Court Opinion

ID: 9590704
Source: CourtListenerOpinion
Date Created: 2023-08-21 23:57:46.002128+00
Date Added: 2024-06-11T09:40:50.328736
License: Public Domain

Justice WEBB
dissenting.
I dissent from the majority opinion. The provisions of the policy and N.C.G.S. § 20-279.21(b)(3) provide that a covered policyholder may recover damages the covered person is legally entitled to recover from the third party tort-feasor after the underinsured tort-feasor’s coverage is exhausted. In this case the plaintiff is not entitled to recover from the Bells. Under the policy she is not entitled to recover from Horace Mann.
The majority says there are conflicting provisions in the policy and the statute. They say the provision that Horace Mann will pay “only after the limits of liability under any applicable liability bonds or policies have been exhausted by payment of judgments or settlements” “appears to require the insured both to preserve the cause of action against the tort-feasor and to settle the cause before seeking UIM benefits.” I believe the policy and the statute can and should be read to mean that before the policyholder may proceed against his own insurer on the underinsured motorist provision of his policy he must first proceed against the underinsured motorist. If he procures a judgment which is larger than the underinsured’s liability coverage he may collect on his underinsured coverage after the underinsured tortfeasor’s liability insurance has been paid. If the policyholder settles his claim for an amount larger than the coverage of the tort-feasor he may collect on his underinsured motorist coverage after the tort-feasor’s policy has been exhausted. If the policy is read in this manner we can give effect to all its provisions. It is a rule of construction, which we are required to follow, that every part of a contract must be given effect if that can be done by any fair or reasonable interpretation. Refining Co. v. Construction Co., *301153 N.C. 277, 72 S.E. 1003 (1911). I believe it is error for the Court to ignore this rule.
I also believe the plaintiff is barred by her failure to give notice to Horace Mann and her settlement of the case without Horace Mann’s consent. The policy provides that she must do these things in order for Horace Mann to be liable. I believe these provisions should be enforced. The majority has required Horace Mann to prove it has been prejudiced before it may take advantage of these exclusions. It appears to me that the prejudice is evident. Horace Mann must now defend a claim which the defendant has no interest in defending. I believe this shows prejudice enough.
I vote to reverse the Court of Appeals.
Justice MEYER joins in this dissenting opinion.