Ragsdale v. Armstrong

BENTON, Judge,

concurring in result.

Shelter Mutual Insurance Company appeals a judgment for damages under the uninsured motorist clauses in two of its insurance policies. After the Court of Appeals affirmed the trial court, this Court granted transfer. Mo. Const. Art. V § 10. The circuit court should be affirmed, but recognizing the realities of this case, I concur in the result of the per curiam.

I.

Plaintiffs John and Donna Ragsdale, husband and wife, are Missouri residents. Defendant Shelley Armstrong is a Louisiana resident. In November 1990, Armstrong and the Ragsdales had an auto accident in Missouri, due to Armstrong’s fault.

Armstrong’s liability insurance policy had limits of $10,000 per person and $20,000 per accident. Shelter issued two insurance policies to the Ragsdales for two different vehicles with uninsured motorist coverages of $100,000 per person and $50,000 per person, respectively.

The Ragsdales sued Armstrong for negligence, and Shelter for uninsured motorist coverage. Donna Ragsdale settled with Armstrong for $7,500, her total damages. John Ragsdale settled for the policy limits of $10,000, though his damages exceeded $150,-000. Finding Armstrong an uninsured motorist, the circuit court awarded John Rags-dale $140,000 — the summed policy limits ($100,000 + $50,000) less the settlement with Armstrong ($10,000).

II.

The starting point to determine Shelter’s liability is the insurance contract. See First National Insurance Company of America v. Clark, 899 S.W.2d 520, 521 (Mo. banc 1995). In its policy, Shelter agrees to pay damages for bodily injury that the Ragsdales are legally entitled to recover from the operator of an uninsured motor vehicle. The Ragdales’ insurance policy defines “uninsured motor vehicle ” as “a motor vehicle not insured by a bodily injury liability ... insurance policy” (bold type in original). The issue is whether Armstrong’s motor vehicle was insured by a “motor vehicle ... insurance policy.”

At first, it might appear that Armstrong had such a policy.1 Here, the insurance contract does not define “motor vehicle insurance policy.” When an insurance contract does not define a term, it must be interpreted in accordance with the law of this state. Ward v. Allstate Insurance Co., 514 S.W.2d 576, 578 (Mo. banc 1974):

*785It is well established in Missouri that ‘[E]xisting and valid statutory provisions enter into and form a part of all contracts of insurance to which they are pertinent and applicable as fully as if such provisions were written into them.’

Section B79.203 RSMo 19862 required that the contract between Shelter and the Rags-dales include uninsured motorist coverage. Four times, section 379.203 explicitly references chapter 303, the Motor Vehicle Financial Responsibility Law. Chapter 303 defines “motor vehicle liability policy” as a: “policy of liability insurance ... subject to limits ... as follows: twenty-five thousand dollars because of bodily injury to or death of one person in any one accident....” §§ 303.190.1, 303.190.2(2); cf. 303.190.7, 303.030.5.

Because Armstrong did not have such a policy, her vehicle was uninsured by the terms of the Ragsdales’ policy. Shelter contracted with the Ragsdales in Missouri, using words with a specific meaning under Missouri law. Shelter should be held to have intended the statutory meaning.

Shelter agrees that Armstrong is uninsured, in view of Cook v. Pedigo, 714 S.W.2d 949, 952[3] (Mo.App.1986). Shelter argues, however, that its liability is limited to $15,-000 — the difference between Armstrong’s coverage ($10,000) and the minimum required by Missouri law ($25,000). §§ 303.030.5, 379.203.1.

This Court has long recognized ireedom of contract in liability insurance. First Nat. Ins. Co., 899 S.W.2d at 521. A motorist purchases uninsured coverage above the statutory minimum so that, upon a proper claim, recovery will include the additional uninsured motorist coverage. Id. at 522. The General Assembly specifically anticipated the purchase of excess or additional coverage in § 303.190.7. In this case, the Ragsdales are entitled to all the coverage they purchased, which distinguishes the case of Halpin v. American Family Mutual Insurance Company, 823 S.W.2d 479, 482-83 (Mo. banc 1992), where an exclusion prohibited all relevant coverage, but the statute required minimum coverage.

Shelter argues that Cook v. Pedigo, 714 S.W.2d 949, 952[4] (Mo.App.1986), limits the amount of John Ragsdale’s recovery to “the difference between the tortfeasor’s liability insurance and the minimum liability requirements.” Cook, however, analyzes neither the terns of the policy, nor section 303.190. On this point, Cook should no longer be followed.

III.

Shelter also asserts that the trial court erred in stacking the Ragsdale’s two policies. Missouri requires the stacking of uninsured motorist coverages where the insured has multiple policies. First Nat. Ins. Co., 899 S.W.2d at 522; Cameron Mutual Insurance Co. v. Madden, 533 S.W.2d 538, 544-45 (Mo. banc 1976); Krombach v. Mayflower Insurance Co., 827 S.W.2d 208, 212 (Mo. banc 1992). The Ragsdales’ policies must be stacked.

IV.

The judgment of the circuit court should be affirmed.

. In other states, "no case has been found denying recovery under an uninsured motorist policy when the tortfeasor carried some liability insur-anee, but with limits less than the statutory mini-mum_” 24 ALR4th at 19 n. 10, 22 n. 11, 26 n. 18.

. Unless otherwise indicated, all statutory references are to RSMo 1986.