This claim arises out of an automobile accident that occurred on July 15, 1991 when the plaintiff, while stopped at a red light, was struck from behind by a motor vehicle which was owned and being operated by Bei-Rong Ye. As a result of that collision, the plaintiff sustained personal injuries and losses and, on April 8, 1992, brought an action for damages in this court. Bei-Rong Ye had liability coverage with Patriot General Insurance Company in the full amount of $20,000 on the date of the accident.
On April 5, 1993, the plaintiff's motion for summary judgment as to liability only against Bei-Rong Ye was granted. On May 3, 1993, the court granted plaintiff's motion to cite in his carrier, Allstate Insurance Company, as a party defendant in plaintiff's action against Ye for purposes of determining Allstate's liability pursuant to the underinsured provisions of the coverage which Allstate provided the plaintiff.1 At a hearing in damages held on June 30, 1993, judgment was entered in favor of the plaintiff and against Ye in the sum of $68,867.00. That judgment was satisfied within the limits of Ye's coverage.2
On June 4, 1993, the plaintiff filed the complaint in this action after having made service on the defendant on May 27, 1993, some thirty-four days prior to the hearing in damages in the action against Ye. Allstate filed its appearance in this action on July 29, 1993 and subsequently filed a special defense alleging that the plaintiff's recovery is limited to the $100,000 policy limit for uninsured/underinsured motorist claims.
There is no dispute between the parties that, at the time of his accident involving the Ye vehicle, the plaintiff owned a vehicle which the defendant insured and the coverage included uninsured/underinsured motorist provisions. Nor is there any dispute that Ye had a maximum liability coverage of $20,000 at the time and that the plaintiff exhausted the full amount of that coverage. Summary judgment as to liability only was granted in favor of the plaintiff on April 11, 1994 and the matter was claimed for a jury trial on the hearing in damages. The defendant admits that it is obligated under the policy to pay the plaintiff damages for bodily injury that he would be legally entitled to receive from the owner or driver of the underinsured motor vehicle. CT Page 740
The purpose of requiring underinsured motorist coverage is "to give a personal injury claimant access to insurance protection to compensate for the damages that would have been recoverable if the underinsured motorist had maintained an adequate policy of liability insurance." Smith v. Safeco Ins. Co.of America,
The court noted that "[b]ecause underinsured motorist protection is not intended to provide a greater recovery than would have been available from the tortfeasor. . .the statutory reduction mandated by §
The pertinent part of §
Finally, §
The Connecticut Supreme Court further noted that "it is undisputed that this phrase [`uninsured motorist'] also includes, as in this case, an underinsured motorist. . . . Thus, in this context, the plaintiff must prove that his damages exceed the amount of liability coverage of the tortfeasor." Id., 368 n. 9.
In moving for judgment prior to trial, the plaintiff has raised the issue of whether, under the circumstances of this case, the defendant legally is bound by the judgment rendered in favor of the plaintiff in Mazziotti v. Ye, Superior Court, Judicial District of New Haven, Docket No. 92 033 08 55. Were the court to grant the motion, it would have to find that the judgment entered against the underinsured motorist is conclusive as to liability and damages in the plaintiff's present action.
The liability policy issued to the plaintiff states, in part, that: "We will pay damages for bodily injury, sickness, disease or death which an insured person is legally entitled to recover from the owner or operator of an uninsured auto."3 The plaintiff contends that the amount which he is legally entitled to recover under the policy has been determined by the judgment entered in the Ye matter. Accordingly, he seeks to have the court enter judgment in his favor in the sum of $68,867.00, less any deductions required by law.
The defendant argues that the doctrine of collateral estoppel cannot apply in this case because of lack of privity between Allstate and Bei-Rong Ye and, further, the judgment entered against Ye cannot bind the company because the plaintiff failed to obtain a written consent to sue Ye as required under the CT Page 742 policy.
In Rawling v. New Haven,
"The doctrines of res judicata and collateral estoppel protect the finality of judicial determinations, conserve the time of the court, and prevent wasteful relitigation." Gionfriddov. Gartenhaus Cafe,
"Collateral estoppel may be invoked against a party to a prior adverse proceeding or against those in privity with that party." Aetna Casualty Surety Co. v. Jones, supra,
In the present matter, the defendant is in privity with the underinsured motorist in the prior action because both parties share the same legal interest. At issue in the underlying tort action against Ye was whether the plaintiff is legally entitled to recover damages from Ye and the amount of such damages; both claims being central to the issue of whether the plaintiff can recover underinsured motorist benefits from Allstate. Those issues were litigated and decided in favor of the plaintiff, a decision necessary to the judgment entered for the plaintiff.
