*1 184 IN THE SUPREME COURT
HARRIS v. NATIONWIDE MUT. INS. CO. (1992)] 184 N.C.
[332 through guardian HARRIS, litem, K. her ad DAVID B. MICHELLE FREEDMAN, HARRIS, DAVID A. ELLEN E. HARRIS NATION- WIDE MUTUAL INSURANCE COMPANY
No. 305A91 (Filed 1992) September 4 — (NCI4th)— § 1. Insurance 527 highway meaning “applicable liability” limits
In determining whether a tortfeasor’s vehicle is an “underin- sured vehicle” within the meaning of N.C.G.S. 20-279.21(b)(4), “applicable liability” referred § to in the statute are those under the UIM Therefore, owner’s policy. proper comparison is between the tortfeasor’s coverage and plaintiff’s rather than between the tortfeasor’s coverage and plaintiff’s liability coverage. 2d,
Am Jur § Automobile Insurance 322. Uninsured and underinsured coverage: motorist recover- ability under uninsured or underinsured motorist deficiencies in compensation afforded party by tort- feasor’s liability coverage. 24 ALR4th 13. (NCI4th)—
2. Insurance underinsured vehicle —intrapolicy coverages The language “applicable limits liability” 20-279.21(b)(4)refers to all UIM limits available in § applicable plaintiff’s claim and allows the intrapolicy stack- ing of UIM determining whether a tortfeasor’s Therefore, vehicle is an “underinsured vehicle.” tortfeasor’s vehicle as an qualified underinsured vehicle where plaintiff’s aggregate UIM exceed the aggregate liabili- ty of the tortfeasor. 2d,
Am Jur Automobile Insurance 322. Uninsured and underinsured motorist coverage: recover- ability under uninsured or underinsured in compensation deficiencies injured party afforded by tort- feasor’s coverage. ALR4th 13. THE
IN MUT. INS. CO. HARRIS v. NATIONWIDE *2 — (NCI4th) UIM cover- intrapolicy stacking § 528 3. Insurance family member ages —nonowner family living nonowner member
The minor as a plaintiff, insured, is entitled to as the named in the same household determining parents’ policy in her stack UIM Intrapolicy is underinsured. whether the tortfeasor’s vehicle the injured party is allowed when of UIM first is a insured of the class. person 2d, § 322. Am Insurance Jur Automobile recover- coverage: and underinsured motorist Uninsured motorist ability under uninsured or underinsured by tort- injured party compensation deficiencies in afforded 24 ALR4th 13. liability coverage. feasor’s — (NCI4th)— intrapolicy stacking § 529 nonowner 4. Insurance not excess on one a nonowner multiple vehicles
Stacking subject or “additional” is not “excess” Act under Responsibility of the Financial provisions compulsory 20-279.21(g). 2d, § 322. Am Jur Automobile Insurance recover- coverage: motorist Uninsured and underinsured coverage of ability under uninsured or underinsured by tort- injured party afforded compensation deficiencies 24 ALR4th 13. liability coverage. feasor’s dissenting. Justice Meyer in this joins dissenting opinion.
Justice Lake dissenting. Justice Webb dissenting opinion. in this joins
Justice
LAKE
7A-30(2)from
to N.C.G.S.
pursuant
defendant
Appeal
Appeals,
of the Court of
panel
the decision of a divided
(1991),
entry
summary
affirming
presents permitted intrapolicy stacking erred in Appeals holding injured party an insurer’s limit of when the determining (2) insured; is the minor named daughter *3 when riding vehicle in which the minor was plaintiff tortfeasor’s vehicle,” though an “underinsured even injured was limit equal on the vehicle was coverage issued to the minor’s As parents. under the Nationwide issue, err. Appeals to the first we hold that the Court of did not affirmative, in the thus question agreeing We answer second the trial court implicit holding Appeals. with the of both and Court Harris, plaintiffs Michelle K. the minor daughter Plaintiff Harris, was in an accident injured David and Ellen automobile by Wayne George while as a in a vehicle owned traveling passenger Faust, by daughter, Mary Faust and his Elizabeth on operated September 25 1989. The Faust vehicle was insured under a State liability limits Company policy having Farm Insurance $100,000/$300,000. expenses Michelle’s medical alone exceeded $102,000. accident, At the time of the Michelle’s owned parents by a single policy three vehicles insured under issued Nationwide. (UM/UIM) This uninsured and underinsured motorist policy provided $100,000 coverage per person for each insured. Plaintiffs paid premiums to defendant on each vehicle for separate UM/UIM coverage. 2 declaratory
