             In the Missouri Court of Appeals
                     Eastern District
                                         DIVISION THREE

NATIONWIDE INSURANCE COMPANY                     )      No. ED102829
OF AMERICA,                                      )
                                                 )
       Appellant,                                )      Appeal from the Circuit Court
                                                 )      of St. Louis County
       vs.                                       )      Cause No. 14SL-CC01166
                                                 )
PATRICE THOMAS,                                  )      Honorable Joseph L. Walsh
                                                 )
       Respondent.                               )      Filed: January 19, 2016

       Nationwide Insurance Company of America (“Appellant”) appeals the trial court’s grant

of summary judgment in favor of Patrice Thomas (“Respondent”) on Appellant’s declaratory

judgment action involving underinsured motorist coverage under a policy issued by Appellant

covering a vehicle in which Respondent was a passenger. We affirm.

                                    I.      BACKGROUND

       Respondent was a passenger in a vehicle driven by her son-in-law, Brandt Jefferson, on

December 12, 2013, when their vehicle was involved in a collision with Edward Close, injuring

Respondent. Close was at fault in the accident. Close maintained automobile liability insurance

through another insurer with a bodily injury liability limit of $100,000 per person. At the time of

the accident, Jefferson retained an insurance policy issued by Appellant which included

underinsured motorist coverage (“the Policy”).
       The Policy contained a declaration page which set underinsured motorist coverage limit

at $50,000 per person, without stating any further limitations or qualifications. It stated a

premium of $31.95 for the underinsured motorist coverage.

       The Policy provided in the insuring agreement of the underinsured motorist endorsement:

       INSURING AGREEMENT

       A. We will pay compensatory damages which an “insured” is legally entitled to
          recover from the owner or operator of an “underinsured motor vehicle”
          because of “bodily injury”:

           1. Sustained by an “insured”; and

           2. Caused by an accident. The owner’s or operator’s liability for these
              damages must arise out of the ownership, maintenance or use of the
              “underinsured motor vehicle.”

       The policy defined “[u]nderinsured motor vehicle” as a vehicle whose “limit for bodily

injury liability is less than the limit of liability for this coverage.” The underinsured motorist

endorsement also contained the following clause:

       LIMIT OF LIABILITY

       A. The limit of liability shown in the Declarations for each person for
          Underinsured Motorists Coverage is our maximum limit of liability for all
          damages, including damages for care, loss of services or death, arising out of
          “bodily injury” sustained by any one person in any one accident. Subject to
          this limit for each person, the limit of liability shown in the Declarations for
          each accident for Underinsured Motorists Coverage is our maximum limit of
          liability for all damages for “bodily injury” resulting from any one accident.
          This is the most we will pay regardless of the number of:

           1. “Insureds”;

           2. Claims made;

           3. Vehicles shown in the Declarations; or

           4. Vehicles involved in the accident. A vehicle and attached “trailer” are
              considered one vehicle. Therefore, the Limit of Liability will not be



                                                  2
               increased for an accident involving a vehicle which has an attached
               “trailer.” . . .

       E. Any amount otherwise payable for damages under this coverage shall be
          reduced by all sums paid because of bodily injury by or on behalf of persons
          or organizations who may be legally responsible. This includes all sums paid
          under Part A of the policy.

       It is undisputed that Respondent suffered damages in excess of $150,000 as a result of the

accident. After the accident, on April 10, 2014, Appellant filed a petition for declaratory

judgment to determine whether Respondent was entitled to underinsured motorist benefits under

the Policy, and Respondent filed a counterclaim for declaratory judgment. The parties then filed

cross-motions for summary judgment. The trial court found the Policy was ambiguous and

granted Respondent’s motion, awarding her underinsured motorist benefits. This appeal

followed.

                                      II.    DISCUSSION

       In its sole point on appeal, Appellant asserts the trial court erred in granting summary

judgment in favor of Respondent, because Respondent’s injuries were not caused by an

“underinsured motorist” as unambiguously defined by the terms of the Policy. We disagree.

       Summary judgment is reviewed essentially de novo and affirmed only where there are no

genuine issues of material fact and the movant is entitled to judgment as a matter of law. ITT

Commercial Finance Corp. v. Mid-America Marine Supply Corp., 854 S.W.2d 371, 376 (Mo.

banc 1993). “When the underlying facts are not in question, disputes arising from the

interpretation and application of insurance contracts are matters of law for the court.” Grable v.

Atlantic Cas. Ins. Co., 280 S.W.3d 104, 106 (Mo. App. E.D. 2009) (quotations omitted).

