                                                               Jan 24 2014, 9:55 am

FOR PUBLICATION


ATTORNEYS FOR APPELLANT:                         ATTORNEYS FOR APPELLEE:

RODNEY L. SCOTT                                  ROGER L. PARDIECK
TRICIA KIRKBY HOFMANN                            KAREN M. DAVIS
CHAD M. SMITH                                    The Pardieck Law Firm
Waters, Tyler, Hofmann & Scott, LLC              Seymour, Indiana
New Albany, Indiana


                             IN THE
                   COURT OF APPEALS OF INDIANA

STATE FARM MUTUAL AUTOMOBILE                     )
INSURANCE COMPANY,                               )
                                                 )
      Appellant-Defendant,                       )
                                                 )
             vs.                                 )       No. 36A05-1212-CT-635
                                                 )
KIMBERLY S. EARL and                             )
THE ESTATE OF JERRY EARL,                        )
                                                 )
      Appellees-Plaintiffs.                      )


                   APPEAL FROM THE JACKSON CIRCUIT COURT
                       The Honorable William E. Vance, Judge
                           Cause No. 36C01-1008-CT-13



                                      January 24, 2014

                              OPINION–FOR PUBLICATION

BAKER, Judge
       In this case, we are presented with an issue of first impression in Indiana. More

particularly, appellant-defendant State Farm Mutual Automobile Insurance Company

(State Farm) asks us to join other states that have determined Uninsured Motorist (UM)

insurance limits to be inadmissible. Here, a jury returned a verdict of $250,000 for

appellees-plaintiffs Kimberly Earl and the Estate of Jerry Earl (collectively, “the Earls”)

after Jerry was injured in a motorcycle accident through no fault of his own. State Farm

argues that the trial court erred when it allowed into evidence at a jury trial the $250,000

bodily injury limit provision contained in the Earls’ insurance policy.         State Farm

contends that evidence of the bodily injury limit was both irrelevant and prejudicial.

Determining that evidence of the bodily injury limit was in fact both irrelevant and

prejudicial, we reverse and remand this cause to the trial court for further proceedings

consistent with this opinion.

                                          FACTS

       On September 3, 2008, Jerry was driving his motorcycle on southbound Interstate

65 in Jackson County. Jerry was in the inside lane with one semi tractor-trailer in front of

him and another in the right lane beside him. When the semi in front of Jerry pulled into

the right lane, the semi to his right moved into his lane, forcing him to swerve to the left

to avoid impact. Jerry lost control of the motorcycle, which flipped, and he was thrown

into the grassy median. The driver of the semi, possibly unaware of what had transpired,

did not stop, and was never identified. Both parties stipulate that Jerry was forced to

swerve to avoid impact and was not responsible for the accident.

                                             2
        Jerry sustained extensive injuries including fourteen rib fractures in ten of the ribs

on his left side, a broken left scapula and clavicle, a lacerated liver, a pulmonary

contusion, abrasions on his legs, and a blood clot in his leg. He was taken to Schneck

Medical Center in Seymour, then to Methodist Hospital in Indianapolis, where he

received treatment from a trauma team. After being hospitalized for two days, he was

released and allowed to recuperate at home. Jerry did breathing exercises for his lung

condition and, in December 2008, attended physical therapy classes. When he was told

that his insurance would no longer cover the physical therapy, he did his exercises at

home.

        After the accident, Jerry could no longer interact with his family in the way he had

before. Kimberly, his wife, testified that, after the accident, sleeping in bed was too

painful for Jerry, and he slept in a recliner. She stated that “he was … passionate and of

course that changed, and that was always important to him.” Tr. p. 234. Kimberly stated

that Jerry had been a “prankster” before the accident, and that the pain he was in after the

accident kept him from laughing and joking like he had before. In addition, Jerry was no

longer able to enjoy many of the activities he engaged in before the accident, such as

gardening and basketball. His son testified that his left shoulder drooped, and that there

was “a very obvious sag” when Jerry stood. Id. at 166.

        Jerry was the co-owner of Brooks and Earl Construction, and he was never able to

return to work in his full capacity. Due to the pain, Jerry could no longer operate the

equipment or lay pipe as he had before the accident. He attempted to do work at home

                                              3
on a laptop, but due to his pain, he had difficulty with his workload. Glen Brooks, his

partner, testified that the business suffered, and that it “took its toll on [Jerry].” Tr. p.

203. Jerry dealt with pain from the accident until he passed away from cancer, an illness

unrelated to the crash, on January 4, 2012.

          Before Jerry died, he and Kimberly brought suit against State Farm, seeking UM

coverage benefits under their automobile insurance policy. At the time of the accident,

Jerry and Kimberly had a personal auto policy with State Farm that provided for UM

insurance coverage with a limit of $250,000 per person. The policy also included an

umbrella policy providing additional UM coverage in the amount of $2,000,000. 1

Kimberly was not present at, or involved in, the motorcycle accident, but filed a claim for

loss of consortium. However, she is also personal representative for Jerry’s estate, which

was substituted as plaintiff for Jerry after his death.

