This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (2002).







Tara Engle,



Tiesha Engle,





The Estate of Dorothy Fischer, Deceased, et al.,



Continental Casualty Company,




Filed January 28, 2003


Halbrooks, Judge



Hennepin County District Court

File No. PI00738


Warren V. Bigelow, Jr., Law Offices of Warren V. Bigelow, Jr., 1000 Superior Boulevard, Wayzata, MN 55391 (for appellant)


Thomas J. Christenson, Quinlivan & Hughes, P.A., 400 South 1st Street, Suite 600, P.O. Box 1008, St. Cloud, MN 56302 (for respondent)




            Considered and decided by Toussaint, Chief Judge, Willis, Judge, and Halbrooks, Judge.

U N P U B L I S H E D   O P I N I O N


            Appellant brought an action for underinsured motorist benefits following settlement of her liability claims for injuries arising out of a motor vehicle accident.  The trial court reduced the jury’s damage award by the amounts received by appellant from collateral sources pursuant to Minn. Stat. § 548.36 (2002), and granted respondent’s motion to offset the award by the amount appellant received in a pretrial settlement from a driver later found by the jury to be 0% at fault.  Appellant contends that (1) the trial court erred by concluding that the language of respondent’s insurance policy limits its total liability to include the amount paid to settle the liability claim on behalf of its insured; (2) the language of the insurance contract is ambiguous; (3) the insurance contract contravenes state law; and (4) the trial court erred by not allowing appellant an offset of the collateral source reduction by amounts paid by her to secure insurance coverage.  We affirm.


            On June 27, l994, appellant Tiesha Engle was injured in a motor vehicle accident while riding as a passenger in a vehicle driven by Brandon Thompson and insured by Continental Casualty Company (Continental).  Thompson’s vehicle collided with a vehicle driven by Dorothy Fischer.  Fischer’s vehicle was insured by Farmers Insurance Group with liability limits of $100,000.  Thompson’s policy with Continental provided for $100,000 per person and $300,000 per accident limits for both liability and underinsured motorist (UIM) coverages.  Engle sued Thompson and Fischer for negligence but settled both claims before trial.  Fischer’s insurer paid its policy limits of $100,000 and Thompson’s insurer, Continental, paid $70,000 for a full and final release of Engle’s claims against Thompson.

            As a passenger in Thompson’s vehicle, Engle asserted a claim for UIM benefits against Continental pursuant to Minn. Stat. § 65B.49, subd. 3a(5) (2002).  Following trial, the jury found Fischer to be 100% at fault for the accident and Thompson to be 0% at fault and awarded Engle total damages of $206,690.50 comprised of the following:  $8,190.50 for past medical expenses; $100,000 for past pain, disability, disfigurement and/or emotional distress; $23,500 for future medical expenses; and $75,000 for future pain, disability, disfigurement and/or emotional distress.  The trial court applied Minn. Stat. § 548.36, subd. 3(a) (2002), the collateral source rule, to the verdict and reduced the total damages by the $100,000 Engle received in settlement from Fischer and the sum of $8,190.50, the amount of no-fault benefits Engle received from her own insurer.

            Continental moved for a further reduction of the verdict based on the $70,000 it paid in settlement on behalf of its insured, Thompson.  Continental based its motion on two arguments—that the settlement payment was a collateral source under Minn. Stat. § 548.36, subd. 3(a), and that the policy language limited its liability.  Continental also moved for a reduction of the verdict by an additional $23,500 on the ground that the evidence did not support the jury’s award for future medical expenses.

            The trial court denied Continental’s motion for reduction of the future-medical-expense award, finding that the evidence was sufficient to support it, but granted Continental’s motion with respect to the $70,000 offset.  The court found that the $70,000 settlement was not a collateral source, but concluded that the plain language of Continental’s policy limited its liability to $100,000.  Because Continental’s liability to Engle was offset by the amount Continental previously paid in settlement of the liability claim, the district court ordered Continental to pay $28,500 in UIM benefits to Engle.

