Allstate Ins. Co. v. Pruett
| Decision Date | 25 June 2008 |
| Docket Number | No. 26830.,26830. |
| Citation | 118 Haw. 174,186 P.3d 609 |
| Parties | ALLSTATE INSURANCE COMPANY, Plaintiff-Appellee, Cross-Appellee, v. Pearl PRUETT; Meredith Pruett; and Ikaika Pruett, a minor, Defendants-Appellants, Cross-Appellees, and Charlene Manglicmot, a minor; Michelle Casil, a minor, Defendants-Appellees, Cross-Appellees, and Salvador Pebenito; Board of Water Supply, City and County of Honolulu, Defendants-Cross-Appellees, and Doe 1-10, Defendants. Pearl Pruett, individually and as guardian of Ikaika Pruett and Meredith Pruett, Third-Party Plaintiffs-Appellants, Cross-Appellees, v. AIG Hawaii Insurance Company, a Hawai`i corporation, Third-Party Defendant-Appellee, Cross-Appellant. |
| Court | Hawaii Supreme Court |
Randall Y.S. Chung and Ward F.N. Fujimoto of Matsui Chung Sumida & Tsuchiyama, Honolulu, on the briefs, for third-party defendant-appellee, cross-appellant AIG Hawaii Insurance Company.
Richard B. Miller and Patricia Kehau Wall of Tom Petrus & Miller, LLLC, Honolulu, on the briefs, for plaintiff-appellee, cross-appellee, Allstate Insurance Company.
Stuart N. Fujioka of Nishioka & Fujioka, AAL, ALC, Honolulu, on the briefs, for defendants-appellants, third-party plaintiffs-appellants, cross-appellees Pearl Pruett, Meredith Pruett and Ikaika Pruett, a minor.
Defendants-Appellants, Third-Party Plaintiffs-Appellants, Cross-Appellees, Pearl Pruett, Ikaika Pruett, and Meredith Pruett (collectively, "the Pruetts"), appeal from the Circuit Court of the First Circuit's ("circuit court's") October 18, 2004 final judgment partially in favor of Plaintiff-Appellee, Cross-Appellee, Allstate Insurance Company ("Allstate").1 On appeal, the Pruetts assert that the circuit court erred when it determined that Allstate was not obligated to defend or indemnify Pearl and Ikaika Pruett under Allstate's homeowner's insurance policy naming Pearl Pruett as the named insured.
Both Allstate and Third-Party Defendant-Appellee, Cross-Appellant, AIG Hawaii Insurance Company ("AIG") (collectively, "the Insurers"), appeal from the circuit court's October 18, 2004 final judgment partially in favor of the Pruetts. On appeal, the Insurers present the following points of error: (1) the circuit court erred when it held that the Pruetts were entitled to coverage under the Insurers' automobile insurance policies; (2) the circuit court erred when it determined that the phrase "any person" as used in the automobile insurance policies was ambiguous; and (3) the circuit court erred when it determined that the Pruetts were entitled to recover costs and attorney's fees against the Insurers.
For the following reasons, we hold that the circuit court: (1) did not err when it determined that liability coverage was afforded to Meredith Pruett and Ikaika Pruett pursuant to the terms of AIG's automobile insurance policy, inasmuch as the manner in which the term "any person" was used in AIG's policy was ambiguous; (2) did not err when it determined that Personal Injury Protection ("PIP") coverage was afforded to Ikaika Pruett pursuant to the terms of Allstate's automobile insurance policy, inasmuch as the manner in which the term "any person" was used in Allstate's policy was ambiguous; (3) erred when it determined that Pearl Pruett and Ikaika Pruett were afforded liability coverage under Allstate's automobile insurance policy because any claim arising from the automobile accident would not arise out of the use of an "insured auto"; (4) abused its discretion in awarding costs and attorney's fees to the Pruetts because the circuit court did not order the Insurers to "pay benefits"; and (5) did not err when it determined that the Pruetts were excluded from coverage under the terms of Allstate's homeowner's insurance policy. Accordingly, we affirm in part and reverse in part the circuit court's October 18, 2004 final judgment.
