*1 Berry compelled Mrs. have could not Bierman lot. $2,100 for the vacant repur- option Berry her not exercised had Mrs. destroyed than fire more was when the house
chase Consequently days final. decision became after our property en- and is the owner of was still Bierman proceeds he of the insurance titled to bought appellant’s not discuss for. We need agreed orally prove had Bierman the trial that offer to at only keep property Not insured. in 1955 to back rule, parol agreement evidence «violate such would argued point held, is not as in trial but also court appellant’s brief. Affirmed. HEISS, Ex’x et U. AETNA
Martha al v. AND SURETY CO. CASUALTY 5-5533 S. W. 2d
Opinion April 19, delivered appel- Richard H. Mays Yocum, ir Mahony lants. *2 appellee. for Shackleford, ér
Shackleford Appellants U. Lyle are Martha Brown, Justice. Henry Heiss, A. and Heiss, executrix of the estate of individually Hall, of the T. and as executrix Dorthea Appellee of an auto- T. M. Hall. is the carrier estate of containing uninsured mobile insurance provisions companied by Henry latter, ac- T. The to M. Hall. issued Hall, T.
A. Dorthea Heiss and Mr. Hall and Mr. collided with an uninsured motorist. injuries T. Hall was received fatal and Dorthea Heiss seriously injured. passenger car, in the Hall Another injuries Robertson, received for which he W. was minor J. satisfactorily party compensated he appeal. paid The two estates and Mrs. Hall were $2,000 each for medical which was the maximum under paid Ap- the medical Robertson was $565.20. pellee chancery impleading then filed this suit court Appellee $13,434.80. the sum of was contended that it $20,000 entitled to deduct the medical maximum contained in the uninsured motorist section of the by from the policy. upheld deduction, Whether that which was chancery proper appeal. court, was is the issue on Payments—insured Coverage C—Medical II, Part occupants T. M. Hall and all of his vehicle for medical expenses per- $2,000 in a maximum amount of for each charged son. For that nine dollars. insurer (Damages for Coverage G—Family IV, Part Bodily Injury Protection provisions]) carried [uninsured provision: separate premium this and contained $5.00 pay To all legal repre- sums which the insured or his legally sentative shall be entitled to recover as dam- ages operator from the owner or of an uninsured bodily injury, automobile because of sickness or including disease, inafter resulting death, therefrom, here- “bodily injury,” called sustained arising sured, caused accident and out of the ownership, maintenance or use of such uninsured automobile;... undisputed (I) occupants Hall all of the
It is (2) insureds, of the were that the limits vehicle $20,000 total each each for were insured occupants vehicle, accident, Hall all damages except Robertson, far in excess suffered total payable policy. tíre máximums limi- contained this The motorist clause uninsured liability: tation of obligated Company shall not part damages which may be to recover the owner
insured or resents entitled rep- operator of an uninsured automobile pay- for medical services *3 able Part II. under in law is found Ark. Stat.
Our uninsured motorist (Repl. 1966): Ann. 66-4003 § covering liability liability insurance, No automobile arising ownership, maintenance, use or out any vehicle be or for of motor shall delivered issued delivery respect any ve- in to this State motor registered principally garaged hicle or in this State provided supplemental is therein or unless thereto, limits in in not less than described section amended, of Act of as 1953 [§ 75-1427], approved by filed with and per- protection Commissioner, for of Insurance legally to sons thereunder who are entitled insured operators damages or unin- recover owners of bodily injury, sick- vehicles because of sured motor resulting including therefrom; disease, death, or ness required provided, however, un- any applicable der this insured named shall not be section where policy reject in cover- shall age. (Supp. provides: 1969),
Ark. Stat. Ann. § 75-1427 No or bond shall effective Section unless issued an insurance com- [§ 75-1426] pany surety company or authorized to do business except provided State, in this in subdivision b of section, nor unless such bond or is sub- ject, bodily injury if the accident has resulted in death, limit, costs, or to a of exclusive interest and bodily injury $10,000 of less than because of (1) person any (1) or death one in of accident one subject (1) person, to said for limit one ato bodily $20,000 limit of not less than of because jury any (2) persons to or death of two or more in (1) accident, one injury and if in the accident has resulted property,
