Filed: October 26, 195
Marion E. Ray
Hunt, Lees, Farrell & Kessler
Charleston, West Virginia
Attorney for Plaintiff
Joanna I. Tabit
Steptoe & Johnson
Charleston, West Virginia
Attorney for Defendant
RETIRED JUSTICE MILLER, sitting by temporary assignment, delivered the Opinion of
JUSTICE ALBRIGHT did not participate.
1. W. Va. Code, 33-6-31(b) (1988), provides minimum coverage for
uninsured motorist protection equal to that contained in our financial responsibility law,
W. Va. Code, 17D-4-2 (1979). W. Va. Code, 17D-4-2, requires a limit of $20,000 for bodily
injury or death of one person and $40,000 for two or more persons injured or killed in any
one accident. Uninsured motorist insurance coverage is mandatory.
2. The mandatory requirement of insurance coverage under W. Va. Code,
17D-4-2 (1979), takes precedence over any contrary or restrictive language in an automobile
liability insurance policy.
3. A motor vehicle liability insurer which carries a single limit policy of
$50,000 for uninsured motorist liability and pays the entire limit to one of two parties injured
in the same accident is not exempt from the requirements of W. Va. Code, 33-6-31(b)
(1988), which incorporates the mandatory insurance imposed by W. Va. Code, 17D-4-2
(1979), for uninsured motorist coverage.
4. "Under W. Va. Code, 55-7-7  the claim of a minor sibling of a
victim of a wrongful death cannot be compromised without court approval." Syllabus Point
1, Jordan v. Allstate Insurance Co., 184 W. Va. 678, 403 S.E.2d 421 (1991).
5. "When the administrator of an estate of a wrongful death victim settles
a claim under W. Va. Code, 55-7-7  with the tortfeasor's insurance carrier, but fails
to seek court approval for the compromise of a minor's claim, the minor's primary cause of
action is against the administrator and not the insurance carrier; but, if the administrator is
insolvent, then the carrier is secondarily liable." Syllabus Point 2, Jordan v. Allstate
Insurance Co., 184 W. Va. 678, 403 S.E.2d 421 (1991).
6. "When a certified question is not framed so that this Court is able to
fully address the law which is involved in the question, then this Court retains the power to
reformulate questions certified to it under both the Uniform Certification of Questions of
Law Act found in W. Va. Code, 51-1A-1, et seq., and W. Va. Code, 58-5-2 , the
statute relating to certified questions from a circuit court of this State to this Court." Syllabus
Point 3, Kincaid v. Mangum, 189 W. Va. 404, 432 S.E.2d 74 (1993).
Miller, Justice:See footnote 1
On September 5, 1988, the plaintiff, Denise Miller, who was fifteen years of
age, was riding as a passenger in an automobile driven by Reba McCoy, her mother. The
automobile was struck by another automobile operated by the defendant, Gregory Lambert,
who had no automobile liability insurance coverage. As a result of the accident, the plaintiff
was injured and her mother was killed. Subsequently, the administratrix of Mrs. McCoy's
estate made a claim against Maryland Casualty Company which carried uninsured motorist
coverage on the McCoy automobile in the amount of $50,000. This amount was paid along
with $2,000 in medical benefits also provided pursuant to the policy. However, there was
no court approval of the settlement under W. Va. Code, 55-7-7 (1982).
Subsequently, on September 1, 1993, the plaintiff filed suit against Mr.
Lambert and sought to recover additional uninsured motorist coverage from Maryland
Casualty Company as a result of her injuries. A copy of the suit papers were served on
Maryland Casualty Company which answered on behalf of Mr. Lambert and also raised the
issue that its uninsured motorist coverage was exhausted by its earlier payment to the
administratrix of the mother's estate. Maryland Casualty Company asserts that its policy was a single limit policy which provided for a single payment, regardless of the number of
persons injured.See footnote 2
On the other hand, the plaintiff contends that under our financial responsibility
law, W. Va. Code, 17D-4-2 (1979),See footnote 3 and the provisions of our uninsured motorist coverage
statute, W. Va. Code, 33-6-31(b) (1988),See footnote 4 an insurance carrier must provide as a mandatory minimum for uninsured motorist coverage the amount of $20,000 for any one person for
bodily injury or death and $40,000 for two or more persons injured or killed in any one
accident. Consequently, the single limit policy was contrary to the multiple limits statutorily
The circuit court, faced with these questions, certified two inquiries to this
Court. The first question related to whether the multiple limit coverage required under
W. Va. Code, 17D-4-2, and W. Va. Code, 33-6-31(b), would preclude exhausting an
insurance carrier's single limit coverage in its insurance policy in a settlement with one
injured person to the detriment of a second injured person. The circuit court answered this
question affirmatively.See footnote 5 The second question is whether the insurance carrier acted in good faith in settling the wrongful death claim of the mother for the policy limits, which would
preclude the plaintiff's case. This question was answered negatively.See footnote 6
The first certified question as to the extent of any further available coverage involves an analysis of W. Va. Code, 33-6-31(b),See footnote 7 and its impact on a single limit policy where the limit was exhausted. This section applies to uninsured motorist coverage that an insurance carrier is required to have as an endorsement or provision in its policy. W. Va. Code, 33-6-31(b), provides a minimum coverage for uninsured motorist protection equal to that contained in our financial responsibility law, W. Va. Code, 17D-4-2.See footnote 8 This section requires a limit of $20,000 for bodily injury or death of one person and $40,000 for two or more persons injured or killed in any one accident. We have recognized that uninsured motorist coverage is mandatory. See, e.g., Marshall v. Saseen, 192 W. Va. 94, 450 S.E.2d 791 (1994).
