IN THE SUPREME COURT OF MISSISSIPPI
NO. 2005-CA-00481-SCT
DARRELL ALLEY
v.
NORTHERN INSURANCE COMPANY
DATE OF JUDGMENT: 01/31/2005 TRIAL JUDGE: HON. STEPHEN B. SIMPSON ATTORNEYS FOR APPELLANT: JOHN R. SANTA CRUZ PRESTON J. MAUFFRAY ATTORNEY FOR APPELLEE: TRACE D. McRANEY NATURE OF THE CASE: CIVIL - INSURANCE DISPOSITION: AFFIRMED - 04/20/2006 MOTION FOR REHEARING FILED: MANDATE ISSUED:
EN BANC.
WALLER, PRESIDING JUSTICE, FOR THE COURT:
¶1. This appeal involves issues pertaining to stacking of uninsured/underinsured insurance
benefits. Finding that our precedent has resolved the first two issues raised on appeal
(whether an insurance agent has a duty to explain the legal implications of
uninsured/underinsured benefits and whether an injured employee may stack when the
tortfeasor is not underinsured) and that the third issue (whether the type of insurance policy
is relevant to the question of stacking) is procedurally barred and/or frivolous, we affirm the
circuit court’s grant of summary judgment to the employer’s uninsured benefits carrier. FACTS
¶2. After having an automobile accident with Betty H. Meyer, Darrell Alley filed suit
against Meyer and Northern Insurance Company of New York, which had issued an
insurance policy to Hancock County providing uninsured/underinsured motorist coverage.1
Alley was acting in the course and scope of his employment with Hancock County at the time
of the accident and was driving an automobile owned by Hancock County. Meyer had in
effect a $100,000 automobile liability insurance policy. Alley had no personal
uninsured/underinsured coverage. The Hancock County policy provided $25,000 per vehicle
uninsured/underinsured coverage for each of Hancock County’s 109 covered vehicles. Alley
alleges Meyer’s liability coverage is not sufficient to cover his injuries and damages.
¶3. Northern Insurance filed a motion for summary judgment, contending that Meyer was
not underinsured because her $100,000 liability coverage exceeded the Hancock County
$25,000 uninsured/underinsured coverage, arguing that, under Mascarella v. U. S. Fidelity &
Guar. Co., 833 So. 2d 575 (Miss. 2002), Meyer could not be considered an underinsured
driver unless her liability coverage was less than Hancock County’s uninsured/underinsured
coverage. Mascarella involved an issue certified to this Court by the United States Court of
Appeals for the Fifth Circuit: “[w]hether an injured insured is entitled to stack the
underinsured motorist coverage of other vehicles covered under his fleet policy thereby
1 Alley originally named Zurich North America as a defendant, but later amended the complaint to name Northern Insurance Company of New York as the proper defendant.
2 making the third-party tortfeasor’s vehicle an underinsured motor vehicle.” Id. at 576. The
circuit court granted Northern Insurance’s motion for summary judgment, finding as follows:
(1) To determine whether an insured vehicle is underinsured, a court must compare the limits of liability coverage on that vehicle to the uninsured limits provided through the injured party’s own coverage.
(2) Marscarella controls. Marscarella, just like Alley, was injured while driving a vehicle which was part of his employer’s fleet. Also, just like Alley, Marscarella did not own or insure the fleet and was “not otherwise insured.” Marscarella was not allowed to stack his employer’s uninsured/underinsured insurance limits. Therefore, Alley is not allowed to do so.
(3) Meyers’ liability limits of $100,000 are more than the sum of (1) the limit of liability for uninsured/underinsured motorist coverage ($25,000) applicable to the vehicle Alley was driving plus any other uninsured/underinsured motorist coverage applicable to Alley ($0). Therefore Meyers was not an underinsured motorist.
(4) The fact that Hancock County had a policy covering 109 vehicles did not take the case outside of the Marscarella holding or increase the uninsured/underinsured motorist limits available to Alley.
