United States District Court, D. South Carolina, Anderson Division
Allstate Fire And Casualty Insurance Company, Plaintiff,
Counter Defendant: Geoffrey William Gibbon, LEAD ATTORNEY,
McAngus Goudelock and Courie, Greenville, SC USA.
Joseph Simpson, Amanda Simpson, Defendant, Counter Claimant:
Eugene Clark Covington, Jr, Covington Patrick Hagins Stern
and Lewis, Greenville, SC USA.
M. Herlong, Jr., Senior United States District Judge.
matter is before the court on cross-motions for summary
judgment. For the reasons stated below, the court grants the
Defendants' motion for summary judgment and denies
Allstate Fire and Casualty Insurance Company's ("
Allstate" ) motion for summary judgment.
Factual and Procedural Background
filed the instant declaratory judgment action seeking a
declaration that " it is not obligated to pay or
provide" underinsured motorist (" UIM" )
coverage under insurance policy number 9 63 649818 04/18
(" Policy" ) issued by Allstate to Amanda Simpson
(" Amanda" ) and Joseph Simpson ("
Joseph" ) because Amanda validly declined UIM coverage
and coverage should not be added pursuant to State Farm
Mutual Automobile Insurance Co. v. Wannamaker, 291 S.C.
518, 354 S.E.2d 555 (S.C. 1987). (Compl., prayer, ECF No. 1;
Pl. Mem. Supp. Summ. J. Ex. D (Policy Declarations Pages),
ECF No. 21-5.) On April 11, 2011, Amanda obtained a new
policy to insure a 1999 Ford, which was
titled in her name, and a 2002 Chevy Malibu, which was titled
in both Amanda and Joseph's name. (Pl. Mem. Supp. Summ.
J. Ex. D (Policy Declarations Pages), ECF No. 21-5.) The
Policy coverage period was April 18, 2011 to October 18,
2011. (Id. Ex. D (Policy
Declarations Pages), ECF No. 21-5.) Further, the Policy
indicates that Allstate investigated the driving backgrounds
of Amanda and Joseph and assigned a good driver rating to
both. (Id. Ex. D (Policy Declarations Pages), ECF
time the Policy issued, Amanda was employed as a customer
service representative for an Allstate agency. (Id.
Ex. C (Amanda Dep. at 16), ECF No. 21-4.) As part of her job,
Amanda stated that she prepared policies and explained UIM
coverage. (Id. Ex. C (Amanda Dep. at 16), ECF No.
21-4.) On the Policy, Amanda and Joseph are both listed as
named insureds. (Pl. Mem. Supp. Summ. J. Ex. D (Policy
Declarations Pages), ECF No. 21-5.) Amanda completed and
signed the declination form for UIM coverage. (Id.
Ex. A (UIM offer form), ECF No. 21-2.) Amanda and Joseph were
a couple and living together in April 2011, and they married
on June 1, 2012. (Id. Ex. C (Amanda Dep. at 21), ECF
No. 21-4.); Ex. F (Joseph Dep. at 5), ECF No. 21-6.) The
Policy was amended in 2013 to reflect Amanda's name
change from Amanda Taylor to Amanda Simpson. (Id. at
2, ECF No. 21-1.) Joseph testified that he did not have car
insurance in April 2011, but that he had been covered
previously by Nationwide until the engine blew up in his
vehicle. (Id. Ex. F (Joseph Dep. at 6-7), ECF No.
21-6.) Both Amanda and Joseph testified that they never
discussed any insurance issues together, including UIM
coverage, other than Amanda telling Joseph that she had added
him to the Policy. (Id. Ex. C (Amanda Dep. at 45,
65, ECF No. 21-4.) Joseph testified that he did not know that
Amanda had obtained insurance for him until " she came
home one day and told me that I had been added to the
policy." (Pl. Mem. Supp. Summ. J. Ex. F (Joseph Dep. at
8), ECF No. 21-6.) Amanda testified that she did not realize
she had added Joseph as a named insured. (Id. Ex. C
(Amanda Dep. at 45), ECF No. 21-4.) Joseph testified that he
thought it was " okay" and " cool" that
he was on the Policy. (Id. Ex. F (Joseph Dep. at 8),
ECF No. 21-6.)
October 12, 2013, the Defendants were involved in an
automobile accident with another vehicle that was being
operated by an impaired driver, who passed away as a result
of injuries received in the accident. The Defendants filed a
lawsuit against the estate of the impaired driver, which is
currently pending in Pickens County, South Carolina, Court of
Common Pleas, Civil Action Number 2015-CP-39-105. The
Defendants have served Allstate with a notice of their claim
for UIM coverage.
November 23, 2015, Allstate filed a motion for summary
judgment on its declaratory judgment claim. (Pl. Mot. Summ.
