Palmer v. Allstate and Casualty Insurance Company
Palmer v. Allstate and Casualty Insurance Company, 2022 UT App 4 (Orme, J., majority; Mortensen, J., concurring; Tenney, J., concurring)
Statute of Limitations; Uninsured Motorist Statute
Plaintiff was involved in an automobile accident in which he and the at-fault driver were insured by the same company (Defendant). In a settlement, Defendant agreed to pay Plaintiff the at-fault driver’s policy limit of on the condition that Plaintiff release all claims against the at-fault driver. Defendant delivered a check to Plaintiff’s attorney and instructed the attorney to hold the funds in trust until Plaintiff executed the release of claims, which the attorney did. Eight days later, Plaintiff signed the release forms, finalizing the settlement.
Plaintiff subsequently sought to recover from Defendant for his own underinsured motorist (UIM) benefits, and Defendant filed a motion to dismiss, arguing that Plaintiff’s action was barred by the statute of limitations. The relevant statute required claims to be filed within three years after the “inception of loss” for UIM claims, which occurs upon the “date of the last liability policy payment.” Utah Code § 31A-22-305.3(5), -313(1)(a).
The question was whether “the date of the last liability payment” was the date Plaintiff’s attorney deposited Defendant’s check into the trust account (which would make Plaintiff’s subsequent action untimely) or the date Plaintiff signed the release forms (which would make his subsequent action timely). The district court ruled that the “date of the last liability payment” was the date Plaintiff’s attorney deposited the check into the trust account, and it granted Defendant’s motion to dismiss. The Utah Court of Appeals reversed, holding:
- Although the statute does not define the phrase “the date of the last liability policy payment,” the plain language of the UIM statute signals that the “date of the last liability policy payment” occurs “when a party delivers money that is accepted in discharge of an obligation, and it comes after all other payments.”
- Here, Defendant sent the check with a condition Plaintiff had to satisfy before he was entitled to the money. Accordingly, “the check could be considered an actual ‘payment’ only after [Plaintiff] signed the release and thereby became entitled to receive the funds.” Thus, the “date of the last liability policy payment” was the date Plaintiff executed the release and not the date the attorney deposited the check into the trust account.