*1 trial court for proceedings further consistent opinion.

with this

Reversed and remanded. KIRSCH, JJ.,

NAJAM and concur. INSURANCE,

ILLINOIS FARMERS

Appellant-Plaintiff,

Tyrone Brown, TYSON and Joan

Appellees-Defendants.

No. 10A04-9310-CV-401.

Court of Appeals

Fourth District.

June

Transfer July Dismissed

ISSUE Ken- applying in court err the trial Did deciding an insurer in whether tucky law policy limits offset the allowed to should liability limits of against the tortfeasor of a underin- to an insured available the insurer? coverage with motorists sured

FACTS case are undisputed facts The driving a 13, 1991, Brown was on December by Farmers. by Tyson and insured car owned Louisville, Kentucky, she stop light At a by Norman by a car driven ended was rear injuries and Moxley. She sustained A. of Mox- expenses in excess incurred medical $25,000 limit. ley's liability in- Moxley's automobile Because $25,000, Brown sub- limited to surance motorist claim mitted an Automobile Farmers. (Policy) under Policy No. 36-12564-21-89 included underin- Tyson is insured $50,- coverage motorist sured $100,000 occurrence. per per person and a formal de- Brown made payment of underin- upon Farmers for mand benefits, Farmers advised sured reduce the it was entitled to $25,000, the limit of $50,000 liability Moxley's insurance. following position Farmers based Policy: provisions contained MOTORIST PART 2-UNINSURED Coverage Cover- Motorist C-Uninsured (Including Motorist Underinsured Gray, India- Gerth, & Kightlinger D. Mark Coverage) appellant. napolis, for an insured all sums which We Abbott, Guilfoyle, Thomas & R. Kenneth as to recover person legally entitled Jeffersonville, B. Trout- Abbott, Matthew of an damages operator the owner KY, man, appellees. Prospect, bodi- motor vehicle because uninsured person. ly injury Judge. RILEY, Plaintiff-Appellant Illinois Farmers Insur- ^[*] ^[*] i ^[*] ^[*] *# (Farmers) In This Part appeals the trial Used Definitions Company ance court's action Defendants-Appellees Joan Brown. for a entry of declaratory judgment Tyrone Tyson and motor Uninsured ^[*] vehicle which "k motor *# is: vehicle means ^[*] ^[*] ^[*] We affirm. i ^[*] ^[*] ^[*] ^[*] " b. Insured lability

bond or at the time of the acci shown in the Declara- provides dent which tion apply subject to amounts less than the limits of unin to the law of the state of the sured motorist shown in the occurrence, no more than *3 declaration Underinsured Motorist Cov these maximums of the number erage and Declarations.1 insured, of vehicles

