    IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
                        DIVISION ONE

TONYA HEDGES, an individual,                     No. 72832-6-
                                                                                                 o


                      Respondent,                                                               —i—i


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                                                                                                     1>—-


AMERICAN FAMILY INSURANCE,                                                                             O
                                                                                       3C
a corporation,                                   UNPUBLISHED OPINION
                                                                                        •   •
                                                                                                -40
                                                                                       en
                      Appellant.                 FILED: March 16, 2015                  en




         Verellen, A.C.J. — American Family Insurance appeals the trial court's order

granting its insured, Tonya Hedges, summary judgment permitting her to "stack"

multiple underinsured motorist (UIM) coverages to a total amount of $200,000.

American Family contends the "anti-stacking" clause limits her to the $100,000 in UIM

benefits she already recovered under another UIM policy. We agree.

         The anti-stacking provision here is unambiguous and precludes Hedges from

stacking multiple UIM policies. Because Hedges' UIM coverage with American Family

had $100,000 of liability limits, Hedges, the driver, has already received the benefit of

her bargain with American Family by recovering $100,000 under the car owner's UIM

policy. Accordingly, we reverse the trial court's summary judgment order. Because

Hedges is not the prevailing party, we also reverse the award of attorney's fees and

costs.
No. 72832-6-1/2


                                           FACTS

       The material facts are undisputed. Hedges was injured in an automobile

accident while driving a vehicle owned by her mother. Her injuries exceeded the

$250,000 limit she received from Arthur Beagle's (the at-fault driver) insurance

company. Since Beagle's policy liability limits were insufficient to compensate Hedges'

damages, he was an underinsured motorist.1 Hedges also recovered $100,000 under

her mother's UIM policy.2

       Hedges then sought $100,000 in UIM coverage from her insurance company,

American Family. American Family denied Hedges' claim, relying on an anti-stacking

clause that barred her from stacking multiple UIM policies. American Family's UIM

endorsement "other insurance" provision includes an anti-stacking clause:

       1.     Other Insurance



              b.      Other Liability Coverage From Other Sources

                     If there is other similar insurance for a loss covered by this
                     endorsement, we will pay our share according to this policy's
                     proportion of the total of all liability limits. But any insurance
                     provided under this endorsement for an insured person while
                     occupying a vehicle you do not own, including any vehicle
                     while used as a temporary substitute for your insured car, is
                     excess over any other similar insurance.




       1 An "underinsured motor vehicle" means "a motor vehicle . .. with respect to
which the sum of the limits of liability under all bodily injury or property damage liability
bonds and insurance policies applicable to a covered person after an accident is less
than the applicable damages which the covered person is legally entitled to recover."
RCW 48.22.030(1).
       2 Because Hedges was driving a vehicle that she did not own, her mother's State
Farm UIM coverage was the primary UIM coverage and Hedges' American Family
policy only provided excess UIM coverage.
No. 72832-6-1/3


               Any recovery for damages under all such policies or provisions of
               coverage may equal but not exceed the highest applicable limit for
               any one vehicle under any insurance providing coverage on either
               a primary or excess basis.[3]

       Hedges sued. Both parties agreed to stipulated facts and filed cross-motions for

summary judgment. The trial court granted Hedges' summary judgment motion,

determining that the other insurance provision was ambiguous and must be construed

in favor of the insured to allow stacking. The trial court concluded that Hedges could

stack UIM coverages and recover an additional $100,000 of UIM benefits under her

insurance policy.4 The trial court also awarded Hedges attorney's fees and costs.

      American Family appeals.

