{
  "id": 2485985,
  "name": "GEORGE L. PROCTOR, Administrator of the Estate of JOYCE BATTS PROCTOR v. NORTH CAROLINA FARM BUREAU MUTUAL INSURANCE COMPANY and BOBBY F. JONES, Administrator C.T.A. of the Estate of William Gray Edwards, Jr.",
  "name_abbreviation": "Proctor v. North Carolina Farm Bureau Mutual Insurance",
  "decision_date": "1989-03-02",
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    "judges": [],
    "parties": [
      "GEORGE L. PROCTOR, Administrator of the Estate of JOYCE BATTS PROCTOR v. NORTH CAROLINA FARM BUREAU MUTUAL INSURANCE COMPANY and BOBBY F. JONES, Administrator C.T.A. of the Estate of William Gray Edwards, Jr."
    ],
    "opinions": [
      {
        "text": "MITCHELL, Justice.\nThe sole question presented by this appeal is what amount of underinsured motorist coverage is required by law when an insurer has not complied with N.C.G.S. \u00a7 20-279.21(b)(4) and the liability insurance policy in which the underinsured motorist coverage is required does not state the existence or the amount of such coverage. The trial court and the majority in the Court of Appeals concluded that under such circumstances the statute, as it was written at the time relevant to this case, required underinsured motorist coverage equal to the maximum liability coverage provided by the policy. We affirm.\nThe facts controlling this case were stipulated by the parties in the trial court. The plaintiff\u2019s decedent, Joyce Batts Proctor, was killed in a traffic accident on 27 September 1984 while driving a van owned by Country Manor Antiques, a partnership in which she was a partner. The wrongful death of the plaintiff\u2019s decedent was caused by the negligence of William Gray Edwards, Jr., who was driving another vehicle involved in the accident. Edwards was covered by a liability insurance policy with maximum coverage limits of $25,000 per person and $50,000 per accident. The plaintiff\u2019s decedent was covered by a policy issued to Country Manor Antiques by the defendant, North Carolina Farm Bureau Mutual Insurance Co., with maximum liability coverage limits for wrongful death of $100,000 per person and $300,000 per accident, as well as uninsured motorist coverage.\nNeither Country Manor Antiques nor the plaintiffs decedent had ever rejected underinsured motorist coverage in the policy issued by the defendant, as required by N.C.G.S. \u00a7 20-279.21(b)(4) if underinsured motorist coverage was not to be provided. The defendant had written the policy with a clause purportedly requiring that the insured request underinsured motorist coverage before it would be provided. The defendant now concedes that the clause contradicted N.C.G.S. \u00a7 20-279.21(b)(4) and that, by operation of the statute, underinsured motorist coverage was provided in its policy covering the plaintiffs decedent, even though premiums had never been paid for such coverage.\nThe plaintiff, George L. Proctor, administrator of Joyce Proctor\u2019s estate, sued the defendant insurance company for proceeds from the underinsured motorist coverage provided in its policy by operation of the statute. The trial court granted summary judgment for the plaintiff in the amount of $75,000. The plaintiffs wrongful death damages had been found to be in excess of $100,000. After determining that the $100,000 per person maximum liability coverage of the policy issued by the defendant was the amount of underinsured motorist coverage required by the statute, the trial court deducted from that amount Edwards\u2019 maximum liability coverage of $25,000 to arrive at the $75,000 that the defendant owed the plaintiff, such deduction also being provided for by the statute as it was then written.\nThe defendant contends that the statute as written at the time of the accident was not intended to provide the maximum amount of underinsured motorist coverage in cases such as this where the insurer failed to comply with the statute and the existence and amount of such coverage were not stated in the policy. The defendant contends that when underinsured motorist coverage was provided solely by operation of the former version of the statute, it was only provided at the minimum level of underinsured motorist coverage offered by the insurer at the time, which in this case would have been $50,000. That is particularly appropriate in this case, the defendant contends, because the insured had opted to purchase only the minimum amount of uninsured motorist coverage. Accordingly, the defendant argues that the trial court should have awarded the plaintiff only $25,000, after deducting Edwards\u2019 $25,000 liability limit from the $50,000 minimum underinsured motorist coverage offered by the defendant.\nThe language of the statute was not explicit as to the amount of underinsured motorist coverage required at the time of this accident. Absent the insured\u2019s rejection of such coverage, the statute as written at that time required underinsured motorist coverage in all insurance policies that provided more than the statutory minimum liability coverage and which included uninsured motorist coverage. The statute provided that the underinsured motorist coverage was \u201cnot to exceed\u201d the policy limits for automobile bodily injury liability as specified in the owner\u2019s policy. The statute\u2019s only other reference to the amount of such coverage was in its formula for the limit of the insurer\u2019s payment under such coverage, the limit then being \u201conly the difference between the limits of the liability insurance [of the underinsured motorist] that is applicable and the limits of the underinsured motorist coverage as specified in the owner\u2019s policy.\u201d N.C.G.S. \u00a7 20-279.21(b)(4) (1983).