          Before the trial began, State Farm filed a motion in limine, asking the trial court to

exclude any evidence about the amount of UM coverage available to the Earls, arguing

that the limit was irrelevant and prejudicial. The trial court denied the motion. At trial,

State Farm’s counsel objected to a reference to the insurance policy in the Earls’

counsel’s opening statement, and again objected when the contract was offered into

evidence. It is unclear, but there may have been an issue with the recording of the

objection colloquy, and so the trial court directed that the record reflect that State Farm

timely objected to the introduction of the UM insurance limit.

1
    No evidence of the $2,000,000 umbrella policy was introduced at trial.
                                                      4
       After hearing all the evidence, the jury returned a verdict for the Earls in the sum

of $250,000, the coverage limit. Of this award, $175,000 was allocated to the Estate of

Jerry Earl, and $75,000 to Kimberly. State Farm had previously advanced $20,000 to the

Earls before the trial, and the judgment was reduced to $230,000 to reflect that sum.

       State Farm now appeals.

                             DISCUSSION AND DECISION

                                   I. Standard of Review

       We review a trial court’s admission of evidence for an abuse of discretion.

Weinberger v. Gill, 983 N.E.2d 1158, 1163 (Ind. Ct. App. 2013). The trial court abuses

its discretion only when its action is clearly erroneous and against the logic and effect of

the facts and circumstances before the court. Id. “A trial court’s decision to admit or

exclude evidence will not be reversed unless prejudicial error is clearly shown.” Morse

v. Davis, 965 N.E.2d 148, 155 (Ind. Ct. App. 2012), trans. denied. To determine whether

reversal is required, the court considers the probable impact of the evidence upon the

jury. Gibson v. Bojrab, 950 N.E.2d 347, 352-52 (Ind. Ct. App. 2011). The appellant

bears the burden of showing reversible error, as all presumptions are in favor of the trial

court’s judgment. Id. at 352.



                                 II. Admission of Evidence

       At the outset, although the record clearly indicates that State Farm timely objected

to the introduction of the bodily injury limit for UM coverage in the Earls’ policy,

                                             5
Kimberly Earl asserts that State Farm waived its objection when it failed to elaborate

upon its objections that the evidence was irrelevant and prejudicial. While Kimberly is

correct that these objections would be insufficient to preserve the issues for appellate

review without any explanation of why the evidence is prejudicial or irrelevant, that does

not seem to be the case here. When State Farm objected during opening statements, the

court reporter may have failed to record the discussion that occurred when State Farm’s

counsel approached the bench, and the trial court, realizing that the recording equipment

had malfunctioned, made a record of the objection, noting that State Farm objected to the

evidence as irrelevant. Tr. p. 95; 12-20. Accordingly, we decline to find that State Farm

waived its objections.

        Proceeding to the merits, State Farm asks us to align our law with states that have

determined that evidence of a UM insurance limit is inadmissible. 2                           In some

circumstances, evidence of UM insurance limits is clearly relevant. For example, if the

existence of the policy is challenged or if the amount of the coverage limit or a coverage

issues is a jury question in the case. However, here, the sole issue for the jury to

determine in the case was the amount of damages caused to the Earls by the uninsured

motorist. Under the Indiana Evidence Rules, “‘[r]elevant’ evidence means evidence

having any tendency to make the existence of any fact that is of consequence to the


2
  See Auto-Owners Ins. Co. v. Dewberry, 383 So.2d 1109 (Fla. Dist. Ct. App. 1980) (holding that, when
insured’s counsel repeatedly mentioned UM policy limits and the jury awarded the policy limit, there was
reversible error); Kvamme v. State Farm Mut. Auto, Ins., 677 N.E.2d 122 (Neb. 2004) (determining that
reversible error existed when the trial court allowed evidence of the UM policy limit into evidence, even
though the jury only awarded the insured half of the coverage limit).
                                                   6
determination of the action more probable or less probable than it would be without the

evidence.” Evid. R. 401. (emphasis added).        In this case, when the only issue to be

determined was damages, evidence of the bodily injury limit in the Earls’ policy was

irrelevant to the issue being decided.

         State Farm also argues that it was prejudiced by the introduction of the bodily

injury limit in the Earls’ insurance policy. Here, the jury was presented with evidence

that the coverage limit for bodily injury was $250,000.        The jury awarded exactly

$250,000 in damages to the Earls. The extent of Jerry’s injuries was hotly contested at

trial, and it is certainly possible that, considering all of the evidence concerning Jerry’s

lowered quality of life and Kimberly’s loss of his companionship, that the jury believed

that the Earls were entitled to the coverage limit or more in damages. However, in light

of the fact that the jury awarded precisely the coverage limit, we cannot say that the jury

was unaffected by the evidence of the coverage limit. Therefore, we find that the trial

court erred when it allowed the introduction of evidence concerning the bodily injury

limit in the Earl’s insurance policy.