Pearl Pruett is the biological grandmother and adoptive mother of Ikaika Pruett, who is a minor. Meredith Pruett is Pearl's biological daughter, Ikaika's biological aunt, as well as Ikaika's sister as a result of the adoption. Pearl, Meredith, and Ikaika all reside together.
On February 8, 2002, Ikaika was involved in an automobile accident while operating a vehicle owned by Meredith. Ikaika did not have a driver's license at the time of the accident. He also did not have a reasonable belief that he was entitled to operate the vehicle, and had neither Meredith's nor Pearl's permission to use or operate the vehicle.
According to the circuit court's undisputed findings of fact, Charlene Manglicmot, Michelle Casil and others may claim to suffer injuries from the accident. Additionally, Salvador PeBenito and the Board of Water Supply of the City and County of Honolulu and others have claimed or may claim property damage from the accident.
Meredith was listed as the named insured on an AIG automobile insurance policy, which was in effect on the day of the accident. Pearl was listed as the named insured on an Allstate automobile insurance policy and an Allstate homeowner's insurance policy, both of which were in effect on the day of the accident.
On June 10, 2002, Allstate filed a complaint in circuit court seeking, inter alia, a judicial declaration that it did not owe duties to defend or indemnify the Pruetts under its automobile insurance policy for any claims or injuries arising out of the automobile accident. Allstate also sought a declaration that it was not required to provide PIP coverage to, inter alia, Ikaika Pruett.
On July 8, 2002, the Pruetts filed a counterclaim against Allstate, as well as a third party complaint against AIG. In their counterclaim, the Pruetts alleged that Allstate owed duties to defend and indemnify under both its automobile and homeowner's insurance policies. The Pruetts claimed that coverage was owed under the homeowner's policy because the Pruetts "expect property damage and personal injury claims to be asserted against them ... based on allegations including but not limited to negligent entrustment and negligent supervision of a minor." In its third party complaint, the Pruetts asserted that AIG owed them duties to defend and indemnify under AIG's automobile insurance policy issued to Meredith.
On November 7, 2002, AIG moved for summary judgment on the Pruett's third party complaint. On November 25, 2002, Allstate moved for summary judgment on its complaint and on the Pruett's counterclaim. On December 17, 2002, the Pruetts filed a cross-motion for summary judgment against Allstate and AIG.
On March 4, 2003, the circuit court filed its findings of fact, conclusions of law and order granting in part the Pruetts' cross-motion for summary judgment against Allstate and AIG. The circuit court also denied in part Allstate's motion for summary judgment, and denied AIG's motion for summary judgment. Therein, the circuit court ruled that the exclusions from coverage enumerated in both AIG's and Allstate's insurance policies did not apply to the Pruetts because the phrase "any person" as used in the policies was ambiguous. Accordingly, the circuit court determined that the Pruetts were entitled to coverage under the Insurers' auto policies for personal injury and property damage claims. For the same reason, the circuit court also determined that Ikaika Pruett was entitled to personal injury protection coverage through Allstate's auto insurance policy.
On June 28, 2004, Allstate filed a motion for partial summary judgment as to its duty to defend on a claim alleging negligent parenting by the Pruetts. On September 7, 2004, the circuit court granted Allstate's motion for partial summary judgment. In its order, the circuit court concluded that Allstate was not obligated, pursuant to the terms of its homeowner's insurance policy, to defend or indemnify any of the Pruetts for any claim to recover for injuries arising from the automobile accident, which included claims for negligent parenting.
On September 8, 2004, the circuit court granted the Pruetts' request for an award of costs and attorney's fees. This award was based on the Pruetts' prevailing on the issue of coverage under AIG's and Allstate's automobile insurance policies, and not under Allstate's homeowner's insurance policy.
The circuit court's final judgment was filed on October 18, 2004. Notices of