Filed: Mar. 22, 2013
Latest Update: Feb. 12, 2020
Summary: UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 12-1189 SHIRLEY A. WESTVEER, Administrator Personal Representative of the Estate of Arthur E. Westveer, Jr., Plaintiff - Appellant, v. GARRISON PROPERTY & CASUALTY INSURANCE COMPANY, Defendant - Appellee. Appeal from the United States District Court for the Eastern District of Virginia, at Norfolk. Robert G. Doumar, Senior District Judge. (2:11-cv-00255-RGD-DEM) Argued: January 30, 2013 Decided: March 22, 2013 Before TRAXLER,
Summary: UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 12-1189 SHIRLEY A. WESTVEER, Administrator Personal Representative of the Estate of Arthur E. Westveer, Jr., Plaintiff - Appellant, v. GARRISON PROPERTY & CASUALTY INSURANCE COMPANY, Defendant - Appellee. Appeal from the United States District Court for the Eastern District of Virginia, at Norfolk. Robert G. Doumar, Senior District Judge. (2:11-cv-00255-RGD-DEM) Argued: January 30, 2013 Decided: March 22, 2013 Before TRAXLER, C..
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 12-1189
SHIRLEY A. WESTVEER, Administrator Personal Representative
of the Estate of Arthur E. Westveer, Jr.,
Plaintiff − Appellant,
v.
GARRISON PROPERTY & CASUALTY INSURANCE COMPANY,
Defendant − Appellee.
Appeal from the United States District Court for the Eastern
District of Virginia, at Norfolk. Robert G. Doumar, Senior
District Judge. (2:11-cv-00255-RGD-DEM)
Argued: January 30, 2013 Decided: March 22, 2013
Before TRAXLER, Chief Judge, and GREGORY and DUNCAN, Circuit
Judges.
Affirmed by unpublished per curiam opinion.
John Stephen Wilson, WILSON & MCINTYRE, PLLC, Norfolk, Virginia,
for Appellant. Brian Nelson Casey, TAYLOR & WALKER, PC,
Norfolk, Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
After her husband was killed in a car wreck, Shirley
Westveer brought this action seeking a declaration that she was
entitled to “stack” the limits of underinsured motorist coverage
for each of the vehicles insured under an automobile insurance
policy issued to the Westveers by Garrison Property & Casualty
Insurance Company. The district court held that stacking was
prohibited under the terms of the policy, and Westveer appeals.
For the reasons set forth below, we affirm.
I.
Subject to certain exceptions not relevant here, Virginia
law requires every automobile liability insurance policy issued
in the state to include coverage for damages caused by uninsured
vehicles (“UM” coverage). See Va. Code Ann. § 38.2-2206(A).
The statute also obligates the insurer to pay for damages caused
by an underinsured vehicle (“UIM” coverage), “to the extent the
vehicle is underinsured, as defined in subsection B of this
section.” Id. Under subsection B,
[a] motor vehicle is “underinsured” when, and to the
extent that, the total amount of bodily injury and
property damage coverage applicable to the operation
or use of the motor vehicle and available for payment
for such bodily injury or property damage . . . is
less than the total amount of uninsured motorist
coverage afforded any person injured as a result of
the operation or use of the vehicle.
2
Va. Code Ann. § 38.2-2206(B) (emphasis added). Accordingly, a
vehicle that causes an accident is “underinsured” for purposes
of the statute only if the liability insurance covering the at-
fault vehicle is less than the total amount of UM/UIM insurance
available to the injured party. See id.; see also USAA Cas.
Ins. Co. v. Alexander, 445 S.E.2d 145, 148 (Va. 1994) (“[A]
motor vehicle is underinsured to the extent that liability
coverage on such vehicle is less than the UM coverage available
to the claimant on account of the operation of such vehicle.”).
Section 38.2-2206(B) requires a comparison of the total
UM/UIM coverage to the total liability coverage. Accordingly,
if the injured party is entitled to payment from multiple
sources of UM/UIM coverage, the coverage limits for each such
source must be “aggregated, or stacked, before the total amount
of this coverage is compared with the total amount of liability
coverage.” Alexander, 445 S.E.2d at 149. If the injured party
is insured under a single automobile policy that covers multiple
vehicles, the injured insured may stack the UM/UIM limits for
each car insured unless the policy clearly and unambiguously
prohibits stacking. See Goodville Mut. Cas. Co. v. Borror,
275
S.E.2d 625, 627 (Va. 1981) (“[I]t is now the rule in Virginia
that the [intra-policy] stacking of UM coverage will be
permitted unless clear and unambiguous language exists on the
face of the policy to prevent such multiple coverage.”).
