Opinion
No. CV 075006581 S
December 30, 2008
MEMORANDUM OF DECISION RE MOTION FOR SUMMARY JUDGMENT AND DECLARATORY JUDGMENT
This memorandum of decision resolves the issues raised by the parties in the two above-listed cases as to the limits of uninsured/underinsured motorist coverage maintained by the City of Bridgeport ("City") in its role as a self-insured municipality, as of the date of a motor vehicle accident, which occurred on February 2, 2004. In Docket No. CV07 5006581, the City has filed a motion for summary judgment claiming that the City maintained coverage in the statutory minimum amounts of $20,000/$40,000. It claims that the plaintiff has already recovered the sum of $20,000 from the tortfeasor and the sum of $30,000 from the plaintiff's own uninsured/underinsured motorist coverage for a total recovery, to date, in the amount of $50,000. As the sum of $50,000 exceeds the City's claimed coverage limits of $20,000/$40,000, the City seeks summary judgment as to the plaintiff's claim for additional underinsured motorist coverage.
The plaintiff Garcia, has objected to the motion for summary judgment, arguing that summary judgment is an improper pleading to have the court determine insurance policy coverage. In a separate action, the plaintiff seeks a declaratory judgment as to the uninsured/underinsured motorist coverage provided by the City as a self-insurer.
Sec. 17-54. Declaratory Judgment; Scope
The judicial authority will, in cases not herein excepted, render declaratory judgments as to the existence or nonexistence (1) of any right, power, privilege or immunity; or (2) of any fact upon which the existence or nonexistence of such right, power, privilege or immunity does or may depend, whether such right, power, privilege or immunity now exists or will arise in the future
Sec. 17-55. Conditions for Declaratory Judgment
A declaratory judgment action may be maintained if all of the following conditions have been met:
(1) The party seeking the declaratory judgment has an interest, legal or equitable, by reason of danger of loss or of uncertainty as to the party's rights or other jural relations;
(2) There is an actual bona fide and substantial question or issue in dispute or substantial uncertainty of legal relations which requires settlement between the parties; and
(3) In the event that there is another form of proceeding that can provide the party seeking the declaratory judgment immediate redress, the court is of the opinion that such party should be allowed to proceed with the claim for declaratory judgment despite the existence of such alternate procedure.
The issue of the monetary limits of the City's motor vehicle self-insurance has been addressed in a recent memorandum of decision by this court denying a similar motion for summary judgment filed by the City in Meszaros v. Philips, Superior Court, judicial district of Fairfield at Bridgeport, Docket No. CV03 0408010S (December 29, 2008, Arnold, J.) However, in denying the City's motion for summary judgment in Meszaros, the court was not asked to issue a declaratory judgment resolving additional coverage questions such as any permitted reductions for proceeds received by the plaintiff from the tortfeasor and his own insurance coverage. The court will therefore resolve the coverage questions applicable to these matters, bearing in mind that the court has already determined that since 1982, the City has maintained uninsured/underinsured motorist coverage in the amounts of $20,000/$40,000 in its role as a municipal self-insurer.
I Legal Standards
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, 757 A.2d 1059 (2000). The party seeking summary judgment has the burden of showing the absence of any genuine issue of material fact, such that the movant is entitled, under principles of substantive law, to a judgment as a matter of law. Id. In ruling on a motion for summary judgment, the court's function is not to decide the issues of material fact, but rather to determine whether any such issues exist. Nolan v. Borkowski, 206 Conn. 495, 500, 538 A.2d 1031 (1988). Summary judgment is appropriate only if a fair and reasonable person could conclude only one way, based on the substantive law and the undisputed material facts. Miller v. United Technologies Corp., 233 Conn. 732, 751, 660 A.2d 810 (1995).
