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Guglielmelli v. State Farm Mutual Automobile Insurance Co.

United States District Court, E.D. Pennsylvania

December 16, 2014

FRANCIS J. GUGLIELMELLI, Plaintiff,
v.
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant

For FRANCIS J. GUGLIELMELLI, Plaintiff: JAMES R. RADMORE, LEAD ATTORNEY, LAW OFFICE OF JAMES R. RADMORE PC, PHILADELPHIA, PA.

For STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant: KATHERINE COLE DOUGLAS, BENNETT BRICKLIN & SALTZBURG LLC, PHILADELPHIA, PA; MICHAEL SALTZBURG, BENNETT BRICKLIN & SALTZBURG LLP, PHILADELPHIA, PA.

For STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Counter Claimant: MICHAEL SALTZBURG, BENNETT BRICKLIN & SALTZBURG LLP, PHILADELPHIA, PA.

For FRANCIS J. GUGLIELMELLI, Counter Defendant: JAMES R. RADMORE, LEAD ATTORNEY, LAW OFFICE OF JAMES R. RADMORE PC, PHILADELPHIA, PA.

Page 589

MEMORANDUM OPINION

Mitchell S. Goldberg, J.

Plaintiff seeks damages for bodily injury under an automobile insurance policy, which incorporated a " sign-down form," reducing the uninsured/underinsured motorist limits of liability available under the policy. Plaintiff, who is listed as the first-named insured, did not execute the sign-down form. Rather, Plaintiff's co-resident, listed as a second-named insured, executed the form. Consequently, Plaintiff claims that the reduced uninsured/underinsured limits of liability are not binding. Plaintiff also posits that a stacking waiver executed on a second, single-vehicle policy does not prohibit inter-policy stacking, nor does the " household exclusion" under that policy apply.

Currently before me are cross-motions for summary judgment filed by Plaintiff, Francis J. Gugliemelli, and Defendant, State Farm Mutual Automobile Insurance Co. (" State Farm" ). For the reasons that follow, I find that the sign-down form reducing Plaintiff's uninsured/underinsured motorist benefits is enforceable, and that the stacking waiver and exclusion found within the second policy prevents inter-policy stacking of coverage. Consequently, I will grant State Farm's motion and deny Plaintiff's motion.

I. FACTUAL AND PROCEDURAL

Page 590

HISTORY[1]

Plaintiff is the first-named insured on two automobile insurance policies furnished by Defendant, State Farm. The application for the first policy was submitted by Achmad Jayadi, on behalf of himself and Plaintiff, on March 11, 2006. Jayadi, who resided with Plaintiff, and is listed as the second-named insured, sought personal-use vehicle coverage for a 2000 Dodge Neon and a 2004 Suzuki. The application for the personal policy was signed by Jayadi only. At the time of application, Jayadi represented that he owned the Neon, and that he and Plaintiff jointly owned the Suzuki. (Stip. of Facts ¶ ¶ 4-5, 11, 21, 42.)

The application requested that the personal policy provide bodily injury liability limits of $100,000/$300,000.[2] In connection with the application, Jayadi also signed and submitted two separate forms on March 17, 2006: (1) an Acknowledgement of Coverage Selection form (" sign-down form" ); and (2) a rejection of stacked uninsured and underinsured coverage limits (" rejection of stacked benefits form" ). The sign-down form requested reduced uninsured and underinsured motorist liability limits in the amount of $15,000/$30,000 on each of the two vehicles. The rejection of stacked benefits form waived stacked coverage of the uninsured and underinsured limits.[3] Plaintiff did not sign the sign-down form, nor did he sign the rejection of stacked benefits form. After receiving these forms, State Farm issued Policy No. 80-1228-C11-38 effective March 11, 2006, listing Plaintiff as the first-named insured and Jayadi as an additional named insured. (Id. at ¶ ¶ 5, 7-11.)

On October 8, 2007, State Farm was requested by either Plaintiff or Jayadi to delete the Suzuki from the policy and replace it with a Jeep Liberty. No other changes to the policy were requested at that time. Although the Jeep Liberty was titled solely in Plaintiff's name, State Farm was not notified of this fact. State Farm substituted the vehicles on that same day. From October 8, 2007 through September 15, 2010, the policy provided coverage to Jayadi and Plaintiff on the Dodge Neon and Jeep Liberty, with bodily injury liability limits of $100,000/$300,000 and uninsured/underinsured motorist limits of $15,000/$30,000. (Id. at ¶ ¶ 14-18.) Plaintiff and Jayadi were sent nine renewal notices and three amended declarations pages between 2006 and 2010, each of which listed the uninsured/underinsured motorist limits as $15,000/$30,000. Plaintiff and Jayadi paid lower premiums as a result of the reduced uninsured/underinsured limits. (Crisanti Aff. ¶ ¶ 2-5.)[4]

On October 23, 2009, Plaintiff submitted a Commercial Vehicle Insurance application on behalf of himself and Jayadi for coverage on a 2000 GMC Safari. In applying for the commercial policy, Plaintiff sought bodily injury liability limits of $100,000/$300,000 and uninsured/underinsured motorist limits of $100,000/$300,000.

Page 591

Plaintiff also signed a rejection of stacked benefits form and was listed as the first-named insured on the commercial policy. (Stip. of Facts ¶ ¶ 20-22.)

On September 15, 2010, Plaintiff was operating the Jeep Liberty when he was involved in an accident with a vehicle operated by Selina Coles-Daniels. The accident was caused by Coles-Daniels' negligence. Plaintiff sought recovery against Coles-Daniels for the personal injuries he sustained during the accident, but her policy provided bodily injury liability limits of $15,000/$30,000. With State Farm's consent, Plaintiff settled his claim against Coles-Daniels for $15,000. Plaintiff claims to have suffered injuries far in excess of $15,000 and sought underinsured motorist coverage from State Farm. (Id. at ¶ ¶ 24-29.)

Recognizing that the rejection of stacked benefits submitted by Jayadi with respect to the personal policy did not comply with Pennsylvania law,[5] State Farm tendered to Plaintiff stacked underinsured motorist benefits from the personal policy totaling $30,000 (the $15,000 per person limit for underinsured motorist liability multiplied by the two vehicles covered by the personal policy). (Id. at ¶ ¶ 33-34.) Arguing that the sign-down form is not binding and that additional proceeds are due under the State Farm policies, Plaintiff filed suit, asserting a claim for bad faith pursuant to 42 Pa. C.S. § 8371. (Am. Compl. ¶ ¶ 27-44.)

State Farm responds that $30,000 is the maximum amount of underinsured motorist coverage to which Plaintiff is entitled for the September 15, 2010 accident, and seeks summary judgment on its counterclaim for declaratory judgment. Plaintiff has filed a cross-motion for summary judgment, insisting that the sign-down of underinsured motorist benefits executed by Jayadi is void, that Plaintiff is entitled to $200,000 in benefits under his personal policy ($100,000 in underinsured motorist coverage, stacked), and that he is additionally entitled to stacked benefits of $100,000 ...


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