                                       ANALYSIS

      The parties dispute the interpretation of an UIM endorsement other insurance

provision that contains an anti-stacking clause.5 We must determine whether Hedges

can stack UIM coverage from two different UIM policies. The core issue is whether the

UIM endorsement anti-stacking clause clearly and unambiguously precludes her from

collecting UIM benefits under her insurance policy where the "highest applicable limit" of



       3 Clerk's Papers (CP) at 54 (emphasis omitted).
      4 Both parties agree that Hedges' UIM coverage with American Family is limited
to $100,000.
       5 Hedges contends American Family's characterization of the applicable clause
here as an anti-stacking clause is unwarranted. See Respondent's Br. at 1, 2, 6, 8. We
disagree because the clear purpose of that provision is to limit Hedges from "adding
together different policy coverages to increase available coverage limits." Nat'l Merit
Ins. Co. v. Yost. 101 Wn. App. 236, 241, 3 P.3d 203 (2000): see also Thomas V.
Harris, Washington Insurance Law § 39.01, at 39-3 (3d ed. 2010) ("Antistacking
provisions are often contained within a UIM policy's 'other insurance' clause."). Notably,
Hedges does not challenge the validity of the anti-stacking clause, and the applicable
UIM provision here substantially parallels the UIM statutory language that permits anti-
stacking. See RCW 48.22.030(6).
No. 72832-6-1/4


UIM coverage has already been paid by her mother's insurer. American Family

contends the anti-stacking clause limits her to $100,000 in UIM benefits from all

sources, and therefore, Hedges should not be able to recover $100,000 under her UIM

policy because she already recovered that amount from another policy. We agree.

       We review summary judgment orders de novo, performing the same inquiry as

the trial court.6 We review questions of law, such as the interpretation of an insurance

policy, de novo.7 Because the material facts are undisputed, we need only determine

whether Hedges was entitled to judgment as a matter of law.8

      We construe insurance policies as contracts, so policy provisions are "interpreted

according to basic contract principles."9 We consider the policy as a whole, giving it a

"'fair, reasonable, and sensible construction as would be given to the contract'" by an

average purchaser of insurance.10 We must enforce policy language that is clear and

unambiguous as written and not create an ambiguity where none exists.11 An ambiguity



      6 McDevitt v. Harborview Med. Ctr.. 179 Wn.2d 59, 64, 316 P.3d 469 (2013).
       7 Sunnvside Valley Irrigation Dist. v. Dickie, 149 Wn.2d 873, 880, 73 P.3d 369
(2003); State Farm Fire & Cas. Co. v. English Cove Ass'n. Inc., 121 Wn. App. 358, 362-
63, 88 P.3d 986 (2004).
      8 CR 56(c); Reliable Credit Ass'n. Inc. v. Progressive Direct Ins. Co., 171 Wn.
App. 630, 638, 287 P.3d 698 (2012);); see also Federated Am. Ins. Co. v. Erickson. 67
Wn. App. 670, 672, 838 P.2d 693 (1992); Doyle v. State Farm Ins. Co.. 61 Wn. App.
640,642,811 P.2d 968 (1991).
      9Allemand v. State Farm Ins. Cos., 160 Wn. App. 365, 368, 248 P.3d 111
(2011): see also Quadrant Corp. v. American States Ins. Co., 154Wn.2d 165, 171, 110
P.3d 733 (2005).
      10 Quadrant Corp., 154 Wn.2d at 171 (internal quotation marks omitted) (quoting
Weyerhaeuser Co. v. Commercial Union Ins. Co., 142 Wn.2d 654, 666, 15 P.3d 115
(2000)).
      11 id; Gull Indus., Inc. v. State Farm Fire & Cas. Co., 181 Wn. App. 463, 470,
326 P.3d 782 (2014).
No. 72832-6-1/5



exists only when the policy's language on its face is fairly susceptible to two different but

reasonable interpretations.12

       Exclusionary clauses, such as an anti-stacking clause, are strictly construed

against the insurer.13 When two constructions of an exclusionary clause exist, "one

favorable to the insured and one favorable to the insurer," we "must adopt the

construction favorable to the insured."14 But a strict application should not trump a

policy's plain and clear language such that a strained or forced construction results.15

       Anti-stacking clauses allow insurers to prohibit insureds from stacking coverage

limits among multiple policies.18 RCW 48.22.030 governs UIM coverage in Washington.

