Should an award at an underinsured motorist arbitration be automatically reduced by a credit of the tortfeasor limits or subject to a motion to molding if the award is in excess of the third party policy limits?
In Whitting v. Erie Ins. Group, No. 2012-721 (C.P. Mercer Aug. 6, 2012) the trial court decided a motion to mold and motion to enter a judgment after an underinsured motorist (UIM) arbitration award of $70,000 where the insured was also bringing a separate claim against a third party who had a liability limit of $50,000. At the arbitration the UIM arbitrators were not informed of the liability limits and awarded $70,000 in damages. Erie sent the insured's attorney a check for $20,000 to reflect a credit for the liability limits. No motion to mold was filed and eventually the insured's attorney sought to enter a judgment for the full $70,000 award. Erie objected.
The trial court construes the award as a total damages and not UIM damages. Pursuant to the Erie policy language, the UIM insurer did not have to file a motion to mold the award to reflect an offset for the $50,000 in liability limits. The trial court also finds that even if an insurer misses the deadline to file a motion for modification or clarification, which is what occurred in this case the court has authority to resubmit the matter if it finds the award to be ambiguous, which in this case it did not.
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