to, or destruction to a limit injury $5,000 not less than because to or destruc- property tion of in others one accident. position takeWe that the deduction for medi- cal recited the uninsured motorist section derogation explicit requirement of our unin- responsibility sured motorist statute and financial law supra, set forth in quire 75-1427, § 66-4003 and which re- § injury $10,000 limits of “not less than” for person injury death one to or death persons. Although of two or more our court has not pass question, had occasion to on the it has been met squarely jurisdictions, point other as we shall now out. Exchange, Group
Bacchus v. Farmers Insurance *4 (Ariz. 1970). Pac. 2d The Arkansas and Arizona statutes uninsured motorists almost are identical. paid In Bacchus the insurer the reduced amount provision by the uninsured motorist had the amount it already payments under the In clause. con- demning procedure the the court said: type insurers, any Permitting would allow of offsets the statute contract, alter of to the Legis- liability, part escape the of which all the to they provide. The medical should intended lature payment independent coverage part policy is the of be and should the uninsured of a different if carried with as it were treated the same company. [*] # [*] irresponsible financially driv- against By statute our to available made must be a minimum ers Legis- a rather as but insureds, convenience aas and cents dollars of in amounts lative mandate nothing imagination drafters of to the which leave per person policies—$10,000 of the insurance the per The fact $20,000 sees fit occurrence. pro- other insurance himself to clothe medi- premium as pays therefor—such a tection and mandatory safe- payments—cannot alter the cal necessary Legislature considers guards that the state. being of our citizen-drivers the well provision in- for which particularly, a More sured considers protection be additional to protec- pays premium with extra such which he transposed the insurer in mind cannot a tion mandatory minimum cov- into erage. reduction v. Allied Mutual Insurance 156 N. W. Stephens Co., (Nebr. Again 1968). on un- the Nebraska statutes 2d insured motorists and financial
responsibility are sub- stantially In the same as ours. the court faced Stephens problem rejecting same before In us. attempt insurer’s to use the medical set- off the court said: complex, devious, if not ramifications
application language can be of this clause quite simply plaintiff If the in this case illustrated. expense coverage had contracted for medical sum of and had suffered medical amount, in excess of this the effect of setoff completely herein involved would be to elimi- coverage. By nate the its terms provision subrogation is not in the nature liability. but a It can limitation be contended only pay nothing that not would the insurer statutory coverage, but under its subro- gation rights entitled, it would be the extent payments, expense proceeds its medical covered re- *5 the uninsured tort-feasor motorist.
479 provision We therefore hold that a in an automobile liability policy be obli- shall not that an insurer gated age motorist cover- under the uninsured part damages which
for that the insured may opera- be entitled to recover from the owner or represents tor of an uninsured automobile which payable services medical payments coverage is void against public policy in the min- that it reduces coverage pre- protection imum scribed required by the law. Tuggle Employees Co., v. Government Ins. So. 207 (Fla. 1968). Again we 2d 674 ours. have the same statutes Referring to the setoff clause the uninsured section, on its face court said: “The clause is one to decrease uninsured beneath statutory minimum, which that un- one means (medical der certain conditions benefits excess $10,000) there will be no uninsured motorist whatever.” Robey Security v. Northwestern Co., F. Ins. 270 Supp. (Ark. 1967), 466 and Boehler v. Com- Insurance 867
pany 1968), Supp. America, (Ark. North F. provision dealt with the setoff cases, at hand. Those precedent decided court, without benefit of from our proper. held the setoff to be Of course those decisions persuasive binding are but not more us. We think the rational conclusion is that which we have reached and par- that it is in line with the trend of authorities and ticularly harmony with a number of decisions have been announced since those two cases. With exception of the two cited district court we have cases precedent contrary been holding, keep- cited to no to our ing particular in mind the facts, statutes, and contrac- tual Appellee in the case at bar. MFA cites Mutual Wallace, Ins. Co. v. 230, Ark. 431 S. W. 2d (1968), McKinley, and MFA Mutual Ins. Co. v. 326, Ark. (1968). S. W. 2d The facts in those precedent cases lend no to the case at hand.
Reversed. J., concurring.
