Schaefer v. Allstate Insurance

[This opinion has been published in Ohio Official Reports at 

76 Ohio St.3d 553

.]




SCHAEFER, APPELLANT, ET AL. v. ALLSTATE INSURANCE COMPANY, APPELLEE.
               [Cite as Schaefer v. Allstate Ins. Co., 

1996-Ohio-368

.]
Insurance—Automobile liability—Each person covered by an uninsured motorist
        policy who is asserting a claim for loss of consortium has a separate claim
        subject to a separate per person policy limit—Provision in insurance
        policy which reaches a contrary result is unenforceable.
Each person who is covered by an uninsured motorist policy and who is asserting
        a claim for loss of consortium has a separate claim subject to a separate per
        person policy limit. A provision in an insurance policy which reaches a
        contrary result is unenforceable. (Tomlinson v. Skolnik [1989], 

44 Ohio St.3d 11

, 

540 N.E.2d 716

, and Dues v. Hodge [1988], 

36 Ohio St.3d 46

, 

521 N.E.2d 789

, paragraph two of the syllabus, overruled.)
     (No. 95-269—Submitted March 5, 1996—Decided September 4, 1996.)
   APPEAL from the Court of Appeals for Franklin County, No. 94APE04-507.
                                  __________________
        {¶ 1} On November 8, 1985, Jeanette Schaefer, plaintiff, and her husband,
David Schaefer, plaintiff-appellant, were involved in an automobile collision with
an uninsured motorist whose negligence was the sole proximate cause of the
collision. At the time of the collision, the Schaefers carried uninsured motorist
coverage with limits of $100,000 per person and $300,000 per occurrence with
defendant-appellee, Allstate Insurance Company (“Allstate”).
        {¶ 2} Mr. and Mrs. Schaefer each filed claims for personal injury with
Allstate, which were eventually submitted to arbitration. The award was vacated
by the court of appeals and the cause was remanded for trial. This court affirmed.
Schaefer v. Allstate Ins. Co. (1992), 

63 Ohio St.3d 708

, 

590 N.E.2d 1242

. At trial,
Mr. Schaefer withdrew his personal injury claim and instead sought damages for
                              SUPREME COURT OF OHIO




loss of consortium. The court instructed the jury that it could award Mrs. Schaefer
up to $100,000 for her injuries as well as up to $100,000 to Mr. Schaefer for his
loss of consortium claim. The jury awarded the Schaefers $100,000 each. Allstate
filed a motion for judgment notwithstanding the verdict, arguing that the Schaefers
together were entitled to recover no more than $100,000 based on the language
contained in the insurance policy. The court denied the motion and Allstate
appealed.
          {¶ 3} Relying upon Tomlinson v. Skolnik (1989), 

44 Ohio St.3d 11

, 

540 N.E.2d 716

, the appellate court reversed the trial court and found that Mrs.
Schaefer’s claim for personal injuries and Mr. Schaefer’s claim for loss of
consortium were both subject to the single $100,000 per person limit.
          {¶ 4} Just prior to this court’s decision to accept jurisdiction, Allstate
voluntarily paid Mrs. Schaefer the full amount of the single per person limit of
coverage. This action prompted the plaintiffs to dismiss Mrs. Schaefer from the
appeal.
          {¶ 5} The cause is now before this court upon the allowance of a
discretionary appeal.
                                __________________
          McCarthy, Palmer, Volkema, Boyd & Thomas, Robert G. Palmer and
Michael S. Miller, for appellant.
          Lane, Alton & Horst and Rick E. Marsh, for appellee.
                                __________________
          FRANCIS E. SWEENEY, SR., J.
          {¶ 6} We are asked to decide whether Mrs. Schaefer’s personal injury claim
and Mr. Schaefer’s loss of consortium claim share a single per person limit of
uninsured motorist coverage, or whether they each have available to them a separate
per person limit to provide compensation for their own claims. In answering this
question, we must determine the validity, in light of recent case law, of an