            Engle moved for amended findings of fact, conclusions of law, and order for judgment pursuant to Minn. R. Civ. P. 52.02 and appealed the district court administrator’s taxation of costs and disbursements.  The trial court concluded that Engle had not waived her right to appeal the court administrator’s taxation of costs by failing to appear at the hearing and awarded Engle $6,722.16 in costs.  The court denied Engle’s motion to amend the findings, specifically noting that Engle failed to establish a defect in the court’s findings and, instead, used the motion to reassert arguments previously rejected by the court.  This appeal follows.


1.         Was the appeal timely?


            Continental challenges the appeal on the ground that it is not properly brought pursuant to Minn. R. Civ. App. P. 104.01, subd. 1, which provides that

an appeal may be taken from a judgment within 60 days after its entry, and from an appealable order within 60 days after service by any party of written notice of its filing.


            In support of its position, Continental asserts that, although captioned as a motion for amended findings, Engle’s motion was really an improper motion for reconsideration, which does not toll the time for appeal.  The trial court issued two findings of fact, conclusions of law, and orders for judgment—the first on December 18, 2001, and the second on April 25, 2002.  The first order addressed the amounts to be offset from the jury’s verdict.  Judgment from the court’s December 18, 2001 order was not entered until May 16, 2002.  Because Engle’s appeal was filed July 3, 2002, it falls within the 60 days provided for by Minn. R. Civ. App. P. 104.01 and is timely. 

The trial court’s second order was issued in response to Engle’s motion for amended findings pursuant to Minn. R. Civ. P. 52.02.  In the second order, the court denied Engle’s motion but ordered taxation of costs to Engle in the amount of $6,722.16.  Engle has also appealed from the April 25, 2002 order.  Because judgment for that order was also entered on May 16, 2002, Engle’s appeal from the entry of judgment of the second order was timely.

            In addition, we respond to Continental’s position that Engle’s motion for amended findings did not toll the time for appeal because it was, in reality, an improper motion for reconsideration.  This argument was addressed by the supreme court in Madson v. Minn. Mining & Mfg. Co., 612 N.W.2d 168 (Minn. 2000).  The court held in Madson that

the test for determining whether a motion [under rule 104.01] is authorized, and therefore proper, is to determine whether on the face of the document the party has filed a motion that is expressly allowed under subdivision 2.


Id. at 172.  Because Engle’s motion was captioned as a motion for amended findings, one of the enumerated motions under rule 104.01, subd. 2, it was a proper motion. 

2.         Is the “limit of liability” clause in the insurance contract ambiguous?


            Interpretation of an insurance contract is a question of law, which we review de novo.  Thommes v. Milwaukee Ins. Co., 641 N.W.2d 877, 879 (Minn. 2002).  An insurance policy must be construed as a whole, and unambiguous language must be given its plain and ordinary meaning.  Henning Nelson Constr. Co. v. Fireman’s Fund Am. Life Ins. Co., 383 N.W.2d 645, 652 (Minn. 1986).  Language is ambiguous if it is reasonably subject to more than one interpretation.  Hammer v. Investors Life Ins. Co., 511 N.W.2d 6, 8 (Minn. 1994).  When language in an insurance contract is ambiguous, it will be construed in favor of the insured.  Progressive Specialty Ins. Co. v. Widness ex rel. Widness, 635 N.W.2d 516, 518 (Minn. 2001).

            The “limit of liability” clause of Continental’s policy reads in pertinent part as follows:

The limit of liability shown in the Coverage Summary for Underinsured Motorists Coverage is our maximum limit of liability for all damages resulting from any one accident with an underinsured motor vehicle.  The limit of liability applicable to Uninsured Motorists Coverage or Underinsured Motorist Coverage is the most we will pay regardless of the number of:


1.         Covered persons;

2.         Claims made;

3.         Vehicles or premiums shown in the Coverage Summary or

4.         Vehicles involved in the accident.


Any amounts otherwise payable for damages under these coverages shall be reduced by all sums:


1.  Paid because of bodily injury by or on behalf of persons or organizations who may be legally responsible.  This includes all sums paid under Personal Liability Coverage.


