2010 WI App 94
court of appeals of
published opinion
Case No.: |
2009AP1422 |
|
Complete Title of Case: |
†Petition For Review Filed |
Opinion Filed: |
May 4, 2010 |
Submitted on Briefs: |
February 2, 2010 |
Oral Argument: |
|
|
|
JUDGES: |
|
Concurred: |
|
Dissented: |
|
|
|
Appellant |
|
ATTORNEYS: |
On behalf of the plaintiffs-appellants, the cause was
submitted on the briefs of D.J. Weis and Rhonda L. Lanford of Habush Habush & |
|
|
Respondent |
|
ATTORNEYS: |
On behalf of the defendant-respondent, the cause was
submitted on the brief of John M. Swietlik, Jr. and Michael D. Aiken of Kasdorf,
|
|
|
2010 WI App 94
COURT OF APPEALS DECISION DATED AND FILED May 4, 2010 David
R. Schanker Clerk of Court of Appeals |
|
NOTICE |
|
|
This opinion is subject to further editing. If published, the official version will appear in the bound volume of the Official Reports. A party may file with the Supreme Court a petition to review an adverse decision by the Court of Appeals. See Wis. Stat. § 808.10 and Rule 809.62. |
|
Appeal No. |
|
|||
STATE OF |
IN COURT OF APPEALS |
|||
|
|
|||
|
|
|||
|
|
|||
Jessica L. Siebert, by her Guardian ad Litem, D.J. Weis and Lynette A. Siebert,
Plaintiffs-Appellants, Steve Albrecht, Jr., by his Guardian ad Litem, Thomas W. Kyle, Steven Albrecht, Sr., Kari Sosnowski, by her Guardian ad Litem, Thomas W. Kyle and Cyndi Anderson,
Intervening-Plaintiffs, Oneida County Department of Social Services,
Involuntary-Plaintiff, v. Wisconsin American Mutual Insurance Company,
Defendant-Respondent, Interstate Brands Corporation, ACE American Insurance Company and Ryan Friberg, Defendants. |
||||
|
|
|||
APPEAL
from a judgment of the circuit court for
Before
¶1 PETERSON, J. Jessica Siebert appeals a summary judgment in favor of Wisconsin American Mutual Insurance Company declaring there is no coverage for her negligent entrustment claim against Jessica Koehler. The circuit court concluded that, because there was no coverage for the driver’s negligent operation of a vehicle, there was also no coverage for Koehler’s negligent entrustment of the vehicle to the driver. We disagree. We therefore reverse and remand.
BACKGROUND
¶2 Koehler lent her father’s car to Jesse Raddatz to run an errand. Raddatz instead used the car to pick up Siebert and go to a party. On the way to the party, Raddatz got into an accident, injuring Siebert. Siebert sued Koehler’s father’s insurer, Wisconsin American, alleging its automobile liability policy covered Raddatz’s negligence. Under the policy, Raddatz’s negligence would be covered if he was an insured person. In this situation, that meant he must have had permission to operate the vehicle and did not exceed the scope of that permission. A jury concluded Raddatz exceeded the scope of permission.
¶3 The court then permitted Siebert to amend her complaint to assert a claim that Koehler negligently entrusted the car to Raddatz. Wisconsin American moved for summary judgment, arguing the independent concurrent cause rule barred coverage for this claim. It contended that Siebert’s negligent entrustment claim against Koehler depended on Raddatz’s negligent driving. Based on the jury verdict, there was no coverage for Raddatz’s driving. Therefore, Wisconsin American argued it follows that there is also no coverage for Koehler’s negligent entrustment. Wisconsin American also contended issue preclusion prevented Siebert from proving negligent entrustment: because the jury found Raddatz exceeded the scope of Koehler’s permission, Siebert could not prove Koehler permitted Raddatz to use the car the way he did.
¶4 The circuit court did not address the latter argument. But it agreed with Wisconsin American that Siebert’s negligent entrustment claim was barred by the independent concurrent cause rule:
The alleged negligence of Raddatz is not covered under the policy pursuant to the jury’s finding … [he] exceeded the scope of permission. And so Raddatz’s negligent operation of the vehicle is an excluded risk. And because the negligent entrustment claim against Koehler requires the occurrence of Raddatz’s negligence and because a claim for Raddatz’s negligence is excluded under the policy, the alleged negligent entrustment by Koehler is not an independent concurrent cause.