Whether an insurance policy is ambiguous is a matter of law. Gulf Ins. Co. v. Noble Broadcast,

936 S.W.2d 810, 813 (Mo. banc 1997).



                                                 3
         The key issue before us is whether the Policy is ambiguous. Absent an ambiguity, an

insurance policy must be enforced according to its terms. Rodriguez v. General Acc. Ins. Co.,

808 S.W.2d 379, 382 (Mo. banc 1991). However, if the policy language is ambiguous, we

construe the ambiguity against the insurer as the drafter of the contract. Gulf Ins. Co., 936

S.W.2d at 814. In construing the policy terms, we apply “the meaning which would be attached

by an ordinary person of average understanding if purchasing insurance . . ..” Seeck v. Geico

General Ins. Co., 212 S.W.3d 129, 132 (Mo. banc 2007) (quotations omitted). An ambiguity

exists if the language used is reasonably open to different interpretations or where there is

duplicity, indistinctiveness, or uncertainty in meaning. Gulf Ins. Co., 936 S.W.2d at 814.

Similarly, a contract that promises something at one point and takes it away at another is

ambiguous. Behr v. Blue Cross Hosp. Service, Inc. of Missouri, 715 S.W.2d 251, 256 (Mo. banc

1986).

         In underinsured motorist coverages cases, an unambiguous definitions section does not

end the inquiry as to the existence of an ambiguity. Simmons v. Farmers Insurance Company,

Inc., 2015 WL 5829654 at *4 (Mo. App. E.D.). Rather, a court must “review[] the whole policy

to determine whether there is contradictory language that would cause confusion and ambiguity

in the mind of the average policy holder.” Id. Specifically, the reviewing court must carefully

examine the declarations page, which is generally less clear about the coverage’s characteristics.

Id. If the declarations page does not adequately alert the ordinary insured of its limitations, this

triggers an additional level of scrutiny when reading the rest of the policy for any language that

may suggest the coverage is excess (payment of the full underinsured motorist coverage amount

up to the insured’s total injury costs), as opposed to gap (paying only the difference between the

tortfeasor’s liability limit and the underinsured motorist limit). Id. at *4 fn. 1, *5.



                                                   4
        Our Court recently addressed the issue of ambiguities in underinsured motorist coverage

in Simmons.1 In that case, a passenger was involved in a collision with another motorist. Id. at

*1. The other motorist’s liability coverage limit and the passenger’s underinsured motorist

coverage limit were equal, at $50,000 per person. Id. The passenger’s policy defined an

underinsured motor vehicle as one with policy limits for liability “less than” the limits of liability

for the passenger’s underinsured motorist coverage. Id. However, the policy also had a

declarations page which set the underinsured motorist coverage at $50,000 per person without

stating any further limitations. Also, the policy’s limits of liability section stated the most the

insurer would pay was either the policy maximum or “The difference between the amounts of an

insured person’s damages for bodily injury, and the amount paid to the Insured person by or

for any person or organization who is or may be held legally liable for the bodily injury.” Id.

(emphasis in original).

        This Court held the policy was ambiguous and the passenger was therefore entitled to

benefits. Id. at *5-6. In so holding, we reasoned that the declarations page set out a benefit

amount, but did not identify any limitations to the underinsured motorist coverage, triggering a

higher level of scrutiny in reading the rest of the policy. Id. at *5. The limits of liability section

contained a second ambiguity, in that it defined the underinsured motorist coverage limit as the

difference between the amount of the insured’s damages for bodily injury and the amount paid to

the insured by a tortfeasor up to the limits of the coverage, which contradicted the definitions

section. Id.




1
 For a more complete history of the case law pertaining to ambiguities in underinsured motorist coverage, see
Simmons, 2015 WL 5829654 at *2-4 (discussing Rodriguez; Seeck; Ritchie v. Allied Property & Cas. Ins. Co., 307
S.W.3d 132 (Mo. banc 2009); Jones v. Mid–Century Ins. Co., 287 S.W.3d 687 (Mo. banc 2009); and Miller v. Ho
Kun Yun, 400 S.W.3d 779 (Mo. App. W.D. 2013)).

                                                       5
       The circumstances and Policy language were substantially similar here. As in Simmons,

it is undisputed that the vehicle driven by the tortfeasor, Close, did not meet the criteria for an

“underinsured motor vehicle” set out in the Policy’s definition section, because his liability

policy limit exceeded the amount of underinsured motorist coverage provided by the Policy.

However, this does not end the inquiry. The declarations page stated the Policy will provide

$50,000 of underinsured motorist coverage per person, without stating any further limitations.

As in Simmons, this type of language triggers a heightened level of scrutiny, and we read the

remainder of the policy for any language that may suggest the coverage is excess. Id.

