{
  "id": 8522683,
  "name": "DAVID E. BRANCH, Administrator of the Estate of Cheryl Lynn Branch v. THE TRAVELERS INDEMNITY COMPANY and UNIGARD MUTUAL INSURANCE COMPANY",
  "name_abbreviation": "Branch v. Travelers Indemnity Co.",
  "decision_date": "1988-05-03",
  "docket_number": "No. 8726SC861",
  "first_page": "116",
  "last_page": "119",
  "citations": [
    {
      "type": "official",
      "cite": "90 N.C. App. 116"
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  "court": {
    "name_abbreviation": "N.C. Ct. App.",
    "id": 14983,
    "name": "North Carolina Court of Appeals"
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    "name_long": "North Carolina",
    "name": "N.C."
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      "category": "reporters:state_regional",
      "reporter": "S.E.2d",
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      "reporter": "N.C.",
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      "cite": "N.C. Gen. Stat. \u00a7 20-279.21",
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      "reporter": "N.C. Gen. Stat.",
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  "last_updated": "2023-07-14T21:55:12.261630+00:00",
  "provenance": {
    "date_added": "2019-08-29",
    "source": "Harvard",
    "batch": "2018"
  },
  "casebody": {
    "judges": [
      "Judges Eagles and Greene concur."
    ],
    "parties": [
      "DAVID E. BRANCH, Administrator of the Estate of Cheryl Lynn Branch v. THE TRAVELERS INDEMNITY COMPANY and UNIGARD MUTUAL INSURANCE COMPANY"
    ],
    "opinions": [
      {
        "text": "WELLS, Judge.\nThe question is whether insured\u2019s failure to comply with a provision of an insurance policy requiring him to obtain written consent from the insurer before settling the tort claim against the underinsured motorist relieves the insurer of any obligation to pay on the underinsurance coverage.\nThe facts are not in dispute. Plaintiff is the administrator of the estate of his daughter, who on 10 December 1983 was fatally injured in an accident while riding as a passenger in an automobile owned and operated by Linda Ann Munao, who was also killed. Plaintiff alleges in his complaint that Ms. Munao\u2019s negligent driving caused the accident from which his daughter died, and that the damages for personal injuries to his daughter, her medical care, funeral expenses, and her wrongful death were not less than $650,000.\nOn the day of the accident there was in effect a policy of motor vehicle liability insurance, issued by Royal Insurance Company of America (Royal) to Ms. Munao, providing coverage for the liability of Ms. Munao with a liability limit for bodily injury of $50,000. There was also in effect on the day of the collision a policy of automobile liability insurance, issued by defendant Travelers, providing underinsurance coverage for plaintiffs decedent with a liability limit of $100,000, subject to certain exclusions. Under the latter policy\u2019s rubric Exclusions the following term appears:\nA. We do not provide Uninsured Motorists Coverage for property damage or bodily injury sustained by any person:\n2. If that person or the legal representative settles the bodily injury or property damage claim without our written consent.\nThe above exclusion clearly applies not only to uninsured coverage but to underinsured coverage as well, because the policy manifestly includes the latter as a subcategory of the former.\nOn 14 August 1984 counsel for plaintiff wrote a letter to defendant Travelers requesting its written consent for plaintiff to settle its claim against the estate of the tortfeasor. By letter dated 24 September 1984 Travelers replied as follows: \u201cWe are not in a position to do that at this time and we will advise you when we have come to a conclusion in that regard.\u201d Travelers did not further advise, and on 29 November 1985 plaintiff entered into a Settlement Agreement and Release with Royal, the liability insurance carrier of the tortfeasor, under which agreement plaintiff recovered the entire liability coverage of $50,000 from Royal. In return plaintiff released Royal from all claims and covenanted not to sue the estate of the tortfeasor.\nThe gravamen of Travelers\u2019 defense is that by settling with the tortfeasor\u2019s estate plaintiff-insured destroyed any right Travelers may have had under the terms of the liability policy and under N.C. Gen. Stat. \u00a7 20-279.21(b)(3)b. to be subrogated to plaintiffs rights against the underinsured tortfeasor. As a result, Travelers is barred from recovering from the tortfeasor\u2019s estate any underinsurance sums that it pays to plaintiff, its insured.