¶4. From this ruling, Alley appeals.
DISCUSSION
I. WHETHER MATERIAL QUESTIONS OF FACT W HICH W OULD PRECLUDE SUM M ARY JUDGMENT EXISTED.
¶5. Alley contends the circuit court erred by failing to consider an affidavit submitted by
the Hancock County Chancery Clerk and that Northern Insurance never disclosed the limited
availability of uninsured/underinsured motorist coverage to county employees. The Chancery
Clerk averred as follows: (1) he purchased the Northern Insurance policy on behalf of
3 Hancock County; (2) uninsured/underinsured motorist coverage was purchased to provide
equal uninsured/underinsured motorist coverage to the drivers regularly assigned to the
covered vehicles; (3) Northern Insurance never explained: (a) the definition of, or the
limitations implied by, the term “named insured,” as it related to the policy; (b) the
circumstances under which an employee would be entitled to stack uninsured/underinsured
motorist coverage; or (c) the availability of the stacked coverage was dependent upon the
amount of the insurance coverage available on vehicles involved in accidents with county
vehicles. Alley, citing Aetna Cas. & Sur. Co. v. Berry, 669 So. 2d 56, 76 (Miss. 1996),
contends that an insurer has a duty to explain uninsured/underinsured motorist coverage to
an insured so the insured knows he has an option to increase the coverage limits.
¶6. We have recently partially overruled Berry, holding that an insurance agent has no
absolute, court-created duty to explain an insured’s right to purchase additional uninsured
motorist coverage over and above the amount of coverage required by statute. Owens v.
Miss. Farm Bureau Cas. Ins. Co., 910 So. 2d 1065, 1074 (Miss. 2005). Optional coverage
which exceeds the statutory limit is not required by statute, id. at 1075, and therefore
insurance agents should not be required to inform insureds of optional coverage. Also, as
Northern Insurance suggests, we question an insurance agent’s competence to explain such
esoteric legal issues as stacking when seasoned attorneys find it difficult to do so.
¶7. Northern Insurance also argues that Alley does not have standing to complain of an
alleged breach of duty owed by Northern Insurance to Hancock County. Because we have
4 held that insurance agents do not have the duty to inform Hancock County of the option of
additional coverage, this issue is moot.
II. WHETHER THE CIRCUIT COURT ERRED IN NOT ALLOWING STACKING OF HANCOCK C O U N T Y ’S U N IN SU R E D /U N D E R IN S U R E D COVERAGE.
¶8. Class II insureds are not entitled to uninsured motorist benefits beyond those for
which the named insured contracted regarding that covered vehicle. Meyers v. American
States Ins. Co., 914 So. 2d 669, 675 (Miss. 2005). Persons included in Class I consist of the
“named insured, and residents of the same household, his spouse and relatives of either,
while in a motor vehicle or otherwise.” Glennon v. State Farm Mut. Auto. Ins. Co., 812
So. 2d 927, 931 (Miss. 2002) (quoting Miss. Code Ann. §
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IN THE SUPREME COURT OF MISSISSIPPI
NO. 2005-CA-00481-SCT
DARRELL ALLEY
v.
NORTHERN INSURANCE COMPANY
DATE OF JUDGMENT: 01/31/2005 TRIAL JUDGE: HON. STEPHEN B. SIMPSON ATTORNEYS FOR APPELLANT: JOHN R. SANTA CRUZ PRESTON J. MAUFFRAY ATTORNEY FOR APPELLEE: TRACE D. McRANEY NATURE OF THE CASE: CIVIL - INSURANCE DISPOSITION: AFFIRMED - 04/20/2006 MOTION FOR REHEARING FILED: MANDATE ISSUED:
EN BANC.