Moreover, in several cases, we have held that the mandatory requirement of
insurance coverage under W. Va. Code, 17D-4-2, takes precedence over any contrary or
restrictive language in an automobile liability insurance policy. For example, in Jones v.
Motorists Mutual Insurance Co., 177 W. Va. 763, 356 S.E.2d 634 (1987), the insurance
policy had a specific exclusion for the owner's teenage son who was in a "high risk"
insurance category. While driving the car, the son had an accident causing damage. Relying
on the exclusion, the insurer refused to cover the loss. However, we held that this exclusion
could not override the mandatory limits imposed under our financial responsibility law. In
the Syllabus of Jones, we stated:
"A 'named driver exclusion' endorsement in a motor vehicle liability insurance policy in this State is of no force or effect up to the limits of financial responsibility required by W. Va. Code, 17D-4-2 ; however, above those mandatory limits, or with regard to the property of the named insured himself, a 'named driver exclusion' endorsement is valid under W. Va. Code, 33-6-31(a) ."
See also Dairyland Ins. Co. v. East, 188 W. Va. 581, 425 S.E.2d 257 (1992).
In Dotts v. Taressa J.A., 182 W. Va. 586, 390 S.E.2d 568 (1990), we
determined that an intentional tort exclusion in a motor vehicle liability insurance policy
could not override the required coverage under W. Va. Code, 17D-4-2. In addition to the
general language of W. Va. Code, 17D-4-2, setting out the limits of the financial
responsibility law, we note that these limits are contained in W. Va. Code, 17D-4-12(b)(2)
(1979), and are required to be a part of any motor vehicle policy issued in this State.See footnote 9
The specific issue in this case was addressed by the Supreme Court of
Minnesota in Dorn v. Liberty Mutual Fire Insurance Co., 401 N.W.2d 662 (Minn. 1987).
There, the insurer issued an automobile liability policy providing a single limit of $60,000
for both liability and uninsured motorist coverage. As here, a mother and daughter were
involved in an automobile accident with a third party who had no liability insurance. The
daughter, who was driving, was seriously injured and was paid the entire policy limit for the
uninsured motorist coverage. The mother almost two years later presented a claim for her
injuries and was advised that the uninsured limits were exhausted. She then filed suit against
Liberty Mutual claiming that its single limit policy violated the financial responsibility law,
which required coverage for $25,000 for any one person and $50,000 for two or more
persons in any one accident. The Minnesota court without extended discussion set this law
in Syllabus Points 1 and 2:
"1. The insurance policy limits for uninsured motorist coverage cannot be exhausted by the first claimant from a multi-person accident.
"2. The extra coverage available to a later
claimant is the $25,000 required by statute."
See also In the Matter of Michigan Mut. Ins. Co. (Miller) , 170 A.D.2d 102, 573 N.Y.S.2d
A related problem was discussed in Bush Leasing, Inc. v. Gallo, 634 So. 2d
737 (Fla. App. 1994), involving a Florida statute which required automobile lessors to carry
liability insurance with limits of $100,000 per person and $300,000 per accident for bodily
injury. The purpose of the statute, if such limits were carried, was to relieve an automobile
lessor from dangerous instrumentality liability. Bush Leasing required a lessee to purchase
a single limit liability policy of $500,000. The Florida court concluded this coverage did not
meet the statutory requirement: "[T]he policy does not necessarily provide equivalent
coverage for other parties who are injured in the same accident. We are, therefore, unable
to conclude that Bush is exempt from liability pursuant to section 324.021(9)(b), Florida
Statutes." 634 So. 2d at 741.
From the foregoing, we conclude that a motor vehicle liability insurer which
carries a single limit policy of $50,000 for uninsured motorist liability and pays the entire
limit to one of two parties injured in the same accident is not exempt from the requirements
of W. Va. Code, 33-6-31(b), which incorporates the mandatory insurance imposed by W. Va.
