Lead Opinion
The issue certified for our review is “whether a wrongful death claimant who is a statutory beneficiary of an insured decedent can recover under the uninsured[/underinsured] motorist provisions of the decedent’s insurance policy if [the wrongful death claimant] is not a named insured under the policy.” Implicit within this certified issue is the question of the effectiveness of a provider of uninsured/underinsured coverage utilizing a restrictive policy definition of who is an “insured” in excluding from coverage the claim of an uncompensated wrongful death statutory beneficiary.
For the reasons which follow, we find that appellant attempts to invoke a policy restriction that actually is inapplicable to the circumstances of this case, as the claims of the sons must be recognized as a matter of law. Consequently, appellant’s attempt to rely on the definition of an “insured” to support its denial of coverage is ineffective to accomplish that purpose, since appellant’s obligation to provide coverage arises due to the fact that an “insured” party has suffered a wrongful death. Accordingly, we answer the certified issue in the affirmative, and affirm the judgment of the court of appeals.
Our result is dictated by an examination of the interplay between the uninsured/underinsured motorist statute relevant here, former R.C. 3937.18(A), and the wrongful death statutes, former R.C. 2125.01 et seq.
Former R.C. 3937.18(A)(1) required (and current R.C. 3937.18[A][1] continues to require) the offering of uninsured motorist coverage to “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
Former R.C. 3937.18(A)(2) required (and current R.C. 3937.18[A][2] continues to require) the offering of underinsured motorist coverage to “provide protection for an insured against loss for bodily injury, sickness, or disease, including death Hs # Hi »
Former R.C. 2125.01 provided:
“When the death of a person is caused by wrongful act, neglect, or default which would have entitled the party injured to maintain an action and recover damages if death had not ensued, the person who would have been liable if death had not ensued * * * shall be liable to an action for damages * *
“Except as provided in this division, an action for wrongful death shall be brought in the name of the personal representative of the decedent for the exclusive benefit of the surviving spouse, the children, and the parents of the decedent, all of whom are rebuttably presumed to have suffered damages by reason of the wrongful death, and for the exclusive benefit of the other next of kin of the decedent.”
Distribution of wrongful death proceeds is governed by R.C. 2125.03. R.C. 2125.03(A)(1) provides:
“The amount received by a personal representative in an action for wrongful death under sections 2125.01 and 2125.02 of the Revised Code, whether by settlement or otherwise, shall be distributed to the beneficiaries or any one or more of them. The court that appointed the personal representative * * * shall adjust the share of each beneficiary in a manner that is equitable * * *.”
This sets the scenario to approach the key issue in this case — whether the insurance company’s definition of an “insured” in the uninsuranee/underinsurance policy is a permissible exclusion of the claims of the sons
In State Farm Auto. Ins. Co. v. Alexander (1992),
This court, in In re Estate of Reeck (1986),
Pursuant to Reeck, when an uninsurance/underinsurance provider pays proceeds for the wrongful death of a policyholder, those proceeds are characterized as “damages” recovered by a personal representative under R.C. Chapter 2125 regardless of how or why they are paid. As such, these damages are considered to have been recovered in an action brought by the personal representative of the decedent for the benefit of the statutory beneficiaries. R.C. 2125.02(A)(1). The damages are paid to the personal representative of the decedent. R.C. 2125.03(A)(1). They are not paid to the statutory beneficiaries directly, but must be apportioned to those beneficiaries by “[t]he court that appointed the personal representative.” R.C. 2125.03(A)(1). Thus, from the foregoing, it becomes clear that, because the insured party was killed (rather than injured) in the accident, the personal representative pursues the recovery the decedent is no longer capable of pursuing. See Thompson v. Wing (1994),
The parties in this case stipulated that appellant paid $250,000 “to the estate of Gawain Holt.” This statement is technically an inaccurate characterization of the payment made by appellant. Pursuant to R.C. Chapter 2125 and Reeck, what happened is that appellant actually paid $250,000 to the personal representative of Gawain Holt, Ingrid Holt. While it is apparent that Ingrid Holt is the executor of Gawain Holt’s estate, the wrongful death insurance proceeds were not received by her acting in that capacity. Rather, they were received by her in her capacity as the personal representative of the decedent. This focus on the personal representative of the decedent as the actual nominal recipient of the wrongful death proceeds makes a subtle distinction. However, this distinction is one required by R.C. Chapter 2125.
