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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. William Holderness v State Farm Insurance (06/22/2001) sp-5425

William Holderness v State Farm Insurance (06/22/2001) sp-5425

     Notice:  This opinion is subject to correction before publication in
the Pacific Reporter.  Readers are requested to bring errors to the attention of the
Clerk of the Appellate Courts, 303 K Street, Anchorage, Alaska 99501, phone (907)
264-0608, fax (907) 264-0878.


             THE SUPREME COURT OF THE STATE OF ALASKA


WILLIAM SCOTT HOLDERNESS,     )
                              )    Supreme Court No. S-8939
               Appellant,     )  
                              )    Superior Court No.
     v.                       )    3AN-94-9277 CI
                              )
STATE FARM FIRE AND CASUALTY  )
COMPANY and STATE FARM MUTUAL )    O P I N I O N
AUTOMOBILE INSURANCE COMPANY, )     
                              )    [No. 5425 - June 22, 2001]
               Appellees.     )
______________________________)    


          Appeal from the Superior Court of the State of
Alaska, Third Judicial District, Anchorage,
                      Karen L. Hunt, Judge.


          Appearances:  David Karl Gross, Law Offices of
Murphy L. Clark, Anchorage, for Appellant.  James M. Powell,
Kimberlee A. Colbo, and Ronald H. Bussey, Hughes Thorsness Powell
Huddleston & Bauman, LLC, Anchorage, for Appellees.


          Before:  Matthews, Chief Justice, Eastaugh,
          Fabe, Bryner, and Carpeneti, Justices.


          BRYNER, Justice.
          


I.   INTRODUCTION
          Dr. William Holderness's car was struck from behind while
he was driving from home to the hospital to perform surgery.  He
was severely injured and ultimately sued his insurers (collectively
State Farm).  This appeal, from an order partially dismissing
Holderness's suit, raises two central questions.  The first is
whether Holderness's personal umbrella liability policy qualifies
as automobile liability insurance under Alaska's insurance code. 
If so, our precedent requires that the policy's underinsured
motorist coverage include prejudgment interest and attorney's fees. 
We conclude that the umbrella policy is automobile liability
insurance.  The second question is whether the accident was covered
by the general liability policy of Alaska Podiatry Associates, a
medical corporation of which Holderness was an executive officer. 
We conclude that the accident was not covered by the general
liability policy because Holderness's duties as an executive
officer of Alaska Podiatry Associates did not include commuting to
work.
II.  FACTS AND PROCEEDINGS
          While Holderness was driving to Anchorage to perform
surgery on January 20, 1994, another motorist hit his car from
behind, causing him serious and permanent injuries.  The driver who
hit Holderness was underinsured.
          At the time of the accident, Holderness held two State
Farm insurance policies: a personal automobile liability policy
covering the car he was driving and a personal liability umbrella
policy.  In addition, Holderness's medical corporation, Alaska
Podiatry Associates, owned a State Farm business insurance policy
that covered Holderness with respect to his duties as one of its
executive officers.
          Holderness filed suit against State Farm, seeking more
than $5,000,000 in damages on a variety of claims, most sounding in
insurance bad faith.  State Farm paid Holderness the facial limits
on his auto and umbrella policies, $100,000 and $2,000,000.  Soon
thereafter, this court decided State Farm Mutual Auto Insurance Co.
v. Harrington. [Fn. 1]  There, we interpreted AS 21.89.020, a
provision of Alaska's insurance code, to require that, in the
absence of a waiver by the insured, an automobile insurance policy
must be deemed to provide equal liability and underinsured motorist
coverage, including coverage for attorney's fees and prejudgment
interest above the policy's facial limits. [Fn. 2]
          In response to this court's ruling in Harrington, State
Farm paid Holderness an additional $28,555.52, representing
prejudgment interest and attorney's fees under his auto policy's
underinsured motorist coverage.  State Farm did not pay interest
and attorney's fees under the umbrella policy, maintaining that
Harrington did not apply to such policies.  The company also
declined to pay Holderness anything under the Alaska Podiatry
Associates business liability policy, claiming that it did not
cover the accident.
          After considering argument concerning whether Harrington
applied to umbrella policies and whether the Alaska Podiatry
Associates business liability policy covered Holderness's accident,
the superior court issued a ruling that the umbrella policy did not
qualify as automobile liability insurance under Alaska's insurance
code and that State Farm therefore owed Holderness no prejudgment
interest or attorney's fees beyond that policy's $2,000,000 facial
limit.  The court further ruled that, although the Alaska Podiatry
Associates policy qualified as liability insurance under Harrington
(and therefore would have to be construed to provide equal
liability and underinsured motorist coverage), the policy did not
cover Holderness's accident because he was not performing
"executive duties" when the accident occurred.  Based on these
rulings, the superior court dismissed those portions of
Holderness's suit that sought recovery under the umbrella and
business liability policies.
          Meanwhile, an arbitration panel found that Holderness had
suffered damages totaling $7,308,076 in the accident.  Holderness
moved to confirm the panel's award and sought Alaska Civil Rule 82
attorney's fees based on that amount.  State Farm opposed this
motion, seeking to reduce the panel's damages finding to
$2,128,555.52 -- the amount that State Farm had already paid
Holderness, and the amount that State Farm claimed to be the total
of the policy limits for his auto and umbrella insurance.  The
superior court confirmed the arbitration panel's award, denying
Holderness's request for Rule 82 attorney's fees and declining
State Farm's request to cap the award at State Farm's estimate of
policy limits.
          Holderness then requested entry of partial judgment under
Alaska Civil Rule 54(b).  In response to this request, the superior
court entered a partial judgment that dismissed Holderness's
"contract claims" with prejudice.  Holderness appeals.
III. DISCUSSION
     A.   Standard of Review
          We apply our independent judgment to issues of statutory
construction [Fn. 3] and contract interpretation. [Fn. 4]  When
interpreting insurance contracts we look to four factors: (1) the
language of the disputed policy provisions; (2) the language of
other provisions in the policy; (3) relevant extrinsic evidence;
and (4) case law interpreting similar provisions. [Fn. 5]  We
review a superior court's decision on attorney's fees for an abuse
of discretion. [Fn. 6] 
     B.   Harrington Reformation of the Umbrella Policy