[*] "k ^[*] "t volved in the occurrence. claims, claimants, policies or vehicles in- (R. 18) (emphasis original). Because of dispute, liability The limits of Farmers filed a shown Declara- apply subject to complaint declaratory judgment on Feb- ruary 12, 1993, 1998. April On Tyson 1. The person" limit for "each is the Brown filed a motion for summary judgment; bodily injury maximum for later, a month Farmer's cross-motioned for any person any one occurrence. summary judgment. July On trial court entered its summary judgment for the accident. Definitions 3b shall 2. The amount of Uninsured Motorist Other Coverage we available ^[*] any ^[*] to # party be reduced under Additional held to be liable *# cover- ^[*] (R. 74).2 order, limit of lability available to Joan Brown tract which leads this court tucky law to the set-off issue. policy limits of the pursuant erage [Farmers] has no because to its underinsured motorist cov- provided of an ambiguity in the con- legal right tortfeasor part: to to set-off the Ken- appeals. Farmers (R. Appellant's 4-5; 17-19) Brief at (empha- sis in DISCUSSION disputed position, Farmers' con- Summary Judgment appropri is an tending Kentucky law should disposition control as ate "designated when the eviden- to the extent of tiary under its matter shows that genuine there is no coverage. Under issue as to material fact and that Farmers is not moving entitled to party is entitled to as a reduce payable the amounts under its 56(C). under- matter of law." Ind.Trial Rule When insured motorist coverage by the amount of we grant review the judgment, Moxley's liability insurance. Brown based we conduct inquiry same as the trial position § her on of the limits court; however, party lost in the policy, which reads: trial court has the persuade burden to 1. The definition of "uninsured motor vehicle" is "3b" under the "Additional Definitions" accord- found, as asserted in Farmers' Brief under ing to Farmers' Exhibit A. "Additional Definitions Used in This Part" in purports Exhibit A which to be "a true and 2. A second issue in the mo- copy correct of the declarations that were issued involving tion stacking of insurance was re- Tyrone Tyson." 4-5; Appellant's (R. to Brief at solved the trial court in favor of Farmer's and 7-25). The definition of an "uninsured motor subject appeal. not the of this vehicle" is found on an unnumbered and out of sequence page which follows the "Limits of Lia- argues bility" Farmers also and "Other Indiana law Insurance" should sections in Part II (R. 18, 19). have controlled in "signifi- See this case based Although Tyson on a addition, analysis. and Brown do not cant discrepancy, raise this contacts" and we do not base our technicality, decision on this that it right litigate did not waive its Insurance," note that section 2 upon of "Other the choice of law issue. Because we affirm the argument, which Farmers bases its refers to the trial grounds, court's decision on other we de- "Additional Definitions 3b" when there is no cline to resolve Farmers' additional issues. adopt court will interpretation, one erred. trial court tribunal appellate Ind.App., insured. to the favorable most (1993), Group v. Criterion Campbell A contract Allstate, at 33. 423, 428, reh'g on N.E.2d