2.  Paid or payable or which would be payable except for the application of a deductible under Personal Injury Protection Coverage.


(Emphasis omitted.)  The limit of liability in the coverage summary is $100,000 per person.

            Engle’s argument relies on a comparison of the “limit of liability” clause with the language in another section of the Continental policy titled “other insurance.”  The “other insurance” clause states:

With respect to coverage we provide when your covered automobile is involved in an accident, only:


* * * *


2.  the limit of liability for Underinsured Motorists Coverage applicable to that your covered automobile will apply for damages for which the owner or operator of the underinsured motor vehicle is legally responsible.


            According to Engle, because the “other insurance” clause does not contain the limiting language found in the “limit of liability” clause, i.e., language that allows for a reduction of payments made on behalf of someone who may be legally responsible, it takes priority.  Engle also asserts that the words “otherwise” and “damages,” which are not defined in Continental’s policy, create ambiguity.

            We disagree.  The words “otherwise” and “damages” are common terms to be given their ordinary meanings in the overall context of the policy.  The fact that the “other insurance” clause, which is applicable when prioritizing two or more potential sources of UIM benefits, does not contain “limiting” language does not create ambiguity.  The policy clearly states that the limit of liability in the coverage summary is the maximum amount Continental will pay for UIM benefits and that any amount paid must be reduced by any sum paid on behalf of a person who may be legally responsible for the bodily injury, including all sums paid under personal liability coverage.

3.         Does the “limit of liability” clause contravene Minn. Stat. § 65B.49, subd. 3a(1) (2002)?


Engle contends that Continental’s policy violates Minn. Stat. § 65B.49, subd. 3a(1), because, as written, it creates a “difference in limits” approach to UIM benefits that was specifically abrogated by the Minnesota Legislature in 1989.  Application of a statute to the undisputed facts of a case involves a question of law and is subject to de novo review.  O’Malley v. Ulland Bros., 549 N.W.2d 889, 892 (Minn. 1996).

Minn. Stat. § 65B.49, subd. 3a(1), provides:

No plan of reparation security may be renewed, delivered or issued for delivery, or executed in this state with respect to any motor vehicle registered or principally garaged in this state unless separate uninsured and underinsured motorist coverages are provided therein.  Each coverage, at a minimum, must provide limits of $25,000 because of injury to or the death of one person in any accident and $50,000 because of injury to or the death of two or more persons in any accident.  In the case of injury to, or the death of, two or more persons in any accident, the amount available to any one person must not exceed the coverage limit provided for injury to, or the death of, one person in any accident.


Continental’s policy provides for UIM benefits of $100,000 per person.  As such, it exceeds the minimum statutory requirement of $25,000.

The legislature’s approach to UIM benefits has changed over time.  Engle’s argument that Continental’s limit-of-liability clause is really a prohibited “difference in limits” provision refers to the UIM statutory scheme that was in effect from 1971-1975 when UIM limits were, in all cases, reduced by the tortfeasor’s liability limits.  See, e.g., Broton v. W. Nat’l Mut. Ins. Co., 428 N.W.2d 85, 87-88 (Minn. 1988) (discussing history of 1971 legislation).  Engle also characterizes the 1985-1989 era as a “difference in limits” period, although technically, the statute then called for a UIM insurer to pay the difference between the amount paid by a tortfeasor and the UIM limits.  Id. at 88.

Continental’s policy, which provides that UIM benefits are available up to a per person limit of $100,000 after reduction for any amount paid by Continental under personal-liability coverage is neither a “difference in limits” or “limits less paid” policy.  Language similar to that contained in Continental’s policy has been characterized as a “reducing clause.”  Jensen v. United Fire & Cas. Co., 524 N.W.2d 536, 538 (Minn. App. 1994), review denied (Minn. Feb. 3, 1995).  We considered and rejected the argument asserted by Engle in Jensen.  524 N.W.2d at 539-540.

