Forbes v. Harleysville Mutual Insurance

⁶⁹² ELDRIDGE, Judge. The first issue in this case is whether the statutorily mandated uninsured motorist coverage in automobile liability insurance policies includes coverage for wrongful death claims. The second issue concerns the insured status of the deceased and the effect of that status on coverage for the wrongful death claims. I. Carol and Robin Forbes were married and had two children, George and Connie.

Prior to August 4, 1984, the four resided in the home of Robin Forbes’s mother in Baltimore City. On August 4, 1984, Carol Forbes left her mother-in-law’s home and, along with Delbert Dean, moved into an apartment in Easton, Maryland, under a month-to-month lease. On or about August 27, 1984, Carol Forbes removed Connie and George from Baltimore to the Easton apartment. Robin Forbes did not consent to the removal of the children.

In addition, the uncontradicted evidence before the trial court was that Carol Forbes at no time asked for or discussed with Robin Forbes a divorce. Carol Forbes did not change her voter registration to Easton and did not notify the Motor Vehicle Administration of any change in her address. On September 22, 1984, Carol Forbes was killed in an accident while riding as a passenger in Delbert Dean’s uninsured motor vehicle. Connie and George Forbes were also passengers and were injured in the accident.

The accident was caused by the negligence of Dean, the uninsured driver. Robin Forbes, as spouse of Carol Forbes and as next friend of George and Connie Forbes, filed an action in the Circuit Court for Anne Arundel County against his uninsured motorist carrier, Harleysville Mutual Insurance Com ⁶⁹³ pany, and against Delbert Dean, the tortfeasor. 1 Counts one and two of the complaint, as amended, sought damages on behalf of Connie and George Forbes for the personal injuries which they had received in the accident. In counts three, four, and five, claims were made on behalf of Connie, George and Robin Forbes respectively for the wrongful death of Carol Forbes. Dean fled the jurisdiction and has never been located.

An order of default was entered against Dean on all five counts. Harleysville filed a motion for summary judgment, and, after a hearing, the circuit court denied the motion as to counts one and two requesting damages for the personal injuries to the children. With regard to counts three, four and five, however, summary judgment was granted in favor of Harleysville. The circuit court held that wrongful death damages could not be recovered by Robin Forbes and the children under the uninsured motorist coverage because, at the time of the wrongful death, Carol Forbes had moved out of Robin Forbes’s home and, therefore, was not an “insured” under the policy.

On June 28, 1988, the circuit court entered judgment on counts one and two against Delbert Dean and Harleysville, and on counts three, four and five solely against Dean. 2 ⁶⁹⁴ Robin Forbes, individually and on behalf of the children and the subrogee Maryland Automobile Insurance Fund, filed a notice of appeal to the Court of Special Appeals. While Forbes’s appeal was pending in that court, the Court of Special Appeals filed its opinion in Globe American Casualty v. Chung, 76 Md.App. 524 , 547 A.2d 654 (1988), vacated, 322 Md. 713 , 589 A.2d 956 (1991), in which the Court of Special Appeals took the position that the statutorily required uninsured motorist coverage in automobile insurance policies does not include wrongful death claims. In reaching this result, the Court of Special Appeals relied upon the language of the insurance policy involved in that case, and upon the language of Maryland Code (1957, 1991 Repl.Vol.), Art. 48A, § 541(c)(2), which refers to “damages which the insured is entitled to recover from the owner or operator of an uninsured vehicle because of bodily injuries sustained in an accident arising out of the ownership, maintenance, or use of such uninsured motor vehicle.” (Emphasis added). The use of the phrase “bodily injuries” without any reference to “death,” and the use of the word “insured” without any reference to “the surviving next-of-kin,” led the Court of Special Appeals to conclude that wrongful death claims were not encompassed by the statutorily mandated uninsured motorist coverage.

