Nationwide Mutual Insurance v. Hill

JUSTICE COMPTON, with whom JUSTICE WHITING and JUSTICE HASSELL join,

dissenting in part.

In deciding the State Farm case, the majority has misinterpreted the applicable statute, misread the pertinent case law, and misconstrued the relevant provisions of State Farm’s insurance policy.

Mary Ann Forsyth was operating a Buick automobile owned by Paul J. Stafford, in which Rebecca Henley was a passenger. Stafford’s vehicle collided with a vehicle operated by Martin W. Jones, an uninsured motorist. Forsyth died as a result of the accident. Henley was seriously injured in the collision and later died from tho:>e injuries.

The Buick was covered by an automobile liability policy issued by Nationwide to Stafford as the named insured. At the time of the accident, Forsyth was the granddaughter of Wesley M. Forsyth and living in his household. State Farm had issued an automobile liability policy to Wesley M. Forsyth as the named insured covering a Comet automobile. Henley, the passenger, was neither a relative of, nor a resident of, the same household as Wesley M. Forsyth and, of course, the Comet •was in no way involved in the accident.

*87After the judgment was obtained in behalf of Henley against both the estate of Mary Ann Forsyth and the uninsured motorist, State Farm paid its bodily injury liability limits on account of the judgment against Forsyth’s estate. This payment was made because Forsyth’s status at the time of the accident was that of a permissive user of a non-owned automobile (Stafford’s Buick) as defined in the “Part I-Liability” portion of State Farm’s policy.

Henley’s administrator contends that because Mary Ann Forsyth, the Buick’s operator, was a State Farm insured at the time of the accident, Rebecca H. Henley, solely by reason of her occupancy of the Buick, was also a State Farm insured, and thereby entitled to an additional payment under the uninsured motorist provisions of State Farm’s policy. To permit such payment involves an unwarranted leap of logic that converts State Farm’s uninsured motorist coverage to accident insurance, a result never intended by the uninsured motorist statute, Code § 38.2-2206, never authorized by the case law, Nationwide Mut. Ins. Co. v. Harleysville Mut. Casualty Co., 203 Va. 600, 603, 125 S.E.2d 840, 843 (1962), and never contemplated by State Farm’s contract with its named insured.

The General Assembly, in enacting the uninsured motorist statute, “intended to create two classes of insured persons, with different benefits accruing to each class.” Insurance Co. of N. Am. v. Perry, 204 Va. 833, 836, 134 S.E.2d 418, 420 (1964). “The first class includes the named insured and, while resident of the same household, the spouse of any such named insured, and relatives of either.” Id. The second class is composed of any other person who is “occupying” an insured motor vehicle. Cunningham v. Insurance Co. of N. Am., 213 Va. 72, 77, 189 S.E.2d 832, 835 (1972). These two classes are set forth in State Farm’s uninsured motorist coverage in this case under “Uninsured Motorists Insurance (Virginia)...II. Persons Insured.”

Rebecca H. Henley, as I have said, was not a resident relative of Wesley M. Forsyth’s household. Thus, she does not become an insured under the State Farm uninsured motorist coverage as a member of the first class; the only potential avenue for coverage for Henley would be through coverage as a member of the second class.

The majority contends that Forsyth’s operation of the Nationwide insured vehicle as a permissive user entitled her to liability coverage under Wesley M. Forsyth’s State Farm policy, and therefore made the vehicle operated by Forsyth an insured motor vehicle under the State Farm policy, and made Henley, as an occupant of the vehicle, a person insured under State Farm’s uninsured motorist coverage. That contention was specifically rejected in Bayer v. Travelers Indem. Co., 221 Va. 5, 267 S.E.2d 91 (1980).

*88In Bayer, we construed policy language identical to that appearing in State Farm’s policy. There, a claimant was a passenger in his own uninsured automobile during a collision with another uninsured vehicle. The claimant sought to recover under the uninsured endorsement of a liability policy written on other vehicles owned by the person driving the claimant’s vehicle at the time of the accident. There, as here, the claimant sought to use the basic liability coverage protecting his driver individually during the operation of a non-owned automobile as a means of cloaking the claimant’s vehicle with uninsured motorist coverage.

Affirming the trial court, we said in Bayer that the only coverage applying to the claimant’s vehicle was that afforded the operator in the event he was legally liable for damages while driving the automobile and that the liability coverages did not extend to the uninsured motorist coverage. Consequently, we held, the claimant “was not an ‘Insured’ and his motor vehicle was not an ‘Insured automobile’ within the meaning of the uninsured motorist endorsement.” Id. at 8-9,267 S.E.2d at 92-93.

Thus, in the present case, under Bayer, the Buick operated by Forsyth was not an insured motor vehicle under State Farm’s uninsured motorist endorsement. Henley, as neither a resident relative of Wesley M. Forsyth’s household nor an occupant of an insured motor vehicle as intended in the State Farm uninsured motorist endorsement, was not a person insured under State Farm’s policy. Hence, her administrator is not entitled to recover under State Farm’s uninsured motorist endorsement.

Consequently, I would reverse the judgment of the trial court in the State Farm case and enter final judgment in favor of that insurer.