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                               January Term, 1996




automobile insurance policy provision which limits recovery for all causes of action
arising out of bodily injuries sustained to one person to a single per person limit.
For the following reasons, we find such a provision unenforceable. Accordingly,
we find that Mr. Schaefer’s claim for loss of consortium constitutes a separate
compensable injury subject to its own per person limit. The judgment of the court
of appeals is reversed.
       {¶ 7} In construing provisions in an automobile insurance policy, we are
mindful of the basic tenet that the purpose of uninsured motorist coverage and its
mandatory offering is “to protect persons from losses which, because of the
tortfeasor’s lack of liability coverage, would otherwise go uncompensated.” Martin
v. Midwestern Group Ins. Co. (1994), 

70 Ohio St.3d 478, 480

, 

639 N.E.2d 438, 440

, citing Abate v. Pioneer Mut. Cas. Co. (1970), 

22 Ohio St.2d 161, 165

, 

51 O.O.2d 229, 231

, 

258 N.E.2d 429, 432

. Furthermore, since R.C. 3937.18(A)(1) is
remedial legislation, it must be liberally construed in order to effectuate the
legislative purpose. Martin, 

70 Ohio St.3d at 480

, 

639 N.E.2d at 440

, citing Curran
v. State Auto. Mut. Ins. Co. (1971), 

25 Ohio St.2d 33

, 

54 O.O.2d 166

, 

266 N.E.2d 566

. An insurance policy provision will be deemed unenforceable if the provision
is contrary to the statute and its purpose. 

Martin at 480

, 

639 N.E.2d at 440

. With
these principles in mind, we now turn to the insurance policy which Allstate
provided to its insureds.
       {¶ 8} The policy at issue contained the following pertinent provision,
included within its Uninsured Motorists Insurance Coverage:
       “Limits of Liability
       “The coverage limit stated on the declarations page for:
       “(1) ‘each person’ is the total limit for all damages arising out of bodily
injury to one person in any one motor vehicle accident.




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                                  SUPREME COURT OF OHIO




          “(2) ‘each accident’ is the total limit for all damages arising out of bodily
injury to two or more persons in any one motor vehicle accident.” (Emphasis
added.)
          {¶ 9} Although this provision clearly states that Mr. Schaefer’s claim for
loss of consortium, arising from the bodily injuries sustained by his spouse, shares
her single per person limit, nevertheless, Mr. Schaefer contends that he and his wife
are not subject to a single $100,000 per person limit of liability. Instead, he believes
that he should be compensated for his own separate claim and be awarded an
additional $100,000 for his loss of consortium claim. He argues that such a result
is dictated by our decision in Savoie v. Grange Mut. Ins. Co. (1993), 

67 Ohio St.3d 500

, 

620 N.E.2d 809

.1 He contends that since a wrongful death beneficiary has a
separate claim subject to a separate per person limit, he, too, should be compensated
for his own claim rather than be subject to his spouse’s single per person limit of
liability. Allstate, however, contends that there is no need to resort to Savoie as the
cases of Dues v. Hodge (1988), 

36 Ohio St.3d 46

, 

521 N.E.2d 789

, and Tomlinson
v. Skolnik (1989), 

44 Ohio St.3d 11

, 

540 N.E.2d 716

, directly support its position
that the provision is valid.
          {¶ 10} Dues and Tomlinson do indeed support Allstate’s position.
However, based upon our decision in Savoie and cases culminating in its decision,
we need to revisit Dues and Tomlinson to determine whether they comport with the
current law of our state.
          {¶ 11} In Dues, we held that “[a]n insurance policy provision that limits
recovery for all causes of action arising out of bodily injury to one person to a single
limit of liability is a valid restriction of uninsured motorist coverage.” Id. at


1. Mr. Schaefer also argues that the policy provision is invalid under State Farm Auto. Ins. Co. v.
Alexander (1992), 

62 Ohio St.3d 397

, 

583 N.E.2d 309

, since it improperly reduces or eliminates
uninsured motorist coverage for a claim arising from a recognized tort. However, it is unnecessary
to address this argument as Savoie is dispositive of the issue presented in this case.




