Opinion
No. FST CV 09 5012134 S
February 8, 2011
MEMORANDUM OF DECISION RE DEFENDANT'S MOTION FOR SUMMARY JUDGMENT (147.00)
I. Background
In this underinsured motorist case the plaintiffs have sued the defendant insurance company Nationwide for underinsured motorist benefits they claim are provided in Nationwide's policy issued to cover a motor vehicle driven by Johane Leon and occupied at the time of an accident by both plaintiffs. A vehicle driven by Elsa Cardona ran into the back of the Leon vehicle on December 11, 2007 allegedly injuring all four persons in the Leon vehicle, including a front passenger seat occupant, Mathurin. The parties agree that Cardona was the tortfeasor in the above accident. It is also agreed that Cardona was insured by a Liberty Mutual policy providing bodily injury liability coverage in the amount of $25,000.00 per person, and $50,000.00 per occurrence, and that Liberty Mutual made payments to Leon and Mathurin of $10,000.00 a piece and payments to the plaintiffs Casseus and Moreau of $15,000.00 a piece, thereby exhausting the Liberty Mutual policy.
The plaintiffs have claimed they are due underinsured motorist benefits from Nationwide's policy insuring the Leon vehicle, policy number 51-06 E 063205, which provides underinsured motorist coverage of $50,000.00 per person and $100,000.00 per occurrence. Nationwide has denied the plaintiffs' claims contending there is no coverage available to the plaintiffs because, pursuant to the language of its policy, the $50,000.00 per person coverage is reduced to zero by Liberty Mutual's payment of $50,000.00 on behalf of the tortfeasor Cardona.
The plaintiffs have sued Nationwide for breach of contract, violation of the implied covenant of good faith and fair dealing, for violations of the Connecticut Unfair Insurance Practices Act, General Statutes §§ 38a-815 et seq. (CUIPA) and the Connecticut Unfair Trade Practices Act, General Statutes §§ 42-110a et seq. (CUTPA). Nationwide has moved for summary judgment on the ground that there is no available coverage under its policy and therefore there is no breach of contract and hence, no bad faith, nor violation of any statute. The motion is opposed by the plaintiffs, and the parties have submitted thorough and well researched memoranda in support of their respective portions which the court has found helpful.
The plaintiffs' memoranda substantially exceeded the 35-page limit set by Practice Book § 4-6. Since the defendant did not object, the court has considered the over-length submission. The court's consideration should not be seen as a license to submit other over-length papers.
II. Scope of Review
Practice Book § 17-49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. "In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party." Appleton v. Board of Education, 254 Conn. 205, 209 (2000). Summary judgment "is appropriate only if a fair and reasonable person could conclude only one way." Miller v. United Technologies, Corp., 233 Conn. 495, 500 (1988).
"Although the party seeking summary judgment has the burden of showing the nonexistence of any material fact [question] . . . a party opposing summary judgment must substantiate its adverse claim by showing that there is a genuine issue of material fact together with the evidence disclosing the existence of such an issue. It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue." Maffucci v. Royal Park Ltd., Partnership, 243 Conn. 552, 554 (1998). "[T]he party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact." Appleton v. Board of Education, supra, 254 Conn. 209.
The interpretation of an insurance policy is based on the intent of the parties, that is the coverage the insured expected to receive coupled with the coverage the insurer expected to provide as expressed by the language of the entire policy. The words of the policy are given their natural and ordinary meaning, and any ambiguity is resolved in favor of the insured. Wentland v. American Equity Insurance Co., 267 Conn. 592, 600-01 (2004).
III. Discussion
Nationwide relies on language in its policy and certain caselaw. The policy language emphasized by Nationwide appears in the uninsured, underinsured motorist portion of the insurance contract:
The limits of this coverage [i.e. $50,000 per individual, $100,000 per occurrence] and/or any amounts payable under this coverage, whichever are less, will be reduced by:
(a) any amount paid by or for any liable parties.
Nationwide contends it is entitled to a reduction in available coverage equal to any amount paid on behalf of the tortfeasor Cardona. Since Liberty Mutual paid $50,000.00 to the four occupants of the Leon vehicle, Nationwide concludes the per person limit in its policy of $50,000.00 has been reduced to zero, and no insurance proceeds are available for either Casseus or Moreau. Nationwide never explains the logic or authority as to why Liberty Mutual's payments are applied to the per person limit rather than the per occurrence limit. Indeed, it seems logical to conclude that monies paid out exhausting Liberty Mutual's per occurrence coverage should be applied to reduce Nationwide's per occurrence coverage, and the Nationwide policy language which is not specific on this point should be construed in that fashion.