3
II.
Arthur Westveer (“Arthur”) was killed when his car collided
with a car driven by Heather Anderson, and the parties have
stipulated for purposes of this action that Anderson was at
fault in the collision. Anderson was insured under an
automobile policy with liability limits of $100,000 per person
and $300,000 per accident for claims involving bodily injury,
and $50,000 per accident for property damage claims.
Arthur was the named insured on an automobile policy issued
by Garrison. The Garrison policy insured three cars and
provided UM/UIM coverage with stated limits of $100,000 per
person and $300,000 per accident for bodily injury, and $50,000
for property damage. The policy includes a clause (the “anti-
stacking clause”) stating that:
The limit of Bodily Injury Liability shown in the
Declarations for each person for Uninsured Motorists
Coverage[1] is our maximum limit of liability for all
damages . . . arising out of bodily injury sustained
by any one person in any one accident. . . .
This is the most we will pay regardless of the
number of:
1. Insureds;
2. Claims made; or
3. Vehicles or premiums shown in the Declarations.
1
The anti-stacking clause is contained in Part C of the
policy. Although the policy describes Part C coverage as
“Uninsured Motorists Coverage,” J.A. 31, Part C includes
coverage for both uninsured and underinsured vehicles.
4
J.A. 32-33.
Shirley Westveer, Arthur’s widow and the administrator and
personal representative of his estate, filed a claim for UIM
benefits under the Garrison policy. Garrison rejected the
claim, asserting that Anderson’s car was not underinsured
because its UM/UIM policy limits did not exceed the liability
limits of Anderson’s policy.
Westveer thereafter brought this action under the
Declaratory Judgment Act, see 28 U.S.C. § 2201, seeking a
determination of the coverage provided by the Garrison policy.
Westveer contended that Anderson’s car was underinsured because
the UM/UIM coverage limits for each of the three cars insured
under the Garrison policy must be stacked and the stacked UM/UIM
coverage limits exceeded the liability limit of Anderson’s
policy.
The district court rejected Westveer’s reading of the
policy. In the district court’s view, the policy’s anti-
stacking clause was indistinguishable from a clause that the
Supreme Court of Virginia had found sufficient to preclude
intra-policy stacking. See Goodville, 275 S.E.2d at 627-28.
Accordingly, the court held that the Garrison policy clearly and
unambiguously precluded stacking and that the per-person limit
of UM/UIM coverage under the policy was $100,000. The court
5
entered judgment denying Westveer’s motion for summary judgment
and granting Garrison’s cross-motion for summary judgment.
III.
On appeal, Westveer argues that the district court erred by
concluding that stacking was prohibited by the anti-stacking
clause. She argues that, at best, the anti-stacking clause is
ambiguous when considered in conjunction with policy provisions
that she believes affirmatively authorize stacking rights and
that, at worst, the clause is deceptive and thus unenforceable.
A.
As the district court held, the anti-stacking clause here
is materially indistinguishable from the clause enforced in
Goodville. In that case, a multi-vehicle policy included a
clause which stated that,
Regardless of the number of motor vehicles to which
this insurance applies, (a) the [$25,000] limit of
liability for bodily injury stated in the schedule as
applicable to “each person” is the limit of the
company’s liability for all damages because of bodily
injury sustained by one person as the result of any
one accident . . . .
Id. at 627 (internal alteration omitted). The court held that
the “clear and unambiguous” language of the clause “requires the
construction that stacking is not permissible.”
Id. at 628. As
the court explained, the portion of the clause underlined above
“plainly limits [the insurer’s] UM liability for damages to any
one person as a result of any one accident to $25,000. The mere
6
fact that two vehicles are insured and two separate premiums are
charged is of no consequence in light of the express language of
the policy.” Id. at 628.
