Snyder v. American Family Insurance

Lanzinger, J.,

dissenting.

{¶ 35} Snyder’s policy states that “[American Family] will pay compensatory damages for bodily injury which an insured person is legally entitled to recover from the owner or operator of an uninsured motor vehicle.” (Emphasis added.) The effect of this policy language is to add a contractual condition precedent to uninsured or underinsured motorist (“UM7UIM”) coverage for the policyholder. R.C. 3937.18(D) states, “With respect to the uninsured motorist coverage, under-insured motorist coverage, or both uninsured and underinsured motorist coverages included in a policy of insurance, an insured shall be required to prove all elements of the insured’s claim that are necessary to recover from the owner or operator of the uninsured or underinsured motor vehicle.” (Emphasis added.) The majority opinion views R.C. 3937.18(D) as merely a “default provision” and holds that a policy may restrict UM/UIM coverage to amounts the insured is legally entitled to recover from a tortfeasor when the tortfeasor is “statutorily immune from liability.”

{¶ 36} This overbroad reading allows an insurer to contract around the definition of “uninsured motorist”; yet the established rule is that policy terms may not contradict statutory requirements. See Ross v. Farmers Ins. Group of Cos. (1998), 82 Ohio St.3d 281, 287-288, 695 N.E.2d 732.

R.C. Chapter 2744 Immunity

{¶ 37} In my view, American Family’s policy restriction may not be upheld against tortfeasors with diplomatic or sovereign immunity, since they are specifi*251eally defined as “uninsured motorists” within R.C. 3937.18(B). R.C. 3937.18(B) provides:

{¶ 38} u\A\n ‘uninsured motorist’ is the owner or operator of a motor vehicle if

{¶ 39} “ * * *

{¶ 40} “(4) The owner or operator has diplomatic immunity.

{¶ 41} “(5) The oumer or operator has immunity under Chapter 27kk. of the Revised Code.” (Emphasis added.)

{¶ 42} The General Assembly, through enactment of 2001 Am.Sub.S.B. No. 97, made clear that insurers were no longer obligated to offer UM/UIM coverage as part of a motor-vehicle liability policy. In addition, insurers who now choose to offer UM/UIM coverage within a policy are granted the freedom to limit or exclude UM/UIM coverage under “specified circumstances.” R.C. 3937.18(1) provides, “Any policy of insurance that includes uninsured motorist coverage, underinsured motorist coverage, or both uninsured and underinsured motorist coverages may include terms and conditions that preclude coverage for bodily injury or death suffered by an insured under specified circumstances * * Five nonexclusive examples of such circumstances follow: (1) while the insured is driving or a passenger in a vehicle with no UM coverage, (2) while the insured is driving or a passenger in a vehicle without permission, (3) when the tortfeasor is specifically excluded from liability coverage, (4) while specified persons are driving or occupying a vehicle other than one covered by the UM policy, or (5) when the person injured or killed is not an insured.

{¶ 43} I cannot agree with the majority view that this section provides “flexibility for uninsured- and underinsured-motorist policies to contain additional provisions modifying [the definition of ‘uninsured motorist’].” R.C. 3937.18(1) allows an insurer to “include terms and conditions that preclude coverage,” but says nothing about modifying statutory definitions. The definition at issue here is contained within R.C. 3937.18(B), which states, in full:

{¶ 44} “For purposes of any uninsured motorist coverage included in a policy of insurance, an ‘uninsured motorist’ is the owner or operator of a motor vehicle if any of the following conditions applies:

{¶45} “(1) There exists no bodily injury liability bond or insurance policy covering the owner’s or operator’s liability to the insured.

{¶ 46} “(2) The liability insurer denies coverage to the owner or operator, or is or becomes the subject of insolvency proceedings in any state.

{¶ 47} “(3) The identity of the owner or operator cannot be determined, but independent corroborative evidence exists to prove that the bodily injury, sick*252ness, disease, or death of the insured was proximately caused by the negligence or intentional actions of the unidentified operator of the motor vehicle. For purposes of division (B)(3) of this section, the testimony of any insured seeking recovery from the insurer shall not constitute independent corroborative evidence, unless the testimony is supported by additional evidence.

