Free Letter - District Court of Delaware - Delaware

Case 1:04-cv—01324-JJF—LPS Document 125 Filed 11/16/2005 Page 1 of 3
Murphy Spadaro & Landon
ATTORN EYS
1011 CENTRE ROAD. SUITE 210
WILMINGTON, DELAWARE 19805
i=•Hor·.iE ao2.4r2.s1oo 302.472.8lUl
FAX 3D2.472.B135 ._ ,\ _
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November 16, 2005
BY ELECTRONIC FILING
The Honorable Kent A. Jordan
United States District Court
844 North King Street, Room 4209
Wilmington, DE 19801
RE: Eames v. Nationwide Mut. Ins. Co.
C.A. N0.: U4-CV-1324KAJ
Dear Judge Jordan:
At the November 8, 2005 oral argument on Nationwide's motion to dismiss, the Court asked us
to identify authority for the proposition that Nationwide's characterization of PIP as "f`ull" is
ambiguous. We have identified an additional and important authority, and hope the Court will
consider it on this motion.
In Hardy v. Nationwide Ins. Co., 356 S.E.2d 38 (Ga. Ct. App. 1981), the Georgia Court of
Appeals addressed Nationwide's simultaneous characterization of PIP as both "basic" and "full" -— a
different and less problematic practice than the one challenged here, but a similar one nonetheless.
Specifically, Hardy was a case in which the PIP claimant had signed a Nationwide insurance
application in the following tbrmat:
[T]he second page ofthe application for insurance in this case provided
the applicant . . . with a seriatim selection of a number of available
coverages, including "BASIC PERS INJURY PROT" and, immediately
below, "ADD PERS INJURY PROT". To the right ofthe basic PIP
selection was a box labeled "FULL COVERAGE"; this box was marked
with an "X." To the right of the additional (or optional) PIP selection
was a series ofboxes labeled "$5,000," "$20,000" and "$45,000,"
respectively; none of these boxes was marked.
Hardy, 356 S.E.2d at 39. Because the form expressly denominated basic PIP, the Court of Appeals
found that it was not confusing:
The application here plainly separates the selection of basic PIP
coverage from the selection of additional PIP coverage. [The Georgia
Statute] mandates $5,000 minimum PIP coverage on motor vehicles
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Case 1:04-cv—01324-JJF—LPS Document 125 Filed 11/16/2005 Page 2 of 3
The Hon. Kent A. Jordan
November 16, 2005
Page 2
registered in this state. The term "PULI. COVERAGE" when used in
conjunction with the selection of basic PIP coverage on the application
obviously means full PIP coverage in the amount of $5,000.
Q. (emphasis added).
The features that rescued Nationwide in the Hardy case are absent here. The documents
targeted by the Eames plaintiffs -- the rate quotes, memoranda of insurance, etc. -- make no reference
to basic PTP. Nor do they contrast basic PIP from additional PIP, or offer a menu of specified dollar
limits. gz; Appendix to Plaintiffs’ Answering Brief in Opposition to Nationwide's Motion to Dismiss,
at B30, B32 (setting forth the unadorned characterization of PIP as "full").
The Court should also consider Judge Carley's special concurrence in Hardy. In that special
concurrence, Judge Carley criticizes l\lationwide's use of the "full" modifier as unbelievably deceptive;
I am constrained to concur in the result reached by the majority that the
application form complies with the current statutory language ....
1%**
With that preface, I cannot help but opine that this form, while
admittedly barely complying with the new statute, is unbelievably
deceptive in that the block wherein one may indicate his selection of only
basic personal injury protection is captioned by the words: "FULL
COVERAGE." Especially is this a less than adequate description in
view ofthe fact that there is absolutely no coverage which may be
purchased that is less than that which is designated as "FULL
COVERAGE."
Hardy, 356 S.E.2d at 40 (emphasis added in part).
Again, the usage in Hardy was redeemed (in the eyes of the Georgia appellate court`) by the
modifier "basic" -- a modifier not employed in the offending documents here. While we would have
reached a different result in Hardy, we think Judge Carley's special concurrence has profound
implications for this case. Faced with a usage that is less problematic than the one challenged here, an
experienced appellate judge found it to be "unbelievably deceptive." How much more deceptive is it
for Nationwide's memoranda of insurance, etc., to characterize PIP as "full" without any reference to
"basic PIP"?
Hardy is thus important authority for the proposition that, at a minimum, more than one
reasonable interpretation of Nationwide’s "full" usage is possible. That, of course, is the very
definition of ambiguity; and such ambiguities must be resolved in favor of the consumer insured.
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Case 1:04-cv-01324-JJF-LPS Document 125 Filed 11/16/2005 Page 3 of 3
The Hon. Kent A. Jordan
November 16, 2005 ‘
Page 3
I apologize for adding to the record, but I hope the Court will appreciate our need to bring
Hardy to the Court's attention.
Respectfully,
fsf John S, Spadaro
John S. Spadaro
J SS/slr
cc: Curtis P. Cheyney, III, Esq. (by electronic filing)
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