Hershel Eugene Easterling, individually and as personal representative of the Estate of Charlotte Easterling
Progressive Specialty Insurance Company
from Chilton Circuit Court (CV-15-900095)
Eugene Easterling, both individually and as the personal
representative of the estate of Charlotte Easterling, appeals
from a summary judgment in favor of Progressive Specialty
Insurance Company ("Progressive") on his claims
seeking uninsured/underinsured-motorist ("UIM")
benefits. We reverse and remand.
and Procedural History
December 2014, Hershel and his wife, Charlotte Easterling,
were injured when their vehicle was rear-ended in Chilton
County by a vehicle driven by Ashley Marie McCartney. In
April 2015, the Easterlings sued McCartney in the Chilton
Circuit Court, alleging that McCartney behaved negligently
and/or wantonly at the time of the accident. The
Easterlings' complaint also named Progressive, their
insurer, as a defendant and included a count seeking to
recover UIM benefits from Progressive.
the filing of the underlying action, Charlotte
died. Subsequently, an estate was opened and
Hershel was appointed personal representative of
Charlotte's estate. The trial court later granted
Hershel's motion seeking to substitute himself, in that
capacity, as a named plaintiff.
trial, McCartney filed a "Suggestion of Bankruptcy"
informing the trial court of her initiation of bankruptcy
proceedings and asserting, as a result, that, because
the underlying action was allegedly "founded on a claim
that a bankruptcy discharge would release, " the instant
case "should be ceased." In response, Progressive
filed a motion and supporting brief requesting a summary
judgment in its favor on Hershel's UIM claim.
Specifically, Progressive argued that, under Alabama law, a
plaintiff may seek to recover UIM benefits from his insurer
only if the plaintiff is "legally entitled to
recover damages" from the tortfeasor. See §
32-7-23(a), Ala. Code 1975. Progressive contended that,
because McCartney's bankruptcy filing "foreclose[d]
[McCartney's] legal obligation to pay debts" --
including any judgment recovered against her by Hershel --
Hershel was not legally entitled to recover from McCartney in
excess of McCartney's own liability-insurance policy
limits and, thus, Hershel's claim for UIM benefits
accordingly failed as a matter of law.
support of its position, Progressive cited, and sought to
have applied, the rationale of cases in which this Court has
interpreted the phrase "legally entitled to
recover" to prevent the recovery of UIM benefits,
including a workers' compensation plaintiff's
inability to recover from a co-employee and a plaintiff's
inability to recover damages in excess of a statutory cap
when the defendant is a governmental entity. See Kendall
v. United Servs. Auto. Ass'n, 23 So.3d 1119, 1125
(Ala. 2009) ("In this case, Kendall could recover no
more than the statutory maximum of $100, 000 in damages from
the County under § 11-93-2, Ala. Code 1975. Because
Kendall had already recovered the statutory maximum of $100,
000, she was no longer 'legally entitled to recover'
damages from the [tortfeasors]; therefore, she could not
recover UIM benefits from her insurer."), and Ex
parte Carlton, 867 So.2d 332, 338 (Ala. 2003) ("The
workers' compensation benefits Carlton received are his
only remedy against his employer. ... Therefore, Carlton is
not 'legally entitled to recover damages from the owner
or operator of an uninsured vehicle' as the plain
language of § 32-7-23(a), Ala. Code 1975, or the clear
and unambiguous provisions of his mother's State Farm
policy require. Thus, he may not recover uninsured-motorist
benefits under the policy."). Progressive maintained
that its reasoning was not contrary to the purpose behind
Alabama's statute requiring UIM coverage but that it was,
instead, part and parcel of the purported condition precedent
to recovery under that statute, namely, "the legal
entitlement to recover from the tortfeasor the amount sought
from the [UIM] carrier."
response to Progressive's motion, Hershel disagreed that
the Bankruptcy Code operated to prevent recovery as
Progressive alleged. According to him, "[t]he
[B]ankruptcy [C]ode ... is not set up to protect ... [an]
entity from payments which they are contractually obligated
to pay through an agreement with an innocent third
party." He further observed that, according to 11 U.S.C.