                                                4
                                January Term, 1996




paragraph two of the syllabus. In so holding, however, Dues overruled Auto-
Owners Mut. Ins. Co. v. Lewis (1984), 

10 Ohio St.3d 156

, 10 OBR 490, 

462 N.E.2d 396

, which had held that a separate per person limit of uninsured motorist coverage
must be available to provide compensation both for the personal injury claim
brought by a father on his son’s behalf and for the father’s own derivative claim for
the loss of his son’s services. In Auto-Owners, the court had reasoned that “[w]ere
this not the rule, [an insured] could conceivably be in the position of having less
coverage than he paid for, despite the fact that [the insured] has individual claims
arising from” the accident which physically injured his son. 

Id.,

10 Ohio St.3d at 161

, 10 OBR at 495, 

462 N.E.2d at 401

.
       {¶ 12} As its rationale for overruling Auto-Owners, the court in Dues
merely stated that “R.C. 3937.18(A)(1) does not indicate that it was intended to
override reasonable limitations on the amount of coverage.” Dues, 

36 Ohio St.3d at 49

, 

521 N.E.2d at 793

. However, such an interpretation disregards the rule that
language in an insurance policy must be read strictly in favor of the insured and
contravenes the public policy concern that uninsured motorist coverage is to protect
motorists from the dangers of uninsured motorists.
       {¶ 13} Applying Dues, Tomlinson, 

44 Ohio St.3d 11

, 

540 N.E.2d 716

, held
that an insurer may, by appropriate language, limit all claims arising out of a single
bodily injury to a single per person limit of coverage. 

Id.

 at paragraph one of the
syllabus.
       {¶ 14} However, since Tomlinson was announced, this court has declined
to apply it to wrongful death claims. See Cincinnati Ins. Co. v. Phillips (1990), 

52 Ohio St.3d 162

, 

556 N.E.2d 1150

, where a sharply divided court considered the
same language considered in Tomlinson in the context of liability limits in a
tortfeasor’s insurance policy and found that a wrongful death claim, another type
of derivative action, could not be subject to a single person limit. Although the
plurality decision distinguished Tomlinson on the basis that Tomlinson was a loss




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                                  SUPREME COURT OF OHIO




of consortium case, it questioned its validity. 

Id. at 164

, 

556 N.E.2d at 1152

.
However, the concurring opinion asserted that the majority opinion should be read
as overruling Tomlinson. 

Id. at 166

, 

556 N.E.2d at 1154, fn. 4

 (H. Brown, J.,
concurring).
         {¶ 15} In an effort to bring stability, consistency, and clarity to the state of
automobile insurance law in Ohio, this court decided 

Savoie, supra.

 In Savoie, we
held that beneficiaries in a wrongful death action each are entitled to a separate per
person limit of coverage under an uninsured motorist policy. 

Id.,

67 Ohio St.3d 500

, 

620 N.E.2d 809

, paragraph one of the syllabus. In so finding, we recognized
that R.C. 2125.02(A)(1) created separate rights to recovery. 

Id. at 504

, 

620 N.E.2d at 812

. However, we believe that the logic of the decision in Savoie should now be
applied to loss of consortium claims in personal injury cases.2
         {¶ 16} Ohio common law recognizes that when one spouse is injured, the
other spouse is also damaged and may assert his or her own cause of action against
the tortfeasor for those damages--i.e., a claim for loss of consortium. Clouston v.
Remlinger Oldsmobile Cadillac, Inc. (1970), 

22 Ohio St.2d 65, 74

, 

51 O.O.2d 96, 101-102

, 

258 N.E.2d 230, 235

. “Consortium consists of society, services, sexual
relations and conjugal affection which includes companionship, comfort, love and
solace.” 

