{ "id": 8956491, "name": "MEDFORD L. AUSTIN, ADMINISTRATOR OF THE ESTATE OF MEDFORD JEROME AUSTIN, DECEASED, Plaintiff v. RICHARD AARON MIDGETT and THEODORE STOCKTON MIDGETT, JR., Defendants", "name_abbreviation": "Austin v. Midgett", "decision_date": "2003-08-05", "docket_number": "No. COA02-1127", "first_page": "416", "last_page": "423", "citations": [ { "type": "official", "cite": "159 N.C. App. 416" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "495 S.E.2d 352", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1998, "opinion_index": 0 }, { "cite": "347 N.C. 560", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 551073 ], "year": 1998, "opinion_index": 0, "case_paths": [ "/nc/347/0560-01" ] }, { "cite": "494 S.E.2d 601", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1997, "opinion_index": 0 }, { "cite": "347 N.C. 410", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 551331, 551217, 551062, 551126, 551135 ], "year": 1997, "opinion_index": 0, "case_paths": [ "/nc/347/0410-01", "/nc/347/0410-04", "/nc/347/0410-05", "/nc/347/0410-02", "/nc/347/0410-03" ] }, { "cite": "488 S.E.2d 628", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1997, "opinion_index": 0 }, { "cite": "127 N.C. App. 260", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11794464 ], "year": 1997, "opinion_index": 0, "case_paths": [ "/nc-app/127/0260-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 20-279.21", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 8, "pin_cites": [ { "page": "(e)" }, { "page": "(e)" }, { "page": "(e)" }, { "page": "(e)" }, { "page": "(e)" }, { "page": "(e)" }, { "page": "(e)" }, { "page": "(e)" } ], "opinion_index": 0 }, { "cite": "446 S.E.2d 597", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1994, "opinion_index": 0 }, { "cite": "115 N.C. App. 718", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 12140204 ], "weight": 2, "year": 1994, "opinion_index": 0, "case_paths": [ "/nc-app/115/0718-01" ] }, { "cite": "430 S.E.2d 895", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1993, "pin_cites": [ { "page": "898" } ], "opinion_index": 0 }, { "cite": "334 N.C. 1", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2531661 ], "weight": 2, "year": 1993, "pin_cites": [ { "page": "6" } ], "opinion_index": 0, "case_paths": [ "/nc/334/0001-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 24-5", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "year": 2001, "pin_cites": [ { "page": "(b)" } ], "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 97-10.2", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 5, "pin_cites": [ { "page": "(j)" }, { "page": "(j)" } ], "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 97-10", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "opinion_index": 0 } ], "analysis": { "cardinality": 552, "char_count": 16422, "ocr_confidence": 0.733, "pagerank": { "raw": 3.1656678164116747e-07, "percentile": 0.8635646325326303 }, "sha256": "06fdc3d516aac8907a91a515016abdc94bdf3ecf8b1294f72e16dbcabb046049", "simhash": "1:5d635576d33ebc1a", "word_count": 2572 }, "last_updated": "2023-07-14T16:27:55.515420+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges TIMMONS-GOODSON and HUDSON concur." ], "parties": [ "MEDFORD L. AUSTIN, ADMINISTRATOR OF THE ESTATE OF MEDFORD JEROME AUSTIN, DECEASED, Plaintiff v. RICHARD AARON MIDGETT and THEODORE STOCKTON MIDGETT, JR., Defendants" ], "opinions": [ { "text": "STEELMAN, Judge.\nThe deceased, Medford Jerome Austin (\u201cAustin\u201d), died on 25 October 2000 when he was struck by a vehicle operated by defendant Richard Aaron Midgett (\u201cMidgett\u201d). At the time of the accident, Austin was acting in the course and scope of his employment with the North Carolina Department of Transportation (\u201cDOT\u201d).\nMidgett had liability insurance coverage with North Carolina Farm Bureau Mutual Insurance Company (\u201cFarm Bureau\u201d) which was in effect on the date of the accident. The limit of liability insurance coverage under this policy was $50,000.00 per person.