Justices unanimously side with State Farm

Steve Korris Nov. 7, 2007, 8:30am


CHARLESTON - Justices of the state Supreme Court of Appeals rejected a woman's claim under her auto insurance policy for emotional distress from her mother's death in a crash that happened under someone else's policy.

The Justices on Oct. 26 unanimously reversed Tyler Circuit Judge Mark Karl, who had ruled that Nicole Elliott could collect from her insurer, State Farm Mutual.

The Justices ordered Karl to dismiss Elliott's suit against State Farm.

Justice Joseph Albright quoted a Utah court decision that recovery under a policy for the death of a third party not covered by the policy would impose unfair risk on insurers.

He quoted a Delaware judge who wrote in a similar case that, "This line of reasoning is so outlandish that it is difficult to articulate."

Albright wrote that in three states where judges allowed third party recovery, legislators enacted laws to keep it from happening again.

Elliott's mother, Cheryl Kettlewell, died in 1999 while riding with a drunken driver. The driver lost control and the vehicle struck a wall.

The driver's insurer paid its policy limit of $20,000 to Kettlewell's estate.

The estate would have collected from Kettlewell's insurer if her policy had covered underinsured motorists -- "UIM" -- but Kettlewell did not carry that coverage.

Her daughters, Stacey Strum and Elliott, initiated a wrongful death action against a tavern as administrators of the estate.

They also sued State Farm and Strum's insurer, Allstate Indemnity.

They sought a declaration that UIM coverage in their policies should provide recovery for emotional distress.

Allstate settled the claim, but State Farm resisted.

Elliott's State Farm policy carried $100,000 in UIM coverage.

"The bodily injury must be sustained by an insured," the policy stated. "The bodily injury or property damage must be caused by accident arising out of the operation, maintenance or use of an underinsured motor vehicle."

Elliott and Strum moved for summary judgment against State Farm, and State Farm moved for summary judgment against Elliott and Strum.

Karl granted summary judgment to Elliott and Strum. He denied it to State Farm.

He ruled that West Virginia's wrongful death statute does not limit recovery to "bodily-injury-type-damages."

State Farm appealed. Kay Fuller and Christopher Moore of Martinsburg and Michael Gallaway of Wheeling represented State Farm.

Christine Machel of Wellsburg represented Elliott and Strum.

Insurance cases often cause division among the Justices, but this one united them.

Albright wrote that Elliott did not sue as beneficiary, heir or family member.

"It is only in her capacity as a personal representative of the estate that she is entitled to bring this wrongful death action," he wrote.

He wrote that the distinction was critical in analyzing her right to obtain benefits through her UIM policy.

"Coverage under a UIM policy is specifically designed to address the bodily injuries sustained by an insured person," Albright wrote. "This Court cannot advocate the judicial extension of UIM coverage to include family members or others for whom the insured is legally entitled to maintain a wrongful death cause of action."

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