The UIM anti-stacking statute provides:

       The policy may provide that if an injured person has other similar
       insurance available to him or her under other policies, the total limits of
       liability of all coverages shall not exceed the higher of the applicable limits
       of the respective coverages.1171

In the UIM context, the term "similar insurance" has been understood to mean other

UIM coverages.18 Further, UIM coverage's underlying policy is to provide "a second

layer of floating protection, not full compensation."19


       12 Quadrant Corp., 154 Wn.2d at 171 (quoting Weyerhaeuser Co. v. Commercial
Union Ins. Co., 142 Wn.2d 654, 666, 15 P.3d 115 (2000)).
       13 Reliable Credit Ass'n, 171 Wn. App. at 638.
      14 \± at 639; see also Britton v. Safeco Ins. Co. of Am.. 104 Wn.2d 518, 528, 707
P.2d 125 (1985).
       15 Quadrant Corp., 154 Wn.2d at 172.
       18 See Britton, 104 Wn.2d at 531-32; Greengov. Pub. Emps. Mut. Ins. Co., 135
Wn.2d 799, 806, 959 P.2d 657 (1998) (stating "external stacking" is "the practice of
adding together different policy coverages to increase available coverage limits.").
       17 RCW 48.22.030(6) (emphasis added).
     18 Greengo, 135 Wn.2d at 806-07; see also 3 Alan I. Widiss & Jeffrey E.
Thomas, Uninsured and Underinsured Motorist Insurance § 40.1, at 373 (3d ed.
No. 72832-6-1/6


      The other insurance provision here is an external anti-stacking provision.

External anti-stacking provisions prohibit an insured from layering multiple UIM policies

upon each other, "giving the insured UIM coverage beyond his or her UIM single policy

limits."20 Hedges seeks to recover under two different UIM policies: her mother's UIM

policy and her own UIM policy. The key provision states:

      If there is other similar insurance for a loss covered by this endorsement,
      we will pay our share according to this policy's proportion of the total of all
      liability limits. But any insurance provided under this endorsement for an
      insured person while occupying a vehicle you do not own, including any
      vehicle while used as a temporary substitute for your insured car, is
      excess over any other similar insurance.

      Any recovery for damages under all such policies or provisions of
      coverage may equal but not exceed the highest applicable limit for any
      one vehicle under any insurance providing coverage on either a primary or
      excess basisS2^

This other insurance provision is found within the UIM endorsement. A "heading is not

a grant of coverage," but it does inform the insured generally what subject covers this

section of the policy: UIM coverage.22

      The provision's first subheading—"other insurance"—is instructive. An average

purchaser of insurance would reasonably believe that "other insurance" means other

UIM insurance because it is found within the UIM endorsement. Our Supreme Court



2005) ("The term 'similar insurance' is appropriately understood to be other
underinsured motorist coverage.").
         19 Greengo, 135 Wn.2d at 809; Little v. King, 147 Wn. App. 883, 888, 198 P.3d
525 (2008) ("UIM insurance provides a second layer of excess insurance coverage that
'floats' on top of recovery from other sources for the injured party.").
      20 Parker ex. rel. Parker v. United Servs. Auto. Assocs., 97 Wn. App. 528, 529,
984 P.2d 458 (1999); see also Greengo, 135 Wn.2d at 806.
      21 CP at 54 (emphasis added).
      22 Vadheim v.Continental Ins. Co., 107 Wn.2d 836, 841, 734 P.2d 17 (1987).
No. 72832-6-1/7


has understood the term "'similar insurance'" to be "'other underinsured motorist

insurance coverages'" in the UIM context.23 Thus, when the other insurance provision

here uses the phrase "other similar insurance for a loss covered by this endorsement,"

that must refer to other UIM insurance.24 This is consistent with the trial court's

determination that the phrase "'other similar insurance for a loss covered by this

[endorsement' limits the insured's ability to obtain coverage from multiple underinsured

motorist provisions."25 Further, Hedges' insurance policy parallels the UIM statutory

language by using the term "other similar insurance available . .. under other policies."26

       Additionally, the last sentence in the first paragraph of the other insurance

provision must also refer to UIM insurance. It states that "any insurance provided under

this endorsement for an insured person while occupying a vehicle you do not own,

including any vehicle while used as a temporary substitute for your insured car, is

excess over any other similar insurance."27 Only one reasonable interpretation of this

sentence exists. The terms "other similar insurance" and "any insurance provided under

this endorsement" must mean, consistent with the subheading and the preceding

sentence, other UIM insurance because this endorsement specifically addresses UIM

coverage.