Plaintiffs filed this action for on March judgment 1990, requesting that the trial court determine whether Michelle was entitled to stack the UIM of three vehicles separate by covered under the issued Nationwide. Plaintiffs single policy or, in the subsequently judgment pleadings moved for on the alter- native, summary judgment. Nationwide also made a motion for 56(b). summary R. P. In judgment pursuant judgment to N.C. Civ. 14 granted plaintiffs’ dated June the trial court motion for summary trial judgment and denied Nationwide’s motion. The court’s included the of fact”: judgment following significant “findings THE SUPREME
IN COURT MUT. INS. CO. v. NATIONWIDE HARRIS N.C. 184 in the 2. That for the three vehicles listed issued Complaint referred to in the and E. A. Harris and Ellen plaintiffs the defendant to the David can be so as to provide Harris stacked $300,000 damages for injuries the amount of and of the accident described arising out plaintiffs sustained that the underinsured motorist Complaint, in the to the available to Michelle Harris identical available A. Ellen E. Harris under the insurance to David Harris and defendant; issued plaintiff 3. That limit of to the the defendant’s $300,000, paid to the primary coverage plain- shall be less the 20-279.21(b)(4). pursuant tiffs to N.C.G.S. § decision, Judge court’s Appeals affirmed trial Court Co., Mut. Ins. 103 N.C. dissenting. Harris Nationwide Greene (1991). appealed to this Court S.E.2d App. dissent, we its Judge granted petition on Greene’s based Harris discretionary review as to additional issues. v. Nationwide 788, 408 Mut. Ins. S.E.2d con- second issue first. Nationwide We address Nationwide’s riding minor was plaintiff that the Faust vehicle which the tends was vehicle” because when not an “underinsured $100,000 vehicle was per limit on Faust person $100,000 liability/UIM plaintiffs’ limit of per person equal when “all coverage is deemed policy.1 apply Nationwide liability *4 bodily or policies providing coverage bonds insurance or use the ímderin- ownership, maintenance caused injury N.C.G.S. have exhausted.” been highway sured vehicle 20-279.21(b)(4) added). (1989) Therefore, the determina- (emphasis § (Faust) vehicle is an underinsured whether the tortfeasor’s tion of is available coverage is in if UIM determining vehicle crucial highway the Nationwide policy. then, vehi- is whether the tortfeasor’s The threshhold question, used in as the term is highway an “underinsured vehicle” cle is 20-279.21(b)(4). is highway An vehicle” “underinsured defined accident, 20-279.21(b)(4), as it existed at time of 1. Under N.C.G.S. § liability to the limits. N.C.G.S. given in were identical
the UIM limits Assembly 1991. Sess. Laws in 1991 N.C. was amended General 20-279.21 § However, 646, arising litigation claims or 1-4. the amendments do not affect eh. §§ noted, any citation prior Id. 4. otherwise pending to amendments. Unless § IN THE COURT SUPREME HARRIS MUT. CO. NATIONWIDE INS. N.C. 184 maintenance, with respect ownership, to the which, use of the sum of liability the limits of under all
bodily liability and injury policies applicable bonds the time of is applicable the accident less than the limits under the liability owner’s .... (1989) added). essence, (emphasis In de- § first, fendant’s second issue can be divided into two subissues: proper comparison outlined the statute is above liability liability between the tortfeasor’s coverage plaintiffs coverage or liability between tortfeasor’s coverage and second, plaintiff’s coverage;2 UIM if proper comparison is to UIM plaintiff’s coverage, whether limits coverage UIM can to be stacked determine if the tortfeasor’s vehicle is an “underin- sured vehicle.”
[1] The resolution of these
subissues
hinges upon
the interpreta
tion of the phrase “applicable
liability
under the owner’s
policy.” We note that
this
found in N.C.G.S.
20-279.21(b)(4),which
exclusively
deals
underinsured motorist
coverage. While it
may
liability”
that
argued
“limits
refers
limits
plaintiff’s liability
under the
we
coverage,3
are con
liability
vinced
the limits referred to are the
limits
accident,
plaintiff’s UIM coverage. Following an automobile
a tort
feasor’s
coverage
called
upon
compensate
injured
plaintiff, who then turns to
own
his
UIM
when the tort
situation,
feasor’s
exhausted. In this
the plaintiff’s liability coverages are not
to the
accident and
a comparison
plaintiff’s liability
inappropriate.
Taken
context with the surrounding subsection on underinsured
coverage,
“liability
limits”
clearly
referred
those
Therefore,
under the
portion
policy.
the owners’
the limits of
in the instant case are the
of liability
limits
under the
coverage portion
plaintiff’s
minor
parents’
and not under the
portion of their policy.
opinion
to or
respect
discussion of N.C.G.S.
