BEFORE ROY NOBLE LEE, ANDERSON and ZUCCARO
ROY NOBLE LEE, CHIEF JUSTICE, FOR THE COURT:
Minnie L. Stamps has appealed from a summary judgment entered against her and in favor of the Travelers Insurance Companies on a complaint seeking punitive damages for bad faith delay/denial to pay an insurance claim.
The appellant assigns three (3) errors committed by the lower court but the real question presented is whether or not the lower court erred in granting appellee's, The Travelers Insurance Companies, motion for summary judgment on the bad faith issue because of its failure to pay medical benefits of the insurance policy and uninsured/underinsured motorist claim provided by the policy.
On the night of March 4, 1984, appellant was driving a 1978 Ford van on Mississippi Highway 18 in Hinds County, Mississippi, when a car driven by Donnie Joe Watts veered across the center line into the opposite lane of traffic and collided head-on with the vehicle driven by appellant. Donnie Joe Watts and the passenger in his car were killed in the collision. There were fourteen (14) passengers in appellant's van, members of a gospel choir returning to Utica from a singing engagement in Jackson. Thirteen (13) of the passengers received injuries. Appellant suffered injuries to her right knee and right arm, and underwent surgery. Her medical bills were in excess of fifteen thousand dollars ($15,000).
Appellant notified her insurance carrier, Travelers, about the accident on March 13, 1984, and retained the services of an attorney. She claimed entitlement to medical and property loss payments. The policy also provided uninsured motorist coverage in the amount of ten thousand dollars ($10,000) per person and twenty thousand dollars ($20,000) per accident. It further provided that the amount of uninsured motorist benefits payable would be the policy limits less any amount paid to appellant from any other policy.
Appellant made claim against the Watts carrier, Thurston Fire & Casualty Insurance. The policy limits on that carrier were ten thousand dollars ($10,000) per person, twenty thousand dollars ($20,000) per accident, and five thousand dollars ($5,000) property loss. Thurston indicated that it would pay the policy limits. It is uncontradicted that the injuries and damages of appellant exceeded the coverages in the Thurston and Travelers policies. Claims advanced by twelve (12) of the other injured parties aggregated two hundred sixty-five thousand dollars ($265,000).
Appellant's policy with Travelers covered her van and another vehicle owned by her upon which a premium was paid, and she contended that she was entitled to "stack" the uninsured motorist coverage on her claim, raising the uninsured policy limit to $20,000 per person and $40,000 per accident. Appellant advised Travelers that she would settle no part of the claim unless Travelers agreed to pay the "stacked" policy limit less the policy limit of decedent's insurance (i.e., $40,000 minus $20,000), resulting in a net amount of $20,000.
Travelers retained an attorney to advise (1) whether appellant was entitled to uninsured motorist benefits and, if so, (2) how the benefits should be distributed among the several injured parties. His advice to
Travelers was to seek judicial determination of distribution rights, and a bill of interpleader for the uninsured motorist payment was filed in the U.S. District Court, Southern District of Mississippi.
Appellant then filed suit against Travelers in the Circuit Court of the First Judicial District of Hinds County, alleging tortious breach of contract by bad faith refusal to pay proceeds, breach of fiduciary duties, and fraud in the inducement. Appellant sought $20,000 in uninsured motorist payments, $500,000 in general damages, and $3,000,000 in punitive damages. A chronology of the dealings between appellant and Travelers follows:
March 13, 1984 Travelers notified
March 19, 1984 Appellant retains counsel
April - June, 1984 Appellant refuses to settle medical *fn1 or property portions of the claim unless uninsured ...