{
  "id": 8522295,
  "name": "HARRIET JOHNSON, Plaintiff v. AMERICAN ECONOMY INSURANCE COMPANY, Defendant",
  "name_abbreviation": "Johnson v. American Economy Insurance",
  "decision_date": "1992-11-03",
  "docket_number": "No. 9118SC907",
  "first_page": "47",
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    "date_added": "2019-08-29",
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    "judges": [
      "Judges Johnson and Parker concur."
    ],
    "parties": [
      "HARRIET JOHNSON, Plaintiff v. AMERICAN ECONOMY INSURANCE COMPANY, Defendant"
    ],
    "opinions": [
      {
        "text": "EAGLES, Judge.\nThe sole issue here is whether the trial court incorrectly determined that the plaintiff was not entitled to uninsured motorist coverage because the sum of the limits collectible under all liability and/or primary uninsured motorist insurance policies applicable to her claim was $50,000. We hold that the trial court erred and, accordingly, we reverse.\nInitially, we note that the trial court correctly determined that the law of Tennessee controlled. Because the American policy was issued in the State of Tenpessee, the law of Tennessee governs interpretation of the policy. Roomy v. Allstate Insurance Company, 256 N.C. 318, 123 S.E.2d 817 (1961).\nTennessee\u2019s statutory code provides:\n(d) The limit of liability for an insurer providing uninsured motorist coverage under this section is the amount of that coverage as specified in the policy less the sum of the limits collectible under all liability and/or primary uninsured motorist insurance policies, bonds, and securities applicable to the bodily injury or death of the insured.\nTenn. Code Ann. \u00a7 56-7-1201(d) (1989) (emphasis added).\n(a) For the purpose of this coverage, \u201cuninsured motor vehicle\u201d means a motor vehicle whose ownership, maintenance, or use has resulted in the bodily injury, death, or damage to property of an insured, and for which the sum of the limits of liability available to the insured under all valid and collectible insurance policies, bonds, and securities applicable to the bodily injury, death, or damage to property is less than the applicable limits of uninsured motorist coverage provided to the insured under the policy against which the claim is made.\nTenn. Code Ann. \u00a7 56-7-1202(a) (1988) (emphasis added).\nPlaintiff argues that the trial court incorrectly determined that plaintiff was not covered under American\u2019s uninsured motorist coverage because it added $25,000, representing the prospective or potential value of Ms. Brabson\u2019s claim, to the $25,000 already paid to the plaintiff by Mr. Malone\u2019s carrier. Defendant, however, argues that the trial court acted properly. We agree with the plaintiff.\nThe language of both Tenn. Code Ann. \u00a7 56-7-1201 and \u00a7 56-7-1202 is couched in the singular. The statutes do not state that the limit of uninsured motorist coverage is determined as the difference between the coverage specified in the policy less the sum of limits collectible under all policies applicable and available to the bodily injury or death of the insureds. Rather, the statutes state that the sum collectible should be offset against the damages available to the insured. Accordingly, we believe the statute itself plainly requires that only those amounts available to each individual insured should be totalled to determine whether or not that insured may recover based on underinsured motorist coverage.\nMoreover, we note that a recent case from Tennessee\u2019s Court of Appeals supports our decision. In Gabel v. Lerma, 812 S.W.2d 580 (1990), permission to appeal denied (4 June 1990), the plaintiff\u2019s decedent received fatal injuries while riding as a passenger in an automobile operated by the defendant. Id. at 581. The defendant had insurance coverage under a policy issued by Permanent General Assurance Corporation (PGA). Id. The PGA policy provided liability limits of $15,000 per person and uninsured motorist limits of $15,000 per person. Id. The plaintiff\u2019s decedent also had an insurance policy with State Farm Mutual Automobile Insurance Company which included uninsured motorist coverage of $25,000 per person, and decedent\u2019s father had a policy with J.C. Penney Casualty Insurance Company which contained uninsured motorist coverage of $100,000 per person. Id. In deciding which carrier provided primary uninsured motorist coverage and which provided excess uninsured motorist coverage, the Tennessee Court quoted the pertinent portion of Tenn. Code Ann. \u00a7 56-7-1201(d), It then continued and held,\n[a]s mentioned above, the PGA policy also included liability coverage with a limit of $15,000 per person. Thus, when PGA paid the $15,000 into the court pursuant to the liability provision of its policy, it was absolved with respect to its uninsured motorist provision which also had a limit of liability of $15,000 per person.\nId. at 582. During its discussion of the facts of the case and its holding the Tennessee Court discussed only \u201cper person\u201d limits and did not even mention the total per accident coverage available under any of the policies involved. While Gabel does not directly address the issue presented here, we believe that it is instructive. It is apparent from the Gabel opinion that the figure to be used in calculating the sum of limits available to the insured is the sum of the \u201cper person\u201d coverages available to that insured and not the sum of either the \u201cper person\u201d coverages available to all insureds or the sum of \u201cper accident\u201d coverages.\nHere, the only liability coverage available to plaintiff is the $25,000 she accepted from Charter. No other uninsured motorist coverage is available to the plaintiff. Accordingly, the plaintiff is entitled to recover $25,000 from American as the difference between the uninsured motorist coverage available ($50,000) and the sum of the limits collectible under all liability policies and primary uninsured motorist policies.\nFinally, we believe that our decision is equitable. Under our interpretation of Tennessee\u2019s uninsured motorist statutes, the plaintiff will be entitled to recover $25,000 from American. If Ms. Brabson accepts the $25,000 tendered by Charter, she will also be entitled to recover up to $25,000 of uninsured motorist coverage from American if she initiates a timely suit and she proves that her damages exceed $25,000. Thus, the largest sum that American will be required to pay under its uninsured coverage is $50,000 ($25,000 to plaintiff here and up to $25,000 to Ms. Brabson), the amount it agreed to pay when the contract was entered. We hold that plaintiff is entitled to recover $25,000 from American pursuant to American\u2019s uninsured motorist coverage. Accordingly, we reverse and remand for proceedings not inconsistent with this opinion.\nReversed and remanded.\nJudges Johnson and Parker concur.",
        "type": "majority",
        "author": "EAGLES, Judge."