20-279.21 in
will
be with
version of the statute
effect at the
time
the accident.
Bureau,
case,
2. This same issue is before us in another
Amos v. N.C. Farm
652,
allowed,
App.
Mut. Ins.
103 N.C.
406 S.E.2d
disc. rev.
cases,
IN THE 189 MUT. CO. HARRIS v. NATIONWIDE INS. 184 N.C. Act, which Responsibility Financial liberally part, a is a “remedial statute be
§ its intended enactment purpose construed so the beneficial Co., v. & Casualty Surety Sutton Aetna may accomplished.” be 265, denied, 259, 759, 763, 437, reh’g N.C. 382 S.E.2d 325 N.C. 325 (1989). A 384 546 treatise on North Carolina automobile S.E.2d concept coverage insurance law discusses and concludes when the insured to recover the tortfeasor has that insurance, “allows compen- his in an but amount insufficient Jr., Snyder, party damages.” for his full J. North sate (1988). interpreta- Law 30-1 Our Carolina Automobile Insurance is in with this approach. tion of the statute accord Another noted treatise on automobile insurance has evaluated definitions of “underinsured motor vehi- legislative the various three which categories classified them in demonstrate cle” has by the approaches determining the different used various states Widiss, 2 A. Uninsured and whether tortfeasor is underinsured. 1990). (2d Insurance 35.2 ed. “There are Underinsured Motorist three are defined these primary types comparisons on comparisons statutes: determinations based tortfeasor’s (1) liability with the amount of underinsured motorist insurance (2) insurance, insurance, motorist with the amount of uninsured (3) damages injuries sustained the insured.” with or Noticeably categories these (emphases Id. absent from original). with liability of the tortfeasor’s comparison We have found no authori- amount of a insurance. plaintiff’s determination of whether which leads us to believe ty requires vehicle” vehicle is an “underinsured a tortfeasor’s insurance and the between tortfeasor’s comparison uninsured coverage. obligation provide plaintiff’s “[T]he to facilitate its was tied to provided who must be persons and to determine the purchase a means not to insurers coverage, provide uninsured motorist liability coverage in which to situations limiting Co., 328 v. Mutual Ins. would in effect.” Smith 148-49, 44, Bradley Mid-Century (quoting 400 S.E.2d 50 (1980)), 1, 35-36, reh’g Ins. N.W.2d Mich. denied, 577, S.E.2d 514 [2] a tortfeasor’s vehicle Having decided the proper is an “underinsured comparison determining vehicle,” we may of whether be stacked address the question now *6 THE IN SUPREME COURT HARRIS NATIONWIDE MUT. INS. CO. (1992)] N.C. 184
[332 when this making Anticipating rejection determination. this Court’s liability liability argument, of a Nationwide comparison contends that, liability even under a coverage comparison, (the tortfeasor) automobile operated by owned and Faust is not an by “underinsured vehicle” as defined 20-279.21(b)(4). that, issue, Nationwide as argues plain- a threshold tiffs must that coverage policy show the limits of UIM their liability Nationwide exceed the limits of Faust’s Thus, policy with State Farm. Nationwide contends that the com- parison between the limit plaintiff’s tortfeasor’s and the prior UIM limit must occur any coverage. such, case, As argues Nationwide that in cases like the instant where the tortfeasor’s equal to the plaintiff’s UIM limit stacking, plaintiff before fails to meet the “threshold” vehicle, an definition of underinsured highway and there is no reject underinsured motorist to stack. We this contention. When examining cases to determine whether insurance coverage is provided a particular policy, automobile insurance careful attention must be given to type coverage, terms of Smith, statutory and the policy, provisions. relevant case, at 47. In present S.E.2d at type sought plaintiffs is UIM coverage. policy The question is a personal automobile policy issued to the parents of minor plaintiff. This Nationwide includes UIM coverage, but that argues policy prohibits Nationwide “stacking” in deter- mining whether a vehicle “underinsured motor vehicle.” in question defines an underinsured motor vehicle coverage” motorists “uninsured/underinsured endorsement follows: A land motor ... vehicle . . . . type which . . [t]o
the sum of the limits of bonds and insurance policies the time of the accident is: equal a. to or greater specified than the minimum limit Carolina; responsibility financial law of North b. less than the limit of coverage. added.) (Emphasis Nationwide notes that the word “limit” in this definition singular, argues therefore refers such, singular to a limit. As Nationwide contends “the singular ($100,000) limit the policy with defendant must greater than IN THE MUT. INS. CO.
HARRIS v. NATIONWIDE
the tortfeasor’s
tortfeasor in order for
liability coverage
that our Court
recognize
We
as underinsured.”
qualify
in the medical
payments
has treated similar
of Appeals
*7
policies
prohibiting stacking
as
automobile insurance
provision of
Co.,
See,
Mut. Ins.
e.g., Tyler v. Nationwide
of medical payments.
