Globe American Casualty Co. v. Boo Hyun Chung

MOYLAN, Judge. When a victim dies because of the tortious conduct of someone else, two entirely different types of claim may arise. One is a survival action commenced or continued by the personal representative of the deceased victim, seeking recovery for the injuries suffered by the victim and prosecuted just as if the victim were still alive. It is called a “survival action” in the sense that the claim has survived the death of the claimant.

The other is a wrongful death action, brought by the relatives of the victim and seeking recovery for their loss by virtue of the victim’s death. A deceptive similarity inevitably results from the prominent common denominator fact that the victim has died. In ⁵²⁷ other essential characteristics, however, the two types of claim are clearly distinct. The first arises from the tortious infliction of injury upon the victim; the second, only from the actual death of the victim.

In the first, damages are measured in terms of harm to the victim; in the second, damages are measured in terms of harm to others from the loss of the victim. In the first, the personal representative serves as the posthumous agent of the victim; in the second, his surviving relatives do not serve as his agent at all. They act in their own behalf. In some states, the distinction between the two types of claim has been lost—or badly blurred.

In Maryland, in no small measure because of the landmark opinion of Chief Judge James McSherry for the Court of Appeals in Stewart v. United Electric Light and Power Co., 104 Md. 332 , 65 A. 49 (1906), that distinction has been meticulously maintained. The distinction is pivotal to this appeal. The Facts in This Case At 11:30 p.m. on July 11, 1988, Bo Hyun Chung, the decedent, was operating his service station with his wife, Kum Ja Chung. Barbara Ann Orejuela drove into the station in a 1975 Chevrolet Monte Carlo.

Ms. Orejuela filled her gasoline tank with $20.03 worth of gasoline. She then walked over to the cash register booth, told Kum Ja Chung that she had no money and offered the rings she was wearing as payment for the gasoline. Mrs. Chung referred her to the decedent. The two discussed the matter as they walked to the car, but no agreement was reached as to the form of payment.

Suddenly, Ms. Orejuela drove away from the service station while the decedent was half leaning into the driver’s side of the car. Mrs. Chung had remained in the cash register booth. Heedless of the decedent’s cries to stop, Ms. Orejuela proceeded southbound on Maryland Route 855 while the decedent clung to the side of the car. At some point, the decedent was either thrown or fell clear ⁵²⁸ of the automobile.

He died sometime later after his admission to the hospital. 1 The Liability of the Uninsured Motorist Whether for the ultimate benefit of the personal representative, as he pursues the estate’s vicarious claim for the bodily injury to the deceased; or for the ultimate benefit of the surviving relatives pursuing their wrongful death claim; or for the ultimate benefit of both, the liability of the uninsured motorist was established in the Circuit Court for Montgomery County. Pursuant to the provisions of Md. Cts. & Jud.Proc. Code Ann. § 3-904 (1984), Kum Ja Chung, on her own behalf as decedent’s widow and also as mother and next friend of the decedent’s minor child, filed a wrongful death action against Ms. Orejuela. Judgment was entered against Ms. Orejuela on June 21, 1985.

The widow was awarded $250,000 compensatory damages and $250,000 punitive damages. The minor child was awarded $100,000 compensatory damages and $100,000 punitive damages. Both Ms. Orejuela and the vehicle operated by her were uninsured. It was evident as well that Ms. Orejuela was insolvent.

To the extent to which anyone might recover anything for the decedent’s injury and/or death, it was obvious that such recovery would have to be through the decedent’s own insurance policies. The Decedent’s Insurance Policies At the time of his death, the decedent maintained two policies of insurance. The first was with the Nationwide Mutual Fire Insurance Company (Nationwide). It insured against robbery and burglary.

On behalf of the decedent’s widow, demand was made upon Nationwide for benefits in the amount of $6,000. Coverage was initially denied by Nationwide, thus prompting a suit for recovery by Boo Hyun Chung, the personal ⁵²⁹ representative of the decedent’s estate and the appellee upon this appeal. The appellee was granted summary judgment by the Circuit Court for Montgomery County. Nationwide forwarded to the appellee a check in the amount of $6,000, along with a release.

The release was signed by the appellee on April 23, 1985. Except for the arguable effect of that release on the obligation under the other insurance policy, the recovery under the policy from Nationwide does not figure further in this appeal. On this appeal, the battle swirls about the second insurance policy. That second policy was a motor vehicle liability insurance policy issued to the deceased by the appellant, The Globe American Casualty Company.