\nThe plaintiff concedes that the policy with Travelers expressly requires the written consent of the insurer as a precondition to settlement. However, plaintiff contends (1) that such exclusionary provision violates N.C. Gen. Stat. \u00a7 20-279.21, (2) that Travelers is estopped to assert the exclusion or has waived it, (3) that Travelers was not materially prejudiced by plaintiffs failure to obtain written consent to settle, and (4) that the underinsured provisions are ambiguous and should be construed against Travelers. We find it necessary to reach only one aspect of plaintiffs arguments inasmuch as Travelers expressly renounces in the disputed policy all right to be subrogated against an underin-sured motorist. In the General Provisions section, the policy provides as follows:\nOur Right to Recover Payment\nA. If we make a payment under this policy and the person to or for whom payment was made has a right to recover damages from another we shall be subrogated to that right.\nThat person shall do:\n1. Whatever is necessary to enable us to exercise our rights; and\n2. Nothing after loss to prejudice them.\nHowever, our rights in this paragraph do not apply under:\n1. Coverage C, D, DI and D2; and\n2. Coverage G or H, against any person using your covered auto with a reasonable belief that that person is entitled to do so.\nSections D, DI, and D2 set forth the terms of the policy\u2019s uninsured/underinsured motorist coverage.\nWhile it is true that plaintiffs failure to obtain the written consent of Travelers violated a provision expressly denominated by the policy as a condition precedent to coverage, defendant Travelers was not prejudiced by this noncompliance in view of its renunciation of all subrogation right in an underinsurance context. In Insurance Co. v. Construction Co., 303 N.C. 387, 279 S.E. 2d 769 (1981), our Supreme Court held that an unexcused delay by the insured in giving notice of an accident to an insurer does not relieve the insurer of its duties under the policy unless the delay materially prejudices the insurer\u2019s ability to defend. By analogy, we hold in the present case that Travelers is not relieved of its obligation to pay underinsurance coverage on account of insured\u2019s failure to comply with the policy\u2019s consent to settle clause because such noncompliance prejudiced no right reserved by Travelers under the policy.\nFor the reasons stated, we reverse the entry of summary judgment for defendant Travelers.\nReversed and remanded.\nJudges Eagles and Greene concur.",
        "type": "majority",
        "author": "WELLS, Judge."
      }
    ],
    "attorneys": [
      "Tucker, Hicks, Moon, Hodge and Cranford, P.A., by John E. Hodge, Jr. and Michael F. Schultze, for plaintiff-appellant.",
      "Wade and Carmichael, by J. J. Wade, Jr., for defendant-appellee."
    ],
    "corrections": "",
    "head_matter": "DAVID E. BRANCH, Administrator of the Estate of Cheryl Lynn Branch v. THE TRAVELERS INDEMNITY COMPANY and UNIGARD MUTUAL INSURANCE COMPANY\nNo. 8726SC861\n(Filed 3 May 1988)\nInsurance \u00a7 69\u2014 underinsured motorist coverage \u2014 failure to comply with condition precedent \u2014 insurer not prejudiced \u2014 renunciation of subrogation right by insurer\nWhile plaintiffs failure to obtain the written consent of defendant insurer before settling a tort claim against an underinsured motorist violated a provision expressly denominated by the policy as a condition precedent to underin-sured motorist coverage, defendant was not prejudiced by this non-compliance in view of its renunciation of all right to be subrogated against an underin-sured motorist.\nAppeal by plaintiff from Snepp, Frank W., Jr., Judge. Judgment entered 9 June 1987 in Mecklenburg County Superior Court. Heard in the Court of Appeals 4 February 1988.\nPlaintiff filed this civil action on 9 December 1985 seeking payment of sums claimed owing under the underinsured motorist coverage provisions of two policies \u2014 one issued to plaintiffs decedent by defendant The Travelers Indemnity Company (Travelers) and the other to decedent\u2019s parents by defendant Unigard Mutual Insurance Company (Unigard). Both defendants filed answers admitting execution of the policies, and both defendants moved for summary judgment. Discovery was engaged in and affidavits were filed. The motion for summary judgment by defendant Travelers came on for hearing on 8 June 1987. Travelers supported its motion for summary judgment with an affidavit from its claim supervisor, Dorothy Becker, which stated that plaintiff had settled its tort claim against the underinsured motorist without first having obtained Travelers\u2019 consent to the settlement. On 9 June the trial court signed and entered summary judgment dismissing plaintiffs action against Travelers. Uni-gard\u2019s motion for summary judgment was continued at its request. The trial court further determined in the judgment that there was no just reason for delay, and on 10 June, plaintiff gave notice of appeal.\nTucker, Hicks, Moon, Hodge and Cranford, P.A., by John E. Hodge, Jr. and Michael F. Schultze, for plaintiff-appellant.\nWade and Carmichael, by J. J. Wade, Jr., for defendant-appellee."
  },
  "file_name": "0116-01",
  "first_page_order": 146,
  "last_page_order": 149
}
