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Rutherford v. Nationwide Affinity Ins. Co.

United States District Court, D. Maryland

December 5, 2019

JACQUELINE M. RUTHERFORD, et al., Plaintiffs,


          Stephanie A. Gallagher United States District Judge

         Plaintiffs Jacqueline Rutherford, individually and as personal representative of the estate of Curtis Rutherford, Sr., Curtis Rutherford Jr., and Willadean Fischbach (collectively “Plaintiffs”) brought this action against Defendant Nationwide Affinity Insurance Company (“Nationwide”) seeking a declaratory judgment relating to Nationwide's liability under an uninsured motorist/underinsured motorist (“UM/UIM”) policy. ECF 1. The parties have filed four dispositive motions: the Rutherford Plaintiffs have filed a Motion for Summary Judgment, ECF 27, to which Nationwide has filed a cross-Motion for Summary Judgment, ECF 37; and Plaintiff Fischbach has filed a separate Motion for Summary Judgment, ECF 26, to which Nationwide has also filed a cross-Motion for Summary Judgment, ECF 38. I have reviewed those filings, the associated oppositions and replies, and the surreply filed by the Rutherford Plaintiffs. ECF 39, 43, 49, 52. No. hearing is necessary. See Loc. R. 105.6 (D. Md. 2018). For the reasons set forth below, Nationwide's cross-Motion as to the Rutherford Plaintiffs will be granted, Plaintiff Fischbach's motion and Nationwide's cross-Motion as to Fischbach will be granted in part and denied in part, and the Rutherford Plaintiffs' Motion will be denied.


         This case arises out of a tragic motor vehicle accident resulting in the death of Curtis D. Rutherford, Sr. (“the Decedent”). The facts underlying the accident are uncontested for purposes of this motion. On December 3, 2014, two Ford Mustangs engaged in an unlawful high-speed street race on Quarterfield Road in Anne Arundel County, Maryland. ECF 27-6, 27-7, 27-8. One of the Mustangs, driven by John Hayes, IV, lost control, crossed over the center line, and collided with a 1983 Oldsmobile Cutlass being driven by the Decedent. Id. The Decedent, who was the sole occupant of his vehicle, died of his injuries. See, e.g., ECF 27-8 at 7.

         The other Mustang, which was green in color, did not collide with the Decedent's vehicle during the race, and left the scene (“the phantom vehicle”). See ECF 1 at 4. Despite subsequent investigation, the identity of the driver of the phantom vehicle remains unknown. Plaintiffs' federal lawsuit against the sole identified driver, Hayes, is stayed pending resolution of this case.[1]See Rutherford v. Hayes, Civil No. ADC-17-0622.

         On December 2, 2014, the day before the fatal accident, Jacqueline Rutherford (“Mrs. Rutherford”), the Decedent's wife, appeared in person, paid a premium, and signed documentation (“the binder documents”) to establish automobile liability coverage with Nationwide (“the Rutherford policy”). ECF 27-12. The Rutherford policy includes UM/UIM coverage with per person limits of $100, 000, and per occurrence limits of $300, 000. ECF 27-9 at 2 (Answer 4). The named insureds on the Rutherford policy include Mrs. Rutherford, the Decedent, and Curtis Rutherford, Jr. (the Decedent's son). ECF 27-9 at 3 (Answer 7(a)); ECF 27-11 at 59. Willadean Fischbach (the Decedent's mother) is not a named insured under the Rutherford policy. Id. Mrs. Rutherford did not receive the formal written policy from Nationwide prior to the deadly accident on December 3, 2014. ECF 27-1 at 7-8.


         Rule 56(a) of the Federal Rules of Civil Procedure states that the court “shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). The moving party bears the burden of showing that there is no genuine dispute of material facts. See Casey v. Geek Squad, 823 F.Supp.2d 334, 348 (D. Md. 2011). If the moving party establishes that there is no evidence to support the non-movant's case, the burden then shifts to the non-movant to proffer specific facts to show a genuine issue exists for trial. Id. The non-movant must provide enough admissible evidence to “carry the burden of proof at trial.” Id. at 349 (quoting Mitchell v. Data Gen. Corp., 12 F.3d 1310, 1315-16 (4th Cir. 1993)). The mere existence of a scintilla of evidence in support of the non-movant's position is insufficient; rather, there must be evidence on which the jury could reasonably find for the non-movant. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986). Moreover, a genuine issue of material fact cannot rest on “mere speculation, or building one inference upon another.” Casey, 823 F.Supp.2d at 349. Additionally, summary judgment shall be warranted if the non-moving party fails to provide evidence that establishes an essential element of the case. The non-movant “must produce competent evidence on each element of his or her claim.” Miskin v. Baxter Healthcare Corp., 107 F.Supp.2d 669, 671 (D. Md. 1999).