Id.,

 paragraph three of the syllabus. Even though a loss of consortium
claim is derivative in that it is dependent upon the defendant’s having committed a
legally cognizable tort upon the spouse who suffers bodily injury, Bowen v. Kil-
Kare, Inc. (1992), 

63 Ohio St.3d 84, 93

, 

585 N.E.2d 384, 392

, it is nonetheless
legally separate and independent from the claim of the spouse who suffered the
bodily injury. Id.


2. See, also, Cole v. Holland (1996), 

76 Ohio St.3d 220

, 

667 N.E.2d 353

, which applies paragraph
three of the syllabus of Savoie to hold that in a personal injury case, an insurer’s setoff applies
against the insured’s damages, not against the policy limit of uninsurance/underinsurance coverage.
Thus, Cole also expands the logic announced in Savoie to cases involving nonfatal injuries.




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                                January Term, 1996




       {¶ 17} The fact that loss of consortium is a creation of the common law does
not meaningfully differentiate spouses bringing those actions from spouses who are
beneficiaries under the wrongful death statute. It is the separate injury which parties
to both kinds of claims suffer that entitle them to separate per person limits. Thus,
we see no valid reason to distinguish between wrongful death claims and loss of
consortium claims in personal injury cases. Therefore, we hold that each person
who is covered by an uninsured motorist policy and who is asserting a claim for
loss of consortium has a separate claim subject to a separate per person policy limit.
A provision in an insurance policy which reaches a contrary result is unenforceable.
Because Tomlinson and paragraph two of the syllabus of Dues do not comport with
the law of this state, we now expressly overrule them and return the law to where
it was before those cases overruled Lewis.
       {¶ 18} Applying our holding to the facts of this case, we find that Mr.
Schaefer’s claim for loss of consortium is subject to its own per person limit of
liability. Thus, the jury award to Mr. Schaefer in the amount of $100,000 is
reinstated. The court of appeals’ decision overturning this verdict is reversed.
                                                                  Judgment reversed.
       DOUGLAS, RESNICK and PFEIFER, JJ., concur.
       DOUGLAS, J., concurs separately.
       MOYER, C.J., and COOK, J., separately dissent.
       HILDEBRANDT, J., dissents.
       LEE H. HILDEBRANDT, JR., J., of the First Appellate district, sitting for
WRIGHT, J.
                               __________________


       DOUGLAS, J., concurring.
       {¶ 19} I concur with the majority. I write separately to respond, in part, to
the dissent of Justice Cook. That dissent says that the majority “depart[s] from the




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sound reasoning contained in Dues and Tomlinson.” I respectfully submit that the
majority is doing no more than returning the law to where it was before Dues and
Tomlinson were decided. The change in the law was brought about by intervening
elections which placed new justices on this court. If the often-quoted (when
convenient) rule of stare decisis had been followed, then the law in the case now
before us would have remained as it was pre-Dues and Tomlinson.
        {¶ 20} The statute in question, R.C. 3937.18(A)(1), provides that insurance
policies issued in this state must include uninsured motorist coverage “for the
protection of persons insured thereunder who are legally entitled to recover
damages from owners or operators of uninsured motor vehicles because of bodily
injury * * * suffered by any person insured under the policy.” In this case, we know
(1) that the policy in question contains an uninsured motorist provision; (2) that Mr.
Schaefer is an insured under that policy; and (3) that he is legally entitled to recover
damages for his loss of consortium claim (his damages) from the uninsured motorist
tortfeasor. These are the only qualifications. The statute does not say that by policy
language, these rights of an insured may be limited or compromised.
        {¶ 21} In Sexton v. State Farm Mut. Auto. Ins. Co. (1982), 

69 Ohio St.2d 431

, 

23 O.O.3d 385

, 

433 N.E.2d 555

, a father had a derivative claim arising out of
the death of his seventeen-year-old daughter, who was killed as a result of an
automobile accident caused by an uninsured driver. In a four-to-three vote, this
court held that the father had a separate claim under his own insurance policy even
though the daughter was not an insured under the terms of the father’s policy. This
court did so in interpreting R.C. 3937.18.
        {¶ 22} Two years later, in 1984, this court decided Auto-Owners Mut. Ins.
Co. v. Lewis (1984), 