Fogleman, *6 concurring. A. I do not Justice, Fogleman, John disagree policy particular with the result reached on this particular closing language in this case. of The the ma- jority opinion appears it, to so restrict but earlier lan- general guage apply is so that it would seem to me to policy. Certainly precedents upon to such the relied are not so restricted. constantly keep un- in mind fact that the must We coverage liability on not is
insured motorist insurance indemnity motorist, insured to the the but uninsured by against perils injury motorist. an the of uninsured 95, Bradshaw, 431 W. v. Ark. S. Ins. Co. MFA Mutual Daniel, Ins. v. Farm Bur. See also Southern 2d 252. remember 849, We must also 440 W. Ark. S. 2d 582. parties are limited the contract insurance the to pub- only by statute contract in the terms of the by acceptance an insured policy. said that lic haveWe including policy motorist cover- uninsured of such age approval con- of all reasonable to be is deemed expressed not which are therein ditions and limitations contrary public policy. Co. v. Brad- Mutual Ins. to MFA supra. that our shaw, remember statutes must also We coverage manda- do make the uninsured They require tory. only be offered. the payments They require be that Consequently, do not medical the the freedom of or offered. included parties payments with reference medical to contract wholly be limited is any unrestricted. Such can parties
way see fit. pointed As out Drummond Motor- “Uninsured Coverage—A Consistency,” Suggested Approach ist policy 181, 167, Ark. L. Rev. the clause used says absolutely nothing reduction of uninsured about coverage. The be- reduction under the clause only payment fore us part relieves insurer damages may which the insured entitled repre- to recover from the uninsured tort-feasor payable pay- or sents amount example given ments at Drummond clearly page application expository of his article is so considering, I we are liberty quoting language, take his viz: language hand, If, the al- other “damages utilized, ternative form is may which the insured be entitled to recover from operator the owner of an uninsured automobile” “repre- $30,000, sum, $2,000 would be and of that *7 expenses paid payable” sents under the less insured motorist limit of for services medical payments coverage. Thus, $30,000
medical applicable $28,000, with but un-
only $10,000, A would be recovery limited to of that amount. summary
Drummond’s so of the effect of the seems clearly interpretation out, correct that I it also set as follows: despite interpretation by
Thus, the announced courts, insurers and most the clauses in the two insuring agreement uninsured motorist rela- forms application paid tive to the amounts under medi- payments coverage parallel. cal are not The first clearly form states that the uninsured motorist shall reduced. second insurance states equal clarity legally damages that recoverable shall form reduced, be presumably and the authors of this option selecting
had the the alterna- they essentially Instead, say tive form. elected to damages the this: If insured’s total are less than coverage, the limits uninsured motorist then by is reduced the amount payments coverage; (2) the medical If the insured’s damages total exceed the sum of the uninsured payments limits, limits and the medical by latter; there is no (3) reduction of former damages If the insured’s total exceed unin- sured motorist limits are less the payments but than com- bined medical you limits, then must determine the insured’s total damages, reduce them medical amount of coverage, covered motor- the difference uninsured coverage up ist to the limits of that appeal a denial comes before This case us summary by appellants, judgment of a motion for dismissing stipu- an order their counterclaims. It was period prior lated that Heiss was conscious some his death which occurred col- within hours after Vz lision; that he left a widow who mental an- suffered guish consortium; and loss of he also left three engineer children; employed salary that he was an at a expectancy $40,000; he had a life of 16.81 years. stipulated It was that Hall received various juries, surviving that he left a widow whose life ex- pectancy years child, was and one and that he had 27.81 expectancy years. highly unlikely a life of 14.14 It seems damages appellant that the to either be so small would damages as to reduce recoverable lim- below its, application requisite but the standard should upon be a matter for the trial court remand. reasons, For various I do not consider the cases majority opinion applicable. instance, cited in the For *8 Stephens in Co., v. Allied Mutual Insurance Neb. 182 562, (1968), 133, 156 N. W. A. L. R. 2d 3d 26 873 upon premise coverage clause was voided that the required by the statute that state “is in the nature liability policy,”—a premise a substitute rejected by that has been upon separate It
us. is also based two independent separate contractual for which a premium charged and collected. In the case before us appellee’s actuary the affidavit is uncontradicted. He computing premium charged states that for un- coverage insured motorist question under its consideration, is taken into that premium creased coverage rate for uninsured motorist payment expense would result from of medical losses coverage. expla- in addition to uninsured motorist This theory nation is consistent with Drummond’s as to the Furthermore, effect of the clause. in that case the Ne- upon braska court relied to some extent decisions may liability an insurer motorist not limit its under uninsured coverage by through setoffs or limitations “oth- clauses, er insurance” such as claimed with reduction respect compensation to workman’s or other insured coverage., position motorist matter of a we have not taken. As a contrary position
fact, we have taken a as Wallace, “other insurance” in MFA v. Ark. 245
485 230, 742, 431 W. S. where 2d we refused to follow deci- sions have federal district courts Arkansas. We should consistency philosophy
a in the of our decisions coverage. While Wallace is cer- tainly controlling us, in this case before a result upon Stephens certainly adoption based constitutes philosophy. of an inconsistent Group v. Exchange,
Bacchus Farmers Insurance 280, Stephens Ariz. P. 2d follows precedent. Bacchus, Another factor entered into how- ever, in that a clause was under consid- different policy, In eration. the medical were classi- repaid fied as advancements in the form of a set- against off pro- other insurance available under another policy. again, vision the same There it is clear that separate premiums coverages, were for the two with premium no indication that either rate inwas re- spect dependent upon or related to the other Tuggle Employees
In Co., v. Government Ins. (Fla. 1968), 674, So. A. L. R. 3d 2d decided division, emphasized 3-2 the Florida court the fact the two sep- classes of “were contracted arately, independent premiums.” proceedings
I the case further con- would remand interpretation set sistent with hereinabove Drummond’s questions as to other such clauses out reverse really backgrounds they are as to other until factual necessarily in issue.