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Underinsurance benefit payout doesn’t satisfy judgment

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The Indiana Court of Appeals held that the party at-fault in an auto accident is not entitled to benefit from the injured party’s “carefulness and assiduousness” in obtaining underinsured motorist insurance coverage.

The court reversed a ruling finding a $98,000 judgment against Alan Steady was satisfied after injured party Ronald Kern’s insurer, State Farm Mutual Automobile Insurance Co., paid out $68,000 in underinsured motorist benefits to Kern. A jury found Steady 100 percent liable for the accident and injuries Kern sustained, but Steady’s insurance policy was only for $25,000. State Farm also paid $5,000 for medical expenses.

After State Farm paid out the UIM benefits, Steady asked the trial court to deem his judgment satisfied. The trial court granted the request, leading to the appeal by State Farm.

Steady claimed State Farm couldn’t appeal because it wasn’t a party at the time judgment was entered against him, but Indiana’s Uninsured and Underinsured Motorist Coverage Act allows the company to be subrogated to the proceeds of the judgment against Steady. Therefore, State Farm has standing to appeal, the court held.

“When an insurer compensates its insured due to a third party tortfeasor being underinsured, the third party tortfeasor’s liability is not reduced. Rather, Indiana Code section 27-7-5-6(a) provides that the insurer may enforce its insured’s right of recovery against the third-party tortfeasor, either in its own name or in the name of its insured, and that the insurer shall then be subrogated to the proceeds of any settlement or judgment that results,” Chief Judge Margret Robb wrote. “To allow a judgment entered against the third-party tortfeasor to be deemed satisfied due to the insurer’s underinsured motorist payment to its insured would undermine the purpose of this statute.”

The case, State Farm Mutual Automobile Insurance Company, Alan Steady v. Richard Kern, 49A02-1201-CT-34, goes back to the trial court for further proceedings.

 

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  1. Well, maybe it's because they are unelected, and, they have a tendency to strike down laws by elected officials from all over the country. When you have been taught that "Democracy" is something almost sacred, then, you will have a tendency to frown on such imperious conduct. Lawyers get acculturated in law school into thinking that this is the very essence of high minded government, but to people who are more heavily than King George ever did, they may not like it. Thanks for the information.

  2. I pd for a bankruptcy years ago with Mr Stiles and just this week received a garnishment from my pay! He never filed it even though he told me he would! Don't let this guy practice law ever again!!!

  3. Excellent initiative on the part of the AG. Thankfully someone takes action against predators taking advantage of people who have already been through the wringer. Well done!

  4. Conour will never turn these funds over to his defrauded clients. He tearfully told the court, and his daughters dutifully pledged in interviews, that his first priority is to repay every dime of the money he stole from his clients. Judge Young bought it, much to the chagrin of Conour’s victims. Why would Conour need the $2,262 anyway? Taxpayers are now supporting him, paying for his housing, utilities, food, healthcare, and clothing. If Conour puts the money anywhere but in the restitution fund, he’s proved, once again, what a con artist he continues to be and that he has never had any intention of repaying his clients. Judge Young will be proven wrong... again; Conour has no remorse and the Judge is one of the many conned.

  5. Pass Legislation to require guilty defendants to pay for the costs of lab work, etc as part of court costs...

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