The anti-stacking clause here likewise makes it clear that
where “any one person” is injured “in any one accident,” the
per-person UIM limit for bodily injury claims is the “maximum
limit of liability for all damages.” And by emphasizing that
the per-person bodily-injury UIM limit “is the most we will pay”
even if the policy insures multiple vehicles and charges
separate premiums for each car insured, the clause makes it
clear that the separate premiums are not purchasing separate
units of UM/UIM coverage. Cf. Cunningham v. Insurance Co. of N.
Am.,
189 S.E.2d 832, 837 (Va. 1972) (stacking of UM benefits
permitted because multi-car, separate-premium policy was
ambiguous: “Defendant here chose to issue coverage on two
separate automobiles and to accept a premium for each. . . .
When we pay a double premium we expect double coverage.”).
Although the anti-stacking clause requires reference to the
policy’s Declarations page to determine the dollar amount of the
relevant UIM limit, the reference in no way muddies the
otherwise clear language of the anti-stacking clause. Cf.
Virginia Farm Bureau Mut. Ins. Co. v. Williams, 677 S.E.2d 299,
303 (Va. 2009) (finding otherwise clear anti-stacking clause
ambiguous when considered in conjunction with declarations page
7
referenced in clause). The Declarations page includes a table
listing the various categories of coverage provided by the
policy and showing the liability limits for each category.
Beneath the “PART C – UNINSURED MOTORISTS” heading, the
Declarations page shows the liability limits as follows:
BODILY INJURY EA PER $100,000
EA ACC $300,000
PROPERTY DAMAGE EA ACC $50,000
J.A. 15. Where one person is injured, the anti-stacking clause
states that Garrison’s maximum liability is “[t]he limit of
Bodily Injury Liability shown in the Declarations for each
person for Uninsured Motorists Coverage.” J.A. 32. That
language points directly to, and only to, the $100,000 “ea per”
bodily injury limit listed under Part C in the Declarations.
There is only one dollar amount shown for per-person/bodily-
injury in the Uninsured Motorists section, and there are no
other limits on the Declarations page to which the clause could
be referring. See Williams, 677 S.E.2d at 303 (clause limiting
liability to UM per-person/bodily injury limit shown in
declarations found to be ambiguous because declarations showed
three per-person UM limits in two different amounts). We
therefore conclude that the anti-stacking clause clearly and
unambiguously precludes stacking of the UM/UIM coverage limits.
8
B.
Westveer, however, contends that even if the language of
the anti-stacking clause is clear enough in isolation, the
policy affirmatively authorizes stacking through its definition
of “underinsured motor vehicle.” According to Westveer, because
the policy affirmatively grants stacking rights while
simultaneously purporting to withdraw those rights through the
anti-stacking clause, the policy, viewed as a whole, is
ambiguous and thus does not preclude stacking. See id. at 302
(“[A]ny ambiguity regarding the stacking of coverage within a
policy will be construed against the insurer.”).
Under the policy, an “underinsured motor vehicle” is a
vehicle for which the total liability insurance “available for
payment is less than the sum of the limits of liability
applicable to the Insured for Uninsured Motorists Coverage under
this policy or any other policy.” J.A. 31. According to
Westveer, the phrase “the sum of the limits of liability
applicable to the Insured” requires stacking. Because the
definition requires adding (or “sum[ming]”) the limits (plural)
of applicable UM/UIM coverage, Westveer argues that there must
always and necessarily be more than one UM/UIM coverage limit
that is “applicable to the Insured” under the Garrison policy.
In Westveer’s view, all of the coverages provided by the policy
for each car insured are generally “applicable” to the insured.
9
Westveer thus argues that the phrase “the sum of the limits of
liability applicable to the Insured for Uninsured Motorists
Coverage” requires stacking of the UM/UIM limits for each car
insured under the policy. We disagree.
The Garrison policy sets separate per-person and per-
accident limits for claims involving bodily injury and still
another limit for claims involving property damage, any
combination of which could be implicated in any given case.
When the policy definition is read in context, with the
structure of the policy and policy limits in mind, the meaning
and import of the phrase is apparent. See, e.g., Hill v. State
Farm Mut. Auto. Ins. Co., 375 S.E.2d 727, 729 (Va. 1989) (“[A]s
in the case of any other contract, the words used [in an
insurance policy] are given their ordinary and customary meaning
when they are susceptible of such construction.”). The plural
“limits of liability” does not mean that more than one liability
limit will always be applicable, but simply reflects the
possibility that a single incident might trigger more than one
of the UM/UIM limits. And the “applicable to the Insured”
language directs consideration of only those limits that are
relevant and appropriately applied to the case at hand – for
example, the per-person limit if one insured is injured, or the
per-person and per-accident limits if more than one insured is
injured. See Webster’s Encyclopedic Unabridged Dictionary of
10
the English Language 102 (2001) (defining “applicable” as
“capable of being applied; relevant; suitable; appropriate”).
