Williams v. State Farm Mutual Automobile Insurance Co.

Williams (plaintiff), a resident of Connecticut, was injured in a car accident in New York when Bain negligently struck Williams’s vehicle. Bain’s insurance company paid Williams the total amount of Bain’s coverage—$10,000. Williams sued his insurer, State Farm Mutual Automobile Insurance Company (State Farm) (defendant), for an additional $15,000 under the $25,000 uninsured-motorist provision of Williams’s policy, which required that he was legally entitled to collect damages from Bain. State Farm denied liability because under New York law, Williams could not collect from Bain because Williams had not sustained either serious injury or economic loss exceeding $50,000. Williams demanded arbitration and argued that he was entitled to the benefits under Connecticut contract law. Williams alternatively argued that if tort law controlled, then Connecticut tort law applied and regardless, the policy’s legally-entitled-to-collect requirement merely required proof that the uninsured party was at fault. The arbitrators and a Connecticut trial court concluded that Connecticut contract law governed the contract, but New York law governed whether Williams was legally entitled to recover damages from Bain, and under New York law, Williams was not entitled to recover from Bain because his damages were not sufficiently severe. Williams appealed.