1 Present: Carrico, C.J., Compton, Lacy, Hassell, Keenan, and
2 Kinser, JJ., and Poff, Senior Justice
3
4 BERNARD J. TRISVAN, JR.
5
6 v. Record No. 962600 OPINION BY JUSTICE ELIZABETH B. LACY
7 October 31, 1997
8 AGWAY INSURANCE COMPANY
9
10 FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND
11 James B. Wilkinson, Judge
12
13 In this appeal, we construe Code § 38.2-2206 to determine
14 whether, in a single vehicle accident, the uninsured/
15 underinsured motorist (UM/UIM) endorsement of a tortfeasor's
16 automobile liability insurance policy is to be considered when
17 determining the extent to which the tortfeasor's motor vehicle is
18 underinsured.
19 The facts are not in dispute. On April 9, 1994, Bernard J.
20 Trisvan, Jr., was a passenger in a car driven by Marcus Wilson
21 Smith. The car overturned, and Trisvan suffered injuries
22 resulting in damages exceeding $125,000. Smith's vehicle was
23 insured by Integon Indemnity Corporation (Integon), with policy
24 limits of $25,000 per person for bodily injury liability and
25 $25,000 per person UM/UIM coverage. Trisvan was insured under a
26 family automobile policy issued to his father by Agway Insurance
27 Company (Agway) with a limit of $100,000 for UM/UIM coverage.
28 Trisvan filed a personal injury action against Smith and
29 served Agway as his underinsurance carrier. In settlement of the
30 personal injury action, Integon paid Trisvan the $25,000
31 liability limit under Smith's policy. Agway then tendered
32 Trisvan $75,000 and filed a declaratory judgment action seeking a
33 ruling that $75,000 was the total amount it owed Trisvan under
1 Trisvan's UM/UIM policy. Trisvan, in his grounds of defense and
2 counterclaim, asserted that the total amount of available UM/UIM
3 coverage was $125,000 and, therefore, Agway was liable for
4 $100,000 rather than $75,000. The trial court, on cross motions
5 for summary judgment, concluded that Smith's vehicle was
6 underinsured by $75,000, not $100,000, and that Trisvan was
7 therefore only entitled to $75,000 from Agway. We awarded this
8 appeal.
9 In this case, we are not concerned with construing the terms
10 of an insurance policy to determine whether an applicant is
11 entitled to recovery. Trisvan did not seek recovery from Integon
12 under the terms of the UM/UIM endorsement in Smith's policy and
13 counsel for Trisvan stated at oral argument that he could not
14 recover under that portion of the policy because of the policy
15 limits. The sole question here requires interpretation of a
16 portion of § 38.2-2206, regarding the method for calculating the
17 amount by which a vehicle is underinsured.
18 Since 1982, § 38.2-2206 has required that automobile
19 liability insurance policies issued in Virginia include an
20 endorsement which obligates the insurer to pay the insured for
21 damages caused by the operation or use of an underinsured motor
22 vehicle. Subsection (B) of that section provides that a motor
23 vehicle is considered underinsured:
24 when, and to the extent that, the total amount of
25 bodily injury and property damage coverage applicable
26 to the operation or use of the motor vehicle and
27 available for payment for such bodily injury or
28 property damage, . . . is less than the total amount of
2
1 uninsured motorist coverage afforded any person injured
2 as a result of the operation or use of the vehicle.
3
4 Trisvan asserts that, in construing this provision, the
5 legislature's use of the word "total" commands that even in a
6 single car accident the driver's UM/UIM coverage always be
7 stacked onto other UM/UIM coverage. According to Trisvan, the
8 purpose of the 1982 amendments to § 38.2-2206 was to "increase
9 the total protection afforded to insurance claimants injured by
10 negligent motorists. See Nationwide Mutual Insurance v. Scott,
11 234 Va. 573, 363 S.E.2d 703 (1988)." Therefore, Trisvan reasons,
12 the General Assembly must have intended that, in calculating the
13 extent to which a vehicle is underinsured, a driver's UM/UIM
14 insurance would be considered to be "afforded" to his passengers
15 even if the driver is the sole tortfeasor. We disagree.
