This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (1994).
STATE OF MINNESOTA
IN COURT OF APPEALS
American States Insurance Co.,
Melissa A. Knapp,
Filed May 21, 1996
Hennepin County District Court
File No. 95837
Theodore J. Smetak, James M. Susag, Arthur, Chapman, McDonough, Kettering & Smetak, P.A., 500 Young Quinlan Building, 81 South Ninth Street, Minneapolis, MN 55402-3214 (for Respondent)
Robert V. Espeset, Blomquist & Espeset, Suite 255, Broadway Place East, 3433 Broadway Street Northeast, Minneapolis, MN 55413 (for Appellant)
Considered and decided by Kalitowski, Presiding Judge, Randall, Judge, and Stone, Judge.*
U N P U B L I S H E D O P I N I O N
Appellant Melissa A. Knapp challenges the district court's summary judgment precluding her from recovering underinsured motorist (UIM) benefits under Minn. Stat. § 65B.49, subd. 4a (1986). We affirm.
D E C I S I O N
On appeal from summary judgment this court reviews to determine whether there are genuine issues of material fact and whether the district court erred in applying the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990). Although Knapp argues American States Insurance Company's (American States) summary judgment motion should have failed for lack of factual findings by the arbitrator, neither party disputes the findings as made by the district court. The only question on this appeal, therefore, is whether the district court erred in determining that the law in effect at the time of the accident precludes Knapp's UIM claim.
The applicable law provides
[w]ith respect to underinsured motor vehicles, the maximum liability of an insurer is the lesser of the difference between the limit of underinsured motorist coverage and the amount paid to the insured by or for any person or organization who may be held legally liable for the bodily injury; or the amount of damages sustained but not recovered.
Minn. Stat. § 65B.49, subd. 4a (1986) (emphasis added). This section provided for "limits less paid" UIM coverage, whereby all amounts paid to an injured person by tortfeasors are deducted from the insured's UIM limit to determine the maximum amount the insured can recover. Broton v. Western Nat'l Mut. Ins. Co., 428 N.W.2d 85, 89 (Minn. 1988); Kothrade v. American Family Mut. Ins. Co., 462 N.W.2d 413, 416 (Minn. App. 1990).
American States argues that, even assuming Knapp was injured by an underinsured motor vehicle, subdivision 4a prevents her from recovering UIM benefits as a matter of law. Knapp was injured in an automobile accident when the car in which she was a passenger collided with another car. Knapp collected $30,000 from the liability policy of the driver of the car in which she was riding and $90,000 from the insurer of the other driver involved in the accident. Knapp subsequently pursued a UIM claim with her own insurer, American States Insurance Company. Her own UIM policy limit is $100,000. The district court concluded Knapp is barred from proceeding to arbitration under her UIM policy because she has received more than her UIM limit in settlement proceeds.
Knapp argues she is entitled to go to arbitration to prove that the driver with whom she settled for $90,000 was zero percent at fault for the accident, and thus not a person who "may legally be held liable" for her injuries under subdivision 4a. We disagree. The 1986 statute reduces a UIM insurer's maximum liability by all amounts paid from persons who "may" be legally liable. Minn. Stat. § 65B.49, subd. 4a. As the district court noted, had the legislature intended the result urged by Knapp it could have used the term "are" legally liable to reduce the UIM insurer's maximum liability.
The insurance company for the other driver involved in this accident agreed to pay $90,000 in exchange for a release of liability from Knapp. Even taking these facts in the light most favorable to Knapp, we conclude the other driver "may" be legally liable for Knapp's injuries. Accordingly, Knapp has no UIM claim against American States as a matter of law.
* Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.