"Our statutes enable judges of the Superior Court to implement a declaratory judgment procedure. General Statutes § 52-29. The purpose of a declaratory judgment action is to secure an adjudication of rights where there is a substantial question in dispute or a substantial uncertainty of legal relations between the parties." (Citations omitted.) Connecticut Association of Healthcare Facilities, Inc. v. Worrell, 199 Conn. 609, 613, 508 A.2d 743 (1986). "There is no question that a declaratory judgment action is a suitable vehicle to test the rights and liabilities under an insurance policy." (Citation omitted.) St. Paul Fire Marine Insurance Company v. Shernow, 22 Conn.App. 377, 380, 577 A.2d 1093 (1990). "The court may address the merits of a declaratory judgment action upon a motion for summary judgment." (Internal quotation marks and citations omitted.) Giglio v. American Economy Insurance Company, Superior Court, Judicial District of New Haven at Meriden, Docket No. CV02-0282069 (Apr. 26, 2005, Arnold, J.).
Sec. 52-29. Superior Court may declare rights and legal relations.
(a) The Superior Court in any action or proceeding may declare rights and other legal relations on request for such a declaration, whether or not further relief is or could be claimed. The declaration shall have the force of a final judgment.
(b) The judges of the Superior Court may make such orders and rules as they may deem necessary or advisable to carry into effect the provisions of this section.
II Discussion
This matter arises from a motor vehicle accident between Carlos Garcia and Stanley Chance that occurred on February 2, 2004. At the time of the accident Garcia was in the course of his employment with the City of Bridgeport and was operating a vehicle owned by the City. Garcia filed a claim against Chance and received $20,000 representing the entire liability limits from Chance's insurance. Garcia also filed a claim against his own insurer, with whom he maintained a $50,000 uninsured/underinsured motorist policy. On November 16, 2006, Garcia received an additional $30,000 payment from his insurer representing a $20,000 offset for the monies he received from Chance, the tortfeasor. Garcia then filed the present matter against the City (Docket No. CV07 5006581 S), which is a claim for uninsured/underinsured payments from the City's self-insurance. The plaintiff claims that the City's uninsured/underinsured motorist coverage was unlimited at the time of the accident, and the City had not filed any documentation with the Insurance Commissioner regarding reductions or limitations on its coverage.
The City argues that since 1982, its written filings with the Department of Motor Vehicles establishes that the City has disclosed that the statutory minimum coverage of $20,000/$40,000 are being provided by "self-insurance." In support of its position the City has provided exhibits and an affidavit by the City Attorney, Mark T. Anastasi. These materials reveal that the City filed an "Application for Self-Insurance Permit" dated August 12, 1982. The application stated that the City was maintaining uninsured/underinsurance coverage in the amount of $20,000/$40,000, and that no "Excess Insurance" was being provided to the City by any insurance company authorized to do business in Connecticut. The State Insurance Commissioner on August 19, 1982 informed the City that its application to self-insure was approved. On February 13, 1990, the Insurance Commissioner sent a letter to the City stating that the Insurance Commissioner assumed the City was still self-insured, to which the City, on April 20, 1990 responded that it was still self-insuring its motor vehicles. The City argues that it is clear from this documentation that it maintained uninsured/underinsured motorist coverage of $20,000/$40,000 through its self-insurance declarations filed with the Insurance Commissioner since 1982. As a result, the City argues that the plaintiff, having recovered an amount of $50,000 from the tortfeasor and his own insurance company, cannot maintain a claim against the City pursuant to its statutory minimum $20,000 uninsured motorist coverage.
Sec. 14-112. Proof of financial responsibility reads in relevant part:
(a) When commissioner shall require. To entitle any person to receive or retain a motor vehicle operator's license or a certificate of registration of any motor vehicle when, in the opinion of the commissioner, such person has a record on file with the commissioner which is sufficient, in the opinion of the commissioner, to require evidence of financial responsibility for the reasonable protection of other persons, the commissioner shall require from such person proof of financial responsibility to satisfy any claim for damages by reason of personal injury to, or the death of, any one person, of twenty thousand dollars, or by reason of personal injury to, or the death of, more than one person on account of any accident, of at least forty thousand dollars, and for damage to property of at least ten thousand dollars . . .