          State Farm paid Holderness the $2,000,000 facial limit of
his personal liability umbrella policy, but refused to pay him
prejudgment interest and Civil Rule 82 attorney's fees in excess of
that amount.  Holderness argued below that his umbrella policy
qualified as automobile insurance under AS 21.89.020 and triggered
reformation of the policy to include prejudgment interest and
attorney's fees under Harrington.  The superior court disagreed,
ruling that umbrella policies are not automobile insurance under
AS 21.89.020 and, accordingly, that Harrington does not apply. 
          Alaska Statute 21.89.020(c) requires insurers to offer
underinsured motorist coverage in amounts equal to the limits
purchased for liability coverage.  The statute provides, in
relevant part:
          An insurance company offering automobile

liability insurance in this state for bodily injury or death shall,
initially and at each renewal, offer coverage prescribed in AS
28.20.440 and 28.20.445 or AS 28.22 for the protection of the
persons insured under the policy who are legally entitled to
recover damages for bodily injury or death from owners or operators
of uninsured or underinsured motor vehicles. . . .  Coverage
required to be offered under this section must include the
following options:
               (1)  policy limits equal to the limits
voluntarily purchased to cover the liability of the person insured
for bodily injury or death[.][ [Fn. 7]]

          Our cases have interpreted this provision to mean that if
an automobile liability policy fails to include equal liability and
underinsured motorist coverage, the policy must be reformed to make
the underinsured motorist coverage "equal to the limits voluntarily
purchased" for liability. [Fn. 8]  In Harrington, we specifically
considered whether a policy reformed to provide such underinsured
motorist coverage must also include attorney's fees and prejudgment
interest in addition to the policy's facial limits, as would be
required in a case involving liability coverage. [Fn. 9]  We held
that underinsured motorist coverage must include those additional
amounts. [Fn. 10]  Noting that we had interpreted "policy limits"
similarly in other contexts, we found this interpretation
consistent with the underlying goal of AS 21.89.020(c): "to provide
for the insured . . . the same benefit level as that provided by
the insured to those asserting claims against the insured." [Fn.
11]
          Here, we must decide whether Harrington applies to
Holderness's umbrella policy.  We based our decision in Harrington
on AS 21.89.020(c), which, by its own terms, only applies to
"automobile liability insurance."  While subsection (c) of
AS 21.89.020 does not define "automobile liability insurance," 
subsection (a) of the same provision sets forth a core definition,
describing an automobile liability policy as one "that insures an
owner or operator of a motor vehicle against loss resulting from
liability for bodily injury or death, or for property injury or
destruction, or both." [Fn. 12]  Accordingly, we apply this
definition in determining whether subsection (c)'s requirement of
equal liability and underinsured motorist coverage applies to
Holderness's umbrella policy.  
          Holderness's umbrella policy expressly covers losses
arising from his liability for personal injury or property damage
in excess of the limits covered by his underlying State Farm
policies:
          If you are legally obligated to pay damages