In her role as personal representative of the decedent, Ingrid Holt pursues the recovery the decedent cannot pursue. Initially, she pursues recovery against the tortfeasor. If the tortfeasor is uninsured or underinsured, she then pursues recovery under the uninsured/underinsured provision of the decedent’s policy. Any recovery she obtains under that policy is wrongful death proceeds. Only after the proceeds are received by the personal representative does apportionment become important. The court that appointed the personal representative divides up the proceeds, as each beneficiary’s measure of “damages.” It is important to recognize that any beneficiary’s personal right of recovery is the final step in the process, and that the proceeds were paid by the uninsurance/underinsurance provider to the personal representative (who was actually recovering in place of the insured decedent, who was unable to seek recovery) at an earlier point in the process.
It is incongruous for appellant to attempt to exclude, through the use of policy language, the sons of Gawain Holt from the definition of “insured” in the policy when, pursuant to R.C. 2125.03(A)(1), they potentially share in the distribution of the wrongful death proceeds as well. The arbitrariness of appellant’s attempted exclusion can best be realized by considering a hypothetical: Assume one of the
Appellant attempts to distinguish this case from the appellate decisions in Lynch v. State Farm Mut. Auto. Ins. Co. (Mar. 21, 1994), Butler App. No. CA9306-099, unreported,
“The death of a motorist protected by uninsured/underinsured motorist coverage was intended to be covered under both the statute and [the] policy. By purchasing [the] policy, [the decedent] was an insured even though the accident with the underinsured tortfeasor claimed his life. To hold otherwise would be to prevent recovery simply because the nature of his injuries was so severe as to cause his death. This would have the effect of altering [the] policy to only provide coverage for injuries.”
As Dion and Lynch noted, an attempt to avoid payment for valid wrongful death claims by narrowly defining who is an “insured” is an impermissible attempt to eliminate underinsured motorist coverage “where the claim or claims of such persons arise from causes of action that are recognized by Ohio tort law.” Alexander at the syllabus. The Alexander syllabus refers to the impermissibility of eliminating or reducing uninsured/underinsured coverage to “persons injured in a motor vehicle accident.” (Emphasis added.) When the special nature of a wrongful death claim is taken into account, it is totally consistent with Alexander to require coverage for the wrongful death claims of the sons in this case, since the claims of the sons arise only because the insured decedent was killed instead of being injured.
As this court stated in Reeck,
Furthermore, since the underinsurance claims arise only because the tortfeasor was not adequately insured, to deny underinsured coverage in this situation would be to treat the beneficiaries in a wrongful death case in which the decedent is killed by an underinsured tortfeasor differently from the beneficiaries in a case in which the tortfeasor was fully insured. Such a treatment would be contrary to the purpose of uninsured/underinsured coverage. See Abate v. Pioneer Mut. Cas. Co. (1970),
Appellant cites the following passage from Wood v. Shepard (1988),
“It is contended that the wrongful death statute, and specifically R.C. 2125.02, could be used, under today’s decision, to permit recovery by persons who are not in any way contractually in privity with an underinsured carrier. This, of course, is not the case. Only an insured under the underinsured motorist provision can recover under the policy for injury or wrongful death.” (Emphasis sic.)
Initially, this observation made in Wood was dictum. It was undisputed in Wood that all claimants were “insureds” under the policy, just as the claimant in Reeck came within the definition of an “insured” in that policy. Moreover, when the nature of a wrongful death claim is considered in the proper context, it becomes obvious that the wrongful death claimants seek recovery due to their status as statutory beneficiaries of an “insured” — the decedent. Thus, there is no need for the claimants to be in privity with the underinsurance carrier. Due to the special nature of a wrongful death claim, the concept of privity is inapplicable. It is sufficient that the decedent was in privity with the underinsurance carrier for coverage to be available. The Wood observation certainly was not meant to give underinsurance providers carte blanche to define an “insured” without due respect for the principles underlying former (and current) R.C. 3937.18(A) and Chapter 2125.