Public Act 82-145, effective October 1, 1982, exempted municipalities from filing a yearly self-insurance certificate.
The court agrees after reviewing the documentation submitted by the City, that the City has sufficiently shown that it has maintained uninsured motorist coverage in the amount of $20,000/$40,000 since 1982. See Piersa v. Phoenix Ins. Co., 273 Conn. 519, 526, 871 A.2d 992 (2005).
However, while the court finds that the minimum applicable limits specified in General Statutes § 14-112 are $20,000 per person and $40,000 per accident, and the City's notice to the commissioner regarding its application for self-insurance specified those minimum amounts, the court's inquiry does not stop here. The City's application for self-insurance, dated August 12, 1982 and its subsequent correspondence with the Insurance Commissioner, dated April 20, 1990, were both silent regarding whether that minimum coverage would be further reduced by the reductions in limits specifically permitted by section 38a-334-6 of the Regulations of Connecticut State Agencies, including the reduction in limits at issue in the present case. See Piersa v. Phoenix Ins. Co., supra, 273 Conn. 526.
Section 38a-334-6 of the Regulations of Connecticut State Agencies titled "Minimum provision for protection against uninsured motorists," reads in relevant parts as follows:
(a) Coverage. The insurer shall undertake to pay on behalf of the insured all sums which the insured shall be legally entitled to recover as damages from the owner or operator of an uninsured or underinsured motor vehicle because of bodily injury sustained by the insured caused by an accident involving the uninsured or underinsured motor vehicle. This coverage shall insure the occupants of every motor vehicle to which the bodily injury liability coverage applies. "Uninsured motor vehicle" includes a motor vehicle insured against liability by an insurer that is or becomes insolvent . . .
(c) Exclusions. The insurer's obligations to pay may be made inapplicable:
(1) To any claim which has been settled with the uninsured motorist without the consent of the insurer;
(2) if the uninsured or underinsured motor vehicle is owned by
(A) the named insured or any relative who is a resident of the same household or is furnished for the regular use of any of the foregoing,
(B) a self-insurer under any motor vehicle law, or
(C) any government or agency thereof;
(3) to pay or reimburse for workers' compensation or disability benefits.
(d) Limits of liability.
(1) The limit of the insurer's liability may not be less than the applicable limits for bodily injury liability specified in subsection (a) of section 14-112 of the General Statutes, except that the policy may provide for the reduction of limits to the extent that damages have been
(A) paid by or on behalf of any person responsible for the injury,
(B) paid or are payable under any workers' compensation law, or
(C) paid under the policy in settlement of a liability claim.
(2) The policy may also provide that any direct indemnity for medical expense paid or payable under the policy will reduce the damages which the insured may recover under this coverage.
(3) Any payment under these coverages shall reduce the company's obligation under the bodily injury liability coverage to the extent of the payment.
(4) This subsection shall not apply to underinsured motorist conversion coverage except that no payment under a policy providing underinsured motorist conversion coverage shall duplicate payment from any other source . . .
The City, has addressed this question by arguing that when it elected to provide coverage in the amount of $20,000/$40,000, it was entitled to also receive the benefit of all statutory deductions provided for § 38a-334-6 of the Regulations of Connecticut State Agencies. The City maintains that it was not also necessary for it to specify that this coverage for the minimum limits would also be subject to all permitted reductions in limits as set forth in § 38a-334-6 of the Regulations of Connecticut State Agencies. If this is the City's argument, this is the argument in Piersa v. Phoenix Ins. Co., supra, that was ultimately rejected by our Supreme Court. "There is nothing in either the language of the act or its purpose to suggest that it was designed to create a presumption that silence by a municipality in this filing regarding the scope of coverage would mean that the minimum coverage and all permitted reductions in limits were applicable as a matter of law." (Emphasis not in original.) Id., 535.
