Opinion
Civil Action 01-2788
November 20, 2002
Before the Court is a Motion for Partial Summary Judgment filed on behalf of the Defendant, State Farm Mutual Automobile Insurance Company, hereinafter "State Farm" and a Motion for Partial Summary Judgment filed on behalf of Defendant "GEICO." The Court, having considered the arguments of counsel, the evidence presented, the law and applicable jurisprudence, is fully advised in the premises and ready to rule.
ORDER AND REASONS
I. BACKGROUND:
The Plaintiff, Ronald D. Strickland, was involved in an automobile accident on November 27, 2000 in Bogalusa, Louisiana. The Plaintiff, a Mississippi resident, was driving a vehicle owned by his employer, Fred's Produce. The principal of Fred's Produce is Fred Hartfield, insured by State Farm. The Plaintiff alleges that he was struck by a vehicle, at an intersection, driven by the Defendant Onice Hill, a Louisiana resident insured by Allstate. The Plaintiff alleges that he sustained injuries and damages as a result of the accident. The Plaintiff sued Hill, Allstate as Hill's liability carrier, State Farm as uninsured/underinsured motorist ("UM") carrier on the work vehicle Plaintiff was driving, and GEICO as Plaintiffs own personal UM carrier based on insurance purchased by Ms. Desiree Boudreaux. The GEICO insurance covered both Ms. Boudreaux and the Plaintiff, Ronald Strickland. Allstate's liability limits are 10/40 and State Farm's UM limits are 25/50.
The State Farm policy covering Fred Hartfield's vehicle was issued in Mississippi to a Mississippi resident, Hartfield. Mississippi law permits policy provisions allowing the UM carrier to offset its UM coverage by the amount received
II. ARGUMENTS OF THE RESPECTIVE PARTIES:
State Farm's Motion for Partial Summary Judgment
The Defendant, State Farm, filed its Motion for Partial Summary Judgment so that Mississippi law would apply to the UM policies at issue. Application of Mississippi law would prevent the Plaintiff from stacking the insurance of another vehicle owned and insured by Fred Hartfield. Both the Plaintiff, Ronald D. Strickland, and the Co-Defendant, GEICO, agree that Mississippi law should apply to the UM policies in question. Furthermore, the Plaintiff agreed not to stack the insurance of the other vehicle, also provided by State Farm, not involved in the accident, owned by Fred Hartfield. The court hereby grants the Defendant's, State Farm, Motion for Partial Summary Judgment to the extent that Mississippi law is the applicable law and the Plaintiff may not stack insurance.State Farm also wanted the Court to determine that the Mississippi law of offset would apply to reduce the amount of State Farm's liability to $15,000 and that the offset provided by Allstate would be given to them. The Defendant, GEICO, filed a conjunctive Motion for Partial Summary Judgment whereby they sought to be entitled to the offset. The Court will now address the issue of offset.
State Farm's Motion for Partial Summary Judgment and GEICO's Motion for Partial Summary Judgment on the Issue of Offset
A. GEICO Solutions Argument in Support of Motion for Partial Summary Judgment:
The Defendant, GEICO, argues that the GEICO policy, like the State Farm policy, contains an "offset" provision which entitles its liability to the Plaintiff to be reduced by the $10,000 amount paid by Allstate. The law of offset was a judicial interpretation of Mississippi Statutory Law and the applicable statute is Mississippi Code of 1972 Article 83-11-101. The first case addressing the issue of offset was State Farm Mutual Automobile Insurance Company v. Kuchling, 475 So.2d 1159 (MS 1985). The Kuehling decision stated that the offset provision in the policy allows for the uninsured motorist ("UM") coverage to be offset by amounts paid by the tortfeasor's carrier. . . . Id. at 1163. In accordance with the Mississippi law as espoused in Kuehling and its progeny, GEICO is entitled to a $10,000 reduction for the amount Allstate, tortfeasor's insurer, has paid to the Plaintiff
B. State Farm's Opposition to GEICO's Motion for Partial Summary Judgment:
The Defendant State Farm argues that GEICO's Motion should be denied and State Farm should be declared entitled to the offset provided under Mississippi law because State Farm is the primary UM carrier. The longstanding rule in Mississippi is that the insurer for the owner of the vehicle involved in the accident is the primary insurer. United States Fidelity Guaranty Co. v. John Deere Insurance Company, et al., 2002 WL 1980402 (Miss. 2002). State Farm is the insurer of the truck driven by the Plaintiff at the time of the accident their UM coverage is therefore primary. As Plaintiffs personal UM carrier, GEICO is the secondary insurer and would only incur liability according to policy terms as provider of excess coverage. See Preferred Risk Ins. Co. v. Insurance Co. of North America, 824 F. Supp. 614, 619 (S.D. Miss. 1993).