J., ECF No. 21.) On December 7, 2015, the Defendants
responded in opposition and filed a motion for summary
judgment on Joseph's counterclaim seeking reformation of
the Policy. (Defs. Resp. Opp'n Pl. Mot. Summ. J., ECF No.
23; Defs. Mot. Summ. J., ECF No. 24.) Allstate filed a reply
to its motion for summary judgment on December 17, 2015, and
a response in opposition to Defendants' motion for
summary judgment on December 29, 2015. (Pl. Reply Supp. Mot.
Summ. J., ECF No. 25; Pl. Resp. Opp'n Defs. Mot. Summ.
J., ECF No. 26.) Further, on January 19, 2016, Allstate
submitted an affidavit in support of its response in
opposition to Defendants' motion for summary judgment.
(Pl. Aff., ECF No. 29.) This matter is now ripe for
Discussion of the Law
Summary Judgment Standard
judgment is appropriate only " if the movant shows that
there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law."
Fed.R.Civ.P. 56(a). In deciding whether a genuine issue of
material fact exists, the evidence of the non-moving party is
to be believed and all justifiable inferences must be drawn
in his favor. See Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
However, " [o]nly disputes over facts that might affect
the outcome of the suit under the governing law will properly
preclude the entry of summary judgment. Factual disputes that
are irrelevant or unnecessary will not be counted."
Id. at 248.
litigant " cannot create a genuine issue of material
fact through mere speculation or the building of one
inference upon another." Beale v. Hardy, 769
F.2d 213, 214 (4th Cir. 1985). " [W]here the record
taken as a whole could not lead a rational trier of fact to
find for the non-moving party, disposition by summary
judgment is appropriate." Monahan v. Cty. of
Chesterfield, Va., 95 F.3d 1263, 1265 (4th Cir. 1996)
(internal quotation marks and citation omitted). " [T]he
mere existence of some alleged factual dispute
between the parties will not defeat an otherwise properly
supported motion for summary judgment; the requirement is
that there be no genuine issue of material
fact." Ballenger v. N.C. Agric. Extension
Serv., 815 F.2d 1001, 1005 (4th Cir. 1987) (internal
quotation marks and citation omitted).
alleges that it " is entitled to a presumption that
there was a meaningful offer" because an offer of UIM
coverage was made to Amanda, the Policy applicant and a named
insured. (Pl. Mem. Supp. Summ. J. 6, ECF No. 21-1.) In
contrast, the Defendants allege that Allstate was required to
offer UIM coverage to Amanda and Joseph, individually,
because they were both named insureds and applicants. (Defs.
Mem. Opp'n Mot. Summ. J. 5, ECF No. 23.) " [T]he
requirement of a meaningful offer of additional . . . UIM
coverage is intended to protect an insured. A meaningful
offer of additional . . . UIM [coverage] makes as certain as
possible that an insured has actual knowledge of his options
with respect to such coverages and is therefore able to make
an informed decision with respect to his desired
coverage." Grinnell Corp. v. Wood, 389 S.C.
350, 698 S.E.2d 796, 800 (S.C. 2010) (citing Floyd v.
Nationwide Mut. Ins. Co., 367 S.C. 253, 626 S.E.2d 6, 12
(S.C. 2005)). Consequently, " [a]ll law with respect to
a meaningful offer of additional . . . UIM coverage must be
applied so as to effectuate this stated purpose."
Id. at 799; Carter v. Standard Fire Ins.
Co., 406 S.C. 609, 753 S.E.2d 515, 518 (S.C. 2013)
(" '[T]he UIM and [uninsured motorist] statutes are
remedial in nature and enacted for the benefit of injured
persons' and 'should be construed liberally to effect
the purpose intended by the Legislature.'" (quoting
Floyd, 626 S.E.2d at 10)).
Accordingly, the insurer bears the burden of establishing
that it made a meaningful offer of UIM coverage. Whether an
insurer has met its burden in this regard is a question of
fact. If the insurer fails to comply with its statutory duty
to make a meaningful offer to the insured, the policy will be
reformed, by operation of law, to include UIM coverage up to
the limits of liability insurance carried by the insured.
Liberty Mut. Fire Ins. Co. v. McKnight, No.
2:14-CV-02145-PMD, 125 F.Supp.3d 602, 2015 WL 4878834, at *3
(D.S.C. Aug. 14, 2015) (unpublished) (internal citations and
quotation marks omitted); Butler v. Unisun Ins. Co.,323 S.C. 402, 475 S.E.2d 758, 759-60 (S.C. 1996). A
meaningful offer requires that: " (1) the insurer's
notification process must be commercially reasonable, whether
oral or in writing; (2) the insurer must specify the limits
of optional coverage and not merely offer additional coverage
in general terms; (3) the insurer must intelligibly advise
the insured of the nature of the optional coverage; and (4)
the insured must be told that optional coverages ...