Wyland v. State Farm Fire ( 2000 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
DARRYL L. WYLAND,
Plaintiff-Appellee,
v.
No. 99-1501
STATE FARM FIRE AND CASUALTY
COMPANY,
Defendant-Appellant.
Appeal from the United States District Court
for the Eastern District of Virginia, at Alexandria.
Albert V. Bryan, Jr., Senior District Judge.
(CA-98-1373-A)
Argued: March 1, 2000
Decided: April 13, 2000
Before WILKINS, NIEMEYER, and KING, Circuit Judges.
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Affirmed by unpublished per curiam opinion.
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COUNSEL
ARGUED: Julia Bougie Judkins, TRICHILO, BANCROFT,
MCGAVIN, HORVATH & JUDKINS, P.C., Fairfax, Virginia, for
Appellant. Peter Stowell Everett, BLANKINGSHIP & KEITH, P.C.,
Fairfax, Virginia, for Appellee. ON BRIEF: Robert J. Stoney,
BLANKINGSHIP & KEITH, P.C., Fairfax, Virginia, for Appellee.
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Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
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OPINION
PER CURIAM:
Darryl Wyland brought this declaratory judgment action in the
Eastern District of Virginia against his insurer, State Farm Fire and
Casualty Company ("State Farm"). Mr. Wyland seeks to resolve
whether an umbrella personal liability insurance policy issued to him
by State Farm provides coverage for a wrongful death claim brought
against him on behalf of his stepsons. The district court concluded
that the umbrella policy provides such coverage and granted summary
judgment in favor of Mr. Wyland. State Farm appeals the district
court's ruling. Finding no error, we affirm.
I.
The underlying facts of this case are not in dispute. This insurance
coverage action arises out of a wrongful death suit filed in Arizona
on behalf of Mr. Wyland's two stepsons for injuries resulting to them
from the death of their mother, Susan Wyland (Mr. Wyland's wife).
On November 24, 1995, Mrs. Wyland was killed in an automobile
accident in Arizona while riding as a passenger in a rental car oper-
ated by her husband. In 1997, the special administrator of Mrs.
Wyland's estate brought suit against Mr. Wyland, pursuant to Arizo-
na's wrongful death statute, on behalf of her two adult sons, David
and Douglas Inglish.1 The wrongful death action asserts that Mr.
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1 The liability section of the Arizona wrongful death statute provides as
follows:
When death of a person is caused by wrongful act, neglect or
default, and the act, neglect or default is such as would, if death
had not ensued, have entitled the party injured to maintain an
action to recover damages in respect thereof, then, and in every
such case, the person who or the corporation which would have
been liable if death had not ensued shall be liable to an action for
2
Wyland's negligence resulted in the wrongful death of their mother
and caused each of her sons to suffer emotional injuries.
At the time of the fatal Arizona accident, Mr. Wyland was insured
by State Farm under the umbrella policy providing $1,000,000 in lia-
bility coverage. The umbrella policy supplemented coverage provided
to Mr. Wyland under several underlying insurance policies, including
an automobile policy he had also purchased from State Farm. It is
undisputed that the automobile policy provided Mr. Wyland $100,000
in coverage for liability arising from the Arizona automobile accident.
The dispute here relates solely to whether the umbrella policy pro-
vides coverage for the wrongful death claim brought against Mr.
Wyland on behalf of his stepsons.
II.
We review a grant of summary judgment de novo. See, e.g., Hal-
perin v. Abacus Tech. Corp., 128 F.3d 191, 196 (4th Cir. 1997). Sum-
mary judgment is appropriate if "`there is no genuine issue as to any
material fact and . . . the moving party is entitled to a judgment as a
matter of law.'" Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)
(quoting Fed. R. Civ. P. 56(c)).
State Farm's umbrella personal liability policy generally provides
coverage if the "insured" is "legally obligated to pay damages" for
"an accident . . . which results in bodily injury" during the policy period.2
J.A. 99, 107. This umbrella policy, however, contains certain exclu-
sions under which coverage is not provided. The issue before us is
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damages, notwithstanding the death of the person injured, and
although the death was caused under such circumstances as
amount in law to murder in the first or second degree or man-
slaughter.
Ariz. Rev. Stat. § 12-611.
2 The coverage provided under the umbrella policy includes expenses
incurred in the investigation, settlement, and defense of a claim covered
by the umbrella policy. Based on Mr. Wyland's underlying automobile
insurance policy, State Farm is already defending the Arizona wrongful
death suit against him and has agreed to indemnify him under that policy.