(1991).
713,
Assuming, arguendo, that
101
As discussed statute highway vehicle” is maintenance, the ownership, to respect
a which, liability under sum of the limits of all or use of the bodily applicable bonds and insurance injury limits applicable than the at the time of accident less policy. the owner’s of added). 20-279.21(b)(4) The statute does not (emphasis policy.” under the owner’s “the applicable define liability” of “the limits applicable While Nationwide interprets policy, the owner’s limit of UIM meaning single a to mean the sum of all interpreted language may this also be to applicable particular under the which are UIM limits claim. statute, is to ensure principle the cardinal interpreting
When
Electric Supply
purpose
legislature
accomplished.
that the
651, 656,
291,
403 S.E.2d
Co. v. Swain Electrical
whole,
consider the act as a
Accordingly,
294
“a court must
statute,
its
and that
spirit,
weighing
Shelton v. Morehead Memorial
accomplish.”
statute seeks
(1986). Also,
824,
76, 82,
828
347 S.E.2d
Hospital, 318 N.C.
“[i]t
with reason
acted
accordance
presumed
legislature
an
or absurd
unjust
intend
and
sense and that it did not
common
Baldwin,
King v.
particular legislation.
result” when
enacted
omitted).
(1970)(citations
12,
316, 325,
Fur-
276 N.C.
thermore,
S.E.2d
given
should be
their natural
“the statute’s words
to be construed
them
ordinary
requires
unless the context
meaning
Shelton,
828.
differently.”
of UIM in the provided which are plaintiff’s Initially, claim. we note statute liability.” refers to limits “applicable Given the natural or- limit, dinary form of meaning that, plural the word we are con- vinced single with reference policy, “applicable limits” Furthermore, refers all available UIM limits under the policy. find that previous we result is consistent with our decision Sutton, in Sutton. In we held that stacking required by provisions when in- determining an sured’s recovery under the UIM provisions of automobile in- Sutton, surance policy. 325 N.C. at S.E.2d 763. To deny an insured access to the recovery approved Sutton prohibiting stacking of UIM determining whether the tortfeasor’s vehicle is an “underinsured vehicle” would be inconsistent with the rationale Sutton and purpose *8 the Financial Act. Responsibility Thus, we conclude that the language of N.C.G.S. 20-279.21(b)(4) the allows of an stacking insured’s UIM §
in determining whether tortfeasor’s vehicle “underinsured highway compares vehicle.” The statute the aggregate liability of the tortfeasor’s vehicle to the limits of liabili- ty the policy, owner’s meaning the or aggregate stacked UIM “limits” under the policy. To the extent that provisions the conflict, of a statute and the terms of policy the provisions 263, 762; of the statute will prevail. Id. 382 S.E.2d at Nationwide Chantos, 441, Mut. Ins. Co. v. 238 S.E.2d Because the tortfeasor’s aggregate coverage is less than the aggregate provisions under the UIM of the policy, the tortfeasor’s vehicle in this qualifies case statute, as an underinsured In highway vehicle. the Faust vehicle was an highway “underinsured vehicle” because maintenance, was it “a respect vehicle with ownership, which, or use of the sum of the limits of liability bodily under all injury liability bonds and insurance policies [$100,000]applicable [$0] at the time of the accident less than the applicable limits [was] of the owner’s policy [$300,000].” N.C.G.S. 20-279.21(b)(4) (1989). [3] Nationwide next argues that even if this Court rejects its “threshold” in argument and allows stacking determining vehicle,” a vehicle is an “underinsured Ap Court of peals family nevertheless erred that a nonowner holding member THE
IN
HARRIS NATIONWIDE MUT. INS. CO. to such stacking. entitled Nationwide relies upon following
portion of the statute: event, any
In limit of underinsured motorist appli- cable to claim is determined to the difference be between the amount to the claimant paid to the exhausted pursuant liability policy and the total limits of owner’s insurance; coverages provided the owner’s of policies being the intent owner, paragraph provide may instances where more than one policy apply, benefits all limits underinsured motorist under all such .... added). .(emphasis Nationwide contends
that repeated the statute’s references to “owner” and “owner’s policy” that only demonstrate owners or vehicle statute, may avail themselves benefits under the such as the Thus, intrapolicy stacking approved in Sutton. Nationwide argues, vehicle, because Michelle is not the owner of the she is not entitled to stack UIM coverages.