\nIn order to determine what level of coverage the statute as formerly written was intended to mandate under the circumstances of this case, we must look to the purpose of the statute and the needs it was intended to address. The purpose of this State\u2019s compulsory motor vehicle insurance laws, of which the underinsured motorist provisions are a part, was and is the protection of innocent victims who may be injured by financially irresponsible motorists. See Nationwide Mutual Insurance Co. v. Chantos, 293 N.C. 431, 238 S.E. 2d 597 (1977).\nThe innocent plaintiffs damages in this case were in excess of $100,000, of which only $25,000 was recoverable (the plaintiff actually recovered less) from the liability coverage of the underinsured motorist who caused the accident. The defendant insurance company, which created the ambiguity confronting us in this case by its failure to comply with the statute, asks this Court to resolve the ambiguity in its favor. That would provide the plaintiff with an additional $25,000 \u2014$50,000 underinsured motorist coverage, less the $25,000 liability limit of the underinsured motorist\u2019s policy \u2014 leaving in excess of $50,000 in damages uncompensated by operation of the statute.\nUnder the plaintiff\u2019s interpretation of the statute\u2019s requirements at the time of the accident, adopted by the trial court and the Court of Appeals, the statute would provide $100,000 of underinsured motorist coverage \u2014an amount equal to the liability coverage in the defendant\u2019s policy \u2014 for the death of this innocent victim of a tortfeasor who was financially unable to make full compensation. Thus, the general purpose of the statute would be served better and more fully by the plaintiff\u2019s interpretation. Furthermore, such an interpretation is consistent with the principle that the remedial compulsory motor vehicle insurance statutes should be liberally construed to accomplish the beneficial purpose intended by the legislature. See Moore v. Hartford Fire Insurance Co., 270 N.C. 532, 155 S.E. 2d 128 (1967).\nAs pointed out by the Court of Appeals, the legislature made the level of underinsured motorist coverage a function of liability coverage, not a function of uninsured coverage as urged by the defendant. 90 N.C. App. at 748, 370 S.E. 2d at 259. This is true under both the former version of the statute, which provided that underinsured motorist coverage would not exceed liability coverage, and under the current statute, which expressly provides that the limits of the two coverages are to be equal. This statutory relationship between underinsured motorist and liability coverages is further evidence that the former version of the statute, under these circumstances, was intended to provide compensation to the innocent victim in an amount up to the limit of the liability coverage in the defendant\u2019s policy covering the victim \u2014the only limit on underinsured motorist coverage found in the statute as it was then written.\nUnless they expressly say so, amendments to statutes are not necessarily clarifications of legislative intent. Nevertheless, the fact that the legislature has amended N.C.G.S. \u00a7 20-279.21(b)(4) since the accident in this case to mandate underinsured motorist coverage equal to liability coverage in all cases is some additional evidence that the statute\u2019s general purpose, which has not been changed, is best served when the statute is interpreted to provide the innocent victim with the fullest possible protection. That calls for underinsured motorist coverage up to the limit of the liability coverage.\nThe defendant in this case must be held responsible for issuing a policy that purported to include requirements that violated the provisions of N.C.G.S. \u00a7 20-279.21(b)(4) regulating critical aspects of the defendant\u2019s business. The defendant admits its responsibility for failing to comply with the statute. The defendant nevertheless asks this Court to give the statute a construction that would result in the least possible protection for the innocent victim of an underinsured tortfeasor, such result arising from the ambiguity created by the defendant\u2019s violation of the statute by failing to write underinsured motorist coverage into the policy. This would undermine the intent and purpose of the statute, and we reject the construction of the statute proposed by the defendant.\nFor the foregoing reasons, we conclude that under the circumstances of this case, the statute as written at the time of the accident required that the victim of an underinsured tortfeasor have underinsured motorist coverage equal to the liability limits of the policy covering the victim, unless the victim had rejected such coverage. N.C.G.S. \u00a7 20-279.21(b)(4) (1983). Therefore, we affirm the decision of the Court of Appeals, which affirmed the trial court\u2019s summary judgment for the plaintiff in the amount of $75,000.\nAffirmed.\n. At the time of this accident, the statute provided in pertinent part:\n[Motor vehicle liability insurance policies] shall . . . provide underinsured motorist coverage, to be used only with policies that are written at limits that exceed those prescribed by subdivision (2) of this section and that afford uninsured motorist coverage as provided by subdivision (3) of this subsection, but not to exceed the policy limits for automobile bodily injury liability as specified in the owner\u2019s policy.\nN.C.G.S. \u00a7 20-279.21(b)(4) (1983) (emphasis added).\n. The statute\u2019s ambiguity as to the amount of underinsured motorist coverage to be mandated under all circumstances, including when the policy does not comply with the statute as in this case, has now been clarified by the legislature. Subsection (b)(4) was amended effective 1 October 1985 to require in all cases that underinsured motorist coverage be \u201cin an amount equal to the policy limits for automobile bodily injury liability as specified in the owner\u2019s policy.\u201d N.C.G.S. \u00a7 20-279.21(b)(4) (Cum. Supp. 1988) (emphasis added).",
        "type": "majority",
        "author": "MITCHELL, Justice."
