2004 Ohio 4939 | Ohio Ct. App. | 2004
{¶ 2} Appeal No. 2002CA00073 challenges the trial court's decision to grant coverage to Richard Bernabei under his union's automobile policy. As we will explain below, the trial court's judgment as regards to the IBEW policy must be reversed based on the recent holding of Westfield Ins. Co. v. Galatis,
{¶ 4} On January 16, 2001, five other members of the Bernabei family filed a declaratory judgment action against Appellant and three additional insurance companies. Their claim against Appellant involved UIM coverage allegedly arising out of the Personal Auto policy issued to Robert and Shirley Bernabei. The two cases were later consolidated by the trial court.
{¶ 5} On May 31, 2001, parent Appellees filed a motion for summary judgment regarding the Personal Auto policy. The next day, Appellee Tamara Bernabei filed a motion for summary judgment regarding the IBEW policy. On June 29, 2001, Appellant filed a cross-motion for summary judgment regarding the Personal Auto policy. Three days later, Appellant filed a cross-motion for summary judgment as regards the IBEW policy. The trial court ruled on all of these motions on February 6, 2002.
{¶ 6} The trial court granted summary judgment to Appellee Tamara Bernabei, holding that the decedent was an insured under the IBEW policy pursuant to the principles set forth inScott-Pontzer v. Liberty Mut. Fire Ins., Co. (1999),
{¶ 7} The trial court also granted, by separate entry, summary judgment to parent Appellees on their UIM claim arising under the Personal Auto policy. The trial court held that the 1997 version of R.C. §
{¶ 8} On April 24, 2002, parent Appellees filed a motion to dismiss the Personal Auto policy appeal for lack of a final appealable order. On May 7, 2002, Appellees refiled the same motion to dismiss. On May 16, 2002, Appellant filed a response. On May 30, 2002, Appellant filed a similar response in the IBEW policy appeal although no motion to dismiss that appeal had been filed.
{¶ 9} This Court subsequently issued a journal entry allowing the parties to petition the trial court for amended judgment entries containing the language required by Civ.R. 54(B).
{¶ 10} On January 3, 2003, the trial court issued an amended judgment entry affecting the Personal Auto policy judgment. The trial court found, nunc pro tunc, that there was no just cause for delay pursuant to Civ.R. 54(B).
{¶ 12} A court of appeals only has jurisdiction to review final appealable orders. Chef Italiano Corp. v. Kent StateUniv. (1989),
{¶ 13} R.C. §
{¶ 15} "(1) An order that affects a substantial right in an action that in effect determines the action and prevents a judgment;
{¶ 16} "(2) An order that affects a substantial right made in a special proceeding or upon a summary application in an action after judgment;
{¶ 17} "(3) An order that vacates or sets aside a judgment or grants a new trial; {¶ 18} "(4) An order that grants or denies a provisional remedy and to which both of the following apply:
{¶ 19} "(a) The order in effect determines the action with respect to the provisional remedy and prevents a judgment in the action in favor of the appealing party with respect to the provisional remedy.
{¶ 20} "(b) The appealing party would not be afforded a meaningful or effective remedy by an appeal following final judgment as to all proceedings, issues, claims, and parties in the action.
{¶ 21} "(5) An order that determines that an action may or may not be maintained as a class action."
{¶ 22} The February 6, 2002, judgment entry only partially resolved parent Appellees' declaratory judgment claim involving the Personal Auto policy. This Court has previously held that a declaratory judgment action is a special proceeding, and has held that a judgment entry in a declaratory judgment action that affects the substantial rights of the parties may be immediately appealed under R.C. §
{¶ 23} Appellees have not challenged the appealability of the entry declaring Appellant liable for UIM coverage under the IBEW policy and submitting the claim to arbitration. Under R.C. §
{¶ 25} "[W]hen (1) there is no genuine issue of material fact, (2) the moving party is entitled to judgment as a matter of law, and (3) reasonable minds can come to but one conclusion and that conclusion is adverse to the nonmoving party, said party being entitled to have the evidence construed most strongly in his favor. Horton v. Harwick Chem. Corp. (1995),
{¶ 27} "The trial court erred as a matter of law in granting summary judgment in favor of appellee and in failing to grant Cincinnati's motion for summary judgment, where Richard Bernabei was not a `named insured' under the terms of the Cincinnati policy."