for a loss, we will pay your net loss minus the retained limit. 
Our payment will not exceed the amount shown on the Declarations as
Policy Limits - Coverage L - Personal Liability.[ [Fn. 13]] 
The umbrella policy defines a "loss" as "an accident that results
in personal injury or property damage during the policy period." 
"Net loss" is the total of the damages the insured must pay for the
loss and the reasonable expenses incurred in settling or trying the
case.  The "retained limit" is the amount the insured or the
underlying insurance must pay before the umbrella policy begins to
pay.  The policy additionally covers "expenses we incur and costs
taxed against you in suits we defend," including attorney's fees,
[Fn. 14] as well as "prejudgment interest awarded against you on
that part of the judgment we pay under Coverage L."
          Although the umbrella policy might have been phrased to
exclude coverage for liability stemming from the ownership or
operation of an automobile, it was not.  By contrast, it
specifically excludes coverage "for any loss involving your
maintenance, use, handling or ownership of any aircraft."  This
language persuades us that the umbrella policy falls within the
ambit of AS 21.89.020(a) and (c), because the policy insures
Holderness as "an owner or operator of a motor vehicle against loss
resulting from liability for bodily injury or death, or for
property injury or destruction, or both." [Fn. 15]
          Indeed, State Farm acknowledges that Holderness's
umbrella policy might qualify as "an automobile liability policy"
under the literal terms of AS 21.89.020; but State Farm insists
that this insurance code provision incorporates by reference a
traffic code provision, AS 28.22.121(b), that precludes umbrella
policies from being treated as automobile liability insurance. 
State Farm's argument unfolds as follows.
          Subsection (c) of AS 21.89.020 -- the insurance code
provision that requires equal liability and underinsured motorist
coverage -- specifically refers to, and directs insurers offering
automobile liability coverage to comply with, two separate parts of
the motor vehicle code, the Alaska Mandatory Automobile Insurance
Act (AMAIA) [Fn. 16] and the Motor Vehicle Safety Responsibility
Act (MVSRA): [Fn. 17] "An insurance company offering automobile
liability insurance in this state . . . shall . . . offer coverage
prescribed in AS 28.20.440 and 28.20.445 [of the MVSRA] or AS 28.22
[of the AMAIA] for the protection of the persons insured under the
policy who are legally entitled to recover damages" caused by an
uninsured or underinsured motorist. [Fn. 18]  
          State Farm points out that one of the incorporated AMAIA
provisions, AS 28.22.121(b), expressly excludes umbrella policies
from its definition of motor vehicle liability policies: "A policy
is excluded from the application of this chapter if the automobile
or motor vehicle liability coverage is provided only on an excess
or umbrella basis." [Fn. 19]  In State Farm's view, because this
AMAIA exclusion is incorporated in AS 21.89.020(c), this subsection 
necessarily excludes umbrella policies from its requirement of
equal liability and underinsured motorist coverage.  Thus, State
Farm insists, it is impossible to apply AS 21.89.020(c) to umbrella
policies without "nullifying" AS 28.22.121(b).   
          The superior court found this argument persuasive,
concluding "that the exclusion of umbrella policies from the
requirements of AS 21.89.020, governing what an insurer must offer
in a policy, is necessary to give effect to the Legislature's
intention to exclude umbrella policies from AS 28.22, governing
what an insured must obtain in a policy."  But closer examination
of these provisions reveals no actual conflict between the
insurance code's treatment of umbrella policies as automobile
liability insurance and the AMAIA's exclusion of such policies from
its own requirements.  
          The provisions of the insurance code and the AMAIA
dealing with automobile insurance are counterparts, each dealing
with the same subject but addressing different parties.  The motor
vehicle code's AMAIA requires drivers to buy certain minimum
