dissenting. I respectfully dissent. I do not agree that the phrase “due by law” is imprecise or ambiguous. The policy provision for UM/UIM coverage provides that the insurer “will pay compensatory damages * * * which are due by law- to [an insured] from the owner or driver of any uninsured motor vehicle because of bodily injury suffered by [an insured].” In this context, the phrase merely means that the insurer will pay the insured for UM or UIM benefits in accordance with the law, ie., what is owed or payable to the insured for bodily injuries caused by the owner or operator of an uninsured or underinsured motor vehicle; it means no more. The phrase at issue has nothing to do with issues of contract formation, place of contract situs, or choice of law.
I fail to follow the majority’s rationale that the phrase somehow relates to the law governing contract formation. Although the Nationwide policy designated that the time period in the state where the accident occurred will determine when the insured must file a claim for UM/UIM benefits under his or her own policy, the majority also stretches that provision to conclude that the insured’s contract rights under the insurance policy are also determined by the law of the state where the accident occurred. The fact that the policy does not define or identify the substantive law of a particular state as being applicable does not render the phrase ambiguous, particularly when nothing in the phrase implies any relation to the law of contract formation.
I agree with the court of appeals that the law of the state of Ohio applies. An insurance policy is a contract between the insurer and the insured. Ohio Farmers Ins. Co. v. Cochran (1922), 104 Ohio St. 427, 135 N.E. 537, paragraph one of the syllabus. In addition, Ohio has long recognized that a dispute between an insurer and an insured over UM/UIM coverage is an issue sounding in contract, not tort. Landis v. Grange Mut. Ins. Co. (1998), 82 Ohio St.3d 339, 341, 695 N.E.2d 1140, 1141 (“We conclude that [the insured’s] UMI [sic, UIM] claim is a contract claim, while acknowledging that there would be no UMI [sic] claim absent tortious conduct.”); Ross v. Farmers Ins. Group of Cos. (1998), 82 Ohio St.3d 281, 695 N.E.2d 732, at syllabus (“[Statutory law in effect at time of entering into contract for automobile liability insurance controls the rights and duties of the contracting parties.”); Miller v. Progressive Cas. Ins. Co. (1994), 69 Ohio St.3d 619, 624, 635 N.E.2d 317, 321 (“We recognize that an action by an *22insured against an insurance carrier for payment of uninsured or underinsured motorist benefits is a cause of action sounding in contract.”); Kraly v. Vannewkirk (1994), 69 Ohio St.3d 627, 632, 635 N.E.2d 323, 327 (“ ‘legal basis for recovery-under the uninsured motorist coverage of an insurance policy is contract’ ”); Kurent v. Farmers Ins. of Columbus, Inc. (1991), 62 Ohio St.3d 242, 243, 581 N.E.2d 533, 535 (“The basis of Farmers’ obligation to the Kurents lies in the insurance contract * * *.”); Motorists Mut. Ins. Co. v. Tomanski (1971), 27 Ohio St.2d 222, 223, 56 O.O.2d 133, 134, 271 N.E.2d 924, 925 (“The right to recover under an uninsured motorist insurance policy is on the contract, not in tort.”).
In Ohio, it is well settled that the law of the state where a contract is made governs the interpretation of the contract. Nationwide Mut. Ins. Co. v. Ferrin (1986), 21 Ohio St.3d 43, 44, 21 OBR 328, 329, 487 N.E.2d 568, 569. Applying a choice-of-law analysis to this insurance contract, it is clear that Ohio law applies. The insurance contract was made in Ohio. The insured vehicle was garaged in Ohio. The insureds are Ohio residents dealing with Ohio insurance agents.
The majority refutes the choice-of-law analysis. Although it admits that such analysis “might be appropriate in regard to an ordinary contract,” the majority distinguishes, without any legal basis, an insurance contract as a “special breed” of contract. Even if this “special breed” exists, why would it be excepted from a choice-of-law analysis? Construing a contract in favor of an insured should not require us to abandon long-standing and sound contract principles.
The majority finds ambiguity where none exists. As a result of this illogical result, I believe questions of UM7UIM coverage for out-of-state accidents will now be routinely forced into litigation. An insured seeking UM/UIM coverage due to an accident that occurred in another state will now argue ambiguity if the policy uses the phrase “due by law,” in order to recover benefits under the state having the laws most favorable to his or her recovery. Is the majority encouraging courts to abandon a choice-of-law analysis in favor of an application of the state’s law that is most favorable to the insured?
Because I would apply the principles of contract law to this insurance contract, I would affirm the judgment of the court of appeals and remand this cause to the trial court to apply Ohio law with respect to the issues of entitlement to set off payments and application of “per person” limits of coverage.
Moyer, C.J., and Cook, J., concur in the foregoing dissenting opinion.