{¶ 28} The trial court's decision to allow Appellee wife to receive UIM coverage under the IBEW policy is predicated on the analysis of Scott-Pontzer, supra, which has recently been overturned by Westfield Ins. Co. v. Galatis,
{¶ 29} The trial court also found that Tamara Bernabei and other family members of Richard Bernabei were covered by the IBEW policy. Galatis held that an employee's family members are not covered under a business UIM policy unless the employee is specifically named as an insured within the policy. Galatis at paragraph three of the syllabus. Richard is not a named insured on the IBEW policy. Therefore, no members of his family can claim UIM coverage under the policy. The trial court should not have submitted this claim to arbitration because no appellees are covered by the IBEW policy. Appellant's first assignment of error is hereby sustained and the judgment of the trial court is reversed in Appeal No. 2002CA00073.
{¶ 30} Appellant's second assignment of error is moot, as it deals with the terms of arbitration. The issue of damages should never have been considered for arbitration because Appellant is not obligated to pay UIM benefits.
{¶ 32} "The trial court erred in holding that the house bill 261 amendments to R.C. §
{¶ 33} Appellant argues that the Personal Auto policy at issue expressly limited UIM benefits to situations in which an insured received bodily injuries. The parties agree that the decedent was not an insured under the policy. Appellant acknowledges that a 1988 version of R.C. §
{¶ 34} Any discussion of the issues involved in this assignment of error must begin with the Sexton case. Sexton reviewed uninsured motorist ("UM") coverage issues arising out of an auto accident in which 17-year-old Laurie Sexton was killed by an uninsured motorist. The father, Gareld Sexton, owned an automobile policy containing UM coverage. Laurie was not living at home at the time, and was not an insured under Mr. Sexton's policy. Mr. Sexton attempted to claim UM benefits for certain expenses, including funeral expenses, surrounding his daughter's death. Mr. Sexton was legally obligated to pay these expenses by virtue of a child support order.
{¶ 35} Sexton held that the UM carrier was required to cover the funeral expenses its insured, Mr. Sexton, was legally obligated to pay for Laurie's death, even though Laurie was not herself an insured under the policy. Sexton,
{¶ 36} Sexton was interpreting the following language in the policy:
{¶ 37} "To pay all sums which the insured * * * shall be legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle because of bodily injury sustained by the insured, caused by accident and arising out of the ownership, maintenance or use of such uninsured motor vehicle * * *." Id. at 432, 23 O.O.3d 385,
{¶ 38} The policy at issue in Sexton attempted to limit recovery to damages arising from bodily injury to the insured, i.e., bodily injury to Mr. Sexton. The Supreme Court held, though, that this restriction violated the public policy of R.C. §
{¶ 39} "(A) No automobile liability or motor vehicle liability policy of insurance insuring against loss resulting from liability imposed by law for bodily injury or death suffered by any person arising out of the ownership, maintenance, or use of a motor vehicle shall be delivered or issued for delivery in this state with respect to any motor vehicle registered or principally garaged in this state unless an equivalent amount of coverage for bodily injury or death is provided therein or supplemental thereto under provisions approved by the superintendent of insurance, for the protection of personsinsured thereunder who are legally entitled to recover damagesfrom owners or operators of uninsured motor vehicles because ofbodily injury, sickness, or disease, including death, resulting therefrom." (Emphasis added.) Id. at 433-434, 23 O.O.3d 385,
{¶ 40} The critical question for the Sexton court was whether the insured, i.e., Mr. Sexton, was legally entitled to recover damages sustained because of injury or death caused by an uninsured motorist. The secondary question was whether the damages related to bodily injury or death.
{¶ 41} The court held that the statute did not specifically require that the bodily injury be sustained by an insured. Id. The statute only required that the insured be legally entitled to recover damages because of bodily injury, without limitation as to the particulars of that bodily injury. Laurie obviously suffered bodily injury and death. Mr. Sexton was legally entitled, under a wrongful death claim, to recover his daughter's funeral expenses from the tortfeasor. The court held that this expense was covered by the terms of the policy, regardless of the fact that Laurie was not an insured under the policy. Id. at 435, 23 O.O.3d 385,
{¶ 42} The four elements of a Sexton claim are: "1) the claimant must be an insured, 2) the claimant is legally entitled to recover damages, 3) the damages result from injury, sickness, disease or death and 4) the tortfeasor must be the owner and/or operator of an uninsured motor vehicle." Wilson v. NationwideIns. Co. (Nov. 20, 1997), 8th Dist. No. 71734, at *6.