      }
    ],
    "attorneys": [
      "Donaldson & Horsley, P.A., by William F. Horsley and Stephanie C. Hess, for plaintiff-appellant.",
      "Karl N. Hill, Jr. for defendant-appellee."
    ],
    "corrections": "",
    "head_matter": "HARRIET JOHNSON, Plaintiff v. AMERICAN ECONOMY INSURANCE COMPANY, Defendant\nNo. 9118SC907\n(Filed 3 November 1992)\nInsurance \u00a7 527 (NCI4th)\u2014 underinsured motorist coverage \u2014 determining amount \u2014Tennessee law\nThe trial court erred in considering the entire amount available to all persons injured in a collision in determining whether plaintiff was entitled to underinsured motorist coverage under a Tennessee automobile policy that provided UM/UIM coverage of $50,000 per accident since the sum of limits available to the insured under the applicable Tennessee statute is the sum of the \u201cper person\u201d coverages available to that insured and not the sum of either the \u201cper person\u201d coverages available to all insureds or the sum of \u201cper accident\u201d coverages.\nAm Jur 2d, Automobile Insurance \u00a7 322.\nUninsured and underinsured motorist coverage: recovera-bility, under uninsured or underinsured motorist coverage, of deficiencies in compensation afforded injured party by tort-feasor\u2019s liability coverage. 24 ALR4th 13.\nAPPEAL by plaintiff from judgment filed 24 June 1991 by Judge Thomas W. Seay, Jr., in GUILFORD County Superior Court. Heard in the Court of Appeals 22 September 1992.\nOn 13 November 1988 plaintiff, Harriet Johnson, was riding as a passenger in a car driven by Theresa Brabson. Ms. Brabson\u2019s vehicle was struck in the rear by an automobile driven by Timothy Malone. Both the plaintiff and Ms. Brabson suffered injuries requiring medical treatment.\nThe car driven by Mr. Malone was insured under a liability policy issued by Charter Risk Adjusting, Inc. The Charter policy provided liability coverage of $25,000 per person and $50,000 per accident. The car driven by Ms. Brabson was owned by Robert F. Mitchell, Jr., a resident of Knoxville, Tennessee. Mr. Mitchell\u2019s car was insured by the defendant, American Economy Insurance Company, under a policy issued in Tennessee covering four vehicles. That policy provided inter alia uninsured motorist coverage with single limits of $50,000 per accident.\nOn 20 November 1990 the plaintiff entered into a settlement agreement releasing all claims against Mr. Malone in exchange for Charter\u2019s payment of $25,000. Under the agreement with Charter the plaintiff also reserved her rights to proceed against American. The trial court signed an order approving the settlement agreement on 8 April 1991. At about the same time that the plaintiff entered into her settlement agreement, Charter tendered to Ms. Brabson\u2019s attorney an offer of $25,000, the remaining \u201cper person\u201d coverage. There is no evidence of record to indicate whether Ms. Brabson has since settled or abandoned her claims or instituted suit.\nAfter trial of her personal injury claims, a jury rendered a verdict for the plaintiff of $85,000. The trial court reduced the verdict by the $25,000 already paid by Charter and entered judgment awarding $60,000. The plaintiff then filed a declaratory judgment action against American to determine its obligation under the insurance contract on Mr. Mitchell\u2019s vehicle. The trial court determined that the law of Tennessee governs interpretation of American\u2019s policy and that American\u2019s policy did not provide plaintiff uninsured motorist coverage. Accordingly, the court entered judgment in favor of American.\nFrom judgment entered, plaintiff appeals.\nDonaldson & Horsley, P.A., by William F. Horsley and Stephanie C. Hess, for plaintiff-appellant.\nKarl N. Hill, Jr. for defendant-appellee."
  },
  "file_name": "0047-01",
  "first_page_order": 75,
  "last_page_order": 79
}