Brown was injured when a passenger in a car on Kauai. See Brown v. Progressive Direct Ins. Co., 2010 Haw. App. LEXIS 211 (Haw. Ct. App. May 5, 2010). The driver of the vehicle in which Brown rode was uninsured. The driver of the second vehicle involved in the accident fled the accident scene.
At the time of the accident, Brown was insured by two auto policies issued by Progressive. Each policy provided UM coverage with a liability limit of $25,000 per person/$50,000 per accident. Brown secured these policies as a resident of Nebraska. The amount of the premiums paid was based on a Nebraska zip code.
Both policies had an "other insurance" provision which limited the total amount that could be recovered arising out of one accident to the highest limit of the available uninsured motorist coverage in any one policy. Brown submitted claims and a settlement demand to Progressive for the maximum amount of UM benefits under both policies, or a total of $50,000. Progressive, relying on the "other insurance' provisions, agreed to pay only $12,500 under each policy. Brown argued that the "other insurance" provisions were invalid under Hawai`i law, which permitted the stacking of UM benefits under multiple policies. Progressive contended that Nebraska law, which did not permit stacking, governed the policies. In March 2007, Progressive sent two checks to Brown totaling $25,000, the maximum benefits permitted under the "other insurance" provision and Nebraska law.
On March 14, 2007, Progressive filed suit for declaratory judgment against Brown in Nebraska. Brown failed to answer and a default judgment was entered. The default judgment found that Nebraska law governed the dispute and that Brown was not entitled to any further compensation from Progressive.
Thereafter, on March 27, 2007, Brown filed a complaint against Progressive in Hawaii. The complaint sought benefits of $25,000 under each policy, or a total of $50,000. Brown's motion for summary judgment was granted by the Circuit Court.
On appeal, the Intermediate Court of Appeals reversed. Brown argued res judicata should not be applied by Hawai`i courts because Progressive never informed the Nebraska court that Brown's claims were made in Hawai`i, that his claims were be handled by a Hawai`i claims adjuster at Progressive's Hawai`i claims office, and that Brown was represented by counsel in Hawai`i. Rejecting these arguments, the ICA found the full faith and credit clause of the U.S. Constitution and the doctrine of res judicata dictated that the Nebraska judgment barred the Hawai`i judgment as a matter of law.