         The judgment of the trial court is reversed and this cause is remanded for a new

trial.

VAIDIK, C.J., concurs, and RILEY, J., dissents with opinion.




                                             7
                             IN THE
                   COURT OF APPEALS OF INDIANA

STATE FARM MUTUAL AUTOMOBILE                     )
INSURANCE COMPANY,                               )
                                                 )
      Appellant-Defendant,                       )
                                                 )
             vs.                                 )   No. 36A05-1212-CT-635
                                                 )
KIMBERLY S. EARL and                             )
THE ESTATE OF JERRY EARL,                        )
                                                 )
      Appellee-Plaintiffs.                       )


RILEY, Judge, dissenting


      I respectfully disagree with the majority’s decision to reverse the jury verdict and

remand for a new trial.      As an issue of first impression, State Farm disputes the

admissibility at trial of the bodily injury limit for UM coverage in the Earls’ policy.

Specifically, relying on a relevancy argument, State Farm asserts that the UM coverage

limits should be excluded because the amount of coverage is irrelevant to the issue of

damages that is being decided. I disagree.

      While State Farm is correct that no Indiana case has decided this issue on point,

case law exists where a policy’s UM limits were presented to the jury for consideration in

                                             8
its verdict. Most prevalently, Indiana courts have allowed the introduction of UM limits

in the area of jury instructions. In 2003, we noted in Malott v. State Farm Mutual

Insurance Company, 798 N.E.2d 924, 925 (Ind. Ct. App. 2003), that “[a]t State Farm’s

request and over Malott’s objections, the trial court instructed the jury that Malott had to

prove that State Farm breached its contract with Malott, resulting in damages to her, and

that it could not award damages against State Farm in excess of the UM policy limit of

$100,000.” Reviewing the jury instruction, we noted that

       [I]n the present case the jury was required to first assess the damages
       Malott suffered in the accident in accordance with tort law principles, and
       then it was required to compare this amount with the amount State Farm
       has actually paid and determine, under contract law principles, whether
       State Farm breached its contractual obligation to pay UM benefits.

Id. at 925-26. As such, we concluded that the jury instruction was a correct

statement of the law and relevant to the issues that needed to be decided. Id. at

927.

       Similarly, in Allstate Insurance Company v. Hammond, 759 N.E.2d 1162, 1165

(Ind. Ct. App. 2001), Hammond sought UM benefits in a contract action against Allstate.

Over Allstate’s objection, the trial court instructed the jury on the UM coverage limits

and informed the jury that it could set the value of Hammond’s injury “without regard to

the policy limits that were in effect at the time of this collision.” Id. at 1165. The jury

returned a verdict in excess of the UM limit. Id. Distinguishing tort actions from actions

in contract, this court noted that “the measure of damages in a contract action is limited to

those actually suffered as a result of the breach which are reasonably assumed to have

                                             9
been within the contemplation of the parties at the time the contract was formed.” Id. at

1166-67. Therefore, “[t]he plaintiff may recover the benefit of the bargain but is limited

in her recovery to the loss actually suffered, and a damage award must be referenced to

some fairly defined standard.” Id. at 1167. However, because we concluded it was error

to instruct the jury that it may assess damages “without reference to the policy limits”, we

reversed the verdict. Id. Thus, although not stated explicitly, it is clear that the limits of

the UM coverage are relevant to the issue of damages.

       Here, the admissibility of the UM coverage limits was contested by Farm Bureau

through a motion in limine and timely objections at trial. The trial court rejected Farm

Bureau’s arguments and instructed the jury on the UM limits and the elements to consider

in determining the damage amount. In light of Malott and Hammond, I conclude that the

trial court did not abuse its discretion when it admitted evidence of the Earls’ UM

coverage limits.

       Moreover, I cannot say that the admissibility of the coverage limits was

prejudicial. State Farm asserts, and the majority agrees, that the amount of the verdict—

which was exactly the maximum under the UM coverage—suggests that the jury was

influenced by the evidence of the coverage limit. However, the majority disregards the

substantial amount of evidence reflecting Jerry’s extreme pain in the weeks after the

wreck and the physical pain, mental suffering, and limitations he continued to suffer

because of his injuries until his death. Prejudicial error is not established merely because

the jury awarded the UM policy limit; rather, the more appropriate inference is that the

                                             10
jury followed the trial court’s instructions and, in light of the overwhelming evidence,

arrived at the policy limit. I would affirm the trial court.




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