|
COURT OF APPEALS DECISION DATED AND RELEASED July 16, 1996 |
NOTICE |
|
A party may file with the
Supreme Court a petition to review an adverse decision by the Court of
Appeals. See § 808.10 and
Rule 809.62(1), Stats. |
This opinion is subject to
further editing. If published, the
official version will appear in the bound volume of the Official Reports. |
No. 96-0342-FT
STATE
OF WISCONSIN IN COURT OF
APPEALS
DISTRICT III
PATRICIA AND GLEN
MCNAMARA,
Plaintiffs-Appellants,
v.
RURAL MUTUAL INSURANCE
COMPANY,
Defendant-Respondent.
APPEAL from a judgment
of the circuit court for Chippewa County:
RODERICK A. CAMERON, Judge. Affirmed.
Before Cane, P.J.,
LaRocque and Myse, JJ.
MYSE, J. Patricia and Glen
McNamara appeal a judgment dismissing their complaint against Rural Mutual
Insurance Company based upon the trial court's determination that an
exclusionary clause in Rural's homeowner's policy applied to recreational motor
vehicles.[1] The McNamaras contend that accidents arising
from the use of recreational motor vehicles are covered under the unambiguous
language of the policy. Alternatively,
the McNamaras contend that the policy is ambiguous and rules of construction
require that we resolve the ambiguity in favor of coverage. Because we conclude that a reasonable
insured would understand that under the terms of this policy injuries resulting
from the use of recreational motor vehicles are covered only conditionally, and
the conditions have not been met in this case, we affirm the judgment.
Patricia McNamara was
injured when a recreational motor vehicle she was operating collided with a
recreational motor vehicle operated by Amy McNamara. The collision occurred on property owned by Patricia and her husband,
Glen. Patricia and Glen brought a
personal injury action against Rural based on the fact that Rural had in effect
an insurance policy issued to Amy's parents, Patrick and Shannon McNamara. Amy was an insured under her parents' homeowner's
policy because she was a resident of her parents' household at the time of the
accident. Rural moved for summary
judgment and the trial court granted it, concluding that an exclusionary clause
in Rural's policy applied to recreational motor vehicles.
We review a grant of
summary judgment de novo, applying the same methodology as the trial
court. Dipasquale v. American
Family Ins. Co., 168 Wis.2d 75, 78, 483 N.W.2d 231, 233 (Ct. App.
1992). Summary judgment is appropriate
where the facts are undisputed and only a question of law remains. Krause v. Massachusetts Bay Ins. Co.,
161 Wis.2d 711, 714, 468 N.W.2d 755, 756 (Ct. App. 1991).
The issue is whether the
exclusionary clause in Rural's policy applies to recreational motor
vehicles. The interpretation of an
insurance policy is a question of law that we review without deference to the
trial court. Dipasquale,
168 Wis.2d at 78-79, 483 N.W.2d at 233.
An insurance policy should be interpreted as a reasonable person in the
insured's position would understand it.
Id. When the
policy is unambiguous, we simply apply the language without engaging in
construction. Id. at 79,
483 N.W.2d at 233. However, if the
policy is ambiguous, the policy should be construed so as to provide
coverage. Just v. Land Reclamation,
Ltd., 155 Wis.2d 737, 746, 456 N.W.2d 570, 573 (1990). The language is ambiguous only if it is
reasonably susceptible to more than one construction from the viewpoint of a
reasonable person in the insured's position.
Dipasquale, 168 Wis.2d at 79, 483 N.W.2d at 233.
Because the parties
agree that coverage applies under the general policy provisions, we look to the
exclusion that Rural contends removes coverage for accidents involving
recreational motor vehicles. The
relevant exclusion provides:
GENERAL EXCLUSIONS THAT APPLY TO ALL
LIABILITY AND MEDICAL COVERAGES
We do not pay for a loss:
1. resulting from the ownership,
operation, main-tenance, use, loading or unloading of:
....
b.
Any motor vehicle or watercraft, except as provided in the Supplemental
Coverages of this form; (This exclusion does not apply to bodily injury to a
person while performing duties as a domestic employee of an insured.) (Emphasis deleted.)
The
term motor vehicle is defined in the policy by the following provisions:
Motorized Vehicle: Any self-propelled vehicle (assem-bled or
unassembled, regardless of horsepower, number of wheels or method of surface
contact) including parts and equipment.
(This does not include small motorized equipment for the service of the
insured premises such as a power lawn mower or snow blower.) (Emphasis deleted.)
The following types of motorized vehicles
have specific meanings as used in this policy:
1. Motor Vehicle means a motorized
vehicle, trailer or semi-trailer designed for travel on public roads and
subject to licensing (including any attached machinery or apparatus);
2.
Recreational Motor Vehicle means a motorized vehicle (other than a motor
vehicle as defined above), trailer or attached apparatus designed or used for
recreation, vacation or leisure time activities. (Emphasis deleted.)
The exclusion applies to
"any motor vehicle" or watercraft.
The term motor vehicle has a specific meaning as found in the
definitions contained in the policy. A
motor vehicle is a subclass of motorized vehicle, which includes both motor
vehicles and recreational motor vehicles.
Motor vehicle is defined as "a motorized vehicle, trailer or
semi-trailer designed for travel on the public roads and subject to
licensing." Because a recreational
motor vehicle is a subset of motorized vehicles, but not included within the
definition of motor vehicle, a recreational motor vehicle is not a motor
vehicle as that term appears in the exclusion.