WALLER, PRESIDING JUSTICE, FOR THE COURT:
¶1. This appeal involves issues pertaining to stacking of uninsured/underinsured insurance
benefits. Finding that our precedent has resolved the first two issues raised on appeal
(whether an insurance agent has a duty to explain the legal implications of
uninsured/underinsured benefits and whether an injured employee may stack when the
tortfeasor is not underinsured) and that the third issue (whether the type of insurance policy
is relevant to the question of stacking) is procedurally barred and/or frivolous, we affirm the
circuit court’s grant of summary judgment to the employer’s uninsured benefits carrier. FACTS
¶2. After having an automobile accident with Betty H. Meyer, Darrell Alley filed suit
against Meyer and Northern Insurance Company of New York, which had issued an
insurance policy to Hancock County providing uninsured/underinsured motorist coverage.1
Alley was acting in the course and scope of his employment with Hancock County at the time
of the accident and was driving an automobile owned by Hancock County. Meyer had in
effect a $100,000 automobile liability insurance policy. Alley had no personal
uninsured/underinsured coverage. The Hancock County policy provided $25,000 per vehicle
uninsured/underinsured coverage for each of Hancock County’s 109 covered vehicles. Alley
alleges Meyer’s liability coverage is not sufficient to cover his injuries and damages.
¶3. Northern Insurance filed a motion for summary judgment, contending that Meyer was
not underinsured because her $100,000 liability coverage exceeded the Hancock County
$25,000 uninsured/underinsured coverage, arguing that, under Mascarella v. U. S. Fidelity &
Guar. Co., 833 So. 2d 575 (Miss. 2002), Meyer could not be considered an underinsured
driver unless her liability coverage was less than Hancock County’s uninsured/underinsured
coverage. Mascarella involved an issue certified to this Court by the United States Court of
Appeals for the Fifth Circuit: “[w]hether an injured insured is entitled to stack the
underinsured motorist coverage of other vehicles covered under his fleet policy thereby
1 Alley originally named Zurich North America as a defendant, but later amended the complaint to name Northern Insurance Company of New York as the proper defendant.
2 making the third-party tortfeasor’s vehicle an underinsured motor vehicle.” Id. at 576. The
circuit court granted Northern Insurance’s motion for summary judgment, finding as follows:
(1) To determine whether an insured vehicle is underinsured, a court must compare the limits of liability coverage on that vehicle to the uninsured limits provided through the injured party’s own coverage.
(2) Marscarella controls. Marscarella, just like Alley, was injured while driving a vehicle which was part of his employer’s fleet. Also, just like Alley, Marscarella did not own or insure the fleet and was “not otherwise insured.” Marscarella was not allowed to stack his employer’s uninsured/underinsured insurance limits. Therefore, Alley is not allowed to do so.
(3) Meyers’ liability limits of $100,000 are more than the sum of (1) the limit of liability for uninsured/underinsured motorist coverage ($25,000) applicable to the vehicle Alley was driving plus any other uninsured/underinsured motorist coverage applicable to Alley ($0). Therefore Meyers was not an underinsured motorist.
(4) The fact that Hancock County had a policy covering 109 vehicles did not take the case outside of the Marscarella holding or increase the uninsured/underinsured motorist limits available to Alley.
¶4. From this ruling, Alley appeals.
DISCUSSION
I. WHETHER MATERIAL QUESTIONS OF FACT W HICH W OULD PRECLUDE SUM M ARY JUDGMENT EXISTED.
¶5. Alley contends the circuit court erred by failing to consider an affidavit submitted by
the Hancock County Chancery Clerk and that Northern Insurance never disclosed the limited
availability of uninsured/underinsured motorist coverage to county employees. The Chancery
Clerk averred as follows: (1) he purchased the Northern Insurance policy on behalf of
3 Hancock County; (2) uninsured/underinsured motorist coverage was purchased to provide
equal uninsured/underinsured motorist coverage to the drivers regularly assigned to the
covered vehicles; (3) Northern Insurance never explained: (a) the definition of, or the
limitations implied by, the term “named insured,” as it related to the policy; (b) the
circumstances under which an employee would be entitled to stack uninsured/underinsured
motorist coverage; or (c) the availability of the stacked coverage was dependent upon the
amount of the insurance coverage available on vehicles involved in accidents with county
vehicles. Alley, citing Aetna Cas. & Sur. Co. v. Berry, 669 So. 2d 56, 76 (Miss. 1996),
contends that an insurer has a duty to explain uninsured/underinsured motorist coverage to
an insured so the insured knows he has an option to increase the coverage limits.
