State Farm Mutual Automobile Insurance v. Patterson
7 A.3d 454
Del.2010Background
- Aneita Patterson, a Delaware resident, was injured by Jean Armstrong, a New Jersey driver, on a New Jersey road; Patterson carries a Delaware UM policy with State Farm.
- Allstate denied Armstrong’s insured status under New Jersey law, prompting Patterson to seek uninsured motorist benefits from State Farm in Delaware.
- The Superior Court applied Delaware law, denied State Farm’s summary judgment motion, and awarded Patterson $20,000 after an inquisition on damages.
- State Farm argued Patterson was not legally entitled to recover under New Jersey Verbal Threshold law, so she was not eligible for UM benefits.
- The court’s choice-of-law analysis centered on whether Delaware or New Jersey tort law governs Patterson’s entitlement to recover damages from the uninsured tortfeasor.
- On appeal, the Delaware Supreme Court affirmed, holding Delaware law applies for the entitlement question and remanding to determine whether Patterson pierces New Jersey’s verbal threshold.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| What law governs entitlement to UM benefits? | Patterson argues New Jersey law governs entitlement. | State Farm argues Delaware law governs entitlement. | Delaware law governs entitlement. |
| Which choice-of-law framework applies to determine entitlement? | Use most significant relationship with NJ connections for entitlement. | Use the same framework to determine entitlement; NJ has significant ties. | Most significant relationship analysis supports New Jersey law for entitlement, per majority reasoning (to be remanded for threshold determination). |
| Should New Jersey tort law determine whether Patterson is legally entitled to recover damages from Armstrong? | New Jersey tort law should determine entitlement because the injury and conduct occurred there. | Delaware law should govern entitlement and the relationship with the insurer. | New Jersey tort law governs entitlement, per the majority’s analysis, with remand for threshold determination. |
| Is there a statute of limitations bar to Patterson’s UM claim? | Contract-based Spinelli rule applies; claim timely within three years. | Spinelli dictates a three-year contract statute of limitations and bars if triggered later. | No statute of limitations bar; Spinelli not controlling for the first-step entitlement analysis; remand to determine threshold under NJ law. |
| What result follows from remand on threshold entitlement under NJ law? | Threshold entitlement under NJ law may entitle Patterson to UM benefits. | Until threshold is established under NJ law, entitlement to UM benefits cannot be determined. | Remand to determine whether Patterson’s injuries pierce New Jersey verbal threshold and thus are legally entitled to recover from Armstrong. |
Key Cases Cited
- Travelers Indem. Co. v. Lake, 594 A.2d 38 (Del. 1991) (adopts most significant relationship for tort conflicts; supports Delaware’s strong UM policy)
- Kent County v. Shepherd, 713 A.2d 290 (Del. 1998) (public policy favors full monetary damages; used to support Delaware’s UM framework)
- Allstate Ins. Co. v. Spinelli, 443 A.2d 1286 (Del. 1982) (contract statute of limitations governs contract-based UM second step; first step governed by tort law)
- Lake v. Travelers Indemnity Co., 594 A.2d 38 (Del. 1991) (distinguishes amount-of-damages issue from entitlement issue; supports Delaware’s role in second step)
- Adams v. Delmarva Power & Light Co., 575 A.2d 1103 (Del. 1990) (cited for UM policy as supplemental coverage)