Globe American Casualty v. Chung, supra, 76 Md.App. at 541 , 547 A.2d at 662 . After the Court of Special Appeals filed its opinion in the Chung case, but before the present case was briefed and argued in the Court of Special Appeals, the plaintiff-appellant Robin Forbes filed in this Court a petition for a writ of certiorari. The petition presented the following two questions: 1. “Does the uninsured motorist statute require coverage for wrongful death claims, contrary to the Court of Special Appeals’ holding in Globe American Casualty v. Boo Hyun Chung, Pers. Rep.?” 2. “Is an uninsured motorist insurance carrier responsible to pay a judgment in favor of minor children for the wrongful death of their mother, where the mother was ⁶⁹⁵ married to but not living with the father at the time she was killed by the negligent uninsured driver?” 3 This Court granted the petition, and we shall reverse that portion of the judgment in favor of Harleysville concerning the wrongful death claims on behalf of the children.

II

The first issue is whether the uninsured motorist coverage required by statute extends to damages arising from a wrongful death caused by the negligence of an uninsured motorist. The General Assembly has enacted a comprehensive insurance scheme, with numerous mandatory coverages, for motor vehicles required to be registered in Maryland and for motor vehicle insurance policies issued in Maryland. See Code (1977, 1987 Repl.Vol., 1990 Cum.Supp.) §§ 17-101 through 17-110 of the Transportation Article; Code (1957, 1991 Repl.Vol.), Art. 48A, §§ 234B, 240AA through 242, 243 through 243L, and 538 through 547. See, e.g., Nationwide v. USF & G, 314 Md. 131, 133-136 , 550 A.2d 69, 70-71 (1988); Lee v. Wheeler, 310 Md. 233 , 528 A.2d 912 (1987); Jennings v. Government Employees Ins., 302 Md. 352, 357 , 488 A.2d 166, 168-169 (1985).

As part of this comprehensive scheme, Art. 48A, § 541(c), requires that “every policy of motor vehicle liability insurance issued, sold, or delivered in this State” contain uninsured motorist coverage “in at least the amounts required under Title 17 of the Transportation Article....” 4 ⁶⁹⁶ In taking the position that the uninsured motorist coverage required by Art. 48A, § 541(c), does not encompass wrongful death claims, the Court of Special Appeals in Globe American Casualty Company v. Chung, supra, and Harleysville in the instant case, seized upon certain words in one sentence of § 541(c)(2), without regard to the legislative purpose reflected in § 541(c) and without regard to the other language in the section. 5 Nevertheless, in construing ⁶⁹⁷ statutes in order to ascertain the legislature’s intent, we do not read particular language in isolation or out of context. We construe statutory language in light of the legislature’s general purpose and in the context of the statute as a whole. Kaczorowski v. City of Baltimore, 309 Md. 505, 513-516 , 525 A.2d 628, 632-633 (1987). See Jones v. State, 311 Md. 398, 405 , 535 A.2d 471, 474-475 (1988).

Our eases have emphasized that the uninsured motorist statute “embodies a public policy ‘to assure financial compensation to the innocent victims of motor vehicle accidents who are unable to recover from financially irresponsible uninsured motorists.’ ” Lane v. Nationwide Mut. Ins. Co., 321 Md. 165, 169 , 582 A.2d 501, 503 (1990), quoting Pennsylvania Nat’l. Mut. v. Gartelman, 288 Md. 151, 157 , 416 A.2d 734, 737 (1980).

See Lee v. Wheeler, supra, 310 Md. at 238 , 528 A.2d at 915 . Also, we have consistently stated that “the purpose of uninsured motorist statutes is ‘that each insured under such coverage have available the full statutory minimum to exactly the same extent as would have been available had the tortfeasor complied with the minimum requirements of the financial responsibility Law.’ ” Nationwide Mut. Ins. Co. v. Webb, 291 Md. 721, 737 , 436 A.2d 465, 474 (1981), quoting Webb v. State Farm ⁶⁹⁸ Mutual Automobile Ins.

Co., 479 S.W.2d 148, 152 (Mo.App.1972). See Hoffman v. United Services Auto. Ass’n, 309 Md. 167, 172 , 522 A.2d 1320, 1322 (1987). See also Lee v. Wheeler, supra, 310 Md. at 237 , 528 A.2d at 914 .

Moreover, we have said that “ ‘the remedial nature’ of the uninsured motorist statute ‘dictates a liberal construction in order to effectuate its purpose____’” Nationwide Mut. Ins. Co. v. Webb, supra, 291 Md. at 737 , 436 A.2d at 475 , quoting State Farm Mut. Ins.