In conclusion, we reiterate several of the points expressed above. When a personal representative of a decedent brings a wrongful death action seeking to recover damages on behalf of the beneficiaries, the personal representative pursues the recovery the decedent is no longer capable of pursuing. When an uninsurance/underinsurance provider pays proceeds for the wrongful death of a policyholder, those proceeds are characterized as “damages” recovered by a personal representative under R.C. Chapter 2125, regardless of how or why they are paid. Even though the damages ultimately go to the beneficiaries, the proceeds are payable due to the fact that an “insured” party — the decedent— suffered a wrongful death. In light of these and all other foregoing reasons, we hold that an uninsurance/underinsurance motorist coverage provider’s use of restrictive policy language defining an “insured” is ineffectual to exclude from coverage the claim of an uncompensated wrongful death statutory beneficiary seeking to recover under the uninsurance/underinsurance provision of the decedent’s policy, since the correct focus for wrongful death recovery under a decedent’s policy of uninsured/underinsured coverage is whether the decedent
Judgment affirmed.
. Not at issue in this case is the question of whether there is an action for wrongful death at common law. See Thompson v. Wing (1994),
. Each of the sons of Gawain Holt, along with' Ingrid Holt, has a separate wrongful death underinsurance claim subject to a separate per person policy limit pursuant to Savoie v. Grange Mut Ins. Co. (1993),
. Amicus curiae points to the insurance policy at issue in Reeck, which it appears contained no requirement that a relative must reside with the insured decedent in order to be an “insured” under the decedent’s uninsured/underinsured provision. Amicus suggests that this case is distinguishable from Reeck — because the policy language in that case did not prevent the wrongful death claimant from being an “insured,” no issue arose as to the status of the claimant as an “insured.” While amicus does point out a valid distinction which prevents Reeck from being summarily dispositive of this case, Reeck’s explanation of how a wrongful death claim must be conceptualized is directly relevant to our resolution of the issue before us.
Dissenting Opinion
dissenting. Although stare decisis limits the extent of my dissent, that same doctrine dictates it. For as much as I disagree with the reasoning and holdings in Wood v. Shepard (1988),
PRIOR DECISIONS LIMITING RECOVERY TO INSUREDS
In Wood, the court enlarged underinsured motorist coverage for wrongful death beneficiaries by deeming that R.C. 2125.02 creates a separate claim for each wrongful death beneficiary. As a limitation to that holding, however, Wood also recognized that compensation for the claim is not mandated by R.C. 3937.18, unless the claimant is an insured under the policy.
Referring to the precise issue this court faces today, Justice Douglas, writing for the Wood majority, stated, “It is contended that the wrongful death statute, and specifically R.C. 2125.02, could be used, under today’s decision, to permit recovery by persons who are not in any way contractually in privity with an underinsured carrier. This, of course, is not the case. Only an insured under the underinsured motorist provision can recover under the policy for injury or wrongful death.” (Emphasis sic.) Wood at 91,
Faced with this limitation in Wood, the majority in the present case dismisses the prerequisite of contractual privity as “inapplicable” due to the “special nature” of a wrongful death claim. To reach the conclusion that wrongful death
However, to do so, the majority must ignore that in both Reeck and Wood, the wrongful death beneficiaries were permitted to recover because they also qualified as insureds themselves. In Reeck, the claimant was entitled to recover proceeds from the uninsured/underinsured section of the policy because she qualified as an “ ‘insured’ within the meaning of the State Farm policy.” Id. at 129, 21 OBR at 432,
The majority’s reliance on State Farm Auto. Ins. Co. v. Alexander (1992),
POLICY LIMITS PAID
Aside from it being at odds with our prior cases on the subject, this decision by the majority reasons from an unmet premise, i.e., that the position taken by the insurer toward its insured here is inequitable. I disagree. It seems that the payment of the insurance proceeds under this policy actually corresponds with the analysis of the majority. Indeed, under the majority’s rationale, Ingrid Holt received $250,000, as the personal representative, “stepping into the shoes” of the insured decedent. Under his policy, the decedent could recover only $250,000 as the per person limit. Applying the “stepping into the shoes” theory, Ingrid Holt and her sons as statutory beneficiaries may share the total amount of coverage paid to Ingrid as the personal representative of the decedent’s next of kin. There appears to be no reasoning by the majority supporting a requirement that there be more than one payment of the policy per person limit other than the status of
CONCLUSION
Consistent with our prior decisions and the intent of R.C. 3937.18 of providing uninsured/underinsured proceeds for those insured under the policy, rather than vicariously through the decedent, I would hold that an R.C. 2125.02 wrongful death beneficiary cannot recover under the uninsured/underinsured motorist provisions of a decedent’s automobile liability insurance policy unless the beneficiary qualifies as an insured. For these reasons, I respectfully dissent.