Code, 17D-4-2, for uninsured motorist coverage.
The second certified question is whether Maryland Casualty Company's settlement for the policy limits with the administratrix of the deceased mother's estate can be considered a good faith settlement so as to preclude any further recovery. The basic issue is whether the insurer's settlement of one claim of a multiple claim accident which exhausts the policy limit is a good faith settlement.See footnote 10 We are cited cases that deal with this issue including an Annotation, Basis and Manner of Distribution Among Multiple Claimants of Proceeds of Liability Insurance Policy Inadequate to Pay All Claims in Full, 70 A.L.R.2d 416 (1960).
However, we find the issue of good faith does not depend on whether the
settlement meets a good faith test. Rather, the issue is controlled by Jordan v. Allstate
Insurance Co., 184 W. Va. 678, 403 S.E.2d 421 (1991), in which the administrator settled
a wrongful death claim. The decedent was survived by his father, who was the administrator,
and a younger brother, who was a minor. The administrator settled without court approval
as required by W. Va. Code, 55-7-7 (1982). This statute requires that, when a beneficiary
in a wrongful death action is incapable of giving consent, there must be court approval of the
settlement.See footnote 11 Allstate, as the liability carrier, paid under its policy and obtained a complete release from the administrator of the wrongful death claim. Subsequently, the minor
beneficiary brought suit against Allstate claiming that it wrongfully deprived him of his share
of the wrongful death settlement. We determined in Syllabus Point 1 of Jordan:
"Under W. Va. Code, 55-7-7  the claim of a minor sibling of a victim of a wrongful death cannot be compromised without court approval."
We went on to assess the responsibility of the parties where there is a failure to follow W.
Va. Code, 55-7-7, by holding in Syllabus Point 2 of Jordan:
"When the administrator of an estate of a wrongful death victim settles a claim under W. Va. Code, 55-7-7  with the tortfeasor's insurance carrier, but fails to seek court approval for the compromise of a minor's claim, the minor's primary cause of action is against the administrator and not the insurance carrier; but, if the administrator is insolvent, then the carrier is secondarily liable."
There is, of course, an obvious difference between the facts of this case and
those in Jordan. Here, the injured plaintiff is not making a claim as a beneficiary under the
wrongful death statute for the death of her mother. Rather, the plaintiff claims that she
suffered her own personal injuries as a result of being a passenger in the automobile which
her mother was driving. Nevertheless, it seems clear that both Maryland Casualty Company
and the administratrix of the mother's estate were negligent in not complying with W. Va.
Code, 55-7-7, as required by Jordan. Proper compliance would have brought the settlement
to the attention of a circuit court and allowed a more equitable distribution of the total policy
limit of $50,000. Moreover, the proposed settlement of the parties would have made the
circuit court aware of the potential claim of the injured daughter which could have been
factored into the case.
Thus, we find under Jordan that the administratrix of the estate of Reba McCoy
bears the initial liability for the failure to seek court approval under W. Va. Code, 55-7-7,
and we allow the plaintiff to amend the complaint to bring in the administratrix as was done
in Jordan. However, it is difficult to understand how Maryland Casualty Company in making even a cursory investigation of the accident would not have discovered that the minor
daughter, as the passenger, was injured. Therefore, we find Maryland Casualty Company
also was negligent in failing to have the wrongful death claim settlement submitted for court
approval and decline to hold that this was a good faith settlement. The underlying rationale
of Jordan was that the failure to obtain court approval of a settlement where a minor is
involved is an act of negligence against those injured by the payment of the settlement
The circuit court answered the second certified question negatively indicating
there was not a good faith settlement. We reach this same result by applying Jordan and
concluding there was no good faith settlement because of the lack of court approval. In our
cases dealing with certified questions, we have retained the right to address them with some
flexibility. Our ability to reform certified questions was discussed at some length in Kincaid
v. Mangum, 189 W. Va. 404, 432 S.E.2d 74 (1993), where we came to this conclusion in
Syllabus Point 3:
"When a certified question is not framed so that this Court is able to fully address the law which is involved in the question, then this Court retains the power to reformulate questions certified to it under both the Uniform Certification of Questions of Law Act found in W. Va. Code, 51-1A-1, et seq., and W. Va. Code, 58-5-2 , the statute relating to certified questions from a circuit court of this State to this Court."
In conclusion, we agree with the circuit court and answer the first certified question affirmatively and the second certified question negatively.
Answered and dismissed.
Footnote: 1 Pursuant to an Administrative Order entered by this Court on September 11, 1995, retired Justice Thomas B. Miller was recalled for the September 1995 term because of the retirement of Justice W.T. Brotherton, Jr.
