Opinion
No. 1998-CA-001810-MR.
Rendered: May 12, 2000. Rehearing Denied: July 28, 2000. Not For Publication June 7, 2001.
Appeal from Boone Circuit Court, Honorable Joseph Bamberger, Judge, Action NO. 97-CI-00487.
Eric C. Deters, Covington, Kentucky, brief for appellants.
Ashley Turner, Covington, Kentucky, oral argument for appellants.
Susanne M. Cetrulo, Edgewood, Kentucky, brief and oral argument for appellees.
Before BARBER, MCANULTY and COMBS, Judges.
OPINION
This is an opinion reversing and remanding the circuit court's decision limiting the recovery of the appellants to "per person" coverage for various damages resulting from the death of Robin Reed. Appellants are the husband and daughters of Robin Reed, who was killed in a two vehicle collision. Appellee John Daley's car struck the back of Robin Reed's Chevrolet Blazer, which burst into flames. James Reed sued for damages as the administrator of his wife's estate. The original complaint demanded damages for "Robin Reed's pain and suffering prior to her death, property damage, funeral, burial and other related expenses, and other compensatory damages not yet known." The requested damages were personal to Robin Reed, and to James Reed, as the administrator of her estate. Reed, as Administrator of the Estate of Robin Reed, settled the liability portion of the suit for $100,000.00, the per person limits of liability of Daley's Allstate Insurance policy.
Reed, as guardian of his daughters, filed an Amended Complaint, alleging that Daley was at fault for loss of parental consortium suffered by each of the minor children. The Allstate policy provided coverage of $300,000.00 per accident. Reed, on behalf of the minor children, demanded the remaining $200,000.00 as per-accident damages on behalf of his four daughters for the loss of consortium claims under KRS 411.135. The trial court held that the claims of both Reed, as Administrator, and as Guardian, for the loss of consortium claims for the minor children were limited to the per-person coverage of $100,000.00, which had already been paid.
The trial court cited Moore v. State Farm Mutual Insurance, Ky., 710 S.W.2d 225 (1986), in support of its ruling. This case holds that where the insurance policy defined compensable damages as "damages for care and loss of services", all damage claims resulting from injury to one person were subject to the per-person limits. Id., at 226. In Moore, the plaintiff's husband was severely injured in an auto accident, and recovered the "per person" insurance policy limits of coverage. His wife then filed a separate claim for loss of consortium. The court held that because the wife had not proven injury in excess of the tort limitations found in the Motor Vehicle Reparations Act (MVRA), KRS 304.39-060(2)(a), her claim fell within the "per person" policy limits of the insurance policy which had already been exhausted by her husband's claim. Id., at 226. The court stated that "[i]n order to recover under the "per accident" limit the insured's policy clearly states that two or more people must have sustained bodily injury. Movant's personal injuries did not exceed the no-fault threshold . . . and thus she is precluded from recovery under the `per accident' limit." Id.
The record in the present case establishes that no discovery has yet been taken as to the injuries suffered by the minor children as a result of Daley's wrongful act. Under such circumstances, entry of judgment in favor of Appellees was premature. The minor children allegedly suffered severe and permanent injury as a direct and proximate result of Daley's negligence and should be permitted the opportunity to document the claim.
Where the insurance policy does not contain language showing that loss of consortium of a loved one is recoverable under the "per person" bodily injury definition, a loss of consortium claim was held not subject to the per person liability limit, but was found to constitute a separate bodily injury to a separate individual. Giardino v. Fierke, 513 N.E.2d 1168 (Ill.App. 1987), allowing a loss of consortium claimant to recover under a "per accident" clause. See also Bilodeau v. Lumbermans Mutual Casualty Company, 467 N.E.2d 137 (Mass. 1984), holding that where the "per person" coverage has been exhausted, a loss of consortium claimant can recover under the "per accident" limitation of liability. Similarly, here the insurance policy does not include loss of consortium in its definition of bodily injury. Under such circumstances, the "per person" limitations of coverage are not applicable to the claims by the four daughters.
Reed asserts that under Giuliani v. Guiler, Ky., 951 S.W.2d 318 (1987) [1997], loss of parental consortium is an independent, separate cause of action. The Kentucky Supreme Court has so held, stating that a claim for loss of consortium is:
[I]ndependent and separate from a wrongful death action and shall not be treated as a single claim. Even though a wrongful death action and a loss of consortium claim may arise from the same injury, they belong to separate legal entities and consequently should not be treated as the single claim.
Id. at 322. The Guiliani Court stated that the economic loss and pain and suffering of the injured party are "entirely independent" from the claims of the children for loss of parental consortium. Id. The Court noted that recovery under a wrongful death claim is generally limited to economic loss, and explained that loss of consortium is a wholly separate action. Id.
Daley admits that the law does give the children an independent and separate right to make a loss of consortium claim, but asserts that the language of the insurance policy at issue here prevents any claim being made under the terms of the insurance policy for the childrens' loss of consortium. The position of Allstate is that the policy limits of $100,000.00 had already paid under the "each person" limits of liability.
"Each person" coverage is defined in the "Definitions" section of the policy as:
The maximum amount we will pay for damages arising out of bodily injury in any one motor vehicle accident, including damages sustained by anyone else as a result of that injury.
The per-person limitation of coverage under the applicable policy is $100,000.00. Appellee asserts that this section limits coverage to any claim by any individual however tangentially related to the injury to the decedent.