liability and underinsured motorist coverages, [Fn. 20] whereas the
insurance code's AS 21.89.020 requires insurance companies to offer
drivers certain minimum levels and combinations of these coverages. 
Considered from the point of view of the parties affected by each
of these statutory regimes, any potential conflict between the
insurance code's AS 21.89.020 and the AMAIA's AS 28.22.121(b) is
more apparent than real.  
          Since the AMAIA's function is to set minimum levels of
coverage that drivers must buy and to specify what provisions these
mandatory policies must contain, the act's exemption of umbrella
policies simply enables drivers to buy excess or umbrella policies
that do not duplicate various provisions that the AMAIA already
requires to be included in their underlying mandatory coverage.
[Fn. 21]  In keeping with the AMAIA's relatively narrow focus, that
act's exemption for umbrella policies operates only within the
sphere of the AMAIA itself; AS 28.22.121(b) thus provides that "[a]
policy is excluded from the application of this chapter [that is,
from the AMAIA] if the . . . coverage is provided only on an excess
or umbrella basis." [Fn. 22]  By its own terms, then, this
exemption does not reach beyond the AMAIA and so cannot nullify
coverage that other statutory regimes independently require
insurers to offer. 
          The insurance code's AS 21.89.020 imposes this kind of
independent coverage requirement.  Apart from prescribing general
compliance with applicable provisions of the AMAIA,
AS 21.89.020(c)(1) commands that underinsured motorist coverage
offered under section .020 "include . . . policy limits equal to
the limits voluntarily purchased to cover . . . liability."  And as
we have already indicated, AS 21.89.020(a) describes automobile
liability broadly enough to include umbrella policies like the
State Farm policy at issue here.   Accordingly, the AMAIA's
internal exemption for umbrella policies fails to reach these
externally imposed coverage requirements of the insurance code.  
          We find further support for this conclusion when we
consider how the insurance code and the AMAIA interact with a third
statutory regime, the MVSRA.  We described this interaction in
Progressive Insurance Co. v. Simmons. [Fn. 23]  We noted in Simmons
that the "AMAIA's coverage limits generally parallel those of the
MVSRA;" while these two acts "coexist as components of the Alaska
Uniform Vehicle Code," they "are not coextensive." [Fn. 24]  Thus,
we observed, the AMAIA "supplements, but does not supplant, the
MVSRA." [Fn. 25]  Concerning the insurance code, we separately
noted that the original version of AS 21.89.020 "required that all
policies issued in the state meet the content requirements imposed
by the MVSRA" and "expressly referred to subsection 28.20.440(b)(3)
of the MVSRA, which required uninsured motor vehicle coverage."
[Fn. 26]  We thus recognized that, "[a]lthough the MVSRA has never
been a mandatory insurance law, as of 1968 the act's policy content
requirements became mandatory for all policies written in the
state." [Fn. 27]  
          We further observed in Simmons that, upon enactment of
the AMAIA in 1989, AS 21.89.020's language incorporating the
content requirements of the MVSRA was amended to include a
reference to the AMAIA. [Fn. 28]  Given that AS 21.89.020(c) now
incorporates the content requirements of both the MVSRA and the
AMAIA, which are generally parallel but not coextensive, we went on
to ask, "How should this language be interpreted where the contents
of policies required under the mandatory act differ from the
content requirements of the MVSRA?" [Fn. 29]  Answering this
question, we interpreted AS 21.89.020(c) to demand primary
compliance with the MVSRA unless the AMAIA imposes broader
requirements:    
          In our view, this language means that all
policies in the state must continue to conform to the content
requirements of the MVSRA, and that if the content requirements of
the mandatory act are broader than those of the MVSRA, those
requirements must also be complied with as to persons covered by
the mandatory act.[ [Fn. 30]]