Co. v. Maryland Auto. Ins. Fund, 277 Md. 602, 605 , 356 A.2d 560, 562 (1976). Finally, limitations on coverage or exclusions in insurance policies, which are inconsistent with the purpose of the uninsured motorist statutory provisions, are unenforceable.

See, e.g., Nationwide v. USF & G, supra, 314 Md. at 135, 141 , 550 A.2d at 71, 74 ; Gable v. Colonial Ins. Co., 313 Md. 701, 703-704 , 548 A.2d 135, 136 (1988); Lee v. Wheeler, supra, 310 Md. 233 , 528 A.2d 912 ; Nationwide Mut. Ins. Co. v. Webb, supra, 291 Md. at 730 , 436 A.2d at 471 ; Pennsylvania Nat’l.

Mut. v. Gartelman, supra, 288 Md. 151 , 416 A.2d 734 ; Reese v. State Farm Mut. Auto. Ins. Co., 285 Md. 548, 554-556 , 403 A.2d 1229, 1233-1234 (1979).

The liability coverage in standard automobile insurance policies, and the liability coverage mandated by Maryland financial responsibility law, encompass wrongful death claims. See Daley v. United Services, 312 Md. 550 , 541 A.2d 632 (1988); Code (1977, 1987 Repl.Vol., 1990 Cum. Supp.), § 17-103(b) of the Transportation Article (“The security required under this subtitle shall provide for at least: (1) The payment of claims for bodily injury or death arising from an accident ... ”) (emphasis added). As pointed out above, the purpose of the required uninsured motorist coverage is to make available the same coverage as would have been available had the tortfeasor complied with the liability insurance requirements of the financial responsibility law.

Since the liability insurance required by the financial responsibility law includes wrongful death claims, it follows that the uninsured motorist coverage also includes wrongful death claims. ⁶⁹⁹ The language of the uninsured motorist statutory provision, Art. 48A, § 541(c), confirms that the General Assembly contemplated coverage for wrongful death claims. Although the sentence in paragraph (2) of § 541(c) relied on by the Court of Special Appeals and by Harleysville refers only to “bodily injuries sustained in an accident,” paragraph (1) of § 541(c), defining the term “uninsured motor vehicle,” refers to “bodily injury or death of an insured.” Paragraph (1) also refers to the “liability under ... liability insurance policies ... applicable to the bodily injury or death.” In addition, paragraph (3) of § 541(c) measures the liability limit of the uninsured motorist carrier as “the amount of that [uninsured motorist] coverage less the sum of the limits under the liability insurance policies ... applicable to the bodily injury or death of the insured.” This obviously reflects the General Assembly’s contemplation that uninsured motorist coverage, to the same extent as liability coverage, is “applicable to the ... death of the insured” and, like liability coverage, embraces wrongful death claims. Moreover, § 541(c)(2) states that “[i]n no case shall the uninsured motorist coverage be less than the coverage afforded a qualified person under Article 48A, §§ 243H and 243-1.” These sections relate to claims not covered by insurance and payable by the Maryland Automobile Insurance Fund as successor to the Unsatisfied Claim and Judgment Fund. See Nationwide Mut.

Ins. Co. v. Webb, supra, 291 Md. at 726 n. 3, 436 A.2d at 468 -469 n. 3; State Farm Mut. Ins. Co. v. Maryland Auto.

Ins. Fund, supra, 277 Md. at 603 n. 1, 356 A.2d at 561 n. 1. We have held that, under this provision of § 541(c)(2), uninsured motorist coverage must be as broad as the coverage under §§ 243H and 243-1; limitations on coverage which are not contemplated by §§ 243H and 243-1 are not allowed under § 241(c). State Farm v. Maryland Auto.

Ins. Fund, supra, 277 Md. at 605-606 , 356 A.2d at 562 . See Lee v. Wheeler, supra, 310 Md. at 236-237 , 528 A.2d at 914 . Section 243H states that “[c]laims for the death of or personal injury to a ⁷⁰⁰ qualified person” will be covered, and § 243-1 sets the maximum amount payable for the injury or death of any one person at $20,000 (emphasis added).