To the extent that Allstate and the underinsured motorist share the same interest on the issues of liability and damages, CT Page 743 "the insurer has an interest mutual with that of the uninsured motorist and becomes therefore a `privy' of the uninsured."Nationwide Mutual Insurance Co. v. Webb,
Although the issue here appears not to have been addressed by our appellate courts, a similar issue arose in Harnicar v.Nationwide Mutual Ins., Superior Court, Judicial District of Litchfield at Litchfield, Docket No. 063893 (
The court, in Harnicar, granted the plaintiff's motion for summary judgment, holding that where the defendant insurer had notice of the plaintiff's suit against the tortfeasor and an adequate opportunity to intervene and present defenses to protect its position, but chose not to, the defendant was bound by the judgment as to the issues of liability and damages. Id., 547. Courts in other jurisdictions also have concluded that, where the insurer has notice, a judgment entered against an underinsured motorist is binding on the plaintiff's insurer in a subsequent action to recover underinsured motorist benefits. See, e.g.,National Grange Mut. Ins. Co. v. Smith,
In Champion Ins. Co. v. Denney,
The question remaining before the court is whether Allstate had sufficient notice of the prior tort action against Ye to provide the insurer with an opportunity to intervene and protect its own interests. "It is settled law that considerations of due process require notice in order for an insurer to be bound by the outcome of the tort action. " Aetna Cas. Surety Co. v. Souras,
As noted earlier, the plaintiff had service made upon Allstate on May 27, 1993, thirty-four days prior to the hearing in damages and judgment against Bei-Rong Ye. The complaint dutifully apprised Allstate of the relevant facts and allegations made in the plaintiff's action against Ye. Moreover, prior to the filing of either of the plaintiff's actions, Allstate had paid $4,492.71 (of a $5,000.00 maximum) to the plaintiff for medical expenses pursuant to the Basic Reparations Benefits provisions of the plaintiff's insurance policy and thus was on notice as to the extent and serious nature of the plaintiff's injuries. Aetna Cas. Sur. Co. v. Souras, supra, at 552 A.2d 911.
"[T]he combination of these factors clearly indicated that [Allstate's] coverage under the [underinsured motorist provisions of the] policy was at stake, and alerted [Allstate] to the need to protect its interest." Id. The court finds the defendant had adequate constructive notice, because of its payment of basic reparation benefits in the sum of $4,492.71, as well as adequate notice made by service of process on May 27, 1993 to satisfy due process requirements. The June 22, 1993 return date in this action required the defendant to enter an appearance by June 24, 1993 to avoid the risk of a judgment being entered by default. The defendant also chose to ignore that requirement and, as previously noted, did not enter its appearance until July 29, 1993.
The defendant is bound by the judgment in the underlying tort action as to the issues of liability and damages. It is noteworthy that the defendant makes no claim that it had no notice of the underlying tort action, but argues instead that the plaintiff failed to obtain Allstate's written consent to CT Page 745 prosecute the action against Ye as required under the policy. Nor is there any claim of prejudice to Allstate from the plaintiff's failure to comply with the written "consent to sue" clause and the delayed notification of the tort action against Ye.
In claiming that it is not bound by the judgment entered against Ye, the defendant relies mainly on the plaintiff's failure to obtain its written consent to sue. The applicable policy provision states:
If an insured person sues a person believed responsible for the accident without our written consent, we aren't bound by any resulting judgment.
Allstate Automobile Policy, Court's Exhibit A-1, p. 22.
In Nationwide Mut. Ins. Co. v. Webb, supra,
After a default judgment was entered against the uninsured motorist, the plaintiff brought a second action against the insurer and filed a motion for summary judgment, claiming that the insurer, "having had notice of and an opportunity to intervene in the tort action but having refused to intervene, was liable as a matter of law for the amount of the tort judgment against [the uninsured motorist]." Id., 470. The insurer opposed the motion on the ground that it was not bound by the default judgment because it had not given written consent to the tort action pursuant to the terms of the policy.
In holding that "conditions or limitations in an uninsured motorist endorsement, which provide less than the coverage required by the statute, are void, " the court affirmed the intermediate appellate court's decision that the "consent to sue" clause relied upon by the insurer was void. Id., 471. The court noted that the "overwhelming majority" of jurisdictions have held that "the `consent to sue' clauses are against public policy and CT Page 746 that an insurer, with notice and an opportunity to intervene, will be bound by the resolution of the issues in the tort suit."Id., 472.