       "Because multiple insurance policies often apply to the same accident, insurance

companies insert 'other insurance' clauses into their policies in an effort to limit or


       23 Greengo, 135 Wn.2d at 806-07 (quoting 3 Alan I. Widiss, Uninsured and
Underinsured Motorist Insurance § 40.1, at 238 (2d ed. 1995)).
       24 CP at 54.
       25 CP at 68 (citing Greengo, 135 Wn.2d at 806-07).
       26 RCW 48.22.030(6).
       27 CP at 54 (emphasis added).
No. 72832-6-1/8


extinguish liability so as to prevent a victim's double recovery."28 Thus, because the

UIM coverage provided under Hedges' policy would be "excess" when she was injured

while occupying a car she did not own, the UIM coverage Hedges received under her

mother's UIM policy was the primary coverage.29

       The last sentence of the other insurance provision contains the anti-stacking

clause. That sentence limits recovery "under all such policies or provisions of coverage"

to the "highest applicable limit for any one vehicle under any insurance providing

coverage on either a primary or excess basis."30 This language is unambiguous and

only one reasonable interpretation exists. The phrase "all such policies or provisions of

coverage" must refer to all UIM policies or provisions of coverage. The plain meaning of

"such" is "previously characterized or specified" or "having a quality already or just

specified."31 Thus, "such policies or provisions of coverage" modifies "other similar

insurance" in the preceding paragraph, which must mean other UIM insurance.

       The highest applicable limit here "under any insurance providing coverage on

either a primary or excess basis" is $100,000. Both Hedges' and her mother's UIM




      28 Safeco Ins. Co. of III, v. Auto Club. Ins. Co.. 108 Wn. App. 468, 479, 31 P.3d
52 (2001) (citation omitted).
       29 In situations where UIM coverage is provided for an insured who is an
occupant of a vehicle that is not identified as an insured vehicle by the insurance policy,
the occupant's UIM coverage generally provides that the UIM coverage shall be excess
over any other collectible insurance. In other words, UIM coverage that exists for
occupants of that vehicle will be the primary coverage, and the occupant's own UIM
insurance will be excess coverage. See 3 Widiss & Thomas, Uninsured and
Underinsured Motorist Insurance § 40.1, at 374.
       30 CP at 54.
       31 Webster's Third New Int'l Dictionary 2283 (2002).


                                             8
No. 72832-6-1/9


policies provide limits of $100,000. Since Hedges has already recovered $100,000 of

UIM benefits, American Family is therefore not required to provide UIM coverage. The

public policy of UIM coverage is to provide a "second layer of floating protection, not full

compensation."32 The external anti-stacking clause here is consistent with this policy

because "the anti-stacking clause applies only after the insured has received a full UIM

recovery, thus satisfying the requirement that the insured receive a second layer of

protection."33

       Moreover, Anderson v. American Economy Insurance34 and Doyle v. State Farm

Insurance35 are instructive here. Anderson interpreted a nearly identical other

insurance provision:

       If this policy and any other policy providing similar insurance apply to the
       same accident, the maximum limit of liability under all the policies shall be
       the highest applicable limit of liability under any one policy. However, any
       insurance we provide with respect to a vehicle you do not own shall be
       excess over any other collectible insurance.[36]

The court determined the other insurance clause in the UIM endorsement "is

unambiguous in limiting the underinsured motorist payments to the highest applicable

policy amount."37 Moreover, because a nonowned vehicle was involved, like here,

payments made under Anderson's policy would only be "in excess of the recoverable

amount under the primary insurance policy."38 Therefore, because Anderson already


