James v. State Farm Mutual Automobile Insurance Co.Annotate this Case
In this declaratory relief proceeding, the Supreme Court affirmed the circuit court's denial of State Farm's motion for summary judgment and entered a judgment in favor of LeRoy James on his complaint alleging that State Farm had no right to reimbursement or subrogation for paying James's medical expenses under his policy, holding that State Farm had no contractual right to reimbursement for the $5,000 paid to James for medical expenses under the policy.
State Farm insured both James and Melissa Rivers, who rear-ended James and caused him personal injury. State Farm paid a portion of James's medical expenses under his policy and then, acting on behalf of Rivers, settled with James. Once James released Rivers from liability, State Farm demanded that James use his settlement proceeds to reimburse State Farm for paying his medical expenses. James then brought this action. The circuit court entered a judgment in favor of James. The Supreme Court affirmed, holding that the text of the reimbursement provision of the policy was ambiguous, and therefore, State Farm had no contractual right to reimbursement from James.