Opinion
No. 72-056
Decided December 19, 1972. Rehearing denied January 9, 1973. Certiorari granted March 5, 1973.
Declaratory judgment action to determine whether uninsured motorist provisions of automobile liability policy extended coverage to plaintiff's insured where that insured had sustained injuries in accident with a tortfeasor whose insurer had subsequently become insolvent. From finding that coverage did not extend to defendant under such circumstances, defendant appealed.
Affirmed
1. INSURANCE — Uninsured Motorist Provision — Clear and Unambiguous Terms — — Not Extend Coverage — Tortfeasor's Insurer — Became Insolvent — Subsequent to Accident. Although, following accident, tortfeasor's insurer became insolvent prior to paying defendant damages for injuries she sustained in the accident, there was liability coverage applicable to tortfeasor's automobile at the time of the accident; and thus, by the clear and unambiguous terms of the uninsured motorist provisions of defendant's policy with plaintiff, defendant is not entitled to uninsured motorist coverage under that policy.
2. Legislative Policy — Favoring Insurance Protection — Uninsured Motorist Accidents — Only Considered — Determine Parties' Intent — Terms of Policy — Ambiguous. Although the legislature has enunciated a policy favoring insurance protection for persons sustaining damages as result of accidents involving uninsured motorists, where the terms of insurance policy are clear and unambiguous in precluding uninsured motorist coverage under certain circumstances, these terms cannot be altered by the courts; and it is only when the contract is ambiguous that the policy of the state may be applied to aid in determining the intent of the parties as to the meaning of the contract.
Appeal from the District Court of Arapahoe County, Honorable Marvin W. Foote, Judge.
Wolvington, Dosh, DeMoulin, Anderson and Campbell, Laird Campbell, for plaintiff-appellee.
Brenman, Sobol Baum, Stephen N. Berkowitz, for defendant-appellant.
Defendant-appellant Mrs. Elaine M. Morgan was involved in an automobile accident with one George Solorio on March 19, 1970. At the time of the accident, Solorio held a liability insurance policy with Trans Plains Insurance Company. Mrs. Morgan brought suit against Solorio and obtained judgment; however, in early 1971, Trans Plains became insolvent and was placed in receivership. Thereafter, Mrs. Morgan demanded that her insurance carrier, plaintiff-appellee, Farmers Insurance Exchange (Farmers) provide compensation under the uninsured motorist provision of her policy. Farmers refused and filed suit for declaratory judgment against Mrs. Morgan. After a hearing, the trial court concluded that the terms of the policy were unambiguous, and that, since Solorio had a liability insurance policy in effect at the time of the accident, Mrs. Morgan was not entitled to uninsured motorist coverage under her policy with Farmers. Judgment was entered accordingly, and Mrs. Morgan appeals. We affirm.
Mrs. Morgan contends that the trial court erred in holding, as a matter of law, that the terms of her Farmers policy were so clear and unambiguous as to preclude uninsured motorist coverage. She further contends that the decision of the trial court is in conflict with the public policy of the state as set forth in 1965 Perm. Supp., C.R.S. 1963, 72-12-20.
The insurance contract entered into between Farmers and Mrs. Morgan contained the following definition of an uninsured motor vehicle:
"Uninsured Motor Vehicle means a land motor vehicle or trailer with respect to the ownership, maintenance or use of which there is . . . no bodily injury liability insurance or bond applicable at the time of the accident . . . ." (Emphasis supplied.)
In interpreting the effect and meaning to be given the terms of an insurance policy, we are guided, in the first instance, by the principle announced in Standard Marine Insurance Co. v. Peck, 140 Colo. 56, 342 P.2d 661:
"Where the provisions of a policy are couched in plain and unambiguous language and do not contravene some principle of public policy, we have no right to relieve one of the parties to the contract from its disadvantageous terms by a forced construction or interpretation of its provisions. It must be given the meaning which a person of ordinary intelligence would attach to them."
Accord, Massachusetts Mutual Life Insurance Co. v. DeSalvo, 174 Colo. 115, 482 P.2d 380.
[1] The uninsured motorist provision of Mrs. Morgan's insurance policy is plain and unambiguous. By its terms coverage is provided against all motor vehicles being operated without either insurance or bond at the time of the accident. It clearly limits Farmers liability to those instances in which there is no insurance applicable at the time of the accident. Here it is uncontested that on March 19, 1970, George Solorio held a policy of bodily injury insurance which, at that time, was in full force and effect. The language of the Farmers policy admits of only one meaning. Therefore we must restrict ourselves to the plain language of the policy and reject the construction for which appellant contends. Since liability coverage was applicable to Solorio's automobile at the time the accident occurred, under the terms of her policy with Farmers, appellant is not entitled to uninsured motorist coverage. Dreher v. Aetna Casualty Surety Co., 83 Ill. App. 2d 141, 226 N.E.2d 287. See Annot., 26 A.L.R.3d 883.
1965 Perm. Supp., C.R.S. 1963, 72-12-20, declares that it is the policy of the state to "encourage all motorists to provide for their financial responsibility for the protection of others" and to make available insurance protection against financial loss caused by negligent financially irresponsible motorists. To this end 1965 Perm. Supp., C.R.S. 1963, 72-12-19, provides that all automobile liability policies providing bodily injury and death coverage shall contain protection of persons who are "legally entitled to recover damages from owners . . . of uninsured motor vehicles because of bodily injury . . . ." unless such coverage is rejected by the insured.
The terms "uninsured motorist" and "uninsured motor vehicle" are not defined by the statute. The statute does not require that coverage be extended, as do the statutes of some states, to cover the situations where the third party's insurance company denies coverage or, as here, becomes insolvent before payment of the liability. 1965 Perm. Supp., C.R.S. 1963, 72-12-19, requires that the provisions of the policy be approved by the insurance commissioner. Farmers policy was so approved.
[2] Where, as here, the terms of the policy are clear and unambiguous, those terms cannot be altered by the courts. Standard Marine Insurance Co. v. Peck, supra. It is only when the contract is ambiguous that the policy of the state can be applied to aid in determining the intent of the parties as to the meaning of the contract. If further implementation of the state policy is needed, that is the prerogative of the legislature, not the courts.
Judgment affirmed.
JUDGE ENOCH concurs.
JUDGE COYTE dissents.