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Hoover v. State Farm Mutual Insurnce Co.3/4/2003
PUBLISHED
In 1993, plaintiff Lloyd Hoover's employer ("Employer") leased a vehicle with financing through First Union Bank. In 1998, that lease expired, and on 23 September 1998, First Union Bank executed a bill of sale and assignment of title for the vehicle jointly to Employer and plaintiff Lloyd Hoover.
On 3 February 1999, while driving the jointly owned vehicle, plaintiff Lloyd Hoover was involved in a motor vehicle accident caused by the negligence of an uninsured motorist. As a result he sustained personal injury damages in excess of $1,250,000.
Prior to the date of the accident, Employer obtained an insurance policy from defendant Selective Insurance Company ("Selective") that provided $1,000,000 in uninsured motorist ("UM") coverage, and plaintiffs purchased an insurance policy from defendant State Farm that provided $250,000 in UM coverage.
Plaintiffs then filed this action requesting a declaratory judgment allowing them to aggregate or "stack" their claims for coverage against both insurers. Upon motion by plaintiffs and following a hearing, the trial court entered summary judgment for defendants concluding, "N.C. Gen. Stat. §20-279.21(b)(3) prohibits interpolicy stacking of uninsured motorist insurance coverage."
Total compensation for UM coverage was capped at $1,000,000 by the trial court because both policies provided that in the event more than one policy applied to a claim, a claimant could only recover the highest amount allowed by any one of the applicable policies. Here, the highest amount recoverable under either of the applicable policies was $1,000,000. Additionally, the trial court found that both UM policies were primary and provided for a pro rata sharing of liability for UM benefits. Thus, Selective was liable to plaintiffs for $800,000 and State Farm was liable for $200,000.
Plaintiffs now appeal contending the trial court erred in not allowing them to stack the Selective and State Farm UM coverage. They allege: (1) the UM anti-stacking provision is inapplicable to the present circumstances, (2) the applicable UM statute nullifies the insurance provisions that capped his recovery at $1,000,000, and (3) both applicable insurance provisions are void because they are ambiguous. See N.C.G.S. § 20-279.21(b)(3) (2001). Defendants argue G.S. § 20-279.21(b)(3) specifically bars plaintiffs from stacking the UM benefits, and as we find this dispositive, we address only this issue.
N.C.G.S. § 20-279 governs UM coverage and was amended in 1991 to provide:
Where coverage is provided on more than one vehicle insured on the same policy or where the owner or the named insured has more than one policy with coverage under this subdivision, there shall not be permitted any combination of coverage within a policy or where more than one policy may apply to determine the total amount of coverage available. N.C.G.S. § 20-279.21(b)(3) (emphasis added).
While obviously the present case involves more than one policy, at issue is whether the "owner . . . has more than one policy with coverage." Plaintiff argues the "owner" is the UM policy owner. Under this interpretation, because each of the policies are held individually, the Selective policy by Employer and the State Farm policy by plaintiff, this case would not involve an "owner" with "more than one policy," and the anti-stacking provision would not apply. Conversely, defendants claim "owner" refers to the owner of the motor vehicle, and thus, as both plaintiffs and Employer were owners of the motor vehicle here, the provision applies and bars plaintiffs from stacking.
Although "owner" is not defined within the provision rela
Page 1 2 North Carolina Personal Injury Attorneys
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