6 than one to more susceptible Summary judg be shown it can sus appeal if it is on affirmed will be ment reading the people on reasonably intelligent in the theory basis found tainable honestly as to differ would Faw trial court. designated material Supermarket ley v. Martin's denied. trans. App., 618 § argues that 34 under con of an insurance law choice of Liability" is not a con rules of the same are tract elementary "by application *4 contracts, construction and as other struction of rules fundamental grammar and of rules law for question of is a contract of a written construction, apparent it is ap particularly is re does not ambiguous and not provision is Ins. v. Selleck propriate. Westfield in de Kentucky law application of quire the 970, denied. trans. provi- validity [set-off] of the termining the generally of contract The rules gion." at 18-14. Appellant's Brief Allstate contracts. apply to 8,§ analysis of stat grammatical presents (1993), Ind.App., Mut. Bureau Farm United defines its independent clause ing that free to are Insurers 618 dependent clause liability, and the maximum however, exceptions, limita coverage; in be maximums could that "these indicates plainly ex be tions, must and exclusions of law of the state required creased is or limitation If an exclusion Id. pressed. However, Farm Id. at 14. the occurrence." will be any doubts clearly expressed, not the state of the law of ers asserts Id. drafter. the contract construed only applies oecurrence un for loss due determining the amount the underinsured Farmers' meaning of true policy, der an part and not to provision motorist from all of ascertained must be the contract Policy. of the the literal not from and provisions, provi spe Further, the set-off it an isolated of technical 5 sion cial clause. Liability" erred in the trial court located is not contends ambiguous Policy Rather, that the locat Policy]. it found it is portion [of invalidate Kentucky law to part of the applied separate completely and in a ed provision. Policy's "Oth set-off entitled uninsured Insurance." er interpreting the When "Subject to the law language extend the cannot policy, we of an insurance [Tyson upon which occurrence" state of unambigu clear coverage delineated apply to simply rely does Brown] contract. Uti in the insurance language ous sepa- in a contained provision Ind.App. [set-off] Ueding ca Mut. Ins. does [Plolicy.... Nor of the part rate where 63, 370 N.E.2d of the the limits language] affect [that is so of an in the declarations. [Plolicy as shown than of more susceptible ambiguous as to be any party injury available to of the occur- of the state to the law 4. 3. (em- (R. 18) rence, maxi- than these no more accident. for the to be liable held in- of vehicles original). the number phasis mums claimants, claims, poli- sured, insured (R. the occurrence. or vehicles involved cies Insur- the "Other fails note 6. Farmers 18) (emphasis in immediately Policy follows portion of the ance" por- portion and both the "Limits Cover- Motorist of Uninsured 5. 2. The amount (R. Policy. page in the are on the same 3b Definitions 19). any other shall be reduced Policy (emphasis original; decided to Id. at 15 footnote add- ed). Kentucky law. See also Meridian Mut. Ins. (1989), Ind., v. Richie analysis Policy Farmers' of the ("Courts give should strive to effect to the however, plausible; Policy does not con expectation insured; reasonable an explaining tain a section its limit of ambiguous policy should be construed fur- liability may be set-off affecting without ther purpose its basic indemnifying liability.7 limit of 'We cannot find reason loss."). [her] why a set-off which reduces Farm- erg' limit of to an insured should not Judgment affirmed. general provision to a about the lability. Thus, limit of an insurer's equal CHEZEM, J., concurs result. ly plausible argument couldbe made that BARTEAU, J., separate dissents with liability, modification of Farmers' like that opinion. described in provision, the set-off affects the A like BARTEAU, Judge, dissenting. 8,§ which makes the limits of Farmers' lia I respectfully dissent because I do not bility subject to the law of the state of the agree that the insurance contains a occurrence, would likewise make the modifi *5 provision; choice of consequently, law lability subject cations of the limits of to the test, the "most intimate contacts" Indiana law of the state of the occurrence. applies law right Farmers has a to set We cannot find in reading our of the Poli- off the amount it owes to Brown under the cy, argument nor does provide us policy by underinsured motorist the amount with, a deciding reason for interpre- that one payable to Brown under the cover- tation of portions the relevant Policy of the age of the underinsured motorist. can be construed within the four corners of the insurance contract and defines the inten- This case interpreta revolves around the § tion of 3 under parties tions of of the contracting. the Addi- tionally, explanation policy. we find our underinsured motorist argues Brown reasonable § that 3 a provision choice of law that light of our standard which demands that provides application for Kentucky the of the law court determine the amount due for loss dispute. to the set-off argues Farmers policy under an insurance be ascertained § 8 is not a provision, choice of law that it is provisions, from all of its and not from the and that provide it does not literal or technical unambiguous, construction of an isolated Allstate, special application the Kentucky clause. of 618 N.E.2d at 33. law to the set-off Thus, dispute. Farmers that The case before us is not one in which the rules, Indiana's conflict of laws Indiana law parties simply interpretations favor different determines whether Farmers is entitled to Policy, of the reasonably but one in which the set-off.1 intelligent people honestly differ as to its Thus, the trial court did not err Clearly policy gen the does not contain a when it found that the of eral choice of law providing that might argue However, ing that "set-off" and apply. "limit that Indiana law should liability" of are terms of art within the pursue argument not appeal does industry and that it is understood within the response argument to Farmers's that it is not industry provisions set-off do not affect a estopped, so we need not address that issue. policy's argu- of this. respond argu- Brown also does not to Farmers's light ment would be without merit in of the title appeal ment on that under Indiana's "most inti- Policy which reads: "Your E-Z-Reader rule, policy mate contacts" the should be inter- Policy," Car Policy and the introduction to the in accordance Thus, with Indiana law. preted Policy which reads: "Your E-Z-Reader Car of- because there is not a choice of law protection your fers tailored to needs. It is writ- the to dictate otherwise, need policy easy-to-read ten style." in non-technical only prima showing make a facie that the "most application intimate contacts" rule results in of argued 1. Brown in her motion for Indiana law to the See Coleman v. State (1992), estopped argu- Farmers was Ind.App., from trans. denied. denied, reh'g App., 526 N.E.2d and construed interpreted be policy will notes, While, as the trans. denied. particular of a the laws in accordance reason found contract will be of Thus, of laws rule the choice