§ 524(e), "discharge of the debtor [in bankruptcy]
does not affect the liability of any other entity ... for
such debt." According to those principles, Hershel
maintained that the authorities cited by Progressive were
inapposite and that Progressive's summary-judgment motion
was due to be denied.
a hearing,  the trial court granted Progressive's
motion based on the holding that, because of McCartney's
Chapter 7 bankruptcy filing, "[Hershel could] no longer
obtain a judgment that ... McCartney would be responsible for
that would invoke the UM/UIM carrier to pay." The trial
court, finding "no just reason for delay, "
certified its judgment as final pursuant to the requirements
of Rule 54(b), Ala. R. Civ. P.
Hershel filed a postjudgment motion requesting that the trial
court "reconsider" its summary-judgment ruling.
Before the trial court's disposition of that request,
Hershel filed a notice of appeal to this Court.
'"This Court's review of a summary judgment is
de novo. Williams v. State Farm Mut. Auto. Ins. Co.,
886 So.2d 72, 74 (Ala. 2003). We apply the same standard of
review as the trial court applied. Specifically, we must
determine whether the movant has made a prima facie showing
that no genuine issue of material fact exists and that the
movant is entitled to a judgment as a matter of law. Rule
56(c), Ala. R. Civ. P.; Blue Cross & Blue Shield of
Alabama v. Hodurski, 899 So.2d 949, 952-53 (Ala. 2004).
In making such a determination, we must review the evidence
in the light most favorable to the nonmovant. Wilson v.
Brown, 496 So.2d 756, 758 (Ala. 1986). Once the movant
makes a prima facie showing that there is no genuine issue of
material fact, the burden then shifts to the nonmovant to
produce 'substantial evidence' as to the existence of
a genuine issue of material fact. Bass v. SouthTrust Bank
of Baldwin County, 538 So.2d 794, 797-98 (Ala. 1989);
Ala. Code 1975, § 12-21-12. '[S]ubstantial evidence
is evidence of such weight and quality that fair-minded
persons in the exercise of impartial judgment can reasonably
infer the existence of the fact sought to be proved.'
West v. Founders Life Assur. Co. of Fla., 547 So.2d
870, 871 (Ala. 1989)."'
"Prince v. Poole, 935 So.2d 431, 442 (Ala.
2006) (quoting Dow v. Alabama Democratic Party, 897
So.2d 1035, 1038-39 (Ala. 2004))."
Brown v. W.P. Media, Inc., 17 So.3d 1167,
1169 (Ala. 2009). Additionally, "'[t]his Court
reviews de novo a trial court's [application] of a
statute, because only a question of law is
presented.'" State Farm Mut. Auto. Ins. Co. v.
Bennett, 974 So.2d 959, 961 (Ala. 2007) (quoting
Scott Bridge Co. v. Wright, 883 So.2d 1221, 1223
issue presented is whether the bankruptcy discharge of a UIM
defendant prevents an injured plaintiff from being able to
recover UIM benefits under the plaintiff's own insurance
policy. Hershel contends that the trial court erred in
answering the foregoing question in the affirmative and in
entering a summary judgment in favor of Progressive. More
specifically, according to Hershel, the reasoning advanced by
Progressive and accepted by the trial court is both contrary
to the effect of a bankruptcy discharge, as indicated by the
Bankruptcy Code, and unsupported by Alabama law. In support
of his position, Hershel cites authority, including In re
Jet Florida Systems, Inc., 883 F.2d 970, 973 (11th Cir.
1989), for the proposition that a bankruptcy discharge
protects only the filing debtor and "will not
act to enjoin a creditor from taking action against another
who also might be liable to the creditor, " including,
in particular, an insurer that may be secondarily liable.
on the other hand, argues that the trial court's ruling
was correct in that it represents a "logical
extension" of this Court's interpretation of the
phrase "legally entitled to recover" under §
32-7-23(a) as discussed in Kendall and Ex parte
Carlton, supra. Progressive maintains that this case
involves a similar impediment to Hershel's recovery of
UIM benefits because, it argues, the automatic stay and
ultimate discharge of a tortfeasor's personal liability
for damages via bankruptcy proceedings effectively
"forecloses the ... legal obligation to pay debts."
(Progressive's brief, at p. 3.) Progressive further
contends that Jet and other cases on which Hershel
relies stand only for the well settled proposition that a
plaintiff may, despite the tortfeasor's bankruptcy
filing, proceed against the tortfeasor's own
insurer but do not hold that the plaintiff may go beyond
that permitted recovery and seek UIM benefits from the
plaintiff's own insurer.
"'This Court has held that "legally entitled to
recover" means that "the insured must be able
to establish fault on the part of the uninsured
motorist, which gives rise to damages and must be able to