Assuming, deciding, without that in- Nationwide is correct in the statute to terpreting only mean “owners” are intended to benefit from of UIM coverages, there no factual dispute that Mr. and Mrs. Harris “benefit” when their child Michelle is allowed to stack. To accept Nationwide’s argument would say the legislature intended parents, for Michelle’s owners, financially to benefit from their UIM when motorist, injured by an underinsured they did but not intend *9 for them to financially benefit when their minor daughter, a member household, of their injured is an Clearly, underinsured motorist. legislature “did intend unjust or absurd result.” [such] 325, See King, 276 N.C. 172 at 18. S.E.2d one
When
member of a household purchases first-party UIM
it
coverage, may fairly be said that he
she
or
intends to protect
all
family
of
members
unit within the household. The legislature
family
recognized this
unit
of
purposes
for
UIM
when
it
“persons
defined
insured” of the first class as “the named insured
and,
household,
while resident
any
same
spouse
named
insured and relatives of either . . . .” See Bass v. North Carolina
(1992)
Co.,
109,
Farm Bureau Mut. Ins.
79 340 App. N.C. S.E.2d disc. rev. 316 THE COURT IN SUPREME 194 CO. MUT. INS. v. NATIONWIDE HARRIS N.C. (1986)). These insured persons S.E.2d they relationship, their are based on protected, first class or otherwise. while in the covered vehicles riding one of injured when or Certainly, spouse “benefits” a owner See id. her can stack UIM or household' family residing member his in Sutton that enumerated principles We coverages. conclude also when the owner stacking allow intrapolicy when the injured party stacking allow intrapolicy class. a insured of the first person reason- perfectly logical of this case demonstrate The facts family unit a person a ing allowing member behind of her coverages. Because insured of the first class stack status, duty was no to honor contract minority Michelle E. have her own. 3 Robert might she on purchased insurance (4th 1981). Therefore, Lee, ed. Family Carolina Law North coverage. parents was on her for insurance dependent Michelle Also, accident, was a minor at time of since Michelle duty was her to the best of their abilities. parents’ support her 50-13.4(b) (1989). 229; Purchasing See id. is an of such daughter example support. to benefit their Michelle By duty protecting daughter, their their discharging support their ex- plainly by limiting out-of-pocket the Harrises “benefit” Therefore, we peace well their of mind. penses, increasing as Michelle, in the family living hold that as a nonowner member insured, is entitled to stack UIM same household as named with Nationwide. parents’ policy under her our in Smith supports Nationwide also contends that decision intrapolicy stacking its should not be allowed argument that unconvincing. find argument instant case. We this for argues rejected intrapolicy stacking Court Smith family only interpolicy stacking. members and allowed nonowner We stacking permissible Whether disagree. intrapolicy Smith, family member not at issue in and we con- nonowner was on stacking presented fined our decision to issue interpolicy Therefore, appeal. reject intrapolicy Smith should not be read to the Court in that stacking, an issue not before case. [4] Nationwide further argues multiple vehicles on one within nonowner “excess” “additional” *10 subject therefore not meaning 20-279.21(g), of N.C.G.S. § Act. Responsibility of the Financial compulsory provisions THE
IN
HARRIS v. NATIONWIDE MUT. INS. CO.
N.C. 184
Sutton-,
rejected
We
in
argument
reject
we
it again today.
Sutton,
Justice dissenting. First, errs in majority major respects. two it errs in holding tort-feasor’s is an vehicle “underinsured highway vehicle” within the of meaning the statute and the language in question. insurance It further errs in holding that the minor nonowner, plaintiff, entitled to stack intrapolicy determining Nationwide’s limit under the policy.
I. I with the disagree majority’s adoption of Greene’s con- Judge clusion, below, I his part dissent the tort-feasor’s vehicle qualifies here as an underinsured vehicle. I concur completely Webb, the dissent plain of Justice which he' concludes that liability coverages of the statute requires comparison determine there coverage. 20-279.21(b)(4) requires provide N.C.G.S. insurers to insureds coverage, affording with UIM their compensa- insureds additional tion when injured by “underinsured highway vehicle.” “Underin- sured vehicle” defined that same section as “a highway maintenance, which, with respect or use of ownership, the sum of the limits of bodily injury liability all bonds and applicable at the time of the accident limits the owner’s is less than the 20-279.21(b)(4)(1989) 1991) policy." (subsequently amended *11 IN THE COURT SUPREME MUT. INS. CO. HARRIS v. NATIONWIDE (1992)] N.C. [332 added). Thus, determining “person in whether a insured” (emphasis benefits, must first be determined it is entitled to UIM “underinsured.”- injuries the was vehicle fault for the insured’s is this to that determination provides liability” “the the limits of insurance made sum of comparing liability with the limits of “applicable for the at-fault vehicle liability Only if at-fault vehicle’s insurance the owner’s the policy.” liability limits of the insurance under applicable less than the injured insured entitled to UIM benefits. the owner’s policy fully Assembly’s with the interpretation comports This General coverage only of of the added offering protection purpose persons protection greater to third provided to insureds who have by law. than that required the two vehicles
Having compared here, not plaintiff evident me that was at issue to within the meaning underinsured 20-279.21(b)(4), is therefore not entitled to plaintiff and § benefits under say, majority, the Nationwide To as does policy. this to UIM as a result of accident plaintiff is entitled benefits the fact that completely ignores to insurance policy equal
under the Nationwide are vehicle, vehicle is the at-fault and therefore at-fault on 20-279.21(b)(4), within the of N.C.G.S. meaning underinsured require Even if to comparison the statute read (before stacking) owner’s UIM tort-feasor’s threshold one under the in person question here, limit of equal. Since the tort-feasor’s liabil- (not than) the ity equal insurance is less Nationwide underinsured plaintiff limit before here fails to meet threshold stacking, vehicle, and there is no definition of an underinsured stack. underinsured motorist II.
