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Country Preferred Ins. Co. v. Lee

United States District Court, E.D. Missouri, Eastern Division

May 4, 2018

COUNTRY PREFERRED INS. CO., Plaintiff/Counter-defendant,
v.
CHRISTOPHER LEE, et al., Defendants/Counter-Plaintiffs.

          MEMORANDUM AND ORDER

          CATHERINE D. PERRY, UNITED STATES DISTRICT JUDGE.

         Country Preferred issued three automobile insurance policies to Christopher and Sandra Lee, each with a policy limit of $100, 000. The Lees paid separate premiums on each policy for underinsured motorist (UIM) coverage. On November 2, 2016, Christopher Lee was struck by a wrong-way driver while riding his motorcycle and suffered substantial injuries. The at-fault driver had an automobile insurance policy with a policy limit of $100, 000, and his insurance company settled with the Lees for the full amount.

         The Lees now seek to recover additional amounts from Country Preferred under the UIM provisions of their own insurance policies. Because Country Preferred contends that the Lees are not entitled to UIM coverage, it filed this declaratory judgment action seeking a declaration that it was not obligated to pay the Lees any amounts under their insurance policies. The Lees then filed counterclaims, seeking a declaration that Country Preferred owes them the full amount of the UIM coverage under each of the three policies and alleging unjust enrichment, fraud, and vexatious refusal to pay.

         Before me now is Country Preferred's motion for judgment on the pleadings. Because the Lees are not entitled to recovery under the unambiguous UIM provisions of their policies or any of their counterclaims, the motion will be granted.

         Standards Governing Motions for Judgment on the Pleadings

         Federal Rule of Civil Procedure 12(c) provides that “[a]fter the pleadings are closed - but early enough not to delay trial - a party may move for judgment on the pleadings.” A motion for judgment on the pleadings under Fed.R.Civ.P. 12(c) is reviewed using the same standard that governs a motion to dismiss under Fed.R.Civ.P. 12(b)(6). NanoMech, Inc. v. Suresh, 777 F.3d 1020, 1023 (8th Cir. 2015) (citing McIvor v. Credit Control Servs., Inc., 773 F.3d 909, 912-13 (8th Cir. 2014)). Therefore, courts must consider whether the complaint pleads “‘enough facts to state a claim that is plausible on its face.'” NanoMech, 777 F.3d at 1023 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “‘A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.'” Barton v. Taber, 820 F.3d 958, 964 (8th Cir. 2016) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “‘[L]egal conclusions' and ‘threadbare recitations of the elements of a cause of action, supported by mere conclusory statements, ' are not entitled to a presumption of truth when considering the sufficiency of a complaint.” Zink v. Lombardi, 783 F.3d 1089, 1098 (8th Cir. 2015) (quoting Iqbal, 556 U.S. at 678). The complaint's factual allegations must be “sufficient to ‘raise a right to relief above the speculative level . . . .'” McDonough v. Anoka Cty., 799 F.3d 931, 946 (8th Cir. 2015) (quoting Twombly, 550 U.S. at 555). The Court does not accept as true any “‘legal conclusion couched as a factual allegation.'” Brown v. Green Tree Servicing LLC, 820 F.3d 371, 373 (8th Cir. 2016) (quoting Iqbal, 556 U.S. at 678). Thus, “[a] pleading that offers ‘labels and conclusions' or ‘a formulaic recitation of the elements of a cause of action will not do.'” Ash v. Anderson Merchandisers, LLC, 799 F.3d 957, 960 (8th Cir. 2015) (quoting Iqbal, 556 U.S. at 678). “Determining whether a complaint states a plausible claim for relief . . . [is] a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” Mickelson v. Cty. of Ramsey, 823 F.3d 918, 923 (8th Cir. 2016) (alteration in original) (quoting Iqbal, 556 U.S. at 679).

         Relevant, Undisputed Background Facts

         The Lees had three automobile insurance policies with Country Preferred at the time of Christopher Lee's accident. The first policy was issued to Christopher Lee and insured his 2015 Harley Davidson motorcycle (Insurance Policy Number P24A5361315). It had effective dates of May 29, 2016 through May 29, 2017. The second policy was issued to Christopher Lee and insured a 2015 Ford automobile (Insurance Policy Number P24A7818593). It had effective dates of June 29, 2016 through December 29, 2016. The third insurance policy was issued to Sandra Lee and insured a 2008 Dodge automobile (Insurance Policy P24A7450349). It had effective dates of June 10, 2016 through December 10, 2016. The three policies contain identical language with respect to the relevant provisions at issue in this case.

         Each policy has UIM coverage limits of $100, 000. The policies state as follows:

         SECTION 2

Uninsured-Underinsured Motorists, Coverage U
If you have paid for this coverage (see the declarations page), we will pay damages which an insured is legally entitled to recover from the owner or operator of an uninsured or underinsured motor vehicle because of bodily injury sustained by an insured and caused by an accident. The owner's or operator's liability for these damages must arise from the ownership, maintenance or use of the uninsured or underinsured motor vehicle.

[Doc. # 1-1 at 8; Doc # 1-2 at 8; Doc. # 1-3 at 8] (emphasis in original). The policies define “underinsured motor vehicle” as “any type of motor vehicle or trailer which the sum of all liability bonds or policies at the time of an accident are less than the limits of liability of the Uninsured Motorist coverage carried on this policy.” [Doc. # 1-1 at 20; Doc. #1-2 at 20; Doc. # 1-3 at 20] (emphasis in original). It is undisputed that the uninsured motorist coverage limit in each of the three policies is $100, 000. This means that under the plain language of the policies, a vehicle is not “underinsured” if it is covered by an insurance policy with a limit of at least $100, 000. The “Limits of Liability” under each policy state as follows:

2. Limits of Liability. The Uninsured - Underinsured Motorists limits of liability shown on the declarations page apply as follows: a. The limit of liability for “each person” is the maximum amount we will pay for all damages arising out of bodily injury to any one person in any one accident. That maximum amount includes any claims of other persons for damages arising out of that bodily injury. That figure listed is the most we will pay for any one person in any one accident regardless or the number of insureds, claims made, insured vehicles, premiums shown on the declarations page, or uninsured or underinsured motor vehicles involved in the accident.

[Doc. # 1-1 at 10; Doc. #1-2 at 10; Doc. # 1-3 at 10] (emphasis in original).

         The policies also contain the following language:

8. Other Vehicle Insurance with Us. If this policy and any other vehicle insurance policy issued to you or a relative by one of our companies apply to the same accident, the maximum limit of our liability under all the policies will not exceed the highest applicable limit of liability under any one policy.

[Doc. # 1-1 at 17; Doc. #1-2 at 17; Doc. # 1-3 at 17] (emphasis in original). It is undisputed that the “highest applicable limit of liability under any one policy” in this case is $100, 000. Finally, each of the three policies contains the following provision:

2. Other Insurance. If there is other applicable uninsured - underinsured motorists insurance that covers a loss, we will pay our proportionate share of that loss. Our share is the proportion our limits of ...

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