Creed v. Smith, 222 N.C. App. 330

Creed filed suit in Catawba County Superior Court on 30 November 2010 against Brett A. Smith and Carolyn Jeanette Wyatt for a 2 February 2008 collision; amendment filed 4 February 2011.
Plaintiff’s employer’s Liberty UIM policy and Integon UIM policy were involved; Liberty insured the employer vehicle with $1,000,000 UIM limit and Integon provided $50,000 UIM.
Nationwide provided the liability limits of $50,000 to the insured driver (Mr. Smith); Plaintiff also held a $50,000 UIM policy with Integon.
Liberty’s and Integon’s UIM policies required exhaustion of liability coverage and contained consent/advance payment and arbitration provisions.
Plaintiff sought binding arbitration under the UIM policies on 18 May 2011 after notice of Nationwide’s tender; trial court denied the motion on 15 August 2011.
The issue on appeal is whether Nationwide’s liability policy was exhausted for purposes of UIM, allowing arbitration under the policies.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the trial court properly denied arbitration given exhaustion of Nationwide’s policy.	Nationwide tendered limits on 26 April 2011, exhausting liability coverage.	Exhaustion requires payment under statute; tendering alone does not apply.	Exhaustion occurred by tender on 26 April 2011; trial court erred in denying arbitration.

Register v. White, 358 N.C. 691 (2004) (interprets exhaustion as tender in UIM context)
Brown v. Lumbermens Mut. Casualty Co., 326 N.C. 387 (1990) (discusses exhaustion/tender and fiduciary duties)
Kinlaw v. Long Mfg., 298 N.C. 494, 259 S.E.2d 552 (1979) (relevance to appellate respect for Supreme Court decisions)
Bray v. N.C. Dep’t of Crime Control and Pub. Safety, 151 N.C. App. 281, 564 S.E.2d 910 (2002) (guidance on judicial adherence to Supreme Court interpretations)
Raspet v. Buck, 147 N.C. App. 133, 554 S.E.2d 676 (2001) (standard for reviewing arbitration eligibility decisions)