Even if with the majority I the tort-feasor’s vehicle agreed vehicle, the policy here was an both the K. Harris prohibit intrapolicy and the statute Michelle from stack- liability. limit of ing the UIM determine Nationwide’s II Judge part This was the conclusion reached Greene I only changes his dissent With his reiterate language, below. minor regard provision his both reasoning the statute.
IN THE
HARRIS v. NATIONWIDE MUT. INS. CO.
Policy
Motorists
endorse-
Coverage”
“Uninsured/Underinsured
part:
ment in the insurance policy provides
pertinent
If
issued to
other auto
*12
accident,
you
liability
to the same
the maximum limit of
apply
your
the sum of
injuries
for
or a
shall be
family
member’s
the limits of
this
under all such
coverage
policies.
139,
Co.,
In
Ins.
Smith v. Nationwide Mutual
328 N.C.
S.E.2d
(1991),
“the
policy language
stacking
this Court read this
to allow
family
family
when the
member
coverages
of UIM
for a
member
is covered more than one
issued to the named insured.”
However,
unambiguous language
Id. at
The two or more language requires policies above endorsement Here, Michelle family before is allowed member. stacking by only one This becomes policy. interpretation Harris was covered liability,” “limit of light irrefutable in of the definition of $100,000 liability for which limits the defendant’s UIM premiums of the of . . . shown “regardless number [v]ehicles Therefore, language, the Declarations.” the endorsement read liability” provision, prohibits in connection with the “limit of by family contained stacking multiple member of in a single policy.
Statute
insured,
as Michelle
Whether under the statute a nonnamed
such
Harris,
the in-
is entitled to stack UIM
to determine
addressed
surer’s limit of
is an issue that has
been
Casualty
Surety
In
v. Aetna
&
this Court.
Sutton
(owner)
and named
plaintiff injured party
policyholder
was
that the Court allowed
policies
insured of all of the
of insurance
259, 261-62,
759, 761,
Sutton, 325
382 S.E.2d
to be stacked.
N.C.
(1989).
denied,
reh’g
presented
HARRIS v. NATIONWIDE pertinent part: provides statute event, motorist the limit of underinsured any In the difference determined to be claim is to the ex- pursuant to the claimant paid the amount between owner’s limits of the and the total liability policy hausted in the owner’s coverages provided motorist insurance; to provide being paragraph the intent of owner, policy may than one in instances where more motorist limits of of underinsured the benefit of all apply, paragraph that this Provided policies: under all such motor vehicle only private passenger to nonfleet apply shall 58-40-15(9) in G.S. defined added). The statute is unam- (emphasis allowed “the benefit only the “owner” is in its biguous of underinsured of all words, only can stack underin- In other the “owner” policies.” all such Sutton, 325 N.C. See “coverages policies.” sured motorist’s *13 (statute stacking coverages allows 382 S.E.2d at bar, Sutton, in the was plaintiff the case at policies). Unlike insured vehicles. the of insurance and the policies the owner of both “owner,” context, owner in refers to the The statute reference to containing of insurance policy of the or (unless 20-4.01(26) 1991) context (Supp. See N.C.G.S. coverages. § definition, of words a different definition requires of statute statute). Therefore, statute, the to applies N.C.G.S. 20-4.01 § Harris, in question, the owner of the policy Michelle who is not available to stack the underinsured motorist is not allowed by of insurance issued the defendant policy on the entirely convincing. reasoning I find this parents. to Michelle’s However, only. for owners requires stacking The statute “in or for excess of coverage an express provision also makes the for a motor coverage specified in addition to subject shall not be coverage excess or additional policy and such 20-279.21(g) this Article.” to the N.C.G.S. provisions § nonowners, Hence, for provided nonrequired coverage if a policy would be “additional such intrapolicy stacking, such as by Respon- term is the contemplated as that Financial coverage” ob- nonowners sibility stacking required, Act. While for owners coverage, as “additional” or “excess” tain more that a nonowner 20-279.21(g).Tothe extent is allowed N.C.G.S. IN THE SUPREME COURT HARRIS v. NATIONWIDE MUT. INS. CO. N.C. 184
