563 S.W.3d 765
Mo. Ct. App.2018Background
- Decedent Megan Kitchen was killed in a Missouri accident; plaintiffs (her estate and parents Kitchen and Kissinger) sued the tortfeasor and insurers for wrongful death and declaratory relief about stacking of UIM and medical-expense coverages.
- Kitchen (insured in Illinois) and Kissinger (insured in Missouri) each had multiple American Family/American Standard policies providing UIM and $5,000 medical-expense coverage; policies contained anti-stacking and "other insurance" clauses plus offsets for amounts paid by liable third parties.
- Insurers interpleaded $165,000 (policy limits less tortfeasor payment) into federal court; funds were later transferred and distributed to plaintiffs in state court.
- Trial court held Illinois law governs Kitchen’s policies and that Kitchen’s UIM and medical-expense coverages do not stack and may be reduced by the tortfeasor’s $25,000 liability payment. The court held Missouri law governs Kissinger’s policies, found ambiguity as to stacking of her UIM and medical-expense coverages, and allowed medical-expense stacking but treated UIM stacking differently.
- Parties appealed: Kitchen challenges choice of law, stacking analyses, and offset; insurers cross-appeal Kissinger rulings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Choice of law for Kitchen’s policies | Missouri law applies because injured person and accident were in Missouri | Illinois law applies because Kitchen’s vehicles were garaged and policies issued/performed in Illinois | Illinois law governs (Restatement §193 priority to insured risk location; §188 factors also favor Illinois) |
| Whether anti-stacking + "other insurance" clauses render Kitchen’s UIM/medical-expense coverages ambiguous (stacking allowed) | Kitchen: the "other insurance" language (esp. non-owned vehicle sentence) creates ambiguity and permits stacking | Insurers: anti-stacking is unambiguous and other-insurance language refers only to other companies’ policies | Denied for Kitchen — under Illinois law anti-stacking + other-insurance read together are not ambiguous; stacking disallowed |
| Whether insurers may offset Kitchen’s UIM recovery by full $25,000 tortfeasor payment or only by amount actually received by Kitchen ($12,500) | Kitchen: offset should be limited to amount he actually recovered ($12,500) | Insurers: statute allows reduction by amounts recovered under tortfeasor liability policy ($25,000) | Offset by full $25,000 permitted under Illinois statutory interpretation (amounts recovered under the liability policy) |
| Whether Kissinger’s UIM and medical-expense coverages stack and whether UIM may be reduced by tortfeasor payment (Missouri law) | Kissinger: other-insurance text ambiguous; stacking and no offset for UIM | Insurers: anti-stacking + explicit phrase "by all other insurance companies" removes ambiguity and permits offset | Mixed: UIM coverage does not stack (phrase "by all other insurance companies" excludes insurer’s own policies); medical-expense coverage stacks; UIM offset construed against insurer (policy ambiguous about offset means deduct from total damages, so full UIM limit payable here) |
Key Cases Cited
- Grzeszczak v. Illinois Farmers Ins. Co., 659 N.E.2d 952 (Ill. 1995) (anti-stacking clauses enforced if unambiguous)
- American Family Mut. Ins. Co. v. Martin, 728 N.E.2d 115 (Ill. App. Ct. 2000) (other-insurance clause construed not to subsume insurer’s own anti-stacking clause when read together)
- Busch v. Country Fin. Ins. Co., 95 N.E.3d 40 (Ill. App. Ct. 2018) (other-insurance clause construed to exclude insurer’s own policies when read contextually)
- Ritchie v. Allied Prop. & Cas. Ins. Co., 307 S.W.3d 132 (Mo. banc 2009) (other-insurance language can create ambiguity allowing stacking where it could be read to include insurer’s other UIM coverages)
- Manner v. Schiermeier, 393 S.W.3d 58 (Mo. banc 2013) (followed Ritchie: other-insurance sentence can render policy ambiguous and permit stacking for non‑owned-vehicle situations)
- Jones v. Mid-Century Ins. Co., 287 S.W.3d 687 (Mo. banc 2009) (policy language promising limits in declarations but offset clause ambiguous; offset should reduce total damages, not the insurer’s declared limit)
- Accurso v. Amco Ins. Co., 295 S.W.3d 548 (Mo. App. W.D. 2009) (location of insured risk controls choice-of-law for auto policies under Restatement §193)
- Gober v. State Farm Mut. Auto. Ins. Co., 636 N.E.2d 1016 (Ill. App. Ct. 1994) (amounts paid under a liability policy to related claimants are applied in determining offsets under the UIM statute)
- Miller v. Ho Kun Yun, 400 S.W.3d 779 (Mo. App. W.D. 2013) (similar policy structure creates ambiguity about whether UIM is gap or excess coverage; declarations can mislead ordinary purchaser)