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State Farm v. Connolly - 5/8/2006

Arizona Court of Appeals Division One Panel Holds that Negligent Infliction of Emotional Distress Claim is Separate Injury to a Second Victim Not Subject to "Each Person" Limitation.


Trista Connolly witnessed the death of her sister Dana, who was struck by a vehicle driven by a State Farm insured. After State Farm paid Dana's parents for Dana's wrongful death, State Farm filed a declaratory action to resolve whether Trista was entitled to damages for her negligent infliction of emotional distress claim. State Farm did not dispute that Trista properly stated a negligent infliction of emotional distress claim and conceded that her emotional distress could constitute bodily injury covered under the insurance policy.

State Farm claimed that Trista's damages were subsumed in the wrongful death claim and subject to the "Each Person" limitation found in the policy, which limited recovery for "all damages due to bodily injury to one person" including "all injury and damages to other resulting from this injury" to $50,000. The policy contained a "Each Accident" limitation, which capped recovery for the accident at $100,000. State Farm argued that Trista's injury, like claims for consortium and other injuries derivative of the principal victim's injury, negligent infliction of emotional distress was "resulted from" the injury to Dana and subject to the $50,000 cap. The trial court and the appellate court disagreed.

The Court of Appeals discussed similar cases across the country that arrived at different conclusions. The appellate court agreed with decisions from Louisiana, Montana and Alaska that considered identical or nearly identical policy language in similar contexts and concluded that negligent inflict of emotional distress claims of witnesses were separate from bodily injury claims of the accident victims. See Crabtree v. State Farm Ins. Co., 632 So.2d 736 (La. 1994); Treichel v. State Farm Mut. Auto. Ins. Co., 930 P.2d 661 (Mont. 1997); See State Farm Mut. Auto. Ins. Co. v. Lawrence, 26 P.3d 1074 (Alaska 2001). The Court of Appeals rejected the holding of the Connecticut Supreme Court in Galgano v. Metropolitan Property and Casualty Ins. Co., 838 A.2d 993 (Conn. 2004) (holding that emotional distress claim of witness "resulted from" injury to victim, as phrase was used in policy). The appellate court explained because that negligent infliction of emotional distress claims require proof of physical injury that results from the emotional distress, these claims are separate from the injury to the accident victim and "result[] from the accident, not solely from the injury to the other person."

The Court awarded attorneys' fees to Trista Connolly.

Presiding Judge Irvine authored the decision, in which Judge Winthrop and Sult concurred.

Posted On: 5/8/2006