Opinion
Civil Action No. 99-3053, Section: "G"(2).
May 12, 2000.
MINUTE ENTRY
MEMORANDUM AND ORDER
This matter comes before the Court on Defendant's motion for partial summary judgment. Having considered the pleadings, depositions, answers to interrogatories, and admissions on file, the Court finds that, with respect to Plaintiff's claims for noneconomic loss and Defendant's claim to receive a credit for Plaintiff's receipt of workers' compensation benefits, no genuine issue of material fact remains and Defendant is entitled to judgment as a matter of law. Therefore, Defendant's motion for partial summary judgment is granted.
Background
On October 6, 2000, Plaintiff, Kin Leger, commenced this action against Defendant, State Farm Automobile Insurance Company ("State Farm"), seeking damages under the uninsured motorist coverage portion of an automobile insurance policy, Policy Number L11 8422 C23 18C, between State Farm and Plaintiff's employer, Diversified Oil Field Services, Inc. ("Diversified Oil") Plaintiff seeks damages for past, present and future mental anguish, physical pain and suffering, medical expenses and loss of wages arising from a November 2, 1998 automobile accident between a Diversified Oil 1997 Ford F150 that Plaintiff was riding in as a passenger and a vehicle driven by underinsured motorist, Marguerite Bruno. Plaintiff was acting within the course and scope of his employment with Diversified Oil at the time of the accident.
Motion
State Farm filed a motion for partial summary judgment, seeking the dismissal of Plaintiff's claims for non-economic losses, such as mental anguish and physical pain and suffering claims, and a credit for the amount of workers' compensation benefits paid to Plaintiff. State Farm claims that an authorized agent of Diversified Oil, co-owner Stanley Elmore, elected to limit the uninsured motorist coverage on the vehicle involved in the accident to economic loss only. State Farm further claims that it is entitled to a credit for the worker's compensation benefits received by Plaintiff as a result of the November 2, 1998 accident, pursuant to La. C.C. art. 1794.
In support of its motion, State Farm provides several relevant documents and a transcript of the deposition testimony of Michael Guth, one of the co-owner's of Diversified Oil. Mr. Guth avers that another co-owner of Diversified Oil, Stanley Elmore, had full authority to select the desired level of insurance coverage. State Farm also supplies a copy of an Uninsured/Underinsured Motorist Bodily Injury Coverage Form signed by "S.E. Elmore" on August 24, 1998 for policy number L11-8422-C23-18B, selecting economic-only uninsured motorist coverage for the same limits as Diversified Oil's bodily injury coverage limits and a certified copy of State Farm policy number L11-8422-C23-18C issued to Diversified Oil for coverage of the 1997 Ford F150 truck involved in the accident, Vehicle Identification Number 1FTDF1724VND31008, from September 23, 1998 to March 23, 1999, which includes the following designation "6098A ECONOMIC-ONLY UNINSURED MOTOR VEHICLE COVERAGE UEO."
In addition, State Farm provides a copy of the 6098A terms and conditions of economic-only uninsured motor vehicle coverage UEO. The terms and conditions of that coverage option clearly state that "there is no coverage . . . for non-economic loss" and define noneconomic loss as "any loss other than economic loss and includes but is not limited to pain, suffering, inconvenience, mental anguish, and other non-economic damages otherwise recoverable under the laws of Louisiana." The coverage terms and conditions also provide that "[a]ny amount payable under this coverage shall be reduced by any amount paid or payable to or for the insured under any workers' compensation, disability benefits, or similar law." Plaintiff opposes State Farm's motion.
Discussion
A. Summary Judgment Standard
Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment should be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law." To meet this standard, the moving party must present more than "mere allegations or affidavits setting forth ultimate or conclusory facts and conclusions of law." The inferences drawn from the underlying facts, however, must be viewed in a light most favorable to the nonmoving party.
Bynum v. FMC Corp., 770 F.2d 556, 576 (5th Cir. 1995).
See Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 588 (1986).