has additional excess the excess coverage, represent amounts voluntary that is to subject provisions not the compulsory the statute. Stacking Id. vehicles on one multiple policy nonowner is “in to” the the coverage required by addition terms 20-279.21(b)(4). of N.C.G.S. §
In judice, the case sub Harris Michelle is neither owner the policy at issue nor of the vehicles on the The UIM policy. change antistacking statute does not require intrapolicy Michelle allowed to stack the her parents’
on policy. explicit language the statute is: “It intent being provide of this owner . . . paragraph the benefit of all added). . . .” liability . (emphasis Disregarding completely explicit language of the statute and as to who an “owner” of the policy, majority because, a nonowner to permits intrapolicy stack UIM so, would doing financially the owners “benefit when their minor household, daughter, a member of their underin- injured by an sured motorist.” Resorting interpretation of which question aof statute or contract of will greater result financial opposed benefit as to the words of statute and plain completely unacceptable to me.
I now two other that I address matters believe merit considera- majority’s disregard tion: the of the recent legislative amendment in question, prohibiting stacking, statute intrapolicy public policy allowing reasons facts of this case. (b)(4)expan-
This Court should not read the subsection present sively intrapolicy to allow *14 stacking light legislative the recent statute. ch. amendment to the See 1991 N.C. Sess. Laws 2. The amended statute contains the following provision: applicable any The underinsured motorist limits to one motor shall with or added under combined any limits other motor vehicle that policy. 20-279.21(b)(4) 1991). (Supp. Although the amendment inapplicable its effective statute is this case reason of
date, as support should nevertheless be considered this Court intrapolicy for the that never proposition legislature intended IN THE 200 CO.
HARRIS v. NATIONWIDE MUT. INS. N.C. they even statute. present expressly Unless so, say necessarily amendments to statutes are not clarifications Nevertheless, intent. the fact that legislative legislature has amended since the accident in this intrapolicy stacking case to eliminate is some additional evidence that the statute’s which has not general purpose, changed, been is served when the statute is interpreted best so not to extend to all covered or stacking privileges persons. insured See Proctor 221, 225, v. N.C. Farm Bureau Mutual Ins. 761, S.E.2d amendment, least, very This recent should- expansion category serve to curb further of persons who are allowed to stack coverages multiple single vehicles on a under the statute. present majority makes the point separate premiums for each vehicle covered under A charged single policy. premium covered vehicle charged each because of the increased risk all of the being insured vehicles involved in an accident or ac- during cidents the same term. Several motor vehicles belong- be, are, to one can ing frequently household on the road at time, thereby same justifying separate premiums for cover- on each vehicle due to the age exposure increased of the several vehicles, vehicle, as opposed single to a involved in being separate A accidents. treatise on insurance law and practice is instructive point: on this
A few of the decisions adhering against to the rule or accumulation of stacking, coverages, UM use the correct is, reasoning. That the actual exposure of an insurer is multiplied vehicles, by the number of persons since different will be driv- ing upon separate them occasions and the risk thereby so that multiplied, separate must be upon carried each whenever vehicle is particular used. some courts . . .
