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RFIP – When the full policy is read by the court, common sense seems



It is the responsibility of every liability insurer to protect the interests of its insured. When there is a coverage dispute, it is best to resolve the negligence claim against the insured and then resolve the dispute by, after protecting the insured's rights, resolving the coverage dispute with an objective of explanatory relief.

The insurer did so in Scottsdale Insurance Company, as successor in the interest of Western Heritage Insurance Company v. Charles Dylan Kuntz, Case No: 2: 19-cv-00113-JES-MRM, United States District Court Middle District Of Florida Fort Myers Division (December 3, 2020) Charles Dylan Kuntz (Defendant or Kuntz) sued Whalen Auto Group, LLC (the Insured or Whalen Auto) (Circuit Court of the Twentieth Judicial Circuit in Charlotte County, Florida (negligence) ) Kuntz sought to recover damages for bodily injuries suffered by him in an accident on December 10, 2016, with an ATV owned by Whalen Auto and driven by its employee.The insurer refused coverage due to clear and unambiguous exc

FACTS

Kuntz, Whalen Auto and Scottsdale resolved the negligence measure under a written settlement agreement, which required Scottsdale to initiate an explanatory court action to determine the rights and obligations of the species arising from the insurance policy and to pay Kuntz $ 150,000.00 if Kuntz were to have priority in the explanatory action.

The indisputable essential facts are as follows: In a signed application (application) for insurance, Whalen Auto's representative Esther Whalen described her business activities as buying, selling and servicing motorcycles and selling protective equipment, cleaning equipment, tires and engine oil. The application also stated that 98% of Whalen Auto's operations consisted of sales and repairs of motorcycles, while 2% of its operations were sales and repairs of dirt bikes or ATVs / UTVs and all other recreational vehicles.

On December 10, 2016, Charles Dylan Kuntz (defendant or Kuntz) suffered bodily injuries while traveling as a passenger on a "Stampede Bad Boy", a four-wheeled ATV owned by Whalen Auto and driven by his employee Brett DeGrasse (DeGrasse) . ATVs were not licensed or equipped for use on Florida roads or highways. DeGrasse was driving from Whalen Auto's service facility to his showroom area when ATV tipped over and injured defendant. At the time of the accident, DeGrasse was twenty years old. DeGrasse is not identified in the policy as a driver for a covered "auto" nor as an authorized driver in the schedule for young drivers. Defendant Kuntz was not employed by Whalen Auto, nor did he test ATV as a prospective buyer. the party that does not move. But if reasonable thoughts may differ on the conclusions from undisputed facts, the court should deny a summary judgment.

Plaintiff Scottsdale argued that the damages claimed by Kuntz were not covered by the policy because the claim falls within the juvenile exclusion of drivers. (exclusion) of the policy, or policy covered drivers or operator restrictions (the restriction) or both. As the defendant briefly states, "the only question for the court to decide is whether the youth driver exclusion, or the covered driver restriction, works to exclude coverage."

Coverage: Youth Driver Exclusion [19659003] Politics says in relevant part:

"YOUTH PROCEDURE EXCLUSION – DEALERS ONLY

" bodily harm, "property damage & # 39; or & # 39; loss & # 39; while someone under the age of twenty-eight (21) runs a covered & # 39; auto & # 39; at any time. This exception does not apply to the persons mentioned in the schedule for young drivers or a potential buyer while they are on a test drive with you or your & # 39; employee & # 39 ;.

As previously mentioned, it is common ground that at the time of the accident DeGrasse was under 21 years of age and was not mentioned in the schedule for young drivers, and that Kuntz was not a potential buyer for a test drive. Thus, the only disputed question is whether the ATV involved in the accident was a covered "car" within the meaning of the exclusion policy.

According to the definitions in Section VI, "auto" is defined as "a land vehicle," trailer "or semi-trailer." It is common ground that the ATV is neither a trailer nor a semi-trailer. The policy does not define additional motor vehicles on land, and the phrase does not appear in quotation marks in the policy, which indicates that it is not given any special meaning in the policy.

It is obvious that the ATV in this case is a land motor vehicle because the ATV transports or transports something over the fixed part of the earth's surface while it is driven by a gasoline engine that provides movement. Consequently, the usual, non-technical definition of a land motor vehicle includes the disputed ATV in this case.

PIP approval Definition of "motor vehicle"

The court had to consider the language of the policy as a whole, including PIP approval. The Court found that the PIP approval definition of "motor vehicle" does not apply to the meaning of land motor vehicles used in the exclusion clause.

Since 1971, Florida law has required that an insurance company that issues insurance in Florida contains provisions that comply with Florida no-fault statutes, which include the provision of personal injury protection (PIP). The PIP approval in this policy explains in capital letters that it "CHANGES THE POLICY" and that it changes the "Garage Coverage Form." More specifically, the PIP approval states that "with respect to coverage provided by this approval, the provisions of the coverage form shall apply unless amended by the approval." (emphasis added). In the relevant part, the PIP approval stipulates: "We will pay benefits for personal injuries in accordance with Florida Motor Vehicle No Fault Law to or for an" insured "who incurs" bodily injury "in an" accident "as a result of ownership, maintenance or the use of a "motor vehicle." "

It is clear from the policy that the PIP approval changes the policy and changes the Garage Coverage Form in some respect, ie to the extent necessary to comply with Florida legal requirements. However, the Court concluded that the PIP approval's specific definition of" motor vehicle "Does not change, nor was intended to change, the simple meaning of" land vehicles "used in the Garage Coverage Form exemption. The clear intention is that the meaning of PIP approval definitions, including" motor vehicles ", is limited to The PIP provisions, and do not apply or replace the definitions in other parts of the policy, given the policy as a whole, the Court found that the term "motor vehicle" used in PIP approval is not applicable to determine whether an ATV is a land motor vehicle. [19659003Consequentlytheplaintiff'sdraftsummaryjudgmentwasgrantedandthedefendant'sproposalwasrejectedthusdeclaringthatthepolicyprovidedbyScottsdaleInsuranceCompanyassuccessorintheinterestofWesternHeritageInsuranceCompanydoesnotprovidecoveragefortheclaimsandthejudgmentisjudgedinfavorofScottsdaleInsuranceCompanyassuccessorininterestofWesternHeritageInsuranceCompanyandagainstCharlesDylanKuntz

Scottsdale should be commended for protecting its insured by concluding a settlement with the applicant and protecting its insured. Only after protecting the insured did it then dispute the issue of coverage with a potential to pay the applicant more and resolved it in favor of both Scottsdale and its insured.


© 2020 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to working as an insurance consultant specializing in insurance coverage, insurance claims management, insurance operations and insurance fraud almost equal insurers . He also acts as an arbitrator or mediator for insurance-related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims lawyer and more than 52 years in the insurance industry. He is available at http://www.zalma.com and zalma@zalma.com.

Mr. Zalma is the first recipient of the first annual Claims Magazine / ACE Legend Award.

For the past 52 years, Barry Zalma has devoted his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to enable insurers and their claims staff to become insurance claims staff.

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