court in Schmidt to the case at hand, one must conclude that the Smiths should be covered under the uninsured motorist provision of the policy covering the Montero. As in Schmidt, they are insureds under South Carolina Code Ann. § 38-77-30(7), as they resided with the insured, James W. Smith, Sr. and are related by blood and mairiage to the insured James W. Smith, Sr. Furthermore, the motor vehicle to which the policy applies would be the Montero Sport, as that is “the motor vehicle designated in the policy.” Furthermore, the Nationwide Policy at issue on page Ul, which is the Uninsured Motorists and Underinsured Motorist provision, states: “We will pay damages, including derivative claims, because the bodily injury suffered by you or a relative, and because of property damage. Such damages must be due by law to you or a relative for the owner or driver of: 1. an uninsured motor vehicle ...” Therefore, the uninsured motorist coverage provision of the Nationwide policy covering the Montero should cover James W. Smith, Jr. and Elizabeth Smith when applying the reasoning of the South Carolina Supreme Court in Schmidt and the policy language of the Nationwide policy.
This Court is also persuaded by the holding of the South Carolina Supreme Court in Hogan v. Home Ins. Co., 260 S.C. 157, 194 S.E.2d 890 (1973). In Hogan, the South Carolina Supreme Court reviewed the judgment from the South Carolina lower court, which held that a policy clause excluding uninsured motorist coverage to the insured and her family, unless they were riding in the vehicle named in the policy, violated the South Carolina Motor Vehicle Safety Responsibility Act (S.C.Code Ann. § 46-750.31 to 46-750.32 (1962 Code of Laws)).
The Supreme Court of South Carolina then points out the distinction between liability and uninsured motorist coverage. The Court states that the liability contract is only required to insure “persons defined as insured, against loss from liability *75imposed by law for damages arriving out of the ownership, maintenance or use of the motor vehicle described in the policy; while uninsured motorist coverage obligates the insured to pay all sums which the insured shall be legally entitled to recover as damages from the owner or operator of an uninsured vehicle.” Hogan at 162, 194 S.E.2d at 892 (internal quotations omitted). Uninsured motorist coverage is not to provide coverage for the uninsured vehicle but to afford additional protection to an insured. Id. Unlike the provisions relative to liability coverage, the Statute plainly affords uninsured motorist coverage to the named insured and resident relatives of his/her household at all times and without regard to the activity in which they were engaged at the time. Id. The Supreme Court stated such coverage is nowhere limited in the Statute to the use of the insured vehicle and cannot be so limited by policy provisions. Id. The Hogan decision is significant because the Supreme Court was examining similar statutory language which is applicable today.
Nationwide’s argument that having no insurable interest defeats uninsured coverage is supported by no case law that refers to uninsured motorist coverage. Within their memorandum, Nationwide has cited the South Carolina cases of American Mut. Fire Ins. Co. v. Passmore, 275 S.C. 618, 274 S.E.2d 416 (1981), and Benton & Rhodes, Inc. v. Boden, 310 S.C. 400, 426 S.E.2d 823 (Ct.App.1993). These cases can easily be distinguished from the case at hand, as neither refer or pertain to uninsured motorist coverage. The case of Pass-more involved a situation in which Helen Whitehead agreed to sell her 1970 Chevrolet Nova to Lonnie Reed in exchange for a down payment and assumption of the existing indebtedness. Per the agreement, Mr. Reed was required to obtain liability insurance on the vehicle. Because Mr. Reed had poor credit, he could not obtain liability insurance and approached a friend, Leaman Foxworth, who agreed to place the vehicle on his policy. The girlfriend of Lonnie Reed was then involved in a collision with James Passmore on May 21, 1977. The trial judge held that an insurance interest was not required for liability insurance in South Carolina, and the Supreme Court reversed the Trial Court’s decision and remanded the matter. The Supreme Court held that with regard to liability coverage, the insurable interest does not depend upon the named in*76sured having either a legal or equitable interest in the property, but it is enough that the insured may be held liable for damages to its operation and use. Passmore at 620-21, 274 S.E.2d at 417-18. Benton & Rhodes does not involve automobile insurance.

CONCLUSION

In conclusion, Nationwide’s argument that there is no uninsured coverage on the Montero Sport is not supported by the evidence or the case law, is irrelevant, and to hold there is no uninsured motorist coverage on the Montero Sport would be against public policy. The Smiths are entitled to Fifty Thousand ($50,000.00) Dollars per person, One Hundred Thousand ($100,000.00) Dollars per occurrence of uninsured coverage on the Montero Sport and then they would each be able to stack the Fifty Thousand ($50,000.00) dollars uninsured motorist coverage provided by the Montero Sport policy and the Fifty Thousand ($50,000.00) Dollars uninsured motorist coverage provided by the 1992 Ford Ranger. The total coverage available to each should be One Hundred Thousand ($100,-00.00) Dollars for a total of Two Hundred Thousand ($200,-000.000) Dollars in total uninsured motorist coverage for this occurrence. Stacking would be allowed, as James W. Smith, Jr. and Elizabeth Smith are relatives of the insured, James W. Smith, Sr., and resided with him at the time of the accident, thus they are Class 1 insureds. Therefore they can stack the available uninsured motorist coverage per Concrete Servs., Inc. v. United States Fidelity & Guar. Co., 331 S.C. 506, 498 S.E.2d 865 (1998), and South Carolina Code Ann. § 38-77-160.
(some minor typographical and citation errors corrected)
Accordingly, I VOTE to AFFIRM.