16 The increased insurance protection for injured claimants, to
17 which Trisvan refers, was not an arbitrary expansion of recovery
18 options. The 1982 amendments were enacted in response to a
19 specific anomaly which had arisen following the adoption of
20 mandatory uninsured motorist endorsements in automobile liability
21 insurance policies. As explained in Scott, a person injured by
22 an uninsured motorist could realize greater financial protection
23 than if injured by an insured motorist, where the injured party
24 had elected uninsured motorist coverage in an amount greater than
25 the liability limits of the insured tortfeasor. 234 Va. at 575-
26 76, 363 S.E.2d at 704. The General Assembly in mandating the
27 underinsurance endorsement corrected this anomaly by allowing a
3
1 claimant to access the "over-insurance" in his UM/UIM
2 endorsement, even if the tortfeasor was insured. This
3 legislation was not enacted to expand protection to injured
4 parties generally.
5 Trisvan's construction of § 38.2-2206(B), requiring the
6 UM/UIM endorsement applicable to the tortfeasor's motor vehicle
7 to be stacked onto other available UM/UIM coverage, is also at
8 odds with other portions of § 38.2-2206. Subsection (A) of that
9 section states that the underinsurance endorsement must
10 "obligate the insurer to make payment for bodily injury or
11 property damage caused by the operation or use of an underinsured
12 motor vehicle." The reference to damage caused by "an uninsured
13 motor vehicle" contemplates the existence of two motor vehicles,
14 not the single vehicle suggested by Trisvan, when read in the
15 context of the entire subsection. Subsection (A) provides that
16 the amount of UM/UIM coverage can either be equal to or less than
17 the amount of the liability coverage. It may not, in any case,
18 exceed the amount of the liability coverage. Thus, when
19 comparing the amounts of liability and UM/UIM coverage in the
20 tortfeasor's policy applicable to his motor vehicle, that vehicle
1
21 could not be "an underinsured motor vehicle."
22 The provisions of subsection (G) of § 38.2-2206 provide
23 another example of the General Assembly's intentions regarding
1
Compare Nationwide Mut. Ins. Co. v. Hill, 247 Va. 78,
439 S.E.2d 335 (1994)(UM/UIM recovery allowed where two
vehicles involved).
4
1 the use of UM/UIM coverage. That section gives the insurer a
2 right of subrogation for the UM/UIM payment against the person
3 causing the injury. Applying Trisvan's rationale, the insurer
4 would have a subrogation right against its insured, the negligent
5 driver. We do not believe the General Assembly intended such a
6 result when it sought to eliminate the anomaly discussed above
7 and allowed an insured to access its UM/UIM insurance coverage
8 when injured by an underinsured motor vehicle.
9 Finally, our interpretation of § 38.2-2206(B) is consistent
10 with the views of other courts in this regard. Policy provisions
11 prohibiting recovery under both the liability and UM/UIM portions
12 in a single vehicle accident have been upheld on both statutory
13 and public policy grounds. See, e.g., Fidelity & Cas. Co. v.
14 Streicher, 506 So.2d 92 (Fla. Dist. Ct. App. 1987), review
15 denied, 515 So.2d 231 (Fla. 1987); Myers v. State Farm Mut. Auto.
16 Ins. Co., 336 N.W.2d 288 (Minn. 1983); Millers Cas. Ins. Co. of
17 Texas v. Briggs, 665 P.2d 891 (Wash. 1983).
18 For these reasons, we hold that in applying § 38.2-2206(B),
19 a passenger injured in a single vehicle accident is not entitled
20 to include the UM/UIM coverage contained in the tortfeasor's
21 automobile liability insurance policy when determining the extent
22 to which the tortfeasor's vehicle was underinsured. Accordingly,
23 we will affirm the judgment of the trial court holding that
24 Agway's total liability to Trisvan is $75,000.
25 Affirmed.
5
1 JUSTICE COMPTON, with whom JUSTICE KINSER joins, concurring.
2 I agree with the result of this appeal. However, I cannot
3 subscribe to the rationale employed by the majority to reach the
4 result.
