Lero v. State Farm Fire & Casualty Co.
2011 Mo. App. LEXIS 1383
| Mo. Ct. App. | 2011Background
- Greene, the Leros’ daughter, died in Oct. 2008 in a conduct of a car collision caused by Mace driving Lyons’ vehicle; Lyons was court-ordered to pay $2 million to the Leros for wrongful death after insurer denied coverage.
- State Farm paid $50,000 UM benefits under Greene’s underlying auto policy; later denied UM coverage under the umbrella policy.
- The umbrella policy listed only Coverage L—Personal Liability on its declarations page and contained a provision stating coverage applies to claims against an insured for damages exceeding the retained limit.
- The Leros sued for breach of contract, asserting the umbrella policy provided uninsured motorist coverage as excess coverage over Greene’s underlying policy, and sought the $1 million limit.
- State Farm moved for summary judgment arguing the umbrella policy does not provide UM coverage; the Leros cross-moved seeking summary judgment that UM coverage exists under the umbrella policy.
- The circuit court granted partial relief to the Leros by concluding the umbrella policy provided UM coverage, and State Farm appealed, challenging that ruling and related defenses such as estoppel.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the umbrella policy provide uninsured motorist coverage? | Leros: UM fits within Coverage L—Personal Liability as excess over underlying UM limits. | State Farm: UM not included; declarations show only Coverage L; no express UM in umbrella. | Yes, the policy does not provide UM coverage; the umbrella policy unambiguously excludes UM. |
| Were State Farm's defenses improperly struck as estoppel-based or inconsistent? | Leros: estoppel barred State Farm from asserting defenses inconsistent with its denial. | State Farm: defenses consistent; no inconsistent denial. | Circuit court abused discretion; estoppel barred presentation of the defense that Coverage L excludes UM. |
| Was summary judgment properly granted for State Farm or the Leros on the coverage issue? | Leros: umbrella provides UM coverage over underlying policy; State Farm breached. | State Farm: umbrella does not include UM; declarations and definitions support denial. | Summary judgment for State Farm; umbrella policy does not include uninsured motorist coverage. |
Key Cases Cited
- Brown v. State Farm Mut. Auto. Ins. Co., 776 S.W.2d 384 (Mo. banc 1989) (estoppel requires a clearly relied-upon inconsistent position to bar a defense)
- Versaw v. Versaw, 202 S.W.3d 638 (Mo.App.2006) (elements of estoppel include inconsistency, reliance, and prejudice)
- Shelter Gen. Ins. Co. v. Siegler, 945 S.W.2d 24 (Mo.App.1997) (estoppel cannot create coverage where none exists)
- Burns Nat. Lock Installation Co. v. Am. Family Mut. Ins. Co., 61 S.W.3d 262 (Mo.App.2001) (two separate justifications for denial can limit estoppel)
- West v. Transamerica Ins. Co., 614 S.W.2d 752 (Mo.App.1981) (umbrella policy coverage limits and relation to underlying policy)
- Christensen v. Farmers Ins. Co., 307 S.W.3d 654 (Mo.App.2010) (declarations page controls and interpretation of coverage; umbrella context)
- Thiemann v. Columbia Pub. Sch. Dist., 338 S.W.3d 835 (Mo.App.2011) (interpretation of insurance policy language; plain meaning governs)
- ITT Commercial Fin. Corp. v. Mid-Am. Marine Supply Corp., 854 S.W.2d 371 (Mo.banc 1993) (de novo standard for insurance policy interpretation)