Sheaffer v. Westfield Insurance

Moyek, C.J. ¶ 1 This appeal requires us to answer the following issue certified by the Court of Appeals for Holmes County: “Whether a judgment for damages entered following application of and based on entitlement to UM/UIM benefits under R.C. 3937.18 precludes retrospective application of a decision by the Ohio Supreme Court changing the relevant law where the Ohio Supreme Court issued the subject decision after the trial court entered the judgment for damages but before the 30 day time to appeal from the trial court’s judgment ran.” ¶ 2 Based on the unique facts of this case, we answer the question in the affirmative and affirm the judgment of the court of appeals. ¶ 3 The wife of appellee Ricky Sheaffer, Judy Kay Sheaffer, was killed in an auto accident involving an uninsured motorist. At the time of her death, Mrs. Sheaffer was employed by Rodhe’s Market, Inc., which had a motor vehicle liability policy through Westfield Insurance Company and a commercial general liability and umbrella policy issued by Argonaut Great Central Insurance Company. These policies were in effect in June 2000, the time of Mrs. Sheaffer’s death. The parties agree that Mrs. Sheaffer was not within the scope of her employment at the time of the accident. ¶ 4 Sheaffer and his children filed suit against Westfield and Argonaut to recover benefits under their uninsured/underinsured-motorist coverage pursuant to this court’s holdings in Scott-Pontzer v. Liberty Mut. Fire Ins. Co. (1999), 85 Ohio St.3d 660, 710 N.E.2d 1116, overruled in part by Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216, 2003-Ohio-5849, 797 N.E.2d 1256, and Ezawa v. Yasuda Fire & Marine Ins. Co. of Am. (1999), 86 Ohio St.3d 557, 715 N.E.2d 1142. Westfield settled with the Sheaffers; Argonaut disputed the Sheaffers’ entitlement to uninsured-motorist coverage. Both Argonaut and the Sheaffers moved for summary judgment. Wdiile Argonaut continued to dispute coverage, the parties agreed to stipulate damages at $525,000. ¶ 5 On August 15, 2002, the trial court found in favor of the Sheaffers and entered a judgment declaring: “Plaintiffs’ decedent and Plaintiffs are all insureds under the UM coverage provided by both the Argonaut GCL Policy and the Argonaut Umbrella Policy. * * * Plaintiffs are entitled to judgment against Argonaut for $525,000.” ¶ 6 Upon Argonaut’s appeal, the court of appeals held that Argonaut was not liable under the commercial general liability policy but was liable under the umbrella policy. Sheaffer v. Westfield Ins. Co., Holmes App. No. 02 CA 14, 2003-Ohio-4810, 2003 WL 22098897, at ¶ 11 and 23 (“Sheaffer I ”). The court remanded the cause to the trial court. Id. at ¶ 46. 267 ¶ 7 We have previously held that “[a] trial court may not vary the mandate of an appellate court, but is bound by that mandate on the questions of law decided by the reviewing court.” Transamerica Ins. Co. v. Nolan (1995), 72 Ohio St.3d 320, 323, 649 N.E.2d 1229; see, also, Nolan v. Nolan (1984), 11 Ohio St.3d 1, 3,11 OBR 1, 462 N.E.2d 410 (“where at a rehearing following remand a trial court is confronted with substantially the same facts and issues as were involved in the prior appeal, the court is bound to adhere to the appellate court’s determination of the applicable law”). ¶ 8 Following the mandate of the court of appeals, the trial court entered a judgment entry on October 15, 2003, that stated: “In accordance with the Opinion and Judgment Entry of the Court of Appeals, this Court hereby finds that the Argonaut GCL Policy was not a motor vehicle liability policy * * *. This Court further finds, however, that its remaining Conclusions of Law, and hence its ultimate decision to grant Plaintiffs’ Motion for Summary Judgment * * *, were affirmed by the Court of Appeals and remain valid, unaffected by the reversal of this Court’s first Conclusion of Law. * * * Plaintiffs are entitled to judgment against Argonaut for $525,000.” ¶ 9 On November 5, 2003, we decided Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216, 2003-Ohio-5849, 797 N.E.2d 1256, ¶ 62, limiting the scope of uninsured-motorist coverage under particular policy language to employees acting within