\nAt the time of the accident, Austin had underinsured motorist (\u201cUIM\u201d) insurance coverage with Integon National Insurance Company (\u201cIntegon\u201d), an unnamed defendant in this matter. Austin\u2019s Integon policy had been renewed on 14 June 2000 and was effective through 14 December 2000. Austin also had UIM insurance coverage through a policy issued to his father, Medford L. Austin, by State Farm Mutual Automobile Insurance Company (\u201cState Farm\u201d), another unnamed defendant in this matter. Each UIM policy had a liability limit of $100,000.00.\nPlaintiff filed a complaint seeking compensation for Austin\u2019s wrongful death against Midgett and his father, defendant Theodore Stockton Midgett, Jr., owner of the vehicle Midgett was driving. The parties entered a stipulation of facts to allow the trial court to determine the amount available to plaintiff under the UIM policies. The parties stipulated that Midgett\u2019s negligence was the sole proximate cause of the accident and resulting death of Austin. They further stipulated that the damages sustained by plaintiff exceeded $200,000.00.\nAustin\u2019s employer, DOT, paid plaintiff workers\u2019 compensation benefits in the amount of $100,278.98. DOT asserted a lien in this amount against any third party recovery, including any proceeds plaintiff received from the UIM policies. Plaintiff filed a motion to extinguish this lien pursuant to N.C. Gen. Stat. \u00a7 97-10.2Q) (2001). Plaintiff and DOT subsequently entered a compromise agreement under which DOT would accept $33,426.00 in full and complete satisfaction of its workers\u2019 compensation lien.\nPursuant to the agreement between plaintiff and DOT and its authority under N.C. Gen. Stat. \u00a7 97-10.2(j), the trial court entered an order reducing the workers\u2019 compensation lien to $33,426.00 in full and complete satisfaction of the original lien of $100,278.98. However, this order was to be \u201cnull and void if the plaintiff, for any reason, does not receive a total recovery of two hundred thousand dollars ($200,000.00) from both the liability insurance carrier and the underinsured motorist carriers. ...\u201d\nPlaintiff accepted payment from Farm Bureau in the amount of $50,000.00, thereby exhausting the amount of recovery under Midgett\u2019s liability insurance coverage. The sum tendered by Farm Bureau was credited against any amounts paid to plaintiff by Integon and State Farm. Integon and State Farm agreed to divide the credit equally, with each receiving a credit of $25,000.00.\nPlaintiff and both unnamed defendants, Integon and State Farm, filed motions for summary judgment pursuant to N.C. Gen. Stat. \u00a7 1A-1, Rule 56 (2001) on the issue of the credits due to Integon and State Farm for liability insurance benefits and workers\u2019 compensation payments received by plaintiff. The trial court granted plaintiff\u2019s summary judgment motion and denied both motions for summary judgment of Integon and State Farm.\nThe trial court entered a $200,000.00 judgment against Integon and State Farm and ordered each to pay plaintiff $75,000.00, which represented the $100,000.00 liability limit in each policy less the $25,000.00 credit each carrier received for Farm Bureau\u2019s liability insurance payment to plaintiff. The order denied both UIM carriers a credit for any portion of the workers\u2019 compensation paid to plaintiff by DOT.\nPlaintiff requested the trial court award prejudgment interest on the judgment against Integon and State Farm. The trial court awarded only post-judgment interest to plaintiff.\nPlaintiff and Integon appeal the trial court\u2019s judgment. State Farm paid its judgment to plaintiff and is not a party to this appeal.\nI.\nPlaintiff assigns as error the trial court\u2019s failure to award prejudgment interest on the judgment against Integon. Specifically, plaintiff contends that pursuant to the terms of the policy, Integon is obligated to pay prejudgment interest as compensatory damages up to the UIM policy limit of $100,000.00.\nN.C. Gen. Stat. \u00a7 24-5(b) (2001) provides:\nIn an action other than contract, any portion of a money judgment designated by the fact finder as compensatory damages bears interest from the date the action is commenced until the judgment is satisfied. Any other portion of a money judgment in an action other than contract, except the costs, bears interest from the date of entry of judgment until the judgment is satisfied.