          In the present case, the content requirements of the
MVSRA and the AMAIA stand in conflict: the MVSRA contains no
equivalent to the categorical exclusion of umbrella policies set
out in the AMAIA's 28.22.121(b). [Fn. 31]  In this respect, the
MVSRA provides for broader coverage than the AMAIA.  Thus, under
Simmons, even assuming that AS 21.89.020(c) did not independently
mandate equal liability and underinsured motorist coverage, the
subsection's incorporation of the MVSRA's comparable content
requirements [Fn. 32] would prevail over its incorporation of the
AMAIA's umbrella policy exclusion. 
          For these reasons, we hold that the superior court erred
in concluding that AS 28.22.121(b) excludes Holderness's umbrella
policy from being treated as an automobile liability policy under
AS 21.89.020(a) and from being reformed, under Harrington, to
provide equal liability and underinsured motorist coverage, as
prescribed by AS 21.89.020(c). 
     C.   Coverage Under the Alaska Podiatry Associates Business
Liability Policy

          At the time of the accident, Holderness was insured under
a business liability policy held by Alaska Podiatry Associates for
those acts he undertook "with respect to [his] duties as [an
executive] officer[]."  The liability section of the policy covers
"those sums that the insured becomes legally obligated to pay as
damages because of bodily injury, property damage, personal injury
or advertising injury to which this insurance applies."  Although
the "Business Liability Exclusions" section of the policy
specifically excludes coverage for injuries arising out of an
insured's use of an automobile, the same section states an
exception to this exclusion that results in coverage for liability
arising from use of a non-company-owned auto:
          Under [the liability coverage], this insurance

does not apply:
          . . . . 

          7.  to bodily injury or property damage

arising out of the ownership, maintenance, use or entrustment to
others of any aircraft, auto or watercraft owned or operated by or
rented or loaned to any insured.  Use includes operation and
loading or unloading.
          This exclusion does not apply to:

          . . . . 