As is required by Md.Ann. Code art. 48A, § 541(c)(2) (1957, 1986 Repl.Vol.) for every liability insurance policy issued in this state after July 1, 1975, there was included Uninsured Motorist (U.M.) coverage. The minimum required coverage, tied to Title 17 of the Transportation Article and to §§ 243H and 2431 of Article 48A, was “up to $20,000 for any one person and up to $40,000 for any two or more persons.” In terms of coverage, the pertinent words for present purposes of § 541(c)(2) are: “... every policy ... shall contain coverage ... for damages which the insured is entitled to recover ... because of bodily injury sustained in an accident ...” Should the victim who is injured by the uninsured or underinsured motorist live, there is no problem in interpretation. Only the victim may sue for damages because of bodily injury sustained in an accident. If the victim should die, however, the consequential litigation becomes more ambiguous.

Does the statutorily required Uninsured Motorist coverage contemplate a survival action brought by the personal representative of the deceased or a wrongful death action brought by the surviving relatives of the deceased or both? If both, how is the $20,000 “cap” for one victim of bodily injury apportioned between the two claims? If either but not both, which type has priority? Will there be a race to the courthouse door or to the in-basket of the ⁵³⁰ insurance company’s claims department?

If one but not the other, which is contemplated by the statute mandating the coverage? The question is squarely before us because in this case two claims were filed, one of each type, under the same Uninsured Motorist provision of the policy issued to the decedent by the appellant. After establishing Ms. Orejuela’s liability and being awarded damages in the wrongful death action, the decedent’s widow presented her claim to the appellant, pursuant to the decedent’s insurance policy, for the satisfaction of the judgment obtained. The policy limited the insurer’s obligation to $20,000 “per person” for bodily injury sustained by one person as the result of any one accident. 2 Whether required to under the literal terms of the policy or not, the appellant paid the decedent’s widow $20,000 for the wrongful death claim.

On August 21, 1984, the widow executed a written release discharging the appellant from any further liability. The second claim against the same Uninsured Motorist provision of the same liability policy appeared on April 29, 1985. It was on that day that the appellee, Boo Hyun Chung, as the personal representative of the decedent’s estate, instituted a survival action against the appellant, seeking payment of what then would have been an additional $20,000 under the Uninsured Motorist provision of the policy. On the basis of the $20,000 payment already made to the decedent’s widow and the release executed by her, the appellant denied any further obligation under the policy.

As the matter moved toward resolution in the Circuit Court for Montgomery County, cross-motions for summary judgment were filed by both parties. On July 13, 1987, Judge DeLawrence Beard denied the appellant’s motion for summary judgment and granted the motion of the appellee/per ⁵³¹ sonal representative for partial summary judgment, ruling that the estate through the personal representative was entitled to payment. The parties subsequently entered a consent judgment with the understanding that an appeal would follow. Upon this appeal, the appellant raises the following three questions: 1) Does the decedent’s widow and his estate each constitute a separate “person injured” for the purposes of appellant’s policy, or, are they various claimants seeking damages for the same person injured? 2) Did the release executed by the decedent’s estate in favor of Nationwide Mutual Insurance Company act to discharge the appellant as well? 8) Does the release as executed by the decedent’s widow in favor of the appellant discharge the appellant from further liability?

We agree with the appellant in terms of its answer to the first question, but do not agree that that answer is dispositive of the larger issue before us. Conversely, we hold in favor of the appellee/personal representative on the issue of his entitlement to recovery under the policy but do so for a reason different than that advanced by him. The $20,000 Limitation Under the Policy Without arguing that the wrongful death action was not covered by the Uninsured Motorist provision, the appellee argues simply that he, as personal representative, is entitled to an additional $20,000 under the policy because there were two “bodily injuries sustained by two persons.” Granting that the initial and primary bodily injury was suffered by the decedent directly, the appellee argues that the mental anguish, pain, and suffering experienced by the decedent’s widow constituted a second “bodily injury” to her independent of the decedent's injury. The recent decision of the Court of Appeals in Daley v. United Services Automobile Assoc., 312 Md. 550 , 541 A.2d 632 (1988), is controlling on this issue.