Jensen was injured in a single-vehicle accident while riding as a passenger in a pickup truck driven by her sister.  Id. at 537.  The truck was owned by another party.  Id.  The insurers for both the vehicle’s owner and Jensen’s father paid their liability limits of $100,000.  Id.  Because Jensen’s injuries exceeded $200,000, she sought UIM benefits, from her father’s automobile insurer.  Id. at 537-38.  We affirmed the district court’s ruling, stating that

Farmers Union is not attempting to use liability payments by other tortfeasors to reduce the available UIM coverage—which is what the legislature’s “add-on” amendment sought to avoid.  Rather, the limitation here is based on the relevant policy’s explicit language that excludes recovery when there has been a previous liability payment under that same policy.


Id. at 539 (citation omitted) (emphasis in original).

            An insurer’s liability is determined by the agreement between the insurer and its insured so long as the policy does not omit coverage required by law and the coverage does not violate applicable statutes.  Lynch ex rel. Lynch v. Am. Family Mut., 626 N.W.2d 182, 185 (Minn. 2001).  Because Continental’s clause does not contravene Minn. Stat. § 65B.49, subd. 3a(1), the trial court did not err by reducing Continental’s UIM payment by the $70,000 it paid to settle Engle’s liability claim against Thompson.

4.         Did the trial court err by denying Engle’s request to reduce the collateral source amount by payments made to secure the right to receive no-fault benefits?


            Following trial, the parties stipulated that Engle had received $8,190.50 in no-fault benefits, an amount that was to be deducted from the verdict as a collateral source.  Engle now argues that the $8,190.50 should have been reduced by $2,488, the amount Engle paid in premiums to secure her automobile coverage, citing Minn. Stat. § 548.36, subds. 2, 3 (2002), in support of her position.  Minn. Stat. § 548.36, subds. 2, 3, provides as follows:

Subd. 2.  Motion.  In a civil action, whether based on contract or tort, when liability is admitted or is determined by the trier of fact, and when damages include an award to compensate the plaintiff for losses available to the date of the verdict by collateral sources, a party may file a motion within ten days of the date of entry of the verdict requesting determination of collateral sources.  If the motion is filed, the parties shall submit written evidence of, and the court shall determine:


(1)  the amounts of collateral sources that have been paid for the benefit of the plaintiff * * *; and


(2)  amounts that have been paid, * * *, or on behalf of, the plaintiff or members of the plaintiff’s immediate family for the two-year period immediately before the accrual of the action to secure the right to a collateral source benefit that the plaintiff is receiving as a result of losses.


Subd. 3.  Duties of the court.  (a) The court shall reduce the award by the amounts determined under subdivision 2, clause (1), and offset any reduction in the award by the amounts determined under subdivision 2, clause (2).


            (b)  If the court cannot determine the amounts specified in paragraph (a) from the written evidence submitted, the court may within ten days request additional written evidence or schedule a conference with the parties to obtain further evidence.


            Engle contends that the trial court has a mandatory duty to reduce the collateral-source payment by the amounts paid, without regard to the timing of the request.  Here, the trial court filed its first findings of fact, conclusions of law, and order for judgment on December 18, 2001.  That order addressed the collateral source offset to the verdict, specifically including the component of $8,190.50 for the no-fault benefits Engle received.  Engle agreed to that figure at the time.  It was not until January 28, 2002, that Engle filed an affidavit requesting the reduction of $2,488 pursuant to Minn. Stat. § 548.36, subd. 2(2).  The trial court denied the request on the ground that it was an improper motion for reconsideration and because it was based on evidence not contained in the record.  The filing of a trial court’s order directing entry of judgment triggers the time for filing a motion requesting a determination of payments from collateral sources, including no-fault benefits.  Wertish v. Salvhus, 558 N.W.2d 258, 258 (Minn. 1997).  The court’s ruling is supported by the statute.