\nOur Supreme Court has held that prejudgment interest up to the amount of the carrier\u2019s liability limit is part of compensatory damages for which the UIM carrier is liable. Baxley v. Nationwide Mut. Ins. Co., 334 N.C. 1, 430 S.E.2d 895 (1993), appeal after remand, 115 N.C. App. 718, 446 S.E.2d 597 (1994).\nThe Integon policy states that with regard to UIM coverage, \u201c[Integon] will also pay compensatory damages which an insured is legally entitled to recover from the owner or operator of an under-insured motor vehicle because o[f] bodily injury sustained by an insured and caused by an accident.\u201d The supplementary payments section of the Integon policy further states that in addition to the limit of liability, Integon will pay on behalf of the insured \u201c[a]ll costs taxed against the insured and interest accruing after a judgment is entered in any suit we defend. Costs do not include prejudgment interest.\u201d\nThe Integon policy did not expressly exclude prejudgment interest from compensatory damages, as it did with costs in the supplementary payments provision. Under Baxley, prejudgment interest is part of compensatory damages up to the liability limit. Thus, we hold that Integon is obligated to pay prejudgment interest on the amount owed to plaintiff up to its liability limit.\nWe disagree, however, with plaintiffs contention that Integon\u2019s limit of liability is $100,000.00. According to the trial court\u2019s order, Integon received a $25,000.00 credit against its UIM liability limit for the liability insurance proceeds paid by Farm Bureau to plaintiff. Therefore, Integon\u2019s liability limit is $75,000.00, the $100,000.00 listed limit less the $25,000.00 credit, and it cannot be required to pay prejudgment interest over this amount. See Baxley v. Nationwide Mut. Ins. Co., 115 N.C. App. 718, 446 S.E.2d 597 (1994) (holding that the UIM carrier\u2019s limit of liability was $75,000.00, representing the difference between the policy\u2019s listed liability limit of $100,000.00 and a $25,000.00 credit for liability insurance proceeds, and could not be required to pay prejudgment interest when it had paid the insured a total of $75,000.00 for damages).\nII.\nIntegon argues the trial court erred in denying it a credit for workers\u2019 compensation payments received by plaintiff. It contends the trial court misinterpreted the current version of N.C. Gen. Stat. \u00a7 20-279.21(e) to preclude a credit to Integon for workers\u2019 compensation benefits received by plaintiff.\nA. Background\nProvisions of the Financial Responsibility Act (\u201cAct\u201d), N.C. Gen. Stat. Chapter 20, Article 9A (2001), are written into every insurance policy as a matter of law. Wilmoth v. State Farm Mut. Auto. Ins. Co., 127 N.C. App. 260, 488 S.E.2d 628, disc. review denied, 347 N.C. 410, 494 S.E.2d 601 (1997). Where the language of an insurance policy conflicts with the provisions of the Act, the provisions of the Act prevail. Baxley, 334 N.C. at 6, 430 S.E.2d at 898.\nPrior to 1999, N.C. Gen. Stat. \u00a7 20-279.21(e) provided that a UIM policy \u201cneed not insure against loss from any liability for which benefits are in whole or in part either payable or required to be provided under any workers\u2019 compensation law. ...\u201d Under this version of the statute, our Supreme Court held in McMillian v. North Carolina Farm Bureau Mut. Ins. Co., 347 N.C. 560, 495 S.E.2d 352 (1998), that a UIM carrier was entitled to reduce its liability by the amount of the workers\u2019 compensation benefits received by the employee even though the employee also was required to reimburse the workers\u2019 compensation lien under N.C. Gen. Stat. \u00a7 97-10.2. This resulted in a double penalty against the employee.\nN.C. Gen. Stat. \u00a7 20-279.21(e) was amended by the General Assembly in 1999 through legislation entitled \u201c[a]n act to clarify that liability, uninsured, and underinsured coverage is not reduced by receipt of subrogated Workers\u2019 Compensation benefits.