As discussed earlier, Connecticut law requires that each automobile liability insurance policy "shall provide insurance. . .for the protection of persons insured thereunder, who are legally entitled to recover damages from owners or operators of uninsured motor vehicles and underinsured motor vehicles. . . ." (Emphasis added.) Section
Here, the plaintiff was granted summary judgment "as to liability only" before the matter was presented as a hearing in damages. "If an insured has obtained a valid judgment in a tort suit against the uninsured motorist, he clearly `is entitled to recover' those damages from the uninsured motorist. To allow an insurer to pay something less than those damages which the insured is entitled to recover against the uninsured motorist because of a policy clause requiring the insurer's consent to prosecute the tort suit against the uninsured, on its face cannot be squared with the statutorily mandated coverage." NationwideMut. Ins. Co. v. Webb, supra, 436 A.2d 473.
"The un[der]insured motorist provision, if it is to achieve its salutary purpose, should not compel the claimant to incur the considerable expense of presenting his claim more than once."Long v. General Accident Fire Life Assurance Corp., supra,
In the context of this case, the court finds the "consent to sue" clause of the policy invalid4 as against public policy because it would conflict with the statutorily mandated coverage to permit Allstate "to pay something less than the CT Page 747 damages which the [plaintiff] is entitled to recover against [Ye] because of a policy clause requiring [Allstate's] consent to prosecute the tort suit." Nationwide Mut. Ins. Co. v. Webb,supra, 436 A.2d 475. A hearing in damages would put the plaintiff at risk in obtaining a verdict awarding damages less than that amount which he is legally entitled to recover under the Ye judgment. Such a result would require a court either to order an additur or to set aside the verdict to prevent an inequity.
Since the judgment against Ye, an underinsured motorist, determined that the plaintiff was entitled to recover damages and established the amount of damages that the plaintiff was entitled to recover, Allstate is not entitled to re-litigate that which has already been determined. The judgment against the underinsured motorist is conclusive as to the issue of damages in the present action and the plaintiff's motion for judgment is granted.5
The plaintiff is "legally entitled to recover" $68,867.00 damages from the underinsured motorist, Bei-Rong Ye. Ye's liability policy limits were only $20,000.00 and satisfied the judgment to that extent in addition to costs and interest in the sum of $9,000.00. The provisions of Section
The defendant is entitled to credit for collateral source payments received by the plaintiff in the sum of $24,492.71 ($20,000.00 for the judgment paid pursuant to the underinsured motorist's liability policy and $4,492.71 for basic reparations benefits). Judgment in the sum of $44,374.29 is hereby entered for the plaintiff.
After filing this action with a return date of June 22, 1993, the plaintiff filed an offer of judgment on December 8, 1994 in the amount of $42,500.00. Accordingly, the plaintiff is entitled to interest on the judgment of $44,373.29 from the date of the filing of the complaint at a rate of 12% per annum pursuant to the provisions of Section
After securing a judgment in the matter of Mazziotti v. Ye,
the plaintiff brought an action against Ye's carrier, made returnable to this court on October 26, 1993, entitled MazziottiCT Page 748v. Patriot General Insurance Co. That action alleged: bad faith and failure exercise due care and diligence in dealing with the plaintiff in the Ye case; failure to satisfy the judgment against Ye; a CUIPA violations under Sections
On February 9, 1995, Patriot General Ins. Co. paid Mazziotti $20,000.00 in settlement of the claims of negligence in its handling of Mazziotti's claims against Ye as well as the allegations of unfair claim settlement practice and an unfair or deceptive act or practice in the business of insurance. The release signed by Mazziotti specified that "no payment is being made" upon the allegations of breach of good faith in attempting to negotiate a settlement in the case of Mazziotti v. Ye as well as breach of the covenant of good faith in protecting the interests of its insured, Ye and in satisfying the judgment entered against Ye.
Although no payment was made for the claims based upon those allegations, the entire action was withdrawn with prejudice upon settlement. Allstate argues that it is entitled to an additional credit of $20,000.00 because the settlement constitutes a collateral source payment under the policy. No law is presented in support of such claim. Nor does the defendant cite any support for its claim of a credit where the action against the insurer was brought for violation of public policy, the legal obligation of Patriot General to pay the judgment and the carrier's CUIPA and CUTPA violations.
Those acts of misconduct cannot be held to be an "Injury. . . caused by accident and [which arose] out of the ownership, maintenance or use of an uninsured auto." (Court Exhibit A-1). Allstate is not entitled to a credit for the settlement of claims brought against Patriot General Insurance Company. The judgment stands as entered.