The Court of Appeals there held that solatium damages claimed in a wrongful death action ⁵³² by parents, whose minor child was killed in an automobile accident, were not bodily injuries independent of the injury to the child. The Court held that the plaintiffs were only entitled to the single policy limits which apply when there is only one bodily injury. The Mandatory U.M. Provision Does Not Cover a Wrongful Death Claim We nonetheless hold in favor of the appellee/personal representative, but for a very different reason. We read the clear terms of both the controlling statute and the Uninsured Motorist provision of the policy itself to limit the coverage to “the insured or his legal representative” for the bodily injuries suffered by the insured.

Insurance policies are contractual and the court interprets the provisions of the policy based on their plain meaning. National Indemnity Company v. Continental Insurance Co., 61 Md.App. 575 , 487 A.2d 1191 (1985). See also Bond v. Pennsylvania National Casualty Insurance Company, 289 Md. 379 , 424 A.2d 765 (1981); National Grange Mutual Insurance Company v. Pinkney, 284 Md. 694 , 399 A.2d 877 (1979). The proceeds of an insurance policy are to be distributed according to the precise terms of the policy.

In the instant case, the policy issued by the appellant requires it: “To pay all sums which the insured or his legal representative shall be legally entitled to recover as damages from the owner or operator of an uninsured highway vehicle because of bodily injury or property damage, caused by accident and arising out of the ownership, maintenance or use of such uninsured highway vehicle ...” (Emphasis supplied). The critical words to be focused upon in that provision are those which require the appellant to pay “all sums which the insured or his legal representative shall be legally entitled to recover as damages____” Appellant maintains that it has fulfilled this contractual obligation to its insured, the decedent. Appellant insists that “the decedent, through the wrongful death claim of his widow, has already made a ⁵³³ claim and received the ‘per person’ limit of liability under the policy contract.” The survival action instituted by the legal representative to recover the sum legally entitled to the decedent’s estate is nothing more, it claims, than an attempt to circumvent the language of the insurance contract “by presenting the same claim but by calling it another name.” The appellant in effect claims that the ghost of the decedent is trying to collect twice. We disagree.

The Two Actions Distinguished The appellant treats a wrongful death action and a survival action as one and the same thing, or at least as alternate and essentially interchangeable remedies. Such is far from the case. In Stewart v. United Electric Light and Power Co., 104 Md. 332 , 65 A. 49 (1906), the Court of Appeals, through Judge McSherry, carefully traced the early history of Maryland’s Wrongful Death Statute, 3 on the one hand, and the statute permitting a personal representative to recover those damages which his decedent might have recovered, had he lived, 4 on the other hand. The opinion threw into sharp relief the distinctions between the two: “ ‘The points of difference between this statute [the Wrongful Death Statute] and the provisions of the Code giving to executors and administrators full power to commence and prosecute any personal action whatever which the testator or intestate might have commenced and prosecuted (except actions of slander and an action where the person causing the injury is dead) are striking and marked even upon a casual comparison of the two enactments.

The suits are by different persons, the damages go into different channels, and are recovered ⁵³⁴ upon different grounds, and the causes of action though growing out of the same wrongful act or neglect, are entirely distinct.’ ” 104 Md. at 338-339 , 65 A. 49 . The difference between a survival statute and a wrongful death action could not be more basic. The opinion first traced the development of survival actions. At the common law, the right of action for a tort abated upon the death of either the injured person or the tortfeasor.

A series of statutes over the course of a century gradually ameliorated the harshness of the common law principle that “the action died with the person to whom or by whom the wrong was done.” 104 Md. at 333-334 , 65 A. 49 . The Acts of 1785, ch. 80, first provided that personal actions, if commenced in the lifetimes of plaintiff and defendant, would not abate by the death of either party but would survive and could be maintained by or against the executors or administrators of either. A series of statutes between 1785 and 1888 added amendments not here pertinent. The precise scope of the cause of action, preserved by the survival statutes, was clear: “It is apparent, therefore, that the statutes, thus far considered, have relation only to a cause of action which the plaintiff himself had in his lifetime and upon which he had instituted suit whilst living.

Hence these statutes give no new cause of action, but merely prevent a subsisting and a pending one from abating by the death of the plaintiff. That cause of action is in such instances devolved upon the executor or administrator and when ripened into a judgment becomes an asset of the decedent for the benefit of his creditors, if he has any; or for the benefit of his legatees and distributees." (Emphasis supplied). 104 Md. at 336 , 65 A. 49 . It is clear that the beneficiaries under a survival action are not necessarily the same as the beneficiaries under a wrongful death action. They may, of course, be identical.