       32 Greengo, 135 Wn.2d at 809.
       33 jd, at 810; see also Little, 147 Wn. App. at 888.
       34 43 Wn. App. 852, 719 P.2d 1345 (1986).
       35 61 Wn. App. 640, 811 P.2d 968 (1991).
       36 Anderson, 43 Wn. App. at 859.
       37 id, at 860.
       38 Id.
No. 72832-6-1/10


recovered the "higher underinsured motorist coverage limit under either of the two

applicable policies," Anderson could not recover UIM benefits under his own insurance

policy.39

       Further, Doyle interpreted a similar other insurance provision:

       If this policy and any other policy providing underinsured motorist
       coverage apply to the same loss, the maximum limit of liability under all
       policies will be the highest limit of liability that applies under any one
       policy. If other underinsured motorist coverage applies, we'll pay only our
       fair share of the loss. That share is our proportion of the total
       underinsured motorist insurance that applies to the loss. But any
       insurance we provide when you or a covered person use a vehicle you
       don't own will be excess over any other collectible insurance.1401

The court determined the other insurance provision established "the maximum limit of

UIM liability among multiple policies."41 The court held that this provision was

unambiguous. When an "insured is injured in a nonowned vehicle," like here, the

"amount of UIM benefits payable" will "depend on the liability limits of the applicable

policies and on the amount that the insured recovers from other policies."42

       Like in Anderson and Doyle, the anti-stacking provision here establishes the

maximum limit of UIM liability among multiple policies. The other insurance clause's

remaining provisions govern the order and share of payments to be made by multiple

insurers up to the liability limits established by the anti-stacking restriction. These

provisions are consistent and unambiguous. Although Doyle analyzed another

insurance provision that expressly referenced UIM coverage, the other insurance clause



       39 jd,
       40 Doyle, 61 Wn. App. at 642 (emphasis omitted).
       41 \± at 644.
       42 Id.



                                             10
No. 72832-6-1/11


here, in context, clearly and unambiguously refers to UIM insurance coverage when

using phrases such as "other similar insurance," "any insurance provided under this

endorsement," "any other similar insurance," "all such policies or provisions of

coverage," and "any insurance providing coverage on either a primary or excess basis."

       Importantly, because Hedges was injured in a nonowned vehicle, the other

insurance clause here clearly states that the amount of UIM benefits payable will

depend on the liability limits of the applicable policies and on the amount Hedges

recovers from other UIM policies. This type of other insurance clause, which provides

that the maximum limit of liability under all the policies shall be the highest applicable

limit of liability under any one policy, and then provides that coverage for nonowned

vehicles will be excess over other collectible insurance, has repeatedly been held

unambiguous.43 Further, the "highest applicable limit" of UIM coverage here was

$100,000. Since Hedges already received that amount from her mother's UIM policy,

her UIM endorsement other insurance provision containing the anti-stacking clause bars

Hedges from additional recovery under her own UIM policy.

       Therefore, Hedges was not entitled to judgment as a matter of law. The trial

court erred in determining that American Family must pay Hedges $100,000 in UIM

benefits.




       43 Hardy v. Pemco Mut. Ins. Co.. 115 Wn. App. 151,155, 61 P.3d 380 (2003);
Yost, 101 Wn. App. at 243; Parker, 97 Wn. App. at 533; Erickson, 67 Wn. App. at 671.


                                             11
No. 72832-6-1/12


      Lastly, the trial court awarded Hedges attorney's fees and costs as the prevailing

party below.44 But because she did not prevail here, Hedges is not entitled to attorney's

fees and costs.

      Accordingly, we reverse the trial court's summary judgment order and its

judgment awarding attorney's fees and costs to Hedges and remand to the trial court to

grant American Family summary judgment.




WE CONCUR:




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                  7




       44 See Olympic S.S. Co. v. Centennial Ins. Co.. 117 Wn.2d 37, 811 P.2d 673
(1991).


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