         If the non-movant fails to do so, “there can be no genuine issue as to any material fact, ” because the failure to prove an essential element of the case “necessarily renders all other facts immaterial.” Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); see also Casey, 823 F.Supp.2d at 348-49. In ruling on a motion for summary judgment, a court must view the facts and inferences “in the light most favorable to the party opposing the motion.” Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587-88 (1986).

         The parties to this action seek competing declaratory judgments. A federal district court can issue a declaratory judgment where the relief sought “(i) will serve a useful purpose in clarifying and settling the legal relations in issue; and (ii) will terminate and afford relief from the uncertainty, insecurity, and controversy giving rise to the proceeding.” Continental Cas. Co. v. Fuscardo, 35 F.3d 963, 966 (4th Cir. 1994) (citations omitted). Concrete insurance coverage disputes, such as those presented in the instant case, can be appropriate for such adjudication. See id.

         III. ANALYSIS

         A brief summary of the parties' respective legal positions is useful at the outset. Nationwide concedes that it owes $100, 000 in UM/UIM coverage, representing the total per person policy limit under the Rutherford policy, which Nationwide submits will be reduced by the $50, 000 available from the Hayes/Progressive policy, for a total of $50, 000 in new coverage. ECF 37 ¶ 4. In Nationwide's view, only the insured Plaintiffs should be entitled to share in the proceeds of the UM/UIM policy, so Fischbach's claim should be excluded. ECF 38 ¶ 2. The Rutherford Plaintiffs, on the other hand, assert that the total UM/UIM coverage could be as much as $800, 000: $100, 000 in coverage for each potential plaintiff (the Decedent's estate, Jacqueline Rutherford, Curtis Rutherford, Jr., and Fischbach) as to the underinsured Hayes vehicle; and another $100, 000 in coverage for each of the four potential plaintiffs as to the uninsured phantom vehicle. ECF 27-1 at 22-23. Fischbach takes the position that she is entitled to bring a wrongful death claim and to recover against the UM/UIM policy pursuant to Md. Code Ann., Ins. Art., § 19-509(c)(2), and that the Plaintiffs collectively should be allowed to recover the $100, 000 policy limit for the Hayes vehicle, and another $100, 000 policy limit for the phantom vehicle, for a total of $200, 000 before deduction of the $50, 000 Hayes/Progressive policy. ECF 26-1 at 6, 11 (“Fischbach is entitled to underinsured motorist coverage for the negligence of Hayes and the disappearing driver.”). For the reasons of contractual and statutory interpretation described below, this Court agrees with Nationwide as to the total available UM/UIM coverage, and agrees with Fischbach that Maryland law permits her to recover from the UM/UIM insurance proceeds.

         A. The Total UM/UIM Coverage Available Under the Policy is $100, 000 1. The Policy Terms Were In Effect At The Time of the Accident

         The Rutherford Plaintiffs contend that only the binder documents executed by Mrs. Rutherford on December 2, 2014, and not the remainder of the policy terms, constituted the contract between the parties at the time of the accident. ECF 27-1 at 19-20. The parties agree that Mrs. Rutherford appeared in person on December 2, 2014, executed the binder documents at 1:55 P.M., and tendered payment in cash to pay the first premium. See ECF 27-1 at 7. The deadly accident occurred on December 3, 2014, before any formal written policy had been delivered to Mrs. Rutherford. The binder documents signed by Mrs. Rutherford, ECF 27-12, provide “UNINSURED MOTORIST-BODILY INJURY 100/300, ” and specifically state, “I hereby acknowledge that all coverages, required and optional, available to me have been fully explained . . . Any coverage that may be provided during the binder period is subject to all policy terms and conditions, including exclusions and endorsements that may apply.” ECF 27-12 at 5.

         The Rutherford Plaintiffs' contention that the binder documents constituted a separate contract not subject to the policy terms is unpersuasive, in light of the binder documents' plain language. Mrs. Rutherford acknowledged in writing that her coverage had been fully explained to her, and agreed that the coverage would be subject to all policy terms and conditions, including exclusions and endorsements. ECF 27-12 at 5. The fact that the formal written policy had not been delivered does not transform the binder documents into broader coverage than that agreed to by the parties, or entitle the Rutherford Plaintiffs to avail themselves of the benefits of the monetary policy limits, without being subject to the other coverage limitations that were material terms of the parties' agreement. The written binder ...

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