\u201d The current version of N.C. Gen. Stat. \u00a7 20-279.21(e) (2001) provides:\nUninsured or underinsured motorist coverage that is provided as part of a motor vehicle liability policy shall insure that portion of a loss uncompensated by any workers\u2019 compensation law and the amount of an employer\u2019s lien determined pursuant to G.S. 97-10.2(h) or (j). In no event shall this subsection be construed to require that coverage exceed the applicable uninsured or underinsured coverage limits of the motor vehicle policy or allow a recovery for damages already paid by workers\u2019 compensation.\n(emphasis added). The amendment, effective for policies issued or renewed on or after 1 October 1999, requires UIM carriers to insure the amount of the employer\u2019s workers\u2019 compensation lien on UIM proceeds received by the employee in addition to the damages uncompensated by workers\u2019 compensation benefits. See George L. Simpson, III, North Carolina Uninsured and Underinsured Motorist Insurance, 2002 Edition: A Handbook, 68 (2002). Since the employee still must reimburse the employer for the workers\u2019 compensation lien from the amount received from both liability and UIM insurance proceeds pursuant to N.C. Gen. Stat. \u00a7 97-10.2, this amendment eliminates the double penalty to the employee which resulted from the McMillian decision while also preventing double recovery by the employee.\nThe amendment provides that the statute may not be construed to \u201callow a recovery for damages already paid by workers\u2019 compensation.\u201d Thus, the current version of N.C. Gen. Stat. \u00a7 20-279.21(e) preserves a credit to the UIM carrier for workers\u2019 compensation benefits which are not subject to an employer\u2019s lien.\nB. Application\nThe UIM coverage section of Austin\u2019s Integon policy states that \u201c[a]ny amount otherwise payable for damages under this coverage shall be reduced by all sums ... [p]aid or payable because of the bodily injury under any of the following or any similar law: a. workers\u2019 compensation law. . . .\u201d This policy language establishing a credit under any circumstances for all sums paid pursuant to workers\u2019 compensation law conflicts with the current version of N.C. Gen. Stat. \u00a7 20-279.21(e), which is applicable to the Integon policy renewed in June 2000. Therefore, the statute controls in this case.\nAs we have explained, N.C. Gen. Stat. \u00a7 20-279.21(e) requires the UIM carrier to pay both the amount of the workers\u2019 compensation lien as determined under N.C. Gen. Stat. \u00a7 97-10.2 and the loss uncompensated by workers\u2019 compensation payments. In the instant case, Integon and State Farm would be liable for the workers\u2019 compensation lien determined under N.C. Gen. Stat. \u00a7 97-10.2(j), $33,426.00, plus the amount of the loss left uncompensated by the amount of workers\u2019 compensation benefits.\nAlthough the trial court made no determination of the total amount of plaintiff\u2019s damages, the Integon policy states: \u201cIf this policy and any other auto insurance policy issued to you apply to the same accident, the maximum amount payable for injuries to you or a family member caused by an underinsured motor vehicle shall be the sum of the highest limit of liability for this coverage under each such policy.\u201d Both carriers cap their UIM coverage at $100,000.00, for an aggregate liability limit of $200,000.00. Thus, we conclude that plaintiff\u2019s uncompensated loss is $200,000.00 less the total amount of workers\u2019 compensation benefits received, $100,278.98, or $99,721.02. Pursuant to N.C. Gen. Stat. \u00a7 20-279.21(e), Integon and State Farm are liable for $99,721.02 plus the amount of the workers\u2019 compensation lien of $33,426.00, for a total of $133,147.02.\nIn its argument to this Court, plaintiff contends Integon provided primary UIM coverage for Austin, and State Farm provided secondary coverage through his father\u2019s policy. Therefore, plaintiff argues, Integon would have to exhaust payment of its UIM coverage before State Farm would be required to pay on its coverage. We disagree.