While Mississippi law clearly allows a UM carrier to offset its UM coverage by the amount paid to the injured party under the tortfeasor's policy, the Court must make an " Eerie guess" to determine how the Mississippi court would decide who is entitled to the offset. The case of Dixie Insurance Company v. State Farm Mutual Automobile Insurance Company, 614 So.2d 918 (Miss. 1992) states that the primary insurer was entitled to offset first. In that case, the primary insurer was the insurer of the car involved in the accident. In the Union Savings American Insurance Company v. State Farm Mutual Automobile Insurance Company, Cause No. D-2402-2000-349, Second Judicial District for Harrison County, the trial court followed the Dixie decision and granted State Farm's, as primary insurer, motion for summary judgment declaring that the primary insurer was the only party entitled to the offset. The Court, therefore, should determine which policy is primary in order to determine who is entitled to the offset of the payment made by Allstate. State Farm should be entitled to the entirety of the offset as primary insurer because they insured the vehicle the Plaintiff was driving at the time of the accident. GEICO's Motion for Partial Summary Judgment should be denied.
Additionally, in USFG v. John Deere Insurance Company, the secondary insurer, GEICO here, is not required to share pro rata responsibility for the insured's injuries. Id. The secondary insurer's coverage is only triggered after the primary coverage pays. The secondary insurer, therefore, should not be allowed to take advantage of the offset on a pro rata basis. See Preferred Risk Ins. Co., supra.
C. Arguments of Ronald D. Strickland in Opposition to Motion for Partial Summary Judgment:
The Plaintiff argues that State Farm is the primary UM insurer and should be entitled to the full benefit of the offset of payments made to the Plaintiff by Allstate. State Farm's UM coverage is primary and, according to USFG v. John Deere Insurance Company, the primary coverage must be exhausted before the secondary coverage is triggered. As the primary insurer, State Farm should be entitled to the offset.
III. LAW AND ANALYSIS:
A. Law on Summary Judgment:
The Federal Rules of Civil Procedure provide that summary judgment should be granted only "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED. R. Civ. P. 56(c). The party moving for summary judgment bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the record which it believes demonstrate the absence of a genuine issue of material fact. Stults v. Conoco, Inc., 76 F.3d 651, 655-56 (5th Cir. 1996) (citing Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 912-13 (5th Cir.) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)), cert. denied, 506 U.S. 832 (1992)). When the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts. The nonmoving party must come forward with "specific facts showing that there is a genuine issue for trial." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (emphasis supplied); Tubacex, Inc. v. M/V RISAN, 45 F.3d 951, 954 (5th Cir. 1995).
Thus, where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no "genuine issue for trial." Matsushita Elec. Indus. Co., 475 U.S. at 588. Finally, the Court notes that substantive law determines the materiality of facts and only "facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
B. The Court's Analysis:
The Court, having examined Mississippi case law regarding the issue of offset, has determined that the Defendant State Farm is entitled to the offset provided by the tortfeasor's insurance, Allstate. The Mississippi law recognized the doctrine of offset in the Kuehling decision. The doctrine appears to be tailored based on the ranking of insurance companies. The Dixie decision and the more recent decisions out of Mississippi seem to point to the primary carrier as being the party entitled to the offset. Since the primary insurer is State Farm, they are entitled to the full benefit of the offset.
The Court, having considered the arguments of counsel, the evidence presented, the law and applicable jurisprudence, is fully advised of the premises and will hereby grant the Defendant State Farm's Motion for Partial Summary Judgment and deny the Defendant GEICO's Motion for Partial Summary Judgment.
Accordingly,
IT IS ORDERED that the Defendant State Farm's Motion for Partial Summary Judgment is hereby GRANTED. IT IS FURTHER ORDERED that Defendant GEICO's Motion for Partial Summary Judgment is hereby DENIED.