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[T] Waters v. United States12/12/2001
Submitted: November 20, 2001
Upon Certification of Question of Law from the United States District Court for the District of Delaware. Question Answered.
This Court has accepted a certified question of law from the United States District Court for the District of Delaware pursuant to Supreme Court Rule 41(a). The question of law concerns the ability of an insurer that has paid benefits to an insured to recover in subrogation from the United States as a "private individual," pursuant to 21 Del. C. § 2118(g). We conclude, in answer to the certified question, that, under Delaware law, the insurer does have the right to right to recover from the United States in subrogation.
I.
The factual basis for certification is taken from the District Court for the District of Delaware's Certification of Question of Law, dated January 2, 2001. Our certification acceptance is limited to these facts. E.I. DuPont v. Florida Evergreen Foliage, Del. Supr., 744 A.2d 457, 458 (1999).
Sharon Waters ("Waters") was involved in a motor vehicle accident with a vehicle driven by an employee of the United States. Pursuant to the provisions of her Personal Injury Protection ("PIP") coverage, Waters made a claim to her insurer, State Farm Mutual Automobile Insurance Company ("State Farm"), for lost wages and medical expenses resulting from the accident. State Farm paid $23,675.62 in "No Fault" benefits on behalf of Waters, subject to a five hundred dollar deductible. State Farm then brought a claim against the United States in the United States District Court for the District of Delaware to recover payments made to Waters on her behalf. The United States filed a motion for summary judgment, arguing that no Delaware insurer may recover in subrogation against it since its shield of sovereign immunity did not extend to such claims. Because the issue thus posed invoked an interpretation of state law, the District Court, with the agreement of the parties, requested this Court to accept certification of the following question: "May an insurer that has paid benefits to an insured, under 21 Del. C. § 2118(a), recover from a 'private individual' in subrogation, pursuant to 21 Del. C. § 2118(g)?" By order dated March 26, 2001, this Court accepted the certified question and the matter was subsequently briefed and argued.
II.
Under the Federal Tort Claims Act, the United States is subject to liability for negligence "in the same manner and to the same extent as a private individual under like circumstances. . . ." 28 U.S.C. § 2674. State Farm argues that the United States should be treated as an uninsured motorist for these purposes, because the vehicle operated by its employee is not a Delaware insured vehicle. The United States, on the other hand, argues that because it can show "proof of financial responsibility" it is not uninsured. The United States essentially contends that it is an undefined "individual" which is neither covered by an auto liability fund nor self-insured, but which nonetheless is financially responsible.
The United States argues that 21 Del. C. § 2118(g) requires an insurer seek subrogation for PIP benefits from the tortfeasor's liability insurance carrier, thereby forbidding the insurer from seeking subrogation directly from the tortfeasor. In support of this argument, the United States relies on Harper v. State Farm Mut. Auto Ins. Co., Del. Supr., 703 A.2d 136 (1997), in which this Court stated that "Delaware's current No-Fault Insurance Statute no longer permits a claim for subrogation by the PIP insurer against the individual tortfeasor. Instead, the PIP insurer's right of subrogation is limited exclusively to the tortfeaso
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