The court therefore granted summary judgment in favor of Wisconsin American.
DISCUSSION
¶5 Whether a circuit court properly granted summary judgment is
a question of law we review independently.
Torgerson v. Journal/Sentinel, Inc., 210
1.
Independent concurrent cause rule
¶6 “The independent concurrent cause rule operates to extend
coverage to a loss caused by the insured risk even though the excluded risk is
a contributory cause, where a policy expressly insures against loss by one risk
but excludes loss caused by another risk.”
Estate of Jones v. Smith, 2009 WI App 88, ¶5, 320
¶7 Siebert argues the independent concurrent cause rule does not apply here because her negligent entrustment claim does not implicate an excluded risk. We agree.
¶8 The circuit court concluded that because there was no
coverage for Raddatz’s negligence under the Wisconsin American policy, it was
an “excluded risk.” However, this
conclusion conflates lack of coverage with excluded risk. An excluded risk is a risk for which the
insurance company did not receive a premium.
See Lawver v. Boling, 71
¶9 Here, Raddatz was not an insured person under the Wisconsin
American policy because he exceeded the scope of Koehler’s permission. But that does not mean Koehler’s policy
excluded the risk that an individual entrusted with the insured car might cause
bodily injury while using the car. The
policy promises to “pay damages an insured person is legally liable for because
of bodily injury and property damage due to the use of a car ….” Individuals other than the driver can be
insured persons: “[L]iability can arise
when any person [negligently entrusts another with a vehicle].” Bankert, 110
¶10 Yet, Wisconsin American contends that under the independent
concurrent cause rule, Koehler’s coverage for this very same risk disappears
simply because Raddatz flouted Koehler’s permission. That is not how the rule operates. The rule is concerned not with who is covered
for their actions, but with whether the risk
is one the policy insures. For example,
in Estate
of Jones, a two-year-old girl died after a day care driver forgot he
left the girl buckled into the backseat of the van. Although the girl was expected at the day
care that day, none of the staff inquired about her whereabouts or looked for
her. As relevant here, the girl’s estate
sought recovery under the day care’s commercial general liability policy. Although the policy explicitly excluded
liability arising out of the use of automobiles, the girl’s estate contended
the policy provided coverage for the incident because the staff’s on-site
negligence in failing to look for the girl was an independent concurrent cause
of her death. Thus, the independent
concurrent cause rule permitted the estate to argue coverage should be extended
to an excluded risk—automobile liability—because the death was also caused by
an insured risk—the staff’s on-site negligence.
See Estate of Jones, 320
¶11 As discussed above, however, Siebert’s negligent entrustment claim—unlike the claim in Estate of Jones—does not implicate an excluded risk. Raddatz’s own negligence may be excluded from coverage, but the risk associated with Koehler lending her car to him is not. The rule therefore does not apply here.[2]
2. Claim preclusion
¶12 Wisconsin American also argues that the jury’s conclusion Raddatz exceeded the scope of permission precludes Siebert’s negligent entrustment claim because it prevents Siebert from arguing Raddatz had permission to use the car the way he did. Siebert counters that it is immaterial Koehler did not permit Raddatz to do what he eventually did. What is important, she contends, is simply that Koehler permitted Raddatz to use the car.
¶13 We agree with Siebert.
To prove negligent entrustment, Siebert must show Koehler (1) was
initially in control of the vehicle, (2) permitted Raddatz to use it, and (3)
knew or should have known Raddatz intended or was likely to use the vehicle in
a way that would create an unreasonable risk of harm to others. See
Bankert,
110
By the Court.—Judgment reversed and cause remanded.
[1] References to the Wisconsin Statutes are to the 2007-08 version.
[2] Beyond the fact that the independent concurrent cause rule does not apply here, Wisconsin American’s argument that it bars coverage is problematic. As described in the text of this opinion, the independent concurrent cause rule extends coverage to an excluded risk when a loss is also caused by an insured risk. Wisconsin American cites no authority for the idea the rule functions as an affirmative bar to coverage.