jurisdiction. could reading contract upon brought, persons able the action where the state terms, meaning of its case, the law differ as to will determine in this ambiguity is not estab an interpreted policy will under which party asserts simply one Mfg. v. Gree because Co. lished Hubbard construed. 1073; see (1987),Ind., 515 N.E.2d asserted contrary to that son Further, "in deter (1991), Ind.App., party. Id. opposing v. Homer Guzulaitis also under an denied; for loss v. amount due mining Maroon 153, trans. meaning policy, the true (1980), 411 N.E.2d 404. Ind.App., State rule is must be ascertained contacts" contract "most intimate from literal or tech provisions, what to determine actions in contract applied special an isolated nical Eby transaction. govern the law Here, ma (my emphasis). clause." York-Division, Borg-Warner "Limits $ under the most Applying jority concludes N.E.2d 623. App., 455 trial ambiguous and thus the Liability" is in Travelers Ins. Com rule contacts intimate apply Ind.App., properly decided court Rogers panies ambiguous. § agree that 8 is that Michi I do not concluded law. this court ac insurance contract gan governed law contains uninsured motorist The Michigan resi insured was tion where following sections: signed the insurance dent and of the con portions Michigan. Several in the Declara- liability shown Michigan law specifically tract referred numerous contained and the max- person" is the The limit for "each *6 1. Michigan compliance bringing it into for any bodily injury by sustained for imum only connection Indiana's law. Any claim any person in one occurrence. that it was where was with the action injury to the loss of consortium for injured plaintiff and the occurred accident injury shall relationship arising from this of Indiana. a resident in this limit. included resident. an Indiana Here, insured is responsibility law of If the financial ga- registered is vehicle The insured loss of treats place of the accident Indiana, and the raged in claim, financial separate as a consortium Indiana edition. it was an noted that be furnished. responsibility limits will are that only contacts with person", limit for "each Subject to the 2. in- Kentucky and the accident occurred maxi- is the limit for "each occurrence" Kentucky. a resident jured claimant is bodily injury amount for mum combined showing prima facie made a Farmers has any persons by two or more rule, contacts intimate the most that under one occurrence. interpretation and govern Indiana law should of the state of to the law 3. occurrence, more than will no we cor as the Under number regardless of the maximums these notes, to limit cover rectly are free insurers insured, Insured vehicle limitations, and exelu- exeeptions, age, but claimants, in- claims, policies, or vehicles any expressed and plainly must be sions in the occurrence. volved against the contract will be construed doubts Insurance Other Farm v. United Ins. Co. drafter. Allstate only pay under this Mut. Ins. Co. 1. We will Bureau any appli- after the clear and the contract 33. If injury Hability poli- bonds cable of the contract unambiguous, by payment of have been exhausted Sharp cies plain given must be settlements. judgments or Ins. Co. Indiana Union Mut.

2. The amount of Underinsured Motorist I would reverse the trial court and order Coverage in favor of Farmers. Definitions 3b [includes an underinsured

vehicle in the definition of Uninsured mo-

tor shall be reduced vehiclel any any party

available to held to be liable

the accident. Except provided

3. as in paragraph above, other collectible insurance RECYCLING, INC., BEDFORD applies to a loss covered part, this Appellant-Plaintiff, pay only our share. Our share is the proportion lability that our limits of bear applicable the total of all limits. U.S. CORPORATION, GRANULES 4. provide We will not insurance for a Appellee-Defendant. your car, vehicle other than un- No. 50A04-9308-CV-283. less the owner of that vehicle has no other applicable part. to this Court of Appeals If applicable insurance other than Fourth District. you by issued to us or company member of the Farmers June Group Companies, the total payable among amount all such

shall provided not exceed the limits

single policy highest with the (emphasis

R. 18-19 When read

in context with the other sections set out

above, § 3 under unam-

biguously states that of the num-

ber of vehicles insured or involved in the

accident of the number of claims or involved in the accident, the maximum will be as

stated in §§ the Declarations and Liability," unless the law of

the state of the requires higher occurrence

minimum provision says This abso-

Iutely nothing reducing about out sub-

ject to the laws of the state of the occur- agree

rence. I do not with the "general provision

this is a about the limit of liability"

... applicable to a reduction in the paid

amount out. Section under "Other clearly

Insurance" unambiguously states paid the amount out will be reduced

the amount available

motorist and this section is not

law of the state of occurrence. This is a

valid see Ind. 27-7-5-5,

Code and Farmers is entitled to

the set-off.