\nThe Integon policy contains the following \u201cother insurance\u201d provision in the UIM section: \u201c[I]f there is other applicable similar insurance, we will pay only our share of the loss. Our [share of the] loss is the proportion that our limit of liability bears to the total of all applicable limits.\u201d Accordingly, because Integon\u2019s $100,000.00 liability limit is one-half of the $200,000.00 aggregate liability limit, it is liable for one-half of the plaintiff\u2019s loss. We conclude that Integon and State Farm must prorate their liability and all applicable credits.\nProrating the total liability, Integon and State Farm each are liable for one-half of $133,147.02, or $66,673.51 each. Since Integon and State Farm are entitled to a credit for the liability proceeds received by plaintiff, the applicable UIM coverage for each carrier is the coverage limit of $100,000.00 less the credit for liability proceeds, $25,000.00 each, or $75,000.00. Thus, we hold Integon must pay to plaintiff $66,573.51 under its UIM coverage together with any accrued prejudgment interest up to its $75,000.00 limit of liability.\nWe remand this matter for entry of judgment consistent with this decision.\nREVERSED AND REMANDED.\nJudges TIMMONS-GOODSON and HUDSON concur.", "type": "majority", "author": "STEELMAN, Judge." } ], "attorneys": [ "Johnny S. Gaskins, for plaintiff-appellee.", "Bennett, Guthrie & Dean, P.L.L.C., by Rodney A. Guthrie and Stanley P. Dean, for unnamed defendant-appellant, Integon National Insurance Company." ], "corrections": "", "head_matter": "MEDFORD L. AUSTIN, ADMINISTRATOR OF THE ESTATE OF MEDFORD JEROME AUSTIN, DECEASED, Plaintiff v. RICHARD AARON MIDGETT and THEODORE STOCKTON MIDGETT, JR., Defendants\nNo. COA02-1127\n(Filed 5 August 2003)\n1. Insurance\u2014 Automobile \u2014 UIM coverage \u2014 prejudgment interest\nAlthough the trial court erred in a wrongful death action seeking the recovery of UIM benefits by failing to award prejudgment interest on the judgment against defendant insurance company when the pertinent policy did not expressly exclude prejudgment interest from compensatory damages as it did with costs in the supplementary payments provision, defendant\u2019s liability limit is $75,000, the $100,000 UIM policy limit less a credit for $25,000 paid by the tortfeasor\u2019s liability carrier to plaintiff, and it cannot be required to pay prejudgment interest that would raise the amount it paid above its $75,000 liability limit.\n2. Insurance\u2014 Automobile \u2014 UIM coverage \u2014 credit for workers\u2019 compensation payments\nThe trial court erred in a wrongful death action seeking the recovery of UIM benefits by denying defendant insurance company a credit for workers\u2019 compensation payments received by plaintiff, and defendant is only required to pay its share of the loss without exhausting payment of its UIM coverage before another insurance company would be required to pay on its coverage, because: (1) the current version of N.C.G.S. \u00a7 20-279.21(e) requires the UIM carrier to pay both the amount of the workers\u2019 compensation lien as determined under N.C.G.S. \u00a7 97-10.2 and the loss uncompensated by workers\u2019 compensation payments; (2) the current version of N.C.G.S. \u00a7 20-279.21(e) preserves a credit to the UIM carrier for workers\u2019 compensation benefits which are not subject to an employer\u2019s lien; and (3) defendant\u2019s policy contained the language that it would pay only its share of the loss which is the proportion that its limit of liability bears to the total of all applicable limits.\nAppeals by plaintiff and unnamed defendant Integon National Insurance Company from judgment entered 21 March 2002 by Judge J. Richard Parker in Dare County Superior Court. Heard in the Court of Appeals 14 May 2003.\nJohnny S. Gaskins, for plaintiff-appellee.\nBennett, Guthrie & Dean, P.L.L.C., by Rodney A. Guthrie and Stanley P. Dean, for unnamed defendant-appellant, Integon National Insurance Company." }, "file_name": "0416-01", "first_page_order": 446, "last_page_order": 453 }