Westveer, however, rejects this obvious reading of the
policy. The underinsured-vehicle calculation set out in the
policy requires a comparison of the limits of liability
insurance “available for payment” to the limits if UM/UIM
coverage “applicable to the Insured.” J.A. 31. The policy
defines “available for payment” in a way that focuses on the
particular claim of the injured party, see J.A. 31 (defining
“available for payment” as “the amount of liability coverage
applicable to the claim of the Insured as reduced by the payment
of any other claims arising out of the same occurrence”
(emphasis added)), but the policy does not define “applicable to
the Insured.” Westveer argues that the presence of a claim-
specific definition on the liability-insurance side of the
underinsured-vehicle calculation and the absence of a similarly
claim-specific definition on the UM/UIM side of that calculation
requires a broader understanding of what limits of UM/UIM
coverage are “applicable to the Insured.” Cf. Forst v.
Rockingham Poultry Mktg. Coop., Inc., 279 S.E.2d 400, 404 (1981)
(“When the General Assembly uses two different terms in the same
act, it is presumed to mean two different things.”).
We find Westveer’s argument unpersuasive. As noted above,
the policy requires a comparison of the limits of liability
11
insurance “available for payment” to the limits of UM/UIM
coverage “applicable to the Insured.” J.A. 31. A claim-
specific focus when determining the UM/UIM limits “applicable to
the Insured” is inherent in the use of the word “applicable.” 2
See Webster’s Encyclopedic Unabridged Dictionary 102. On the
liability-insurance side of the calculation, however, an
additional definition was needed to establish the claim-specific
focus for determining the amount of liability insurance
“available for payment.”
The absence of a specific definition of the UM/UIM that is
“applicable to the Insured” therefore cannot justify ignoring
the plain meaning of the terms used in the policy or assigning
more meaning than the terms reasonably can bear. The phrase at
issue here -- “the sum of the limits of liability applicable to
the Insured” -- cannot reasonably be interpreted as requiring
stacking when determining whether the at-fault vehicle was
underinsured. And because the policy does not affirmatively
2
Before the district court and in the briefs filed with
this court, counsel for Westveer contended that the policy
authorized stacking of all UIM limits -- per-person, per-
accident, and property damage -- for each car, for a total of
$1,350,000 in UM/UIM coverage. At oral argument, however,
counsel abandoned that claim and asserted a right to stack only
the $100,000 per-person limit for each of the three cars insured
under the policy. Counsel’s narrower argument seems implicitly
to reflect a similar understanding of the policy language.
12
require stacking, we reject Westveer’s claim that the anti-
stacking clause creates an ambiguity within the policy. 3
C.
In her final effort to avoid the effect of the anti-
stacking clause, Westveer argues that the clause itself is
deceptive and thus unenforceable.
The anti-stacking clause states that the UM/UIM per-person
bodily-injury limit (or the per-accident limit, if applicable)
“is our maximum limit of liability for all damages” and is “the
most” Garrison will pay under the policy. J.A. 32-33. The
anti-stacking clause also includes a set-off provision stating
that any damages payable under the UM/UIM coverage “shall be
reduced” by the amount paid by or on behalf of the at-fault
driver. J.A. 33. Westveer argues that as to a claim involving
an underinsured vehicle, Garrison will never pay the full limit,
3
Westveer also refers to the insuring agreement contained
in the UM/UIM section of the policy and a statement on the
Declarations page when arguing that the anti-stacking clause
conflicts with other policy provisions authorizing stacking.
Because the policy’s definition of underinsured vehicle does not
require stacking and the uninsured motorist statute does not
require intra-policy stacking, there is no conflict between the
anti-stacking clause and Garrison’s promise in the insuring
agreement to pay damages in accordance with the statute. And
because the policy does not require stacking, there is likewise
no conflict with the statement in the Declarations that the
“limits shown . . . may not be combined regardless of the number
of vehicles for which a premium is listed unless specifically
authorized elsewhere in this policy.” J.A. 15.