Having said that, the court will consider Nationwide's arguments. In support of its position, Nationwide cites to Jacaruso v. Lebski, Superior Court, judicial district of Fairfield, CV 044001636 (July 7, 2008, Arnold, J.) aff'd, 118 Conn.App. 216 (2009). This case involved a 2004 accident between a vehicle operated by Lebski and one operated by Jacaruso, the latter vehicle also carried Picone. Jacaruso and Picone sued Lebski in separate cases. The insurer of Lebski, GEICO, paid Jacaruso and Picone $50,000.00 a piece, exhausting the policy. Picone sued Jacaruso as a second defendant, and Nationwide paid $400,000.00 to Picone on Jacaruso's behalf to settle Picone's claim. Jacaruso then claimed underinsured benefits from the insurer Nationwide, and Nationwide declined the claim by contending that the $50,000.00 paid by GEICO to Jacaruso and the $400,000.00 to Picone on behalf of Jacaruso exhausted coverage under its policy. The policy language in Jacaruso is the same as in this case. The Superior Court held that Nationwide was entitled to a credit for all payments made on behalf of all tortfeasors and the $500,000.00 paid by GEICO and Nationwide effectively exhausted the $300,000.00 single limit Nationwide UIM policy. The decision was upheld by a 2-1 majority of the Appellate Court. The Appellate Court determined, correctly it seems, that since applicable Regulation of Connecticut State Agencies § 38a-334-6(d)(1)(C) allowed a reduction of limits for "payments under the policy in settlement of a liability claim" Nationwide was permitted to charge the $400,000.00 paid on behalf of Jacaruso against the limit on the underinsured portion of the policy. However, the Jacaruso case is not this case, and it does not support Nationwide's position. In this case neither plaintiff was charged with liability, and Nationwide made no payments based on claims of their actual or potential liability.
Nationwide also relies on Allstate Insurance Company v. Lenda, 34 Conn.App. 444 (1994). In that case the Allstate uninsured motorist policy stated that "[t]he limits of this coverage will be reduced by: (1) all amounts paid by the owner or operator of the uninsured auto, or anyone else responsible. This includes all sums paid under the bodily injury liability coverage of this or any other policy." In Lenda, the Appellate Court found this language to be exceptionally broad and included monies paid to others rather than to just Lenda. This court determines that Lenda is distinguishable because the Allstate policy involved was a single limit policy, unlike the split limits policy issued by Nationwide.
Be that as it may, it appears that the Appellate Court has carefully circumscribed the applicability of Lenda. In Loika v. Aetna Casualty Surety Co., 44 Conn.Sup. 59, 58-70 (1994), aff'd., 39 Conn.App. 714 (1995) cert. denied, 236 Conn. 902 (1996), a Superior Court (Judge Gaffney) said:
In short, unless the policy language is unambiguously to the contrary (e.g. Lenda), the relevant consideration is the total of the liability coverage available to the individual claimant, and not those amounts paid to other individuals which were unavailable to the claimant.
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Furthermore, § 38a-334-6(d)(1) of the regulations provides in pertinent part that the policy may provide for the reduction of limits to the extent that damages have been . . . paid by or on behalf of any person responsible for the injury . . . [Emphasis added by Judge Gaffney.] Quite clearly any reduction must be for an amount actually received by the claimant. [Emphasis by this court.]
The Appellate Court affirmed Judge Gaffney and adopted his memorandum of decision, see 39 Conn.App. 714 at 717.
This case presents the situation of the tortfeasor Cardona's GEICO policy having split liability limits ($25,000 per person, $50,000.00 per occurrence.) Therefore, the amount available to each of the plaintiffs under that policy was $25,000.00. In this case, the court agrees with the plaintiffs that the critical factor is what money (insurance proceeds or otherwise) was available to each of the plaintiffs from the underinsured tortfeasor. In Covenant Insurance Co. v. Coon, 220 Conn. 30, 34 (1991), the Connecticut Supreme Court said, referring to the tortfeasor's policy "the total of the per person limit is the amount of liability insurance available to the claimant . . ." For the plaintiffs Casseus and Moreau, the total amount available to each of them from Cardona's policy was $25,000 each. This amount is less than the per person coverage in Nationwide's underinsured motorist policy and considerably less than the per occurrence coverage.
In Coon the Connecticut Supreme Court held that a tortfeasor's vehicle was underinsured when the amount of insurance on that vehicle available to the victim of the accident was $25,000.00, and the underinsured motorist policy made $50,000.00 available to the victim. Id. 34. This concept of availability was reinforced more recently in Doyle v. Metropolitan Property Casualty Co., 252 Conn. 79 (1999), a case which actually held against a plaintiff suing his own insurance company, but which reiterated the holding in Coon that the critical issue to be resolved is what is the insurance coverage available to the plaintiff from the tortfeasor's policy and compare that amount to what is available from the plaintiff's own underinsured motorist benefit. Id., 86-87. See also Florestal v. Government Employees Insurance Co., 236 Conn. 299, 304 (1996) (underinsured motorist benefits are not recoverable unless the limits of the underinsured motorist coverage available to the claimant exceed the total amount of liability insurance available to satisfy claims against the tortfeasor.)
In this case the only amount available to Casseus and Moreau was $25,000.00 each based on the per person limit of Cardona's policy. In fact, they received less than the $25,000.00 per person. What was available and what was received are both less than the $50,000.00 per person limit under Leon's policy within Nationwide, and less than the policy's per occurrence limit. Therefore, the court is not persuaded by Nationwide's arguments and for that reason, as well as the reason stated earlier, the motion for summary judgment on the breach of contract count is denied.
III. Conclusion
Since Nationwide's motion seeking dismissal of all four counts of the complaint is based on its contention that its interpretation of its policy was proper, the motion in its entirety is denied.