A close reading of the
language and the definition of the words used within the policy leads us to
conclude that the exclusion of motor vehicles from coverage is not sufficiently
broad to encompass recreational motor vehicles. If Rural desired to exclude recreational motor vehicles from
coverage, it should have specifically used the term in the exclusion or used
the term motorized vehicles, which includes both motor vehicles and
recreational motor vehicles. Because
the term motor vehicle appears in the exclusion and that term does not
encompass recreational motor vehicles, we conclude that the exclusion, by its
literal terms, does not encompass recreational motor vehicles.
Our conclusion that a
recreational motor vehicle is not included within the literal terms of the
exclusion does not end our inquiry. The
exclusion makes reference to supplemental coverage available to an
insured. We must therefore examine the
terms of supplemental coverage to determine the meaning of the exclusion. The relevant supplemental coverage provision
which provides an exception to the exclusion states in relevant part:
4. Incidental Motorized Vehicle
Coverage: We will pay for bodily injury
or property damage which:
a. Occurs on the insured premises
and results from the ownership, maintenance, use, loading or unloading of:
....
2. recreational motor vehicles;
....
c.
results from an insured's use of a recreational motor vehicle not owned by or
rented to that insured.
The
supplemental coverage provisions specifically grant coverage for bodily injury
or property damage resulting from the use of recreational motor vehicles when
it occurs on the insured's premises or when the recreational motor vehicle is
not owned by the insured. The
unambiguous language of the supplemental coverage provision is inconsistent
with the literal terms of the exclusionary clause. Why would the policy have to restore coverage for use of
recreational motor vehicles if the policy had not excluded coverage in the
first place?
In construing and
interpreting an insurance policy, we must consider the policy as a whole to
give each of its provisions the meaning the parties intended. Schaefer v. General Cas. Co.,
175 Wis.2d 80, 84, 498 N.W.2d 855, 856 (Ct. App. 1993). Therefore, we must reconcile the terms of a
policy which grants coverage to recreational motor vehicles, does not appear to
remove that coverage by an exclusion but provides for a specific grant of
supplemental coverage on certain conditions.
Because the grant of coverage for recreational motor vehicles is
specifically conditioned, we cannot agree with the McNamaras' claim that there
is an unambiguous grant of coverage for all accidents involving recreational
motor vehicles. While an examination of
a portion of the policy would lead to that conclusion, an examination of the
policy as a whole discloses that there is only a conditional grant of coverage
for recreational motor vehicles. We
therefore conclude that, examining the policy as a whole, there is no clear and
unambiguous grant of coverage for accidents involving recreational motor
vehicles without condition or limitation.
Next, we must examine
the language of the policy to determine whether a reasonable insured would be
able to determine the coverage available for accidents involving recreational
motor vehicles. See Dipasquale,
168 Wis.2d at 79, 483 N.W.2d at 233. We
conclude that a reasonable insured would understand the homeowner's policy to
provide coverage for bodily injury or property damage from the use of
recreational motor vehicles only when it occurs on the insured's premises or
when the recreational motor vehicle is not owned by the insured. In this case, the accident did not occur on
the insured's premises and the insureds owned the recreational motor vehicle
involved in the collision. Therefore,
the injuries are not covered by this insurance policy.
We reach this conclusion
for two reasons. First, we note that
the coverage for recreational motor vehicles is specifically stated in the
supplemental coverage portion of the policy.
There is no ambiguity that recreational motor vehicles are only
conditionally covered by this policy.
This specific and unambiguous language must prevail over ambiguous
language that a reasonable insured could understand in either of two ways. Second, a strict reading of the definition
portion of the policy leads us to conclude that recreational motor vehicles are
a subset of motorized vehicles and are not included in the term motor
vehicle. However, that language, when
read with a specific grant of supplemental coverage relating to recreational
motor vehicles, is insufficient to create an ambiguity. A reasonable insured would construe the term
motor vehicle to include recreational motor vehicle as part of the exclusion
when there is a specific grant of coverage, albeit conditional, for
recreational motor vehicles in the supplemental coverage portion of the
policy. The supplemental coverage
provision granting conditional coverage to recreational motor vehicles would be
unnecessary and meaningless if recreational motor vehicles were not excluded
elsewhere in the policy. A construction
giving reasonable meaning to every provision of a policy is preferable to one
leaving part of the language useless or meaningless. Stanhope v. Brown County, 90 Wis.2d 823, 848-49,
280 N.W.2d 711, 722 (1979). Because
there is a specific grant of supplemental coverage, we conclude that a
reasonable insured would construe the exclusion as encompassing recreational
motor vehicles when considering the provisions of the policy as a whole.
Because we conclude that
there is only one reasonable interpretation of the policy notwithstanding
conflicts within the provisions of the policy, we conclude that there is no
ambiguity that would have confused or misled a reasonable insured. A reasonable insured when examining the
policy in question could reach only one conclusion in regard to coverage for
recreational motor vehicles: the policy granted conditional coverage for
recreational motor vehicles and recreational motor vehicles owned by the
insured and used off the insured's premises are not within the grant of
conditional coverage specifically provided by the policy. We therefore affirm the judgment dismissing
the McNamaras' complaint.
By the Court.—Judgment
affirmed.
Not recommended for
publication in the official reports.