This Court has taken the position that §§ 243H and 243-1 encompass wrongful death claims. Unsatisfied Claim & Judgment Fund v. Hamilton, 256 Md. 56 , 259 A.2d 303 (1969). Consequently, as the uninsured motorist coverage under § 541(c) must be as broad as the coverage under §§ 243H and 243-1, and as §§ 243H and 243-1 include wrongful death claims, the conclusion is inescapable that § 541(c) also includes wrongful death claims. In recent years this Court has dealt with the uninsured motorist coverage required by § 541(c) in a multitude of opinions.

The General Assembly has amended § 541(c) on numerous occasions. Neither the opinions of this Court nor the actions of the General Assembly, including the underlying legislative history, have even intimated that wrongful death claims might not be embraced within § 541(c). On the contrary, we have, although without any discussion of the issue, treated wrongful death claims as covered by § 541(c). See Hoffman v. United Services Auto.

Ass’n, supra, 309 Md. 167 , 522 A.2d 1320 ; Yarmuth v. Gov’t Employees Ins. Co., 286 Md. 256 , 407 A.2d 315 (1979). Furthermore, the cases throughout the country which have considered the issue have held that wrongful death claims are within uninsured motorist coverage. See, e.g., Williams v. Williams, 23 Ariz.App. 191 , 531 P.2d 924 (1975); Zeagler v. Commercial Union Ins.

Co., 166 So.2d 616 (Fla.App.1964), cert. dismissed, 172 So.2d 450 (Fla.1965); Pearthree v. Hartford Acc. & Indem. Co., 373 So.2d 267, 271 (Miss.1979); Ashcraft v. Ashcraft, 689 S.W.2d 693, 695 (Mo.App.1985); Sterns v. M.F.A. Mutual Insurance Company, 401 S.W.2d 510 (Mo.App.1966); Satzinger v. Satzinger, 156 N.J.Super. 215 , 383 A.2d 753 (1978); Wood v. Shepard, 38 Ohio St.3d 86, 89-90 , 526 N.E.2d 1089, 1092 (1988); In re Estate of Reeck, 21 Ohio St.3d 126 , 488 N.E.2d 195 (1986); Brummett v. Grange Ins. Assoc., 4 Wash.App. 979 , 485 P.2d 88 (1971). ⁷⁰¹ We hold, therefore, that Art. 48A, § 541(c), encompasses wrongful death claims.

III

Harleysville next argues that if wrongful death claims are covered by Art. 48A, § 541(c), there nevertheless can be no recovery in this case because of Carol Forbes’s status at the time of the accident resulting in her death. Harleysville contends that under the language of the insurance policy issued on Robin and Carol Forbes’s station wagon, uninsured motorist benefits are payable only if the person sustaining bodily injury or death in an accident was an “insured” at the time of the accident. While conceding that the two children were “insureds” within the meaning of the policy, Harleysville maintains that Carol Forbes was not an “insured” at that time. According to the insurance company, she was not an “insured” because she was not designated as a “named insured” in the policy and did not reside in the household of the named insured.

Therefore, the argument continues, the language of the insurance policy precludes the recovery of uninsured motorist benefits on behalf of the insured children. 6 ⁷⁰² Harleysville recognizes that if the insurance policy contains a limitation on coverage which is inconsistent with Art. 48A, § 541(c), such limitation is unenforceable. Harleysville asserts, however, that § 541(c) does not require the payment of wrongful death benefits to the insured children if their parent, who was killed by the negligence of an uninsured motorist, was not an “insured” when the accident occurred. It is also Harleysville’s position that nothing in the statutory language requires that Carol Forbes be deemed an “insured” under the Harleysville policy. While not accepting Harleysville’s interpretation of the insurance policy, the thrust of petitioner Robin Forbes’s argument is that the statutory provisions require coverage of the claims on behalf of the children regardless of Carol Forbes’s status under the language of the policy.