In Piersa, supra, the issue was whether a self-insured municipal employer may reduce the limits of its uninsured motorist coverage by the amount of workers' compensation benefits paid, without having created a writing effectuating such a reduction. Id., 521. The City claims that the reasoning in Piersa, is limited solely to reductions for workers' compensation payments. The court disagrees. The decision in Piersa, is not limited solely to workers' compensation benefits as the court's analysis is applicable to all the stated limits of liability and permitted reductions contained in § 38a-334-6(d)(1)(A)(B)(C) and § 38a-334-6(d)(2)(3)(4).
"We conclude that the language of the regulation must be interpreted so as to require a municipal self-insurer that wishes to impose permitted limits on its obligations as such to do so by a written document that appropriately provides for reduction of limits." Piersa v. Phoenix Ins. Co., 273 Conn. 527.
We emphasize that there is no particular form that a self-insured entity must use in order to take advantage of the permitted reductions in limits. The required written document may be part of its written notice to the commissioner of its election to be self-insured, pursuant to § 38a-371(c), as the defendant in the present case did with respect to its election of the minimum coverage of $20,000 per person and $40,000 per accident. Or, as our discussion of § 38a-371(c) in this opinion indicates, it may be as part of a written document that the self-insured entity maintains in its files.
Id., 531
Nor is it necessary for the document to repeat verbatim the language of the regulation that the defendant intends to adopt as limits on its coverage. As the plaintiff suggested at oral argument before this court, the defendant could adopt those limits by appropriate language indicating incorporation by reference. The purpose of the document is to require the self-insured entity to fulfill its obligation as insurer by providing a kind of rough equivalence to the obligation of a commercial insurer to limit its coverage by appropriate language in its policy of insurance. Any document that reasonably fulfills that purpose will suffice.Id.
"Therefore, self-insurers, like commercial insurers, are required to provide written documentation specifying the insurer's selected reductions in limits and the city's notification to the state insurance commissioner of its election to he self-insured and its selection of minimum coverage does not automatically constitute notice of all permitted reductions in limits." Pacileo v. City of West Haven, Superior Court, judicial district of Waterbury at Waterbury, No. CV02-0174638 S (Dec. 19, 2005, Moraghan, J.) 40 Conn. L. Rptr. 528.
Section 38a-334-6 of the Regulations of Connecticut State Agencies "is a provision that specifies the basic requirement of how an insurer — self or commercial — may limit its liability. It is neither untenable nor counterintuitive to require a self-insurer to file a written document to accomplish that purpose so as to achieve a rough equivalence to a commercial insurer." Piersa v. Phoenix Ins. Co., supra, 273 Conn. 531.
The City has not provided any documentation or proof that prior to the date of the plaintiff's alleged injuries on February 2, 2004, it sent a written document to the Insurance Commissioner setting forth the permitted reductions in limits allowed by § Section 38a-334-6 or that the City was incorporating the permitted reductions by reference. See Id. The correspondence with the Insurance Commissioner sets forth only that the City was electing to be a self-insurer with the minimum uninsured motorist coverage of $20,000/$40,000. Additionally, the City has not submitted any proof or documentation that a written document is maintained in its files that states the City intended to adopt the limits in its coverage that are permitted by § 38a-334-6. Id. Accordingly, the motion for summary judgment filed by the City, is hereby denied.
Regarding the plaintiff's action for a declaratory judgment the court finds that the City's self-insurance for uninsured/underinsured motorists is limited to $20,000/$40,000. Additionally, for the reasons set forth herein, the court finds that the City is not permitted to reduce those sums by the $50,000 previously received by the plaintiff from the tortfeasor and the plaintiff's own insurer. This declaratory judgment applies only to the rights between the plaintiff Carlos Garcia and the defendant City of Bridgeport, who are the only remaining parties to these two pending actions.