By: dmc-admin//March 12, 2007//
What the court held Case: Thom v. OneBeacon Insurance Co., No. 2006AP1617. Issue: Can a plaintiff amend a complaint against an insurer, to change the claim from one based on UIM coverage to one based on liability coverage? Holding: No. A UIM claim in the original complaint does not give fair notice of the amended liability claim. Attorneys: For Appellant: Steber, Michael T., Brookfield; For Respondent: Whitley, Jason W., Amery. |
A complaint against an insurer, alleging the insureds negligence, does not relate back to an original complaint against the same insurer, seeking underinsured motorist (UIM) benefits, the Wisconsin Court of Appeals held on Mar. 6.
In 2001, Rose Thom was injured in an automobile accident as a passenger. Her sister, Jean Thom, was the driver of one vehicle, and Mary Mallett drove the other.
Malletts insurer paid its policy limits of $25,000 in exchange for a release of itself and Mallett.
While arbitration with Jeans insurer, OneBeacon Insurance Company, was pending, Rose filed suit against One-Beacon, seeking only UIM benefits.
The arbitrators found that Jean was solely responsible for the accident, and thus, Rose was not entitled to UIM benefits under the policy.
More than three years after the accident, Rose moved to amend the complaint to allege a claim against OneBeacon based on Jeans negligence.
Eau Claire County Circuit Court Judge Paul Lenz granted the motion. The court of appeals granted OneBeacon leave to appeal, and reversed, in a decision by Judge Gregory A. Peterson.
Section 802.09(3) provides in relevant part, If the claim asserted in the amended pleading arose out of the transaction, occurrence, or event set forth or attempted to be set forth in the original pleading, the amendment relates back to the date of the filing of the original pleading. Where the amended complaint adds a new party, the requirements are more exacting.
The court concluded that the case was governed by Biggart v. Barstad, 182 Wis.2d 421, 513 N.W.2d 681 (Ct.-App.1984). Biggart also involved an automobile accident; first, the plaintiff sued the driver, and his insurer. Later, he sued the owner of the car, who just happened to have the same insurer.
The court of appeals held that the amended complaint did not relate back, even though the same insurer coincidentally insured both drivers, and thus, no new party was technically named in the amended complaint.
Applying Biggart to the case at bar, the court of appeals concluded, The same rule applies here. Roses original complaint alleged OneBeacon was liable based solely on Malletts negligence. The amended complaint asserted OneBeacons liability based on the negligence of a different individual Jean.
The court also found it relevant that the new claim was under the liability portion of the policy rather than the UIM policy.
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The court concluded, While these were different parts of the same automobile insurance policy, not different policies as in Biggart, the effect of the change was the same. In Biggart, the amended complaint changed American Family from the liability insurer of one driver to the liability insurer of a different driver.
The court noted that Roses new claim against OneBeacons liability coverage had the same effect by shifting the company from being Malletts liability insurer to Jeans liability insurer. Therefore, Roses original complaint, like Biggarts, did not warn the insurer that she would raise her new claim.
Finally, the court distinguished Korkow v. General Cas. Co., 117 Wis.2d 187, 344 N.W.2d 108 (1984). In Korkow, the Supreme Court held that a complaint could be amended to add a new plaintiff, where the claim was based on the same policy occurrence.
The court acknowledged that One-Beacon undoubtedly had knowledge of the facts underlying the claim in the amended complaint. However, because nothing in the original complaint indicated Rose would claim Jeans negligence, the court held that the original complaint did not give fair notice of the new claim to OneBeacon.
Accordingly, the court affirmed.
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David Ziemer can be reached by email.