          e.  bodily injury or property damage arising

out of the use of any non-owned auto in your business by any person
other than you[.]
          Like Holderness's umbrella policy, this business
insurance is an "automobile liability policy" under AS 21.89.020(a)
because its coverage includes circumstances in which liability
arises for causing injury, death, or property damage by driving an
automobile.  Thus, as the superior court correctly recognized, if
the provisions of the policy's liability coverage extend to
Holderness's accident, then AS 21.89.020 and Harrington would
require reformation of the policy to provide underinsured motorist
coverage that parallels its liability coverage. 
          Accordingly, we must inquire whether the policy's
liability coverage might extend to Holderness's accident.  The
policy defines "non-owned auto" to mean "any auto you do not own,
lease, hire or borrow which is used in connection with your
business."  The policy also specifies that, throughout its
provisions, "'you' and 'your' refer to the Named Insured shown in
the Declarations and any other person or organization qualifying as
a Named Insured under this policy."  The Named Insured in this case
was Alaska Podiatry Associates.  And since the policy nowhere
indicates that another person or organization would qualify as a
Named Insured, it follows that Holderness's personal automobile was
a "non-owned" auto under the terms of the policy -- that is, it was
not an auto owned by Alaska Podiatry Associates, the only Named
Insured.  
          The remaining question, then, is whether Holderness was
an insured under the Alaska Podiatry Associates policy at the time
of the accident; if he was an insured, his injuries would be
covered by the policy.  In describing who it insures, the policy
distinguishes between the insured company's employees and its
executive officers.  Under the policy, the corporation's
"employees, other than . . . executive officers," are insureds
"only for acts within the scope of their employment."  By contrast,
the corporation's "executive officers . . . are insureds . . . only
with respect to their duties  as . . . officers."  Accordingly, the
executive officers of Alaska Podiatry Associates were covered for
personal liability arising from their own negligence while carrying
out their duties as executive officers.
          It is undisputed that Holderness was an executive officer
of Alaska Podiatry Associates.  Holderness argues that driving from
home to the hospital to perform surgery qualifies as conduct
performed "with respect to" his duties as a corporate officer. 
Therefore, he claims, he was covered by the liability policy at the
time of the accident, and the policy, when reformed under
Harrington, insures him for the injuries he sustained at the hands
of an underinsured motorist. 
          State Farm responds that because Holderness was not
"attending a director's meeting or a shareholder's meeting[,] . . .
signing payroll checks for the corporation's employees," or the
like, he was not acting with respect to his duties as a corporate
officer.  But the non-managerial nature of Holderness's activity
does not necessarily determine whether he was acting with respect
to his duties.  For in the absence of a policy provision more
narrowly defining the policy's reference to duties of office,
Holderness's duties as an executive officer of Alaska Podiatry
Associates would have encompassed not just his managerial duties,
but all duties related to the corporation's business that
Holderness usually performed as an executive officer.  Two cases
illustrate this point.
          In Martin v. United States Fidelity & Guaranty Co., [Fn.
33] the Supreme Court of Missouri, holding that a policy's use of
the term "duties as your officers" was ambiguous, resolved the
ambiguity by concluding that the term could include a non-
managerial duty, such as fitting a pipe flange, if that duty was
one of the executive officer's actual responsibilities. [Fn. 34] 
By contrast, in Creel v. Louisiana Pest Control Insurance, Inc.,
[Fn. 35] the Court of Appeal of Louisiana construed similar policy
language narrowly, to include only managerial duties; but the court
based its decision on the trial testimony of Ray's Pest Control's
president, who specifically described his responsibilities as
president to be limited to "attending and participating in
corporate meetings, the hiring and firing of personnel, handling
financial dealings, and making corporate decisions." [Fn. 36] 
Noting that Ray's president had been on his way to spray a house
for pests when the accident occurred, the court concluded that he
was not an insured at the time of the accident. [Fn. 37]
          Read together, Martin and Creel suggest that, absent a
narrower definition of "duties of office," when a policy extends
coverage to executive officers acting "with respect to their duties
as . . . officers," the coverage should be construed to include all
work-related activities performed by executive officers -- whether
menial or managerial -- unless case-specific evidence establishes
that an officer actually undertook to perform a narrower range of
duties in that capacity.
          Here, no record evidence suggests that Holderness's role
as an executive officer of Alaska Podiatry Associates was actually
limited to managerial or purely "executive" functions. 
Accordingly, we reject State Farm's contention that Holderness was
necessarily acting outside the scope of his duties as an executive
officer at the time of the accident merely because he was not
performing managerial functions.  
          But this conclusion does not resolve the issue
specifically presented here.  The superior court's ruling did not
focus on whether Holderness was performing uniquely "executive"
functions at the time of the accident; instead, the ruling more
broadly concluded that driving to work falls outside the scope of
any kind of work-related activity: "Holderness has raised no
factual issue that he was involved in anything other than a
completely ordinary commute to work."  As the court's ruling
recognizes, Alaska follows the general rule that going to work and
coming home fall outside the scope of employment. [Fn. 38] 
Although the "going-and-coming" rule allows for exceptions on
certain occasions -- as when special errands call a worker away
from work [Fn. 39] or force the worker to take an unusually
dangerous route to work [Fn. 40] --  the record presents no
evidence suggesting that Holderness was responding to any unique or
special demands when he left home for the hospital on the day of
the accident. [Fn. 41]  Nor does the record contain any case-
specific evidence indicating that Alaska Podiatry Associates
actually considered commuting to work to be an integral aspect of
Holderness's duties as an executive officer.  Absent such evidence,
we conclude, the superior court properly ruled that Holderness "was
not performing his duties as an executive officer and was not
covered by the [Alaska Podiatry Associates] policy."  
     D.   Dismissal of Contract Claims
          This appeal is before us on a Civil Rule 54(b) partial
judgment dismissing all of Holderness's "contract claims" with
prejudice.  Holderness argues that this judgment was too broad
because it could be interpreted to block a contractual claim that
he has asserted separately -- his still pending claim that State
Farm violated AS 21.89.020(e) by failing to obtain his written
waiver of underinsured motorist coverage.
          But the superior court's partial summary judgment
dismissed Holderness's contract claims "in accordance with" its
order regarding the "Policy Limits Issues."  The policy limits
order did not consider or purport to decide the validity of
Holderness's contract claim for violations of AS 21.89.020(e)'s
waiver provision.  We thus interpret the superior court's
subsequent entry of partial summary judgment to be similarly
limited, and we conclude that the judgment does not bar Holderness
from pursuing his separate claim for violation of AS 21.89.020(e).
     E.   The Arbitration Panel Decision
          A panel of arbitrators heard Holderness's underinsured
motorist claim, as mandated by his automobile policy.  Under the
policy, the arbitration panel was to answer two questions:
          1.   Is the insured legally entitled to

collect damages from the owner or driver of the uninsured motor
vehicle or underinsured motor vehicle; and
          2.   If so, in what amount? 