{¶ 43} Sexton was reaffirmed in the Moore case, which interpreted the following version of R.C. §
{¶ 44} "(A) No automobile liability * * * policy of insurance * * * shall be delivered or issued for delivery in this state * * * unless both of the following coverages are provided to persons insured under the policy for loss due to bodily injury or death suffered by such persons:
{¶ 45} "(1) Uninsured motorist coverage, which * * * shall provide protection for bodily injury or death * * * for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness, or disease, including death, suffered by any person insured under the policy." (Emphasis added.) Moore,
{¶ 46} Moore held that the 1994 version of the statute continued to protect insureds against losses and damages arising from bodily injury or death caused by the act of an uninsured motorist, whether or not the person who suffered the bodily injury or death was specifically an insured. Id. at 32,
{¶ 47} "if the words `for loss' and `damages' were removed from R.C.
{¶ 48} The version of R.C. §
{¶ 49} "(A) No automobile liability or motor vehicle liability policy of insurance insuring against loss resulting from liability imposed by law for bodily injury or death suffered by any person arising out of the ownership, maintenance, or use of a motor vehicle shall be delivered or issued for delivery in this state with respect to any motor vehicle registered or principally garaged in this state unless both of the following coverages are offered to persons insured under the policy forloss due to bodily injury or death suffered by such insureds [prior version: "persons"]:
{¶ 50} "(1) Uninsured motorist coverage, which shall be in an amount of coverage equivalent to the automobile liability or motor vehicle liability coverage and shall provide protection for bodily injury, sickness, or disease, including death under provisions approved by the superintendent of insurance, for the protection of insureds [prior version: "persons insured"] thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness, or disease, including death, suffered by any person insured under the policy. * * *
{¶ 51} "(2) Underinsured motorist coverage * * * shall provide protection for insureds thereunder against loss for bodily injury, sickness, or disease, including death, suffered by any person insured under the policy * * *." (Emphasis added.)
{¶ 52} The relevant changes between the 1997 version of R.C. §
{¶ 53} It is interesting to note that the Moore case was decided on February 16, 2000, over two years after the effective date of Am.Sub.H.B. No. 261. Although Moore was interpreting a 1994 version of R.C. §
{¶ 54} Although Appellant contends that the Ohio Supreme Court has never addressed the 1997 version of R.C. §
{¶ 55} Appellant argues that the legislature's decision to change the word "persons" to "insureds" at the end of the first full paragraph of R.C. §
{¶ 56} Upon closer analysis of the Ohio Supreme Court's interpretations of prior versions of R.C. §
{¶ 57} Both cases held that the statute was ambiguous in its use of the phrase "bodily injury or death." Sexton at 434, 23 O.O.3d 385,
{¶ 58} The same ambiguity occurs in the 1997 version of the statute. The key section of the statute is: "unless both of the following coverages are offered to persons insured under the policy for loss due to bodily injury or death suffered by such insureds." On the one hand, the statute can be interpreted as providing UIM coverage to an insured for loss suffered by the insured, if such loss is somehow related to bodily injury or death. This reading emphasizes the words in the statute in the following way: "unless both of the following coverages areoffered to persons insured under the policy for loss due to bodily injury or death suffered by such insureds."
{¶ 59} On the other hand, the statute can be interpreted to provide coverage only when an insured has suffered bodily injury or death. This interpretation emphasizes the following words: "unless both of the following coverages are offered to persons insured under the policy for loss due to bodily injury or deathsuffered by such insureds."
{¶ 60} Both of these readings are plausible. Given the choice, the remedial nature of the statute requires an interpretation in favor of granting UIM coverage consistent withSexton and Moore.
{¶ 61} Appellant appears to assume that the legislative intent in changing the word "persons" to the word "insureds" could only be interpreted as a negative response to the Supreme Court's prior interpretation of R.C. §
{¶ 62} Furthermore, in Moore the Supreme Court based its decision, in part, on the fact that the uncodified commentary to the 1994 changes to R.C. §
{¶ 63} The trial court in this case was correct in applyingSexton and Moore to the 1997 version of R.C. §
{¶ 64} Pursuant to the above, in Appeal No. 2002CA00073, we reverse the February 6, 2002, decision to grant summary judgment to Tamara Bernabei, and we further grant Appellant's motion for summary judgment pursuant to the IBEW policy No. CAP 500 9118 C1. The decedent Richard Bernabei was not an insured under the IBEW policy, and Richard Bernabei's related family members cannot claim to be insureds, based on the principles set forth in the recent Galatis case issued by the Ohio Supreme Court. In Appeal No. 2002CA00078, we affirm the February 6, 2002, judgment entry granting summary judgment to Appellees Robert and Shirley Bernabei, et al. on their Sexton/Moore claim under Policy No. HRA 696 49 73 issued by Cincinnati Insurance Companies.
Donofrio, J., concurs.
Vukovich, J., concurs.