       The limits of liability section contained such language. As stated above, that section

provided in relevant part:

       A. The limit of liability shown in the Declarations for each person for
          Underinsured Motorists Coverage is our maximum limit of liability for all
          damages, including damages for care, loss of services or death, arising out of
          “bodily injury” sustained by any one person in any one accident. Subject to
          this limit for each person, the limit of liability shown in the Declarations for
          each accident for Underinsured Motorists Coverage is our maximum limit of
          liability for all damages for “bodily injury” resulting from any one accident.

       Notably, this subsection phrased its limits in terms of “all damages” suffered by the

insured, “including damages for care, loss of services or death.” It also specifically referred the

reader back to the declarations page, which as stated above lists a policy limit of $50,000 per

person without further limitation. As in Simmons, the limits of liability section was therefore

phrased with reference to the insured’s total uncompensated damages. The above-referenced

section is followed by another pertinent part of the limits of liability portion of the Policy, the

“set-off” provision in subsection E, which stated:

       E. Any amount otherwise payable for damages under this coverage shall be
          reduced by all sums paid because of bodily injury by or on behalf of persons
          or organizations who may be legally responsible. This includes all sums paid
          under Part A of the policy.

                                                  6
        The preceding language seemingly contradicts that found in subsection A and the

declarations page, in that it seeks to set the limit of liability relative to the amount paid by the

tortfeasor, rather than relative to the insured’s total damages as stated in the other sections.

Appellant contends this language negates its liability, but the Supreme Court found similar

language created an ambiguity in Jones v. Mid-Century Ins. Co., 287 S.W.3d 687 (Mo. banc

2009). Using very similar language to that at issue here, the set-off provision in that case

provided in relevant part:

        f. The amount of UNDERinsured Motorist Coverage we will pay shall be
           reduced by any amount paid or payable to or for an insured person;

                i. by or for any person or organization who is or may [be] held legally
                   liable for the bodily injury to an insured person.

Id. at 690 (emphasis in original). The insurer in Jones asserted the preceding language allowed it

to reduce its total underinsured motorist payment by the amount paid by the tortfeasor. Id. at

691. The Supreme Court disagreed, stating such a construction was in conflict with the

unqualified promises to pay elsewhere in the contract which did not reference the set-off

subsection. Id. at 692. Further, if the insurer was allowed to set-off the tortfeasor’s payment, the

full amount of the limit of liability would never be paid, as it would always be reduced by the

statutory minimum of liability in Missouri. Id. at n.3. Such an interpretation would be

“inaccurate and misleading.” Id. at 692. Ultimately, the contract promised coverage in one

section and took it away in another, rendering it ambiguous and requiring it to be construed in

favor of the insured. Id.

        We find the reasoning in Jones controls the outcome here. The Policy promises to pay

$50,000 per person in underinsured motorist coverage without further limitations on the

declarations page. The policy then describes its limits of liability in terms of “all damages”

                                                   7
suffered by the insured. To adopt Appellant’s proposed interpretation of subsection E would

contradict these other sections, rendering the contract ambiguous. See Miller v. Ho Kun Yun,

400 S.W.3d 779, 792 (Mo. App. W.D. 2013) (“any contradictory language anywhere” in a

policy renders it ambiguous) (emphasis in original). Further, in this case the tortfeasor’s liability

limits are greater than the amount of applicable underinsured motorist coverage (e.g., $100,000

liability limit versus $50,000 per person in underinsured motorist coverage). To allow Appellant

to reduce its payment by the tortfeasor’s payment would limit recovery to $0.00, rendering the

underinsured motorist coverage completely illusory under these circumstances, despite the fact

the insured paid a separate premium for it. Such a construction is not favored by Missouri law.

Id. at 791 (“[c]onfusion of the ordinary insurance purchaser of [underinsured motorist] coverage

is legislatively recognized in Missouri, in that the Missouri General Assembly has adopted

legislation to help protect the insurance consumer from purchasing ‘illusory’ coverage” (citing

section 379.204 RSMo 2000)); see also Cano v. Travelers Ins. Co., 656 S.W.2d 266, 271 (Mo.

banc 1983) (“[a] construction which may render a portion of the policy illusory should not be

indulged in”).

       Based on the foregoing, the trial court did not err in finding the Policy ambiguous and

granting summary judgment in favor of Respondent. Point denied.

                                      III.   CONCLUSION

       The trial court’s grant of summary judgment in favor of Respondent is affirmed.




                                                ROBERT M. CLAYTON III, Presiding Judge
Kurt S. Odenwald, J., and
James M. Dowd, J., concur.


                                                  8