The substantive law determines the materiality of the facts, and only facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Thus, only genuine disputes over "material facts" can prevent a grant of summary judgment. A "genuine issue" exists only if there is "sufficient evidence favoring the non-moving party for a jury to return a verdict for that party." Finally, if the moving party meets its initial burden of production, the adverse party must go beyond the pleadings and set forth specific facts that show the existence of a genuine issue of material fact. If the adverse party fails to do so, then summary judgment, if appropriate, shall be entered against the adverse party.
See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
See id.
Id. at 249.
See FRCP 56(e).
See id.
B. Economic Only Uninsured Motorist Coverage
La. Rev. Stat. § 22:1406(D)(1)(a)(i) requires uninsured motorist coverage "in not less than the limits of bodily injury liability provided by the policy" except "where any insured named in the policy [rejects] in writing . . . the coverage or selects lower limits." La. Rev. Stat. § 22:1406(D)(1)(a)(ii) provides that "such rejection or selection of lower limits [shall be] signed by the named insured or his legal representative."
The signed rejection or selection of lower limits "shall be conclusively presumed to become a part of the policy or contract when issued and delivered, irrespective of whether physically attached [to the policy or contract]." Moreover, uninsured motorist coverage "need not be provided in or supplemental to a renewal, reinstatement, or substitute policy where the named insured has rejected the coverage previously issued to him by the same insurer or any of its affiliates."
La R.S § 22:1406(D)(1)(a) (ii).
La. R.S. § 22:1406(D)(1)(a)(i). La. R.S. 22:636.1(A)(5) defines a "renewal policy" as "the issuance and delivery by an insurer of a policy replacing at the end of the policy period a policy previously issued and delivered by the same insurer, or the issuance and delivery of a certificate or notice extending the term of a policy beyond its policy period or term."
In Tugwell v. State Farm Insurance Co., the Supreme Court of Louisiana addressed the requirements of a proper rejection or selection of lower limits by an insured and explained that
609 So.2d 195 (La. 1992)
The object of the [uninsured motorist] legislation is to promote full recovery for innocent automobile accident victims by making uninsured motorist coverage available for their benefit . . . The statute is to be liberally construed, such that the statutory exceptions to the coverage requirement are interpreted strictly. Any exclusion from coverage in an insurance policy must be clear and unmistakable. The insurer bears the burden of proving any insured named in the policy rejected in writing [uninsured motorist] coverage equal to the bodily injury limits or selected lower limits.
Id. at 197 (citing Hoefly v. Government Employees Insurance Co., 418 So.2d 575, 578 (La. 1982); Roger v. Estate of Moulton, 513 So.2d 1126, 1130 (La. 1987)).
The court held that, for a rejection or reduction in coverage to be valid, the insurer must give the insured "the opportunity to make a `meaningful selection' from his options" provided by the statute: (1) uninsured motorist coverage equal to bodily injury limits in the policy; (2) uninsured motorist coverage lower than bodily injury limits in the policy; or (3) no uninsured motorist coverage. The court reasoned that
Tugwell, 609 So.2d at 197.
A rejection on a form that prohibits the insured from choosing limits below liability coverage or which automatically chooses a certain lower amount for the insured, does not meet the statutory requirements because it forecloses options available to the insured by law.
Id. at 198.
Here, despite Plaintiff's arguments to the contrary, Diversified Oil's selection of lower uninsured motorist limits is valid. Diversified Oil limited its coverage to economic losses only by having its authorized agent, co-owner Stanley Elmore, sign a form which provided to Diversified Oil a broad selection of coverage options, including those required by statute. That form, dated August 24, 1998, several months prior to the date of the accident, applied specifically to the policy number covering the vehicle at issue, L11 8422 C23 18B. State Farm then issued a renewal policy Declaration Page ("Notice") for policy number L11 8422 C23 18C, describing the coverage elected by Diversified Oil for the vehicle involved for the period from September 23, 1998 to March 23, 1999. That Notice specifically provided that it replaced policy number L11 8422 C23 18B and included economic only uninsured motorist coverage. Therefore, it is clear that Diversified Oil properly elected to limit its uninsured motor vehicle coverage to economic only losses in its automobile insurance policy with State Farm for the vehicle involved in the November 2, 1998 accident.