      },
      {
        "text": "Justice MEYER\ndissenting.\nUnderinsured motorist coverage is not required by law, since the insured may reject it. The repealed statute that governs this case, as well as the current statute, requires that the carrier offer underinsured coverage only to the holders of liability policies which exceed the minimum compulsory amounts of liability insurance. Even the currently effective statute, which provides that underinsured coverage must be offered in the amount of the upper limits of the owner\u2019s liability policy, does not require the motorist to carry such insurance since he may reject the same simply by electing not to purchase the coverage.\nI agree with the majority that, because of the erroneous language in its policy, Farm Bureau should be held to have provided underinsured motorist coverage in this case. I differ from the majority as to the amount of coverage applicable. In my opinion, Farm Bureau should be held to have provided $50,000 in underinsured coverage for the death of the plaintiffs decedent, which, after the $25,000 credit for sums recovered from the tort-feasor, would leave a net liability of $25,000.\nRecovery in this additional amount of $25,000 does equity in this case. It cannot be said that Mrs. Proctor had an expectation of receiving the higher coverage. The statute in effect at the time the policy was purchased certainly did not explicitly so provide. Nor can any such expectation have arisen from the words of the policy. Though the policy provisions relating to underinsured coverage were totally erroneous, they served specifically to notify the insured that the policy did not provide any underinsured coverage at all. Nor can any such expectation be said to have arisen from any inquiry made to the company by the insured. The erroneous policy provisions clearly informed the insured that if under-insured coverage was desired, she should make inquiry of her agent, and she made no such inquiry. Nor can any such expectation be said to have arisen from the fact that the insured purchased more than the minimum amount of uninsured coverage, because she did not. No evidence whatsoever has been produced which would suggest that the insured wanted or expected higher underinsured limits than the required minimum compulsory liability coverage.\nWhile the statute has now been amended to specifically tie the amount of underinsured coverage to the amount of the liability coverage purchased by the insured and while there are probably only a few cases yet to be decided under the old statute, it is important to decide this case correctly. I vote to reverse the decision of the Court of Appeals.",
        "type": "dissent",
        "author": "Justice MEYER"
      }
    ],
    "attorneys": [
      "Bridgers, Horton & Rountree, by Charles S. Rountree, for the plaintiff appellee.",
      "Poyner & Spruill, by Diane Dimond and Mary Beth Forsyth Johnston, for the defendant appellant."
    ],
    "corrections": "",
    "head_matter": "GEORGE L. PROCTOR, Administrator of the Estate of JOYCE BATTS PROCTOR v. NORTH CAROLINA FARM BUREAU MUTUAL INSURANCE COMPANY and BOBBY F. JONES, Administrator C.T.A. of the Estate of William Gray Edwards, Jr.\nNo. 384A88\n(Filed 2 March 1989)\nInsurance \u00a7 69.1\u2014 required underinsured motorist coverage \u2014 failure of policy to state existence or amount \u2014 coverage equal to liability coverage\nWhere an insurer failed to comply with former N.C.G.S. \u00a7 20-279.21(b)(4) (1983) and an automobile liability policy in which underinsured motorist coverage was required because the insured had not rejected such coverage did not state the existence or amount of such coverage, the statute required underinsured motorist coverage equal to the maximum liability coverage provided by the policy.\nJustice Meyer dissenting.\nAPPEAL of right pursuant to N.C.G.S. \u00a7 7A-30 of the decision of a divided panel of the Court of Appeals, 90 N.C. App. 746, 370 S.E. 2d 258 (1988), affirming a judgment entered by Wright, J., in the Superior Court, EDGECOMBE County, on 2 November 1987. Heard in the Supreme Court on 15 November 1988.\nBridgers, Horton & Rountree, by Charles S. Rountree, for the plaintiff appellee.\nPoyner & Spruill, by Diane Dimond and Mary Beth Forsyth Johnston, for the defendant appellant."
  },
  "file_name": "0221-01",
  "first_page_order": 259,
  "last_page_order": 265
}