3
whether one of those exclusions, Exclusion 10 (as amended by an
endorsement),3 permits State Farm to deny coverage for any damages
awarded in the wrongful death suit against Mr. Wyland on behalf of
his stepsons.4 Under Exclusion 10, as amended, the umbrella policy
does not provide coverage "for bodily injury . . . to the named insured
[(Mr. and Mrs. Wyland)], spouse, or [certain residents of the
Wylands' household]." J.A. 97, 108 (emphasis in original). This pol-
icy further defines "bodily injury" to include physical injury, emo-
tional distress or mental injury to a person, and"death resulting
therefrom." J.A. 107.
The district court concluded that, by its plain language, Exclusion
10 does not permit State Farm to exclude insurance coverage for the
claimed injuries suffered by Mrs. Wyland's sons, because David and
Douglas Inglish were not residents of the Wylands' household during
the relevant period. It is undisputed that, in fact, the Wylands and
Mrs. Wyland's sons resided in different states, separate and apart
from each other.
State Farm argues that the claim on behalf of Mrs. Wyland's sons
is properly excluded because, under Arizona law, Mrs. Wyland's
death is the operative fact creating her sons' asserted right to recov-
ery. See Ariz. Rev. Stat. § 12-611 (establishing a survivor's right to
recovery if a wrongful act results in a death and the injured party
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3 Under its exclusions, the umbrella policy, pursuant to its amending
endorsement, does not provide insurance:
10. for bodily injury or personal injury to the named insured,
spouse, or [certain residents of the named insured's house-
hold].
This exclusion also applies to any claim made or suit
brought against [the insured] to share damages with or
repay someone else who may be obligated to pay damages
because of the bodily injury or personal injury.
J.A. 97, 108 (emphasis in original).
4 Because we conclude that Exclusion 10 does not bar coverage in this
case, we need not decide an issue raised by Mr. Wyland: whether Exclu-
sion 10 is void under the law of Virginia (the state where the parties
entered into the insurance contract).
4
could have maintained an action, had the decedent survived). In State
Farm's view, its coverage for Mrs. Wyland's death is barred by
Exclusion 10, and because her death is the "operative fact" in the
wrongful death action, coverage for any damages awarded on behalf
of her sons in the wrongful death action is likewise barred by Exclu-
sion 10.
We disagree with State Farm's analysis. Under Arizona law, "[a]
wrongful death action is an original and distinct claim for damages
sustained by statutory beneficiaries and is not a derivative or continu-
ation of claims existing in decedent . . . ." Halenar v. Superior Ct. for
Maricopa County, 504 P.2d 928, 930 (Ariz. 1972) (en banc). The
wrongful death action is not a survival claim based on injury to Mrs.
Wyland; rather, it is an action based on her sons' own injuries, i.e.,
"the injur[ies] resulting from the death to the surviving parties." Ariz.
Rev. Stat. § 12-613 (providing measure of damages for wrongful
death statute). Put simply, survival actions and wrongful death actions
seek separate recoveries for different wrongs, notwithstanding that
they arise from the same wrongful act. See Barragan v. Superior Ct.
of Pima County, 470 P.2d 722, 725 (Ariz. App. 1970). The Arizona
wrongful death claim was filed on behalf of specific beneficiaries,
i.e., Mrs. Wyland's sons, and this claim is unlike a survival claim that
"passes from the decedent to the personal representative and becomes
one of the assets of the estate." Id. at 724. We therefore conclude, as
did the district court, that because the special administrator may prop-
erly bring a separate cause of action for emotional injuries (mental
anguish) suffered by Mrs. Wyland's sons, that cause of action is cov-
ered by the umbrella policy at issue.5
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5 State Farm also asserts that: (1) Benner vs. Nationwide Mutual Ins.
Co., 93 F.3d 1228 (4th Cir. 1998) (deciding under Maryland law that
coverage was excluded where the policy's plain language excluded cov-
erage for damages "arising out of" various injuries to the claimant),
requires reversal in this case; (2) the umbrella policy excludes coverage
for Mr. Wyland, a named insured, and that it is actually Mr. Wyland,
rather than his stepsons, who benefits from insurance coverage of the
Arizona wrongful death action; and (3) the district court's ruling is
flawed as a matter of public policy, because under the court's interpreta-
tion of the exclusion, coverage denial would be proper if the stepsons
had been residents in the Wylands' home. We have carefully reviewed
and considered each of these arguments and find each of them to be
without merit.
5
III.
For the foregoing reasons, we conclude, having reviewed the issues
de novo, that the district court properly granted summary judgment
in favor of Mr. Wyland. See Wyland v. State Farm Fire and Casualty
Co., CA No. 98-1373-A (E.D. Va. Mar. 26, 1999). We therefore
affirm the district court's declaratory judgment against State Farm.
AFFIRMED
6