          In presenting this case to the panel, the parties
stipulated that Holderness was legally entitled to damages and
submitted no evidence concerning "relative fault or the like." 
Thus, the arbitration addressed only the amount of damages
Holderness suffered, which the panel found to be $7,308,076.   
          On appeal, Holderness argues that the trial court erred
by refusing to confirm the arbitration panel's decision "on both
liability and damages."  But because the parties stipulated that
the motorist who hit Holderness was at fault, the amount of damages
was the only point at issue before the arbitration panel.  The
arbitrators found that amount to be $7,308,076, and the superior
court's order confirmed this finding.  As the panel correctly
observed, the question of whether State Farm owes Holderness any
payment was not before it:  "The extent of State Farm's liability,
if any, for policy limits or beyond has not been presented to nor
determined by this Panel.  Our decision merely establishes the
extent of Holderness's damages resulting from the accident."  The
superior court's order correctly reflected this statement.  We
therefore uphold the confirmation order.
     F.   Arbitration Attorney's Fees
          Holderness sought, and the trial court denied, Civil
Rule 82 attorney's fees based on the amount of damages the
arbitration panel found that he had suffered.  We have previously
held that "Civil Rule 82 only applies to 'costs of the action' not
attorney's fees incurred in the conduct of the prior arbitration."
[Fn. 42]  Thus, the trial court correctly denied Holderness's
motion for Rule 82 attorney's fees based on the arbitration panel's
findings.
IV.  CONCLUSION
          We AFFIRM in part and REVERSE in part the superior
court's order granting partial judgment, and REMAND for further
proceedings consistent with this decision.


                            FOOTNOTES


Footnote 1:

     918 P.2d 1022 (Alaska 1996).


Footnote 2:

     See id. at 1025-27.


Footnote 3:

     See Tipton v. ARCO Alaska, Inc., 922 P.2d 910, 912 n.1 (Alaska
1996).


Footnote 4:

     See Alaska Hous. Fin. Corp. v. Salvucci, 950 P.2d 1116, 1119
(Alaska 1997). 


Footnote 5:

     See Cox v. Progressive Cas. Ins. Co., 869 P.2d 467, 468 n.1
(Alaska 1994).


Footnote 6:

     See Osborne v. Hurst, 947 P.2d 1356, 1358 (Alaska 1997).


Footnote 7:

     AS 21.89.020(c).  Under subsection (e) of AS 21.89.020, an
insured may waive underinsured motorist coverage required under
subsection (c), but must do so in writing. 


Footnote 8:

     AS 21.89.020(c)(1); see State Farm Mut. Auto. Ins. Co. v.
Harrington, 918 P.2d 1022, 1025 (Alaska 1996); Burton v. State Farm
Fire & Cas. Co., 796 P.2d 1361, 1364 (Alaska 1990). 


Footnote 9:

     See Harrington, 918 P.2d at 1025-26.


Footnote 10:

     See id.


Footnote 11:

     Id. at 1026.


Footnote 12:

     AS 21.89.020(a) provides:

               An automobile liability policy that
insures an owner or operator of a motor vehicle against loss
resulting from liability for bodily injury or death, or for
property injury or destruction, or both, that is sold in the state,
must contain limits in at least the amount prescribed for a motor
vehicle liability policy in AS 28.20.440 or AS 28.22.101. 


Footnote 13:

     The emphases in the quoted passage appear in the original
policy, which emphasizes words to indicate that they are
specifically defined in the policy.  In the remaining references,
this emphasis is omitted, except where necessary for clarity. 


Footnote 14:

     Cf. Kenai Peninsula Borough v. Port Graham Corp., 871 P.2d
1135, 1141 (Alaska 1994); Schultz v. Travelers Indem. Co., 754 P.2d
265, 267 (Alaska 1988).