{¶ 48} “(4) The owner or operator has diplomatic immunity.

{¶ 49} “(5) The owner or operator has immunity under Chapter 27kk. of the Revised Code.

{¶ 50} “An “uninsured motorist” does not include the owner or operator of a motor vehicle that is self-insured within the meaning of the financial responsibility law of the state in which the motor vehicle is registered.” (Emphasis added.)

{¶ 51} For purposes of any UM7UIM insurance coverage then, an “uninsured motorist” is the “owner or operator” of a motor vehicle who is not covered by a bodily injury liability bond or similar insurance, or whose insurance company denies coverage or is insolvent, or who is a “hit-and-run driver,” or who is protected by diplomatic immunity or governmental immunity under R.C. Chapter 2744. Accordingly, Officer Castro was an uninsured motorist pursuant to R.C. 3937.18(B)(5).

{¶ 52} Applying the policy’s restriction against Officer Castro contradicts the statute. The majority recognizes this effect by stating, “Had the policy in this case not contained the ‘legally entitled to recover’ language, the police cmiser would have been an uninsured vehicle within the meaning of R.C. 3937.18(B)(5), and, absent another policy condition excluding coverage, Snyder would have been entitled to recover.” (Emphasis added.)

{¶ 53} By considering the term “legally entitled to recover” as a “specified circumstance” under R.C. 3937.18(1), the majority allows the insurance contract to invalidate the plain language of R.C. 3937.18(B)(5). Application of the term “legally entitled to recover” to exclude from UM coverage an owner or operator of a motor vehicle who has immunity under R.C. Chapter 2744 would vitiate R.C. 3937.18(B)(5)’s definition of “uninsured motorist,” a definition that is set forth for purposes of “any uninsured motorist coverage.”

{¶ 54} It is unnecessary to resurrect State Farm Mut. Auto. Ins. Co. v. Webb (1990), 54 Ohio St.3d 61, 562 N.E.2d 132, to delve into the meaning of the phrase “legally entitled to recover.” Owners and operators with governmental immunity under R.C. Chapter 2744 (R.C. 3937.18(B)(5)) and diplomatic immunity (under R.C. 3937.18(B)(4)) remain among those to be considered as “uninsured motorists” for purposes of UM/UIM coverage. Officer Castro and her employer both qualify as uninsured motorists by definition, since both are protected by R.C. Chapter 2744. Snyder should therefore be entitled to recover UM benefits under *253her own policy. I would hold that the policy term “legally entitled to recover” may not be applied to void the definition of an owner or operator who has immunity under R.C. Chapter 2744.

Lamkin, Van Eman, Trimble, Beals, & Dougherty, L.L.C., Timothy L. Van Ernán, and Keri N. Yaeger, for appellant. Frost, Maddox & Norman Co., L.P.A., and Mark S. Maddox, for appellee. Weston Hurd, L.L.P., Carol K. Metz, and John G. Farnan, urging affirmance for amicus curiae Ohio Association of Civil Trial Attorneys. Paul W. Flowers Co., L.P.A., and Paul W. Flowers, urging reversal for amicus curiae Ohio Academy of Trial Lawyers.

Fellow-Servant and Other Immunities

{¶ 55} With respect to R.C. 4123.741, the statute providing fellow-servant immunity when an injury is compensable under the workers’ compensation statutes, the analysis is not the same. If Officer Castro were merely a “fellow servant” and an employee of a nongovernmental employer, R.C. Chapter 2744 would not apply. Were Snyder to then sue Castro for an injury occurring in the course and scope of their employment, application of the policy term “legally entitled to recover” would not contradict the UM/UIM statutes because an owner or operator with fellow-servant immunity is not specifically defined as an “uninsured motorist” within R.C. 3937.18(B). In other words, the policy phrase “legally entitled to recover” would not contradict the General Assembly’s intent to grant tortfeasors with diplomatic or sovereign immunity the status of uninsured motorists for UM/UIM coverage.

{¶ 56} I therefore respectfully dissent and would reverse the judgment of the court of appeals.

Pfeifer, J., concurs in the foregoing opinion.