Footnote: 2 The applicable policy language is:
"LIMIT OF LIABILITY
"A. The limit of liability shown in the Declarations for this
coverage is our maximum limit of liability for all
damages resulting from any one accident. This is the
most we will pay regardless of the number of:
"2. Claims made;
"3. Vehicles or premiums shown in the Declarations; or
"4. Vehicles involved in the accident."
Footnote: 3 The applicable language of W. Va. Code, 17D-4-2 (1979), is:
"The term 'proof of financial responsibility' as used in this chapter shall mean: Proof of ability to respond in damages for liability, on account of accident . . . in the amount of twenty thousand dollars because of bodily injury to or death of one person in any one accident, and, subject to said limit for one person, in the amount of forty thousand dollars because of bodily injury to or death of two or more persons in any one accident[.]"
Footnote: 4 W. Va. Code, 33-6-31(b), states, in relevant part:
"Nor shall any such policy or contract be so
issued or delivered unless it shall contain an endorsement or
provisions undertaking to pay the insured all sums which he
shall be legally entitled to recover as damages from the owner
or operator of an uninsured motor vehicle, within limits which
shall be no less than the requirements of section two, article
four, chapter seventeen-d of the code of West Virginia, as
amended from time to time[.]"
The accident occurred in 1988. Currently, this same language is contained in W. Va. Code, 33-6-31(b) (1995).
Footnote: 5 The language of the first certified question is:
"Whether W. Va. Code §17D-4-2  which
mandates uninsurance coverage of Twenty Thousand Dollars
($20,000.00) because of bodily injury to or death of one person in any one accident, and, subject to said limit for one person in the amount of Forty Thousand Dollars ($40,000.00) because of bodily injury to or death of two or more persons in any one accident, precludes insurers from exhausting single policy limits in settlement with one of the insured persons to the detriment of the second injured person when only two insured persons or claimants are involved?"
Footnote: 6 The language of the second certified question states: "Whether a liability insurer may in good faith settle part of multiple claims arising from a single accident when the settlement exhausts the single policy limits of uninsured motorist coverage to the extent that one of the claimants is left without recourse against the insurance company?"
Footnote: 7 The applicable language of W. Va. Code, 33-6-31(b), is set out in note 4, supra.
Footnote: 8 The relevant language of W. Va. Code, 17D-4-2, is contained in note 3, supra.
Footnote: 9 W. Va. Code, 17D-4-12(a) and -12(b)(2), state:
"(a) A 'motor vehicle liability policy' as said
term is used in this chapter shall mean an 'owner's policy' or
an 'operator's policy' of liability insurance certified . . . by an
insurance carrier duly authorized to transact business in this
State, to or for the benefit of the person named therein as
"(b) Such owner's policy of liability insurance:
* * *
"(2) Shall insure the person named therein and
any other person, as insured, using any such vehicle or
vehicles with the express or implied permission of such
named insured, against loss from the liability imposed by law
for damages arising out of the ownership, operation,
maintenance or use of such vehicle or vehicles within the
United States of America or the Dominion of Canada, subject
to limits exclusive of interest and costs, with respect to each
such vehicle, as follows: Twenty thousand dollars because of
bodily injury to or death of one person in any one accident
and, subject to said limit for one person, forty thousand
dollars because of bodily injury to or death of two or more
persons in any one accident, and ten thousand dollars because
of injury to or destruction of property of others in any one
Footnote: 10 The language of the second certified question is contained in note 6, supra.
Footnote: 11 The accident in this case occurred on September 5, 1988. At that time, W. Va. Code, 55-7-7 (1982), applied. It stated in material part:
"The personal representative of the deceased
may compromise any claim to damages arising under section
five of this article before or after action brought, with the
consent of the person or persons who would be entitled to the
damages recovered in an action therefor brought by such representative under section six of this article; or if any such persons are incapable from any cause of giving consent, the personal representative may compromise with the approval of the judge of the court wherein any such action has been brought, or if none has been brought, with the consent of the judge of the court wherein such action may be brought." (Emphasis added).
In 1989, W. Va. Code, 55-7-7, was amended to its present form. In Arnold
v. Turek, 185 W. Va. 400, ___, 407 S.E.2d 706 (1991), minor beneficiaries were
involved and court approval of the settlement was obtained. W. Va. Code, 56-10-4
(1982), also states in part:
"In any action or suit wherein an infant or
insane person is a party, the court in which the same is
pending, or the judge thereof in vacation, shall have the
power to approve and confirm a compromise of the matters in
controversy on behalf of such infant or insane person[.]"
Moreover, W. Va. Code, 44-10-14 (1929), provides for court approval of infant settlements even though no suit has been filed.