There may be simply a significant overlapping of the two ⁵³⁵ classes of beneficiaries. There is, as well, at least the theoretical possibility that the two classes will be not only separate and distinct but hostile in terms of opposing interests. Creditors of the estate, for instance, may have interests adverse to those of the next of kin. The decedent, moreover, may have disinherited his relatives and provided for a class of “legatees and distributees” separate and apart from those who could bring a wrongful death action.

The right to bring a personal action was significantly broadened by the Code of 1888. Art. 93, § 104, provided that “Executors and administrators shall have full power to commence and prosecute any personal action whatever, at law or in equity, which the testator or intestate might have commenced and prosecuted____” “Thus in 1888 for the first time executors and administrators were given full power to commence suits for the recovery of damages for personal injuries sustained by their testator or intestate in his lifetime.” 104 Md. at 337 , 65 A. 49 (Emphasis in original). In a survival action, in contrast to a wrongful death action, the death of the claimant need not have been as a result of the tortious injury but may have stemmed from a completely independent cause. The Wrongful Death Statute, by contrast, was first enacted in Maryland by Acts of 1852, ch. 299.

It, as well as similar statutes in every American State, was modeled on the English Fatal Accidents Act of 1846 (9 and 10 Vic., ch. 98), universally known as Lord Campbell’s Act. See McKeon v. State, Use of Conrad, 211 Md. 437 , 127 A.2d 635 (1956); Flores v. King, 13 Md.App. 270 , 282 A.2d 521 (1971). Unlike a survival action, a wrongful death action arose not from the injury but from the death of the injured party. It was not for the benefit of the injured party but “for the benefit of the wife, husband, parent and child of the person whose death shall have been so caused....” Judge McSherry’s opinion emphasized the difference between these provisions: ⁵³⁶ “[T]he Code of 1888 giving for the first time full power to administrators to commence any personal action except for slander, went into effect thirty-six years after the adoption here of Lord Campbell’s Act in 1852; and it must be presumed that the Legislature intended by the provision in the Code of 1888 to give a remedy for the injuries which the Act of 1852 did not cover.

To say that the two enactments are merely alternatives of each other ignores the genesis of this legislation and in effect asserts that though the Legislature distinctly and in definite terms prescribed how and by whom the suit should be brought under the Act of 1852 still thirty-six years afterwards it adopted a wholly different method by which and designated a wholly different person by whom, the suit was to be commenced and prosecuted.” 104 Md. at 339 , 65 A. 49 . Scrupulously to be avoided is a thoughtless identification of the two “in which event a race of diligence between the personal representative and the family of the deceased would determine whether the damages recovered would go in one direction or another.” Id. In every characteristic, save only that a wrongfully injured party has since died, the actions are distinct: “Under the Act of 1852 the damages recoverable are such as the equitable plaintiffs have sustained by the death of the party injured; under sec. 103 the damages recoverable are only such as the deceased sustained in his lifetime and consequently exclude those which result to other persons from his death. Under the Act of 1852 the damages are apportioned by the jury among the equitable plaintiffs, and belong exclusively to them and form no part of the assets of the decedent’s estate; under sec. 103 of Art. 93 of the Code the damages recovered go into the hands of the executor or administrator and constitute assets of the estate.

Under the Act of 1852 there is no survival of a cause of action—the cause of action is created by it and is a new cause of action and consequently one which the deceased never had; under sec. 103 there ⁵³⁷ is a survival of a cause of action which the decedent had in his lifetime.” (Emphasis in original). 104 Md. at 339-340 , 65 A. 49 . The Wrongful Death Act, by contrast, is not a survival statute at all but creates a totally new cause of action. In Tucker v. State, use of Johnson, 89 Md. 471, 479 , 43 A. 778 , 44 A. 1004 (1899), the Court of Appeals said of the Wrongful Death Act: “By it the jury may give such damages as they may think proportioned to the injury resulting from such death, and not such as the injured person could have recovered if he had survived. The injury for which the equitable plaintiffs are compensated is the pecuniary loss sustained by reason of the death of the person through the wrongful act, neglect or default of the defendant.

The statute ... has not undertaken to keep alive an action which would otherwise die with the person, but, on the contrary, has created a new cause of action for something for which the deceased person never had, and never could have had the right to sue—that is to say, the injury resulting from his death.” (Emphasis in original). The logical conclusion of the Court of Appeals opinion