Uninsured motorist ruling for passenger crash victim reversed

A man who won a judgment that he was covered by his auto insurance’s uninsured motorist policy after a crash that left him a quadriplegic lost the ruling in his favor Wednesday. The Indiana Court of Appeals decision could cost him millions of dollars that a jury awarded in a separate trial.

The appellate panel ruled for Gregory Smith’s insurer in Progressive Southeastern Insurance Co. v. Gregory Smith, et al., 18A-PL-312, in a case in which Smith was a passenger in his own insured truck. According to court records from the underlying litigation, Smith and Nolan Clayton were intoxicated after drinking at an Indianapolis Stacked Pickle bar in February 2016, and the bar called a cab for them. However, as their ride was pulling into the parking lot, Smith and Clayton decided to drive themselves, with Smith asking Clayton to drive his truck. Clayton crashed, permanently disabling Smith.

Smith sued Clayton and his insurer, Allstate, and a Marion County jury in December awarded Smith $35 million. 

In the instant case, Smith’s insurer, Progressive, filed a complaint for declaratory judgment, asking Marion Superior Judge Timothy Oakes for a determination that, according to the terms of its insurance policy with Smith, he was not entitled to coverage under the policy’s uninsured-motorist provisions for injuries sustained during an accident while being a passenger in his vehicle.

Oakes granted summary judgment in favor of Smith. “On December 14, 2017, without a hearing, the trial court signed Smith’s proposed findings and summarily granted judgment to him and against Progressive,” appellate Judge Patricia Riley noted. “On January 16, 2018, Progressive filed its motion to correct error, which the trial court denied the following day.”

But the COA panel found the trial court erred in ruling for Smith. The panel noted that he had settled out of court with Nolan’s insurer, Allstate, which tendered its full policy limits to Smith for the damages Clayton caused in the crash.

“(T)he unambiguous language of the policy does not extend UM coverage to Smith’s bodily injuries sustained in an accident caused by his own truck because Smith’s truck is a covered auto as defined by the policy, and thus not included in the uninsured motor vehicle definition which would trigger coverage of the policy,” Riley wrote. “In other words, no vehicle that Smith owns or insures can ever be an ‘uninsured motor vehicle’ for UM coverage purpose.

“(W)e hold that the trial court erred by concluding that Smith is entitled to receive payment from Progressive for his bodily injury under his insurance policy’s UM coverage, where his injury arose from a single-vehicle accident involving his insured vehicle and the driver’s liability insurance covered Smith’s bodily injury damages,” Riley wrote for the panel.

The COA found Smith’s policy unambiguously excluded Smith’s truck from UM coverage and “the trial court incorrectly applied the law to the facts.” The unanimous opinion was joined by Chief Judge Nancy Vaidik and Judge James S. Kirsch.