The form provided by state Farm allowed Diversified Oil to select between the following options for uninsured motorist coverage: (1) economic and non-economic losses with the same limits as the bodily injury coverage limits; (2) economic and non-economic losses with limits lower than the bodily injury coverage limits, with spaces to fill in the reduced amount; (3) economic only losses with the same limits as the bodily injury coverage limits; (4) economic only losses with limits lower that the bodily injury coverage limits, with spaces to fill in the reduced amount; and (5) no uninsured motorist coverage.
Plaintiff argues that Diversified Oil's selection of limited uninsured motorist coverage applies only to policy number L11 8422 C23 18B. Plaintiff, however, does not dispute that both L11 8422 C23 18B and L11 8422 C23 18C apply to the vehicle involved in the November 2, 1998 accident. Because the La. R.S. § 22:1406(D)(1)(a)(i) specifically provides that an insured need not execute a new rejection or selection of lower coverage in a renewal, reinstatement or substitute policy, Diversified Oil is not required to reexecute such a form for the renewal policy, L11 8422 C23 18C. Simply put, once Diversified Oil elected to limit the amount of uninsured motorist coverage on the vehicle at issue, it need not continuously re-execute that selection form at every six month renewal.
Therefore, considering the pleadings, depositions, answers to interrogatories, and admissions on file and viewing that evidence in a light most favorable to Plaintiff, the Court is convinced that no genuine issue of material fact remains and that Plaintiff's claims for non-economic loss should be dismissed with prejudice.
C. Credit for Workers' Compensation Benefits
In addition, State Farm claims that it is entitled to a credit for the workers' compensation benefits received by Plaintiff as a result of the November 2, 1998 accident. Plaintiff also opposes this claim.
Several federal and state courts have determined that, pursuant to Article 1794 of the Louisiana Civil Code, workers' compensation insurers and uninsured motorist insurers are solidary obligors with respect to an insured's lost wages and medical expenses. Under that provision of the Civil Code, the performance of one solidary obligor relieves the liability of other solidary obligors toward the obligee. Accordingly, an uninsured motorist insurer may receive a credit for workers' compensation benefits paid to an insured for damages arising in the same accident giving rise to the uninsured motorist insurer's obligation. In holding that an uninsured motorist insurer is entitled to a credit for The workers' compensation benefits received by the insured, the courts expressly reject application of the collateral source rule in such instances.
See, e.g., Dodson v. Old Republic Insurance Co., 1999 WL 329701, at *5-6 (E.D. La. May 21, 1999); Fertitta v. Allstate Ins. Co., 462 So.2d 159 (La. 1985); Moloney v. United Servies Auto Ass'n, 683 So.2d 891, 894 (La.App. 4th Cir. 1996).
See La. C.C. art. 1794.
See Dodson, 1999 WL 329701, at *6 (citing Fertitta, 462 So.2d at 164; Moloney, 683 So.2d at 893-94).
Here, State Farm clearly is entitled to a credit for the workers' compensation benefits paid to Plaintiff for damages arising from the November 2, 1998 accident. In addition to the express limitation carved out of Diversified Oil's selected uninsured motorist coverage option, which requires a reduction in benefits for amounts paid by workers' compensation, State Farm is a solidary obligor with Plaintiff's workers' compensation insurer with respect to Plaintiff's claims for lost wages and medical damages arising from the November 2, 1998 accident. Considering the submissions of the parties in a light most favorable to the Plaintiff and the relevant case law, it is clear that State Farm should receive a credit for the workers' compensation benefits received by Plaintiff.
Accordingly,
IT IS ORDERED that State Farm's Motion for Partial Summary Judgment is GRANTED.
IT IS FURTHER ORDERED that Plaintiff's claims for non-economic loss, including mental anguish and physical pain and suffering, are dismissed with prejudice.