13
since some amount of insurance is always available where UIM
benefits are sought and the policy calls for the benefits
payable to be reduced by the amounts paid by the liability
insurer. Westveer thus contends that the anti-stacking clause
is “deceptive and always untrue” in the UIM context, Brief of
Appellant at 26, because Garrison will never be required to pay
the “maximum limit” of the policy, J.A. 32. And because the
anti-stacking clause is deceptive, Westveer contends the clause
is unenforceable. We disagree.
Assuming that the set-off provision is enforceable and
would operate as described by Westveer, we still find nothing
deceptive about the anti-stacking clause. The policy’s UM and
UIM coverage, including the anti-stacking clause, is set out in
Part C of the policy, which is entitled “Uninsured Motorists
Coverage.” J.A. 31. The policy consistently uses “Uninsured
Motorists Coverage” to refer to both UM and UIM coverage, and
the anti-stacking clause likewise encompasses UM and UIM
coverage. Even if the full limit will never be paid in UIM
cases, the full limit will always be paid in UM cases, where
there is no liability insurance and thus no basis for a benefits
offset. The anti-stacking clause therefore is not deceptive,
and there is no basis for us to refuse to enforce it.
14
IV.
In its order denying Westveer’s motion for summary judgment
and granting Garrison’s cross-motion for summary judgment, the
district court stated that “because [Westveer] is not entitled
to stack the UIM coverages present in the Declaration section of
the Policy, UIM coverage is limited to $100,000.” J.A. 440.
Westveer construes the court’s order as a declaration that she
is entitled to a payment of $100,000 in UIM benefits. Garrison
has refused to pay any amount under the policy, and Westveer
believes Garrison’s refusal to pay is premised on the set-off
provision discussed above. Westveer argues that the set-off
provision is void and that Garrison therefore cannot rely on the
provision to evade its statutory obligation to provide
underinsured coverage. See Nationwide Mut. Ins. Co. v. Hill,
439 S.E.2d 335, 339 (Va. 1994) (holding that a policy provision
requiring a set-off of liability insurance payments against
amount payable under UM coverage is “void as against public
policy”).
Contrary to Westveer’s claim, the district court simply did
not hold that Westveer was entitled to payment of $100,000 in
UIM benefits. The district court held that the anti-stacking
clause precluded stacking of the UM/UIM benefits for each car
insured under the Garrison policy. Because stacking was
precluded, the policy’s per-person, bodily-injury limit for
15
UM/UIM coverage was $100,000, as shown in the policy
Declarations and as stated by the district court in its order.
That the policy included UIM coverage with per-person
limits of $100,000, however, does not mean that Garrison is
obligated to pay UIM benefits in this case. Under § 38.2-
2206(A), Garrison is obligated to pay UIM benefits in this case
only “to the extent the vehicle is underinsured, as defined in
[§ 38.2-2206(B).” Va. Code Ann. § 38.2-2206(A) (emphasis
added). In this case, the at-fault vehicle is not underinsured
within the meaning of the statute, because the non-stackable
$100,000 per-person UIM limit under the Garrison policy does not
exceed the liability limits of the at-fault driver’s insurance.
See id. § 38.2-2206(B) (“A motor vehicle is ‘underinsured’ when,
and to the extent that, the [applicable liability coverage] . .
. is less than the total amount of [UM/UIM] coverage afforded
any person injured as a result of the operation or use of the
vehicle.”).
Because the at-fault vehicle was not underinsured,
Westveer’s UIM coverage was not triggered, and Garrison has no
obligation to pay UIM benefits in any amount; there is nothing
in the district court’s order that can be construed as holding
otherwise. Accordingly, the set-off provision has nothing to do
with Garrison’s refusal to pay benefits, and we need not
16
consider whether the set-off clause would be enforceable in a
case where the insurer was obligated to pay UIM benefits.
V.
As we have explained, the anti-stacking clause contained in
the Garrison policy is not deceptive or otherwise unenforceable,
and the clause clearly and unambiguously precludes stacking of
UM/UIM benefits. Accordingly, the district court’s order
granting summary judgment to Garrison is hereby
AFFIRMED.
17
