United States District Court, E.D. Missouri, Eastern Division
COLLEEN A. HAYES-SCHNEIDERJOHN, et al., Plaintiffs,
GEICO GENERAL INSURANCE COMPANY, Defendant.
MEMORANDUM AND ORDER
JEAN C. HAMILTON, District Judge.
This matter is before the Court on Defendant GEICO General Insurance Company's ("Geico") Motion for Summary Judgment. (ECF No. 18). The Motion has been fully briefed and is ready for disposition.
The essential facts are not in dispute. "On September 16, 2009, Plaintiff Colleen Hayes-Schneiderjohn [("Hayes-Schneiderjohn")] was driving her 2002 Infiniti QX4 on the Daniel Boone Bridge in Saint Charles, Missouri." (Geico Uncontroverted Material Facts, "GUMF, " ECF No. 20, ¶ 1). At that time, the erratic driving of an unknown driver caused traffic to slow. Id. ¶ 3. Timothy Wylder, a driver for Beckmann Distribution Services, Inc. ("Beckmann"), failed to slow down with the traffic and rear-ended Hayes-Schneiderjohn's car. Id. ¶¶ 2-4. Hayes-Schneiderjohn and her husband, Plaintiff John Schneiderjohn ("Schneiderjohn") then filed suit against Wylder and Beckmann for personal injuries and loss of consortium on January 19, 2012. Id. ¶ 5. On August 20, 2013, that suit settled for $100, 000, an amount paid to Plaintiffs by an insurance company on behalf of Beckmann and Wylder. Id. ¶¶ 8-9.
At the time of the accident, Plaintiffs were covered under a motor vehicle insurance policy issued by Geico (the "Policy"), which included uninsured motorist coverage ("UM Coverage"). Id. ¶ 11. "The Policy provided a $50, 000 per person UM Coverage limit, which, when stacked for the two vehicles insured under the [P]olicy, combines for a total of $100, 000 in available UM Coverage." Id. ¶ 13. On June 5, 2014, Plaintiffs filed suit against Geico "for uninsured motorist coverage, loss of consortium and vexatious refusal to pay." (Plaintiffs' Uncontroverted Material Facts, "PUMF, " ECF No. 25, ¶ 2). Geico timely removed the case to this Court on September 10, 2014, (Removal Notice, ECF No. 1), and now seeks summary judgment against Plaintiffs.
SUMMARY JUDGMENT STANDARD
Under the Federal Rules of Civil Procedure, courts must "grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). Summary judgment is particularly appropriate in a situation such as this one, in which there are no factual disputes and disposition of the motion turns on the purely legal question of insurance policy interpretation.
Geico contends it is entitled to summary judgment because Plaintiffs' claims are subject to "a liability limitation that provide[s] a setoff of the policy limits for all amounts (a) paid by or for all persons or organizations liable for the injury...'" (Motion at 2). Since Plaintiffs have already recovered $100, 000 in settlement of their lawsuit against Wylder and Beckmann, this setoff provision precludes recovery under the Policy, which has a $100, 000 limit in this particular case. Id. at 3. Moreover, the setoff provision is not contrary to Missouri public policy and cannot be avoided on that basis. Id. at 4.
Plaintiffs respond that the setoff provision is ambiguous and therefore should be construed against Geico. (Plaintiff Response, ECF No. 23, at 4-8). The provision is ambiguous, Plaintiffs maintain, both because of the way in which it is arranged and because its language is unclear. Id. at 5-8. Plaintiffs contend in the alternative that the setoff provision violates Mo. Rev. Stat. § 379.203, under which every car insurance policy in Missouri must have at least $25, 000 in UM Coverage. Id. at 8. Any attempt by an insurance company to reduce coverage below the statutory minimum violates the public policies underlying the statute. Id. at 10.
A. Whether the Setoff Provision is Ambiguous
It is first necessary to determine whether the setoff provision can be applied to reduce Plaintiffs' recovery, which requires interpretation of the Policy. In Missouri, the language of an insurance policy must "be given its plain meaning. If the language is unambiguous the policy must be enforced according to such language." Robin v. Blue Cross Hosp. Serv., Inc., 637 S.W.2d 695, 698 (Mo. 1982) ( en banc ) (internal citations omitted). Where policy language is ambiguous, however, the language "will be construed against the insurer." Id. "In an insurance policy, ambiguity arises when there is duplicity, indistinctness or uncertainty of meaning. When the language of an insurance policy is reasonably and fairly open to different constructions it is ambiguous." Nixon v. Life Investors Ins. Co. of Am., 675 S.W.2d 676, 679 (Mo.Ct.App. 1984) (internal citation omitted).
The setoff provision appears in the "Limits of Liability" subsection of the Policy's UM ...