PRESENT: Hassell, C.J., Lacy, Koontz, Kinser, Lemons and Agee,
JJ., and Stephenson, S.J.
RICHARD JOHNSON
OPINION BY
v. Record No. 031537 SENIOR JUSTICE ROSCOE B. STEPHENSON, JR.
June 10, 2004
WINDSOR INSURANCE COMPANY
FROM THE CIRCUIT COURT OF FAIRFAX COUNTY
Arthur B. Vieregg, Judge
In this appeal, the sole assignment of error states:
The trial court erred when it ruled that an insurer
under an automobile liability insurance policy was not
required to provide coverage for the named insured who
allegedly negligently entrusted the insured vehicle to
a permissive user after the insurer settled a part of
the claim against the permissive user where the
insurance policy failed to limit its liability
pursuant to [Code] § 38.2-2204.
The assignment of error presents for our consideration three
issues, framed as follows:
1. "Whether Virginia law requires coverage under an
automobile liability insurance policy for both a named insured
who negligently entrusts his automobile to a permissive user and
for the permissive user?"
2. "Whether the omnibus clause, [Code] § 38.2-2204, . . .
in effect at the time of the collision, requires an insurer to
provide coverage for each of two independent tortfeasors whose
separate negligent actions caused injury to another?"
3. "Whether the language of the Windsor policy which
provides for $300,000 coverage for 'each accident' can be
relieved of that obligation when it fails to meet the simple
strictures of the 1999 amendment to the omnibus clause?"
I
On July 12, 2000, Richard Johnson was a passenger in a
vehicle that was struck in the rear by an automobile operated by
Quang Huynh (Q. Huynh), and owned by his father, Thien Huynh
(T. Huynh). Johnson sustained serious, permanent injuries.
Windsor Insurance Company (Windsor) had issued a Virginia
automobile liability insurance policy to T. Huynh as the named
insured. Q. Huynh was also insured under the policy as a
resident of T. Huynh's household and also as a permissive user
of the automobile. The policy limits are $100,000 for each
person and $300,000 for each accident. The policy provides that
the liability insurance coverage afforded "applies separately to
each insured against whom claim is made or suit is brought, but
the inclusion herein of more than one insured shall not operate
to increase the limits of the company's liability." The policy
further provides that
[t]he limit of bodily injury liability stated . . . as
applicable to "each person" is the limit of the
company's liability for all damages . . . arising out
of bodily injury sustained by one person as the result
of any one occurrence; the limit of such liability
stated . . . as applicable to "each occurrence" is,
subject to the above provision respecting each person,
the total limit of the company's liability for all
such damages arising out of bodily injury sustained by
two or more persons as the result of any one
occurrence.
2
Johnson filed a motion for judgment against Q. Huynh and
T. Huynh, alleging a separate count of negligence against each.
Johnson alleged that T. Huynh had negligently entrusted his
automobile to Q. Huynh and that Q. Huynh had negligently
operated the vehicle.
Following commencement of the action, Johnson settled his
negligent-operation claim against Q. Huynh for $100,000, and
Windsor paid $100,000 to Johnson. Johnson, however, continued
to look to Windsor to provide further coverage in the amount of
$100,000 for his negligent-entrustment claim against T. Huynh.
Windsor denied further obligation and filed a motion for
declaratory judgment, seeking a declaration that the maximum of
its liability for the accident is $100,000, regardless of the
number of insureds who may be held liable for Johnson's
injuries. The trial court agreed with Windsor and granted
summary judgment in its favor. This appeal ensued.
II
Johnson contends that our 1997 decision in Haislip v.
Southern Heritage Insurance Co., 254 Va. 265, 492 S.E.2d 135
(1997), requires a reversal of the trial court's judgment.
Windsor, on the other hand, contends that a 1999 amendment to
Code § 38.2-2204 (the Omnibus Clause) allows an insurer "to
limit exposure exactly the way Windsor has limited exposure."
