Appeal from Johnson District Court; THOMAS E. FOSTER, judge.
1. An insured's failure to comply with an insurance policy condition may be waived, but generally waiver and estoppel will not expand an insurance policy's coverage.
2. Under an exclusion or limitation of insurance coverage based on K.S.A. 40-284(e)(3), an insured is not covered for a non-contact accident caused by a negligent unidentified driver in the absence of evidence to prove the facts of the accident by a disinterested witness.
3. The purpose of K.S.A. 40-284(e)(3) is to prevent fraud. Under the facts of this case, without a disinterested witness to the accident, the insurer had no way to refute the insured's claim that his injury was caused by the negligence of an unidentified motorist.
The opinion of the court was delivered by: Buser, J.
Reversed and remanded with directions.
Before PIERRON, P.J., MALONE and BUSER, JJ.
In this uninsured motorist case, Farmers Insurance Company, Inc., (Farmers) appeals a judgment in favor of its insured, Craig Russell. Because the automobile insurance policy issued by Farmers did not provide coverage for Russell's accident, we reverse and remand with directions to the district court to enter judgment in favor of Farmers.
Factual and Procedural Background
On March 30, 2002, Russell was injured when he tripped and fell outside a grocery store in Lenexa, Kansas. He reported the accident to Farmers 2 months later on May 31, 2002, claiming he was injured while avoiding a vehicle driven by an unidentified motorist.
The automobile insurance policy issued by Farmers to Russell provided coverage for injuries negligently caused by the operator of an uninsured motor vehicle, defined to include "[a] hit-and-run vehicle whose operator or owner has not been identified and which causes bodily injury with or without physical contact." The policy further provided that "[i]f there is no physical contact, the facts of the accident must be verified by someone other than you or another person having a claim from the same accident."
Russell and his counsel initially advised Farmers that disinterested witnesses existed. Following an investigation, Farmers denied Russell's claim without mentioning the disinterested witness issue, but reserved its rights under the policy while not waiving any rights, defenses, or contentions. In December 2003, Russell provided an interrogatory response to Farmers indicating that no witness to the accident was "known at this time." Subsequently, Russell propounded an interrogatory which sought information from Farmers regarding "all defenses . . . which you claim to plaintiff's Petition." Farmers responded that "its investigation failed to uncover any independent witness to verify the facts of the accident as required by the policy."
During his deposition on August 26, 2004, Russell testified that he had not identified a disinterested witness, and Farmers moved for summary judgment on this basis a few weeks later. The trial court denied Farmers' motion, however, finding Farmers had "failed to notify plaintiff Craig Russell of its policy defense that he failed to comply with the particular policy condition/requirement that . . . the facts of the accident must be verified by someone other than [Russell] . . . at a time when defendant ...