10 Ohio St.3d 156

, 10 OBR 490, 

462 N.E.2d 396

. Between
the decision in Sexton in February 1982 and the decision in Lewis in April 1984,
the election of November 1982 took place. In that election one of the dissenting
votes in Sexton was replaced by a new justice, who then voted with the majority in




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                                January Term, 1996




Lewis. In Lewis, this court held in paragraph two of the syllabus, unambiguously
and unequivocally, that “[w]here separate and independent causes of action arise
from injuries caused by an uninsured motorist and such injuries are covered by the
uninsured motorist provision of an automobile insurance policy, the policy limits
applicable to uninsured motorist coverage will be available to each cause of action.”
(Emphasis added.) The vote was five to two, with the two dissenters being two of
the three dissenters in Sexton, continuing their dissent.
       {¶ 23} Then, in April 1988, this court decided Dues v. Hodge (1988), 

36 Ohio St.3d 46

, 

521 N.E.2d 789

. Between the 1984 decision in Lewis and the 1988
decision in Dues, two more elections (November 1984 and November 1986) took
place. At the 1984 election, two new justices joined the court. The two justices in
dissent in Lewis remained on the court. At the 1986 election, two more new justices
were elected, replacing two of the justices who were in the majority in Lewis.
Combined, these two elections (1984 and 1986) brought about a new majority
deciding the issue that is, once again, before us. Thus, in April 1988, in Dues, a
majority of this court overruled paragraph two of the syllabus in Lewis (although
not doing so in the syllabus of Dues) and held in paragraph two of the syllabus of
Dues that “[a]n insurance policy provision that limits recovery for all causes of
action arising out of bodily injury to one person to a single limit of liability is a
valid restriction of uninsured motorist coverage.” This was, of course, completely
opposite to the holding in Lewis (and arguably Sexton), case law that had been in
effect only since 1984 (Lewis) and 1982 (Sexton). The only intervening events
effecting this change were two elections (1984 and 1986).
       {¶ 24} Subsequently, in Tomlinson v. Skolnik (1989), 

44 Ohio St.3d 11

, 

540 N.E.2d 716

, with a visiting judge joining the majority to make four and one of the
members of the Dues majority now joining the dissenters (albeit for a different
reason), this court by a vote of four to three reaffirmed and followed paragraph two




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                             SUPREME COURT OF OHIO




of the syllabus of Dues. Thus, until today, the law of Dues and Tomlinson, which
changed the law of Lewis (and Sexton), remained.
       {¶ 25} Now, yet two more elections affecting this equation (November
1988 and November 1992) were held. Today, a new majority (which includes one
of the justices dissenting in Dues and Tomlinson), returns the law to what it was
(Lewis) before all of this started. Accordingly, I concur.
                              __________________
       HILDEBRANDT, J., dissenting.
       {¶ 26} The majority in this case holds that “[e]ach person who is covered
by an uninsured motorist policy and who is asserting a claim for loss of consortium
has a separate claim subject to a separate per person policy limit” and that,
therefore, “[a] provision in an insurance policy which reaches a contrary result is
unenforceable.”    Accordingly, the majority opinion holds that the insurance
contract limits in this case for “each person,” as defined in the contract as “all
damages arising out of bodily injury to one person in any one motor vehicle
accident,” are invalid. I cannot agree with these holdings.
       {¶ 27} In Savoie v. Grange Mut. Ins. Co. (1993), 

67 Ohio St.3d 500

, 

620 N.E.2d 809

, this court held that a wrongful death beneficiary has a separate damage
claim subject to a separate per person limit. The majority now extends the holding
in Savoie to this case where Mr. Schaefer’s separate claim is based upon loss of
consortium resulting from physical injuries suffered by his wife in an automobile
accident.
       {¶ 28} Subsequent to this court’s decision in Savoie, the legislature
amended R.C. 3937.18. Specifically, R.C. 3937.18(H) provides as follows:
       “Any automobile liability or motor vehicle liability policy of insurance that
includes coverages offered under division (A) of this section and that provides a
limit of coverage for payment for damages for bodily injury, including death,
sustained by any one person in any one automobile accident, may, notwithstanding