We disagree with Harleysville’s' constructions of both the insurance policy and the statute. In our view, under the particular circumstances of this case, Carol Forbes was an “insured” or “covered person” at the time of the accident. Alternatively, even if she were not deemed an “insured” under the policy, Art. 48A, § 541(c), as applied to the fact situation here, requires that the children’s wrongful death claims be covered by the uninsured motorist provisions of the policy. (a) Preliminarily, a strong argument could be made that Carol Forbes was a “named insured” for purposes of uninsured motorist coverage regardless of the definitions in the insurance policy.

Art. 48A, § 538, containing the definitions for the required motor vehicle insurance coverage subtitle of the Maryland Insurance Code, defines a “named insured” in subsection (c) as “the person denominated in the declarations in a policy of motor vehicle liability insurance.” Section 538(c) does not require that the person be denominated “as a ‘named insured’ ” or specifically designated as such. As previously noted, both Robin and Carol Forbes were co-owners of the insured vehicle, were both designated ⁷⁰³ in the policy as the two operators, and both names were listed on the declaration page of the policy. Only Robin Forbes, however, was expressly designated as “named insured.” Harleysville acknowledged in the circuit court that, in the situation where the husband and wife were co-owners and co-operators of the insured vehicle, the insurance premium would have been the same regardless of whether both spouses or one spouse was designated as “named insured.” Harleysville further stated that sometimes its policies designated both spouses as named insureds and sometimes only one; the insurer indicated that there was no particular reason for the difference in designations. Under these circumstances, it could be persuasively argued that Carol Forbes was a “named insured” under the definition in Art. 48A, § 538(c).

Nonetheless, for purposes of this case, we shall assume that Carol Forbes was not a “named insured.” The endorsement to the Harleysville insurance policy relating to uninsured motorist coverage states: “We will pay damages which a covered person is legally entitled to recover from the owner or operator of an uninsured motor vehicle because of: 1. Bodily injury sustained by a covered person and caused by an accident____” The uninsured motorist endorsement contained its own section of definitions. The definition of “covered person” was as follows: “ ‘Covered person’ as used in this endorsement means: 1. You [the named insured] or any family member. 2.

Any other person occupying your covered auto. 3. Any person for damages that person is entitled to recover because of bodily injury to which this coverage applies sustained by a person described in 1 or 2 above.” The term “family member,” although used in several provisions set forth in the uninsured motorist endorsement, is not further defined or limited in the definition section or ⁷⁰⁴ elsewhere in the endorsement. The definition section at the beginning of the main policy, however, defines the term as follows: “ ‘Family member’ means a person related to you by blood, marriage or adoption who is a resident of your household. This includes a ward or foster child.” The parties have proceeded upon the assumption that this general definition of “family member” is applicable to the uninsured motorist endorsement, and we shall do likewise.

Therefore, the critical issue under the language of the insurance policy is whether Robin Forbes’s wife, who was co-owner and co-operator of the insured vehicle, was “a resident of [Robin Forbes’s] household” at the time of the accident. Harleysville’s position seems to be that whenever one spouse stops physically residing in the household where both spouses have resided, and begins physically residing at another place, that spouse is no longer “a resident” of the other spouse’s household for purposes of being covered under the family car policy, regardless of how temporary the separation may be and regardless of the reason for it. Married couples often may experience marital difficulties which result in one of the spouses leaving the home for a period of time. The employment situations of spouses may require them to maintain separate households in different areas for varying lengths of time.

It would be an unreasonable construction of the “household residence” language in automobile insurance policies, as well as similar language in the Maryland Insurance Code, 7 to hold that during every such period of separation, no matter how brief, the spouse who leaves the marital home automatically becomes uninsured with regard to the family car. It would be a particularly unreasonable construction where the spouse leaving the household is co-owner and co-operator of the family ⁷⁰⁵ car. 8 Even though her car is covered by a policy containing the mandatory insurance coverages, such spouse would not be a “covered person.” Adoption of Harleysville’s theory would result in the creation of a large class of uninsureds who obtained such status simply by leaving the residence of the named insured, even for a temporary period. This would be inconsistent with Maryland’s public policy of mandatory motor vehicle insurance coverage. See, e.g., Larimore v. American Ins.

Co., 314 Md. 617, 625 , 552 A.2d 889, 892 (1989) (“To uphold the ... exclusion in motor vehicle insurance policies could result in a large class of ... uninsured motorists”); Jennings v. Government