the scope of their employment. ¶ 10 On October 24, 2003, prior to our decision in Galatis, Argonaut filed in this court a motion in support of acceptance of a discretionary appeal of Sheaffer I. On January 21, 2004, we declined to accept jurisdiction of the appeal. Sheaffer v. Westfield Ins. Co., 101 Ohio St.3d 1421, 2004-Ohio-123, 802 N.E.2d 153. ¶ 11 While simultaneously appealing the ruling in Sheaffer I to this court, Argonaut appealed the trial court’s October 15 judgment on November 12, 2003. The court of appeals affirmed the trial court’s order on December 3, 2004. Holmes App. No. 03CA006, 2004-Ohio-6755, 2004 WL 2895985 (“Sheaffer II”). We accepted Argonaut’s discretionary appeal from that judgment and recognized the certified conflict on May 2, 2005. ¶ 12 The legal issues that determined this case were terminated on January 21, 2004, when we denied jurisdiction of Sheaffer I. Transamerica Ins. Co. v. Nolan, 72 Ohio St.3d at 323, 649 N.E.2d 1229 (“Further appeal to this court was denied * * *, and therefore the law-of-the-case doctrine dictated final judgment for the insurers”). A valid judgment entry had been entered by the trial court; the court of appeals did not substantially change that judgment. The trial court, consistently with the instructions of the court of appeals, made a minor modification to its order. No new evidence was required. No new argument was heard. No briefs were submitted. Prior to the first round of appeals, a judgment had 268 been entered against Argonaut for $525,000. It was found liable under both its general comprehensive liability policy and its umbrella policy. After the first round of appeals, Argonaut still had a judgment against it for $525,000. Pursuant to this judgment, Argonaut was liable only under the umbrella policy. Because both policies limited the insurers’ liability to $1,000,000, the court of appeals’ decision had no practical effect on the judgment. After this court denied jurisdiction, there was nothing for the Sheaffers to do but collect on their October 15 judgment. ¶ 13 Argonaut argues that Galatis should be applied retroactively to foreclose liability because its appeal was pending at the time that Galatis was decided. See Hopkins v. Dyer, 104 Ohio St.3d 461, 2004-Ohio-6769, 820 N.E.2d 329. While Argonaut’s argument is generally correct, it does not apply to the particular facts of this case. When we denied jurisdiction over Sheaffer I, that decided the issue and prevented any retroactive application of Galatis to this case. ¶ 14 In one of its assignments of error in Sheaffer I, Argonaut argued that the trial court had incorrectly held the Sheaffers to be insureds under the general commercial liability policy and under the umbrella policy. The court of appeals reversed the trial court’s judgment regarding the general commercial liability policy and affirmed the trial court’s judgment regarding the umbrella policy. Argonaut appealed the affirmance to this court, and we denied its appeal, foreclosing any argument as to that point of law. ¶ 15 The issue raised in the current appeal had already been heard and decided by the court of appeals. In its second round of appeals, Argonaut presented one assignment of error to the court of appeals: “The trial court erred * * * because, as a matter of law, Plaintiffs-Appellees are not insureds under the Argonaut Umbrella Policy.” Sheaffer II, 2004-Ohio-6755, 2004 WL 2895985, ¶ 7. This is virtually the same as an assignment of error raised in Sheaffer I: “The trial court erred by determining that appellees and appellees’ decedent were insureds under the Argonaut policies.” Sheaffer I, 2003-Ohio-4810, 2003 WL 22098897, ¶ 5. We are not aware of any issue that was not raiséd on the first round of appeals that could have been raised in the second. Wffien we declined to accept its appeal of Sheaffer I, Argonaut’s case was finally decided. ¶ 16 Under the law-of-the-case doctrine, the denial of jurisdiction over a discretionary appeal by this court settles the issue of law appealed. The judgment of the court of appeals is affirmed. Judgment affirmed. Resnick, Pfeifer and Lanzinger, JJ., concur. Lundberg Stratton, O’Connor and O’Donnell, JJ., dissent.