Although pay considerable attention to policy language, actually the intent of most reasonably clear. This is true of the “each person” proviso the insuring agreements, irrespective of the number of vehicles insured. insurer, There no rule which forbids a single ordinarily, from providing against tacking, stacking, of the coverages available the several vehicles of a insured. single Nor is this considered to be if it against public policy, at least meets the minimum required by amount statute. *15 THE
IN MUT. INS. CO. HARRIS NATIONWIDE n Law A. Insurance and Prac- Appleman
8C & Jean Appleman, John (1981) (footnotes omitted). further tice The treatise states: a of doubling tripling If it is not to for or argue reasonable owner, single there a single policy limits when is a and it is not to such a
company, urge position then reasonable . . the of coverages. majority Yet . for uninsured issue, that upon feeling courts have confused themselves this they coverage, such the insurer somehow up unless double UM windfall, a for charges separate premium a since it receives it a applies separate each as automobile. If were
Let us for a moment. there analyze reasoning, automobile, insured, single only and he ever drove but obviously at a time and the only he can drive one vehicle But, courts then be in consider- reasoning might logical. such rate underwriting computation and the actuarial ing basic structures, customary pro- take we must into consideration now written so cedures mankind. Automobile insured, only not liability protection as to afford named owner, family, his usually perhaps who is but to members of household, in the and —with a few residing same persons — anyone with the named exceptions operating permission or his When it comes insured adult members of household. of exposure, to UM we have a like coverages, multiplication risk, including persons we stated since have classes all above, well, many with pedestrians granted benefits may when one be another vehicle or even circumstances upon highway. vehicle, single
When the insured then owns more than second, always contemplation it is that almost third, And will be others. those others operated or vehicles motorist, also, may, expose if an uninsured of the contract. aspect insurer loss owning an insured reasonably argued Now could only liability, them could insure one of for several automobiles collision, collect as to comprehensive, damages yet or for or — any vehicles he elected by, loss inflicted those upon, result which Yet this is precisely insure. counsel, under UM or their contend policyholders, Similarly, the courts. upheld repeatedly has been IN THE SUPREME COURT *16 MUT. INS. CO. HARRIS v. NATIONWIDE (1992)] 184 N.C. [332 double, limit of triple, single more logical it is no deliberately which the insured the amount of coverage, UM selected, to the insured. and tender it free single the situation where there is a
mayWe summarize owner, by multiple saying vehicles single company, you buy you get is: “What is what proper that the result —and courts, It those which have been so no more.” is time for others, with to take a new look at this generous the funds of problem. (footnotes omitted). 5101,
Id.
449-51
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IN THE COURT SUPREME MUT. HARRIS v. NATIONWIDE INS. CO. less multivehicle single premium generally because policy, provided policyholders.
discounts are Harrises, In the issued first $289.60, vehicle has a total whereas the second premium $131.30, as the third vehicle. only premium has a does totalling ap- This is noted on as “discounts page discount the declarations “multi plied,” car.” referring *17 insurance, statute, is still although regulated
Automobile law, governed by private parties contract where are allowed to long agree- as their respective rights private determine their statutory provisions. ment does not conflict with the An defined risk in for an accepts specifically exchange insurer adequately compensates the agreed upon premium amount Thus, the is necessi- being premium insurer for the risk assumed. ty the risk undertaken. being related to as the this Court the statute
Accordingly, majority of liberalizes stack multi- beyond persons its terms and allows more and more to will in- car the insurers ple coverages, premiums charged likely evitably (and point increased. Premiums will increase to have) will they may already many begin where insureds indeed reject only This result can be detrimental coverage. run, carry begin in the as motorists will public good long protection. less and less voluntarily coverage
The issue becomes not how much one can rather, required much will be choose to but how purchase, Continued society consuming public. and what costs to and eventually may have unwanted expansion of ability result of an accident victim’s reducing and deleterious recover, Financial thereby thwarting purpose remedial for the Responsibility Act. stated, majority dissent from the respectfully
For the reasons I Appeals. vote to reverse the decision the Court opinion and dissenting opinion. LAKE in this joins Justice dissenting. Justice Webb correctly says
I that the determination majority dissent. The Faust, tortfeasor, under- Mary Elizabeth is an as to whether IN THE SUPREME COURT STATE v. THOMPSON N.C. 204 on depends interpretation insured motorist of N.C.G.S. 20-279.21(b)(4), which defines “underinsured highway vehicle” as maintenance, respect ownership, vehicle with which, liability or use of the sum of limits under all liability bodily injury bonds and insurance policies applicable at the time of accident than the applicable less limits the owner’s policy. in this question “applicable There no case that limits $100,000 under the owner’s in this case would be policy” if Michelle Harris had been for injuries damages liable suffered in the This is accident. the amount of she tortfeasor had and was an underinsured motorist under 20-279.21(b)(4). majority
The cites treatises with dealing subject of unin- says sured motorist coverage noticeably absent from of them a comparison of the tortfeasor’s the plaintiff’s may say, insurance. Whatever the treatises I the plain believe the statute requires a comparison of liability to determine there coverage. plain us language requires to hold that *18 Mary Elizabeth Faust was not an underinsured motorist.
I Appeals. vote reverse Court LAKE joins Justice dissenting opinion.
STATE OF NORTH CAROLINA v. TAMMIE LEE THOMPSON
No. 424A91 (Filed 1992) September (NCI4th)— 1. Evidence tape Witnesses recorded telephone —no conversation constitutional violation —no ethical violation
The trial court did not err noncapital degree first prosecution by admitting murder two transcripts tape record- ed conversations between defendant and Jose Sanchez where voluntarily defendant drove from Florida North Carolina