Footnote 15:

     AS 21.89.020(a).


Footnote 16:

     AS 28.22.


Footnote 17:

     AS 28.20.


Footnote 18:

     AS 21.89.020(c).


Footnote 19:

     AS 28.22.121(b).  The full text of AS 28.22.121 reads: 
 
               Excess of additional coverage.  (a) A
policy that grants the coverage required for a motor vehicle
liability policy may also grant lawful coverage in excess of or in
addition to the coverage specified for a policy and the excess or
additional coverage is not subject to the provisions of this
chapter.  With respect to a policy that grants excess or additional
coverage, the term "motor vehicle liability policy" applies only to
that part of the coverage that is required by this chapter.

               (b) A policy is excluded from the
application of this chapter if the automobile or motor vehicle
liability coverage is provided only on an excess or umbrella basis.


Footnote 20:

     See AS 28.22.101.


Footnote 21:

     For instance, AS 28.22.101(d) requires that motor vehicle
liability policies governed by the AMAIA "must provide coverage in
the United States or Canada."  Under the exclusion for umbrella
policies in AS 28.22.121(b), an insured might buy umbrella coverage
for a more restricted geographical area.


Footnote 22:

     AS 28.22.121(b) (emphasis added). 


Footnote 23:

     953 P.2d 510, 520-22 (Alaska 1998).


Footnote 24:

     Id. at 520-21.


Footnote 25:

     Id. at 521.


Footnote 26:

     Id. at 520.


Footnote 27:

     Id.


Footnote 28:

     See id. at 522.  Specifically, we stated: 

               Finally, prior to the mandatory insurance
act of 1989, AS 21.89.020(c) read as follows:

                    An insurance company offering
automobile liability insurance in this state for bodily injury or
death shall offer coverage prescribed in AS 28.20.440 and 28.20.445
. . . for the protection of the persons insured under the policy
who are legally entitled to recover damages for bodily injury or
death from owners or operators of uninsured or underinsured motor
vehicles.

               The mandatory act changed this by adding
the phrase "or AS 28.22" after "28.20.445." 


Footnote 29:

     Id.


Footnote 30:

     Id.


Footnote 31:

     Compare AS 28.20.440(g) (MVSRA) with AS 28.22.121 (AMAIA).


Footnote 32:

     See AS 28.20.440(b)(3) (requiring an owner's liability
insurance policy to contain underinsured motorist coverage "in not
less than the amounts" set out for liability coverage).  


Footnote 33:

     996 S.W.2d 506 (Mo. 1999).


Footnote 34:

     Id. at 508, 510.


Footnote 35:

     723 So. 2d 440 (La. App. 1998), cert. granted, 731 So. 2d 272
(La. 1998).


Footnote 36:

     Id. at 443.


Footnote 37:

     See id. at 443-44.  Unlike the policy at issue here, however,
the policy in Creel excluded coverage for officers performing
executive duties; accordingly, the court's conclusion that the
president's conduct fell outside his official duties resulted in a
finding that the Ray's Pest Control policy covered the Creels'
injuries.  See id. at 444.  


Footnote 38:

     See, e.g., Seville v. Holland Am. Line Westours, Inc., 977
P.2d 103, 106 (Alaska 1999). 


Footnote 39:

     See, e.g., Witmer v. Kellen, 884 P.2d 662, 666 (Alaska 1994). 



Footnote 40:

     See, e.g., Johnson v. Fairbanks Clinic, 647 P.2d 592, 595
(Alaska 1982).


Footnote 41:

     As a surgeon and executive officer of Alaska Podiatry
Associates, Holderness regularly worked both at his office and at
the hospital.  The record fails to suggest that driving from home
to the hospital exposed Holderness to any greater risk than he
would have encountered had he been driving to his office.  Given
these circumstances, the fact that the accident occurred when
Holderness was driving to the hospital rather than to his office
has no special significance for purposes of applying the going-and-
coming rule.  


Footnote 42:

     Integrated Resources Equity Corp. v. Fairbanks N. Star
Borough, 799 P.2d 295, 300 (Alaska 1990) (quoting Alaska State
Hous. Auth. v. Riley Pleas, Inc., 586 P.2d 1244, 1249 (Alaska
1978)).