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In Haislip, we considered whether the Omnibus Clause
required a liability insurer "to provide full and separate
coverage to its named insured who was allegedly guilty of
negligent entrustment of a vehicle, even though the insurer had
already paid the insurance policy limits on behalf of a
permissive user who negligently operated the insured vehicle."
254 Va. at 266, 492 S.E.2d at 136. The proceedings and facts in
Haislip are analogous to those in the present case, except as to
the policies' limits.
In Haislip, an injured plaintiff brought an action to
recover damages resulting from an automobile accident. The
plaintiff alleged that the insured owner had negligently
entrusted her automobile to an uninsured permissive user who
negligently operated the vehicle. The owner's liability
insurance policy provided for $25,000 of coverage "per
occurrence." The insurer settled the plaintiff's claim against
the permissive user for $25,000, which the insurer believed was
the maximum amount of coverage available to the plaintiff under
the terms of the policy. The plaintiff also sought payment of
$25,000 from the insurer for the owner's negligent entrustment
of the vehicle. Id. at 267, 492 S.E.2d at 136.
Thereafter, the insurer filed a motion for declaratory
judgment, requesting that the trial court declare that the
maximum amount of coverage available to the plaintiff under the
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policy was $25,000, that the policy had been exhausted by reason
of the settlement paid on behalf of the permissive user, and
that the insurer had no duty to pay any amount related to the
plaintiff's claim against the owner. The trial court agreed and
entered a judgment declaring that the coverage available under
the policy had been exhausted by the settlement on behalf of the
permissive user. Id.
We reversed the trial court's judgment, holding that the
insurer could not deny coverage to the named insured who had
purchased the policy, even though the "per occurrence" limit had
already been paid on behalf of the permissive user. Id. at 269-
70, 492 S.E.2d at 138. We noted that the plain language in the
Omnibus Clause requires a liability insurance policy to contain
"'a provision insuring the named insured, and any other person
using . . . the motor vehicle.'" Id. at 269, 492 S.E.2d at 137.
The Omnibus Clause was amended in 1999, subsequent to our
decision in Haislip, and now reads, in pertinent part, as
follows:
No policy or contract of bodily injury or
property damage liability insurance, covering
liability arising from the ownership, maintenance, or
use of any motor vehicle . . . shall be issued . . .
in this Commonwealth to the owner of such vehicle
. . . , unless the policy contains a provision
insuring the named insured, and any other person using
or responsible for the use of the motor vehicle . . .
with the expressed or implied consent of the named
insured . . . ; however, nothing contained in this
section shall be deemed to prohibit an insurer from
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limiting its liability under any one policy for bodily
injury or property damage resulting from any one
accident or occurrence to the liability limits for
such coverage set forth in the policy for any such
accident or occurrence regardless of the number of
insureds under that policy.
Code § 38.2-2204(A) (emphasized language reflects amendment).
III
It is firmly established that, in determining the meaning
of a statute, we must consider the plain language that the
General Assembly used when the statute was enacted. Thus,
" '[w]here the legislature has used words of a plain and
definite import the courts cannot put upon them a construction
which amounts to holding the legislature did not mean what it
has actually expressed.' " Barr v. Town & Country Properties,
240 Va. 292, 295, 396 S.E.2d 672, 674 (1990) (quoting Watkins v.
Hall, 161 Va. 924, 930, 172 S.E. 445, 447 (1934)).
We are of opinion that the plain language of the 1999
amendment to the Omnibus Clause clearly enables an insurer to
limit its liability even if more than one insured is liable for
the accident or occurrence. However, such limit is that stated
as the "per accident or occurrence" limit, rather than the "per
person" limit. Thus, in the present case, Windsor's total
obligation under its policy is its "per accident" limit of
$300,000, and Windsor must provide further coverage for the
negligent-entrustment claim against its named insured. We hold,
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therefore, that the trial court erred in ruling that Windsor was
not required to provide coverage to T. Huynh after it settled
the claim against Q. Huynh.
IV
For the reasons stated, we will reverse the trial court's
judgment and remand the case for the entry of a judgment
consistent with the view expressed herein.
Reversed and remanded.
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