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                                  January Term, 1996




Chapter 2125 of the Revised Code, include terms and conditions to the effect that
all claims resulting from or arising out of any one person’s bodily injury, including
death, shall collectively be subject to the limit of the policy applicable to bodily
injury, including death, sustained by one person, and, for the purpose of such policy
limit shall constitute a single claim. Any such policy limit shall be enforceable
regardless of the number of insureds, claims made, vehicles or premiums shown in
the declarations or policy, or vehicles involved in the accident.”
          {¶ 29} Section 10 of Am.Sub.S.B. No. 20 explains R.C. 3937.18(H) as
follows:
          “It is the intent of the General Assembly in enacting division (H) of section
3937.18 of the Revised Code to supersede the effect of the holding of the Ohio
Supreme Court in its October 1, 1993 decision in Savoie v. Grange Mut. Ins. Co.
(1993), 

67 Ohio St.3d 500

 [

620 N.E.2d 809

], that declared unenforceable a policy
limit that provided that all claims for damages resulting from bodily injury,
including death, sustained by any one person in any one automobile accident would
be consolidated under the limit of the policy applicable to bodily injury, including
death, sustained by one person, and to declare such policy provisions enforceable.”
(145 Ohio Laws, Part I, 239.)
          {¶ 30} Although this amended statute was not in effect at the time of the
accident or at the time this case was filed, I find it instructive on how this case
should be decided.       Rather than extend Savoie to the facts of this case in
contravention of amended R.C. 3937.18(H), I would reaffirm this court’s holding
in Dues v. Hodge (1988), 

36 Ohio St.3d 46

, 

521 N.E.2d 789

. I would, therefore,
find the per person limit language in this policy a valid restriction of coverage.
Because Mrs. Schaefer recovered the policy limits under this language for her
bodily injuries, I would hold that Mr. Schaefer has no right to recovery for his claim
for loss of consortium arising from his wife’s physical injuries under this insurance
policy.




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                             SUPREME COURT OF OHIO




       {¶ 31} I, therefore, respectfully dissent.
                               __________________
       COOK, J., dissenting.
       {¶ 32} I respectfully dissent from the majority’s opinion.    Neither public
policy considerations nor the Savoie case mandates the majority’s conclusion that
ignores the plain language set forth in this insurance contract.     The Dues and
Tomlinson cases were decided correctly and I would not limit or overrule them.
       {¶ 33} This insurance contract limits “each person” coverage to “the total
limit for all damages arising out of bodily injury to one person in any one motor
vehicle accident.” Together, our decisions in Dues and Tomlinson hold that a loss
of consortium claim is a derivative action and is not a separate bodily injury claim,
and, therefore, the policy language at issue here is a valid restriction of coverage.
In Dues v. Hodge (1988), 

36 Ohio St.3d 46, 49

, 

521 N.E.2d 789, 793

, this court
stated that “R.C. 3937.18(A)(1) does not indicate that it was intended to override
reasonable limitations on the amount of coverage available for each accident.”
       {¶ 34} Rather than overruling Dues or Tomlinson, Savoie limited the
application of the second paragraph of the Dues syllabus to “cases involving a
single bodily injury which has not resulted in wrongful death.” Savoie v. Grange
Mut. Ins. Co. (1993), 

67 Ohio St.3d 500, 509

, 

620 N.E.2d 809, 816

. That is exactly
the situation which now presents itself to this court.
       {¶ 35} With all due respect, I am unpersuaded by the majority to join in its
about-face from the sound reasoning contained in Dues and Tomlinson.
Accordingly, I would affirm the judgment of the appellate court.
       MOYER, C.J., concurs in the foregoing dissenting opinion.
                               __________________




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