The Supreme Court of Maryland held that District Courts maintain jurisdiction over underinsured motorist claims when the damages sought fall within the statutory threshold, rejecting State Farm's jurisdictional challenge in *Bowens v. State Farm Mutual Automobile Insurance Company*.
The court's opinion, authored by Justice Killough and filed Nov. 24, addressed a fundamental question about which Maryland courts can hear insurance disputes involving underinsured motorist coverage. George Bowens brought his claim against State Farm Mutual Automobile Insurance Company in District Court, prompting a jurisdictional dispute that ultimately reached the state's highest court.
Under Maryland law, underinsured motorist coverage is statutorily required in every motor vehicle liability policy issued in the state. This mandatory coverage protects drivers when they are injured by motorists whose insurance is insufficient to cover damages. However, disputes over these claims can raise complex jurisdictional questions about which court system should handle the case.
The Supreme Court of Maryland applied section 4-401(1) of the Courts and Judicial Proceedings Article of the Annotated Code of Maryland to resolve the jurisdictional question. This statute governs District Court jurisdiction based on the amount of debt or damages claimed in civil actions.
"Under section 4-401(1) of the Courts and Judicial Proceedings Article of the Annotated Code of Maryland, the debt or damages claimed is to be determined by the amount demanded in the pleadings," the court wrote in its opinion. The statute establishes that when an action is based in contract and the debt claimed is $30,000 or less, the District Court has jurisdiction.
The case originated in Prince George's County, where Bowens initially filed his underinsured motorist claim. The matter was argued before the Supreme Court on Sept. 9, following appeals from the Circuit Court for Prince George's County. The case number C-16-CV-24-003510 indicates the dispute has been working through the court system for some time.
State Farm apparently challenged the District Court's authority to hear the case, likely arguing that underinsured motorist claims should be handled in Circuit Court due to their complexity or the nature of insurance contract disputes. However, the Supreme Court rejected this position, emphasizing that jurisdiction depends on the amount claimed rather than the type of insurance coverage at issue.
The court's analysis focused on the contractual nature of underinsured motorist claims. Because these disputes arise from insurance contracts and involve claims for monetary damages, they fall within the District Court's jurisdiction when the amount sought does not exceed $30,000.
This ruling provides important clarity for both insurance companies and policyholders about where to file underinsured motorist claims. The decision ensures that smaller UIM claims can be resolved in District Court, which typically offers faster and more cost-effective proceedings compared to Circuit Court.
For insurance practitioners, the decision reinforces that the amount demanded in pleadings determines jurisdiction, not the underlying nature of the insurance coverage dispute. This bright-line rule helps attorneys advise clients on proper venue and prevents unnecessary jurisdictional challenges.
The Supreme Court's opinion also has implications for court administration and caseload management. By confirming District Court jurisdiction for UIM claims under $30,000, the ruling helps ensure that these cases are heard in the appropriate forum without unnecessary delays or procedural complications.
The decision joins a line of Maryland cases interpreting the jurisdictional statutes governing District Courts. Section 4-401(1) has been the subject of various disputes over the years as parties seek to determine the proper court for different types of civil claims.
For State Farm and other insurers operating in Maryland, the ruling provides clarity about litigation strategy and case management. Insurance companies can no longer challenge District Court jurisdiction solely based on the UIM nature of claims when damages sought fall within the statutory threshold.
The case also reflects the ongoing importance of underinsured motorist coverage in Maryland's insurance landscape. With UIM coverage mandated by state law, disputes over these claims regularly appear in Maryland courts, making jurisdictional clarity essential for efficient case processing.
Looking ahead, the decision should streamline the handling of UIM claims in Maryland courts. Attorneys representing both insurers and policyholders now have clear guidance on jurisdictional requirements, reducing the likelihood of successful challenges based on the nature of the insurance coverage rather than claim amount.
The Supreme Court of Maryland's ruling in *Bowens v. State Farm* thus serves dual purposes: it resolves the immediate jurisdictional question while providing broader guidance for future underinsured motorist litigation in the state's court system.