The "Each Accident" coverage is limited by the following exclusion:
The maximum we will pay for damages arising out of bodily injury to two or more persons in any motor vehicle accident. This limit is subject to the limit for each person.
In this case, the per-accident limitation was $300,000.00. Under this section, where two persons are injured by way of an automobile accident, each individual may only recover up to $100,000.00, the "per person" limits of coverage. "Bodily injury" is defined in the insurance policy as "bodily injury, sickness, disease or death sustained."
Under Kentucky law, the terms of an insurance policy are to be enforced as written, and the court can neither add nor subtract terms from the policy. Foster v. Kentucky Housing Corp., 850 F. Supp. 558 (E.D.Ky. 1994). An insurance policy is a contract of indemnity, under which the insurer agrees to indemnify the insured for any loss resulting from a specific event. The insurer expects losses, and writes its policy so as to best provide protection for both the insurer and the insured. Buck Run Baptist Church Inc. v. Cumberland Surety Insurance Company, Inc., Ky., 983 S.W.2d 501 (1998). Insurance policy terms are to be given their ordinary meanings, as persons with ordinary and usual understanding would construe them. Sutton v. Shelter Mutual Insurance Company, Ky.App., 971 S.W.2d 807 (1997).
In the present case, the term "damages" is not defined under the insurance policy at issue. Damages recoverable for the wrongful death of a person are defined by Kentucky statute and case law as compensation for the loss of decedent's earning power. See Adams v. Miller, Ky., 908 S.W.2d 112, 116 (1995), holding that damages properly recoverable in a wrongful death action are determined by "such sum as will fairly and reasonably compensate the decedent's estate for the destruction of the decedent's earning power". The Kentucky Supreme Court has emphasized that these damages "do not include the affliction which has overcome the family by reason of the wrongful death." Department of Education v. Blevins, 707 S.W.2d 782, 783 (1986) (emphasis in original). For this reason, a person with ordinary and usual understanding would find that only damages peculiar to the decedent, or resulting from loss of her earning power are properly sought under the "per person" policy limitation. Similarly, the term "per person" would be interpreted by a person with ordinary and usual understanding as applying to any one person, but not limiting the claims to be made by other individuals. Where Reed made separate claims on behalf of the four children who were also injured by reason of Daley's negligence, these claims properly fell under the "per accident" policy limitations.
Daley cites case law from other jurisdictions in support of his argument that the per person coverage limits payment under the policy to $100,000.00. In Auto Club Insurance Association v. Lanyon, et al, 369 N.W.2d 269 (Mich.App. 1985), the Michigan court held that a child's loss of consortium claim for injury to a parent fell within the "bodily injury" limit of coverage, and denied the plaintiff the right to claim compensation under the "per occurrence" policy provision. Similarly, in Federal Kemper v. Karlet, 428 S.E.2d 60 (W.Va. 1993), the court ruled that claimants requesting damages for loss of parental consortium were not to be treated as separate injured persons subject to separate "per person" limits under an automobile insurance policy. In that case, the West Virginia Supreme Court held that:
The claim for loss of consortium by an individual other than the one suffering bodily injury as a result of an automobile accident is generally recognized as arising out of the claim for damages of the bodily injured person. As a result, the claim of the bodily injured person and the claim for loss of consortium are covered within the same per person limit of liability provisions of the automobile insurance policy.
Id. at 61. The ruling in both these cases was based on a finding that a loss of consortium claim is a derivative action. Id. at 65. Kentucky law is clear in holding that loss of consortium claims in this Commonwealth are not derivative of the claims of the injured party. For this reason, the ruling adopted by the West Virginia court does not apply in this Commonwealth.
Reed states that under Kentucky law, loss of consortium is not a derivative action, but an independent, separate cause of action. Guiliani v. Guiler, supra. In Department of Education v. Blevins, supra, the Kentucky Supreme Court held that loss of consortium, and the damages suffered by the other injured party "belong to separate legal entities, must be separately asserted, and shall not be treated as a single claim." Id. at 785. The Blevins Court pointed out that the personal representative of a decedent may be authorized to bring a wrongful death suit, but has neither the right nor the authority to assert the separate claim for loss of consortium. Id. at 785.
The trial court ruled that the Supreme Court's ruling in Department of Education v. Blevins, supra, had no effect on the present case. The trial court stated that the only issue in the present case was whether the policy language denied recovery in excess of the "per person" limit, regardless of what damages were claimed. In Blevins, the court stated that KRS 411.135(2) permits recovery for damages peculiar to a parent or other person who suffered due to the loss of the decedent. These damages are "different in kind and character to the loss suffered by the person killed." Id. at 784. The Court held, in Guiliani v. Guler, supra, that:
Even though a wrongful death action and a loss of consortium claim may arise from the same injury, they belong to separate legal entities and consequently should not be treated as a single claim.
Id. at 322. Similarly, this Court finds that the claims of the minor children for the injury they suffered due to Daley's negligence are not the same claim as that made by the personal representative of decedent. Daley's wrongful action caused injury to five people, not just to Mrs. Reed, and the rights of the four children to recover for their injuries must not be limited by the insurer to the coverage available to Mrs. Reed alone. Therefore, this case is remanded to the Boone Circuit Court for proceedings consistent with this opinion.
ALL CONCUR.