¶6. We have recently partially overruled Berry, holding that an insurance agent has no
absolute, court-created duty to explain an insured’s right to purchase additional uninsured
motorist coverage over and above the amount of coverage required by statute. Owens v.
Miss. Farm Bureau Cas. Ins. Co., 910 So. 2d 1065, 1074 (Miss. 2005). Optional coverage
which exceeds the statutory limit is not required by statute, id. at 1075, and therefore
insurance agents should not be required to inform insureds of optional coverage. Also, as
Northern Insurance suggests, we question an insurance agent’s competence to explain such
esoteric legal issues as stacking when seasoned attorneys find it difficult to do so.
¶7. Northern Insurance also argues that Alley does not have standing to complain of an
alleged breach of duty owed by Northern Insurance to Hancock County. Because we have
4 held that insurance agents do not have the duty to inform Hancock County of the option of
additional coverage, this issue is moot.
II. WHETHER THE CIRCUIT COURT ERRED IN NOT ALLOWING STACKING OF HANCOCK C O U N T Y ’S U N IN SU R E D /U N D E R IN S U R E D COVERAGE.
¶8. Class II insureds are not entitled to uninsured motorist benefits beyond those for
which the named insured contracted regarding that covered vehicle. Meyers v. American
States Ins. Co., 914 So. 2d 669, 675 (Miss. 2005). Persons included in Class I consist of the
“named insured, and residents of the same household, his spouse and relatives of either,
while in a motor vehicle or otherwise.” Glennon v. State Farm Mut. Auto. Ins. Co., 812
So. 2d 927, 931 (Miss. 2002) (quoting Miss. Code Ann. § 83-11-103(b) (1999)). A Class II
insured is “any person who uses, with the consent, expressed or implied, of the named
insured, the motor vehicle to which the policy applies. Id. An employee who drives a
vehicle covered under his employer’s business automobile policy is not a Class I insured
because the employee is not a named insured. Harris v. Magee, 573 So. 2d 646, 656 (Miss.
1990). Therefore, Alley was a Class II insured under the Hancock County policy.
¶9. Under Mascarella, a Class II insured may stack his own uninsured motorist coverage
with that of the vehicle in which he was riding, but a Class II insured does not have the right
to stack an employer’s uninsured motorist coverage. Mascarella, 833 So. 2d at 580. Under
this ruling, Alley may not stack Hancock County’s uninsured motorist coverage.
5 III. WHETHER THE TYPE OF POLICY HAS R ELEVANC E TO TH E Q UESTIO N O F STACKING.
¶10. Alley argues that Mascarella should not be applied to the instant case because
Mascarella involved a commercial fleet policy for a closely-held corporation which covered
only 8 vehicles and the instant case involves a municipal policy covering 109 vehicles. The
relevant cases, Mascarella, Meyers, Harris, and Glennon, only consider whether the injured
party is an employee of the named insured or is the named insured. We find the type of entity
of the named insured – i.e., a corporation or a municipality – is irrelevant. Also, Alley failed
to raise this issue before the circuit court, and it is therefore procedurally barred from review
by this Court. Finally, Alley cites absolutely no case law or statute in support of his
proposition.
CONCLUSION
¶11. We find the first two issues raised by Alley have been disposed of by previous
precedent, and the third issue is procedurally barred and/or frivolous. We affirm the
judgment of the circuit court.
¶12. AFFIRMED.
SMITH, C.J., COBB, P.J., CARLSON AND DICKINSON, JJ., CONCUR. EASLEY AND GRAVES, JJ., DISSENT WITHOUT SEPARATE WRITTEN OPINION. DIAZ AND RANDOLPH, JJ., NOT PARTICIPATING.