United States District Court, S.D. Alabama, Southern Division
AMENDED ORDER AND MEMORANDUM OPINION
V. S. Granade SENIOR UNITED STATES DISTRICT JUDGE
matter is before the Court on a motion for summary judgment
filed by Defendant Geico General Insurance Company
(“Defendant”) (Doc. 46), response in opposition
filed by Plaintiff Phillip Heaton (“Plaintiff”)
(Doc. 53), and reply by Defendant (Doc. 54). For the reasons
stated below, Defendant's motion is
2009, Plaintiff resided with his parents, Jasper and Mary
Heaton, in Foley, Alabama. At that time, Jasper and Mary
owned a 2008 Kia Optima insured with Defendant under an
Alabama automobile insurance policy (“the
Policy”). (Doc. 46-4). The Policy contained
uninsured/underinsured motorist coverage (“UIM
coverage”). Id. at 4. As it pertains to UIM
coverage, the Policy explained as follows:
Under the Uninsured Motorists Coverage we will pay damages
for bodily injury caused by accident which the insured is
legally entitled to recover from the owner or operator of the
uninsured auto or hit-and-run auto arising out of the
ownership, maintenance or use of that auto.
The amount of the insured's recovery for these damages
will be determined by agreement between the insured or his
representative and us. The dispute may be arbitrated if an
agreement cannot be reached.
Id. at 14. UIM coverage, however, “does not
apply to bodily injury to an insured if the insured or his
legal representative has made settlement or has been awarded
a judgment of his claim without [Defendant's] prior
relates to UIM coverage, the person or persons named in the
declaration are not the only persons covered. Instead,
“relatives of [the person(s) named in the declaration]
if residents of his household” are also provided UIM
coverage. Id. Defendant does not contest that
Plaintiff meets this criteria. (Doc. 46-1, p. 2). Bodily
injury to any person covered includes injury “resulting
[in] sickness, disease or death.” Id. at 7.
Although the language above primarily speaks to uninsured
motorist or autos, the Policy also covers underinsured
motorist or auto situations in UIM coverage claims.
Id. at 14.
resident of his parents' home, Plaintiff's nephew
needed a way back to Galveston, Texas for work. (Doc. 46-2,
p. 2). Plaintiff's parents were unable to drive to Texas,
so Plaintiff drove his nephew to Texas using the 2008 Kia
Optima his parents owned. Id. While in Texas on July
23, 2009, Gerald Ray Rivera (“Rivera”) struck the
2008 Kia Optima Plaintiff was driving. Plaintiff suffered
extensive physical injury and the 2008 Kia Optima was
totaled. Id. at 5.
August 25, 2009, a Texas division of Defendant's company
wrote Plaintiff's father, Jasper Heaton, in accordance
with Texas law regarding recovery of any deductible Jasper
Heaton paid under the Policy. The letter stated, in relevant
Please be advised that in accordance with Section 542.204 of
the Texas Insurance Code, we are notifying you that with
respect to recovery of your deductible or our subrogation
interest, we do not intend to take further collection actions
against the third party(ies) who may be liable for this
claim. As such, we hereby authorize you to bring an action at
your option and your expense against the responsible third
party(ies), if any, in order to attempt to recover your
(Doc. 53, p. 3). Jasper Heaton had a $500.00 deductible for
any collision damage the 2008 Kia Optima sustained. (Doc.
46-4, p. 4). The extent of Plaintiff's contact with
Defendant was related to reimbursement of certain medication
and mileage expenses under Defendant's “med
pay” portion of the policy, which totaled approximately
$5, 000.00. (Doc. 46-2, pp. 8-9). The Policy capped medical
payments at $5, 000.00. (Doc. 46-4, p. 4).
1, 2011, Plaintiff filed suit against Rivera and Kia Motors
Corporation in a Texas court, under representation of a Texas
attorney. (Doc. 46-2, p. 27). Relevant to the instant motion,
Plaintiff brought a negligence claim against Rivera for the
injuries he sustained in the accident. Id. 32.
During the pendency of the suit, Plaintiff's Texas
attorney was aware of the Policy. Id. at 11.
Plaintiff spoke with his Texas attorney about adding
Defendant to the suit because of Rivera's “minimal
coverage.” Defendant, however, was never added and an
UIM claim was never filed. Id. at 16. The Texas
attorney told Plaintiff that he would have to retain an
Alabama attorney if he wanted to file an UIM claim.
Id. at 20. Plaintiff testified that he did not send
a letter to Defendant informing it that the lawsuit had been
initiated in Texas. Id. at 21. Further, Plaintiff
testified that he was unaware of whether the Texas attorney
wrote Defendant informing it of the Texas lawsuit.
Id. But evidence suggests Defendant was aware that
Plaintiff filed suit against Rivera in a Texas court. (Doc.
53, p. 4).
November 20, 2012, Plaintiff and Rivera reached a final
settlement in the amount of $5, 000.00 for the negligence
claim. (Doc. 46-2, p. 35). Thereupon, the Texas court entered
a final judgment, which denied any further claims against
Rivera in regards to the accident. Id. Plaintiff
testified that he has no knowledge of whether the Texas
attorney ever communicated with Defendant prior to entering
settlement with Rivera. Id. at 22. Additionally,
Plaintiff did not inform Defendant of the settlement,
settlement specifics, or a potential UIM claim prior to
entering settlement with Rivera. Id. at 24-25.
April 28, 2015, Plaintiff, acting pro se, initiated the
present suit. (Doc. 1). On October 27, 2015, Plaintiff, then
represented by counsel, filed his First Amended Complaint.
(Doc. 25). Therein he claimed Defendant breached the Policy
by “failing to pay Plaintiff's bodily injury and