5 In deciding this case, one must be careful to recognize the
6 distinctions among bodily injury liability insurance coverage,
7 uninsured motorist coverage for bodily injury, and underinsurance
8 motorist coverage for bodily injury.
9 On April 9, 1994, Trisvan, the claimant, was a passenger in
10 a motor vehicle operated by Smith, the tortfeasor. The vehicle
11 left the road because of the alleged negligence of the tortfeasor
12 and overturned injuring the claimant. No other vehicle was
13 involved in the accident.
14 At the time, the vehicle operated by the tortfeasor was
15 insured by Integon Indemnity Corporation. The policy had bodily
16 injury liability limits of $25,000 for each person injured and a
17 like amount of uninsured and underinsured motorist coverage for
18 bodily injury. Those were the minimum limits required by the
19 applicable financial responsibility statute. Code § 46.2-472(3).
20 Thus, the tortfeasor's vehicle was not an uninsured motor
21 vehicle.
22 The claimant qualified as an insured under a "Family
23 Automobile Policy" issued to his parents by Agway Insurance
24 Company. As relevant here, that policy contained an endorsement
25 for uninsured motorist coverage for bodily injury and an
6
1 endorsement for underinsured motorist coverage for bodily injury
2 with a single limit of $100,000 for each person.
3 The claimant's injuries resulted in damages exceeding
4 $125,000. Thus, Integon paid the claimant the limits of $25,000
5 under its bodily injury liability coverage. Agway paid the
6 claimant $75,000 under its uninsured/underinsured motorist
7 coverage for bodily injury, claiming that was the full sum it
8 owed.
9 The claimant contends he is entitled to collect a total of
10 $100,000 from Agway. This declaratory judgment proceeding
11 ensued, and was decided in favor of Agway on cross motions for
12 summary judgment.
13 The controversy must be resolved by determining the amount
14 that the claimant's vehicle was underinsured under Code § 38.2-
15 2206(B). According to the statute, a motor vehicle is
16 underinsured "when, and to the extent that, the total amount of
17 bodily injury . . . coverage applicable to the operation or use
18 of the motor vehicle . . . is less than the total amount of
19 uninsured motorist coverage afforded any person injured as a
20 result of the operation or use of the vehicle."
21 Here, the tortfeasor's vehicle was an insured motor vehicle,
22 not an uninsured motor vehicle under the Integon policy. Thus,
23 the uninsured motorist coverage for the tortfeasor's vehicle was
24 not coverage "afforded" the claimant. In other words, the
25 $25,000 Integon uninsured motorist limit may not be added when
7
1 computing "the total amount" of "coverage" referred to in the
2 statute to determine the extent to which the claimant's vehicle
3 was underinsured.
4 Therefore, because the tortfeasor was insured, there is
5 $75,000 underinsured motorist coverage available to the claimant.
6 Combining Integon's payment of its liability limits of $25,000
7 with Agway's payment of $75,000 means that the claimant has
8 received a sum equal to his uninsured motorist limit of $100,000.
9 A contrary ruling, viz., that a tortfeasor's uninsured motorist
10 coverage is always applicable when determining the amount of
11 underinsured motorist coverage available to an injured claimant,
12 would render meaningless the distinction in coverage available
13 under the uninsured or underinsured provisions of a policy or the
14 statute. In sum, the claimant is not entitled to assume that the
15 tortfeasor's vehicle is uninsured in order to be able to use
16 Integon's uninsured motorist coverage when computing available
17 underinsured motorist coverage.
18 For the foregoing reasons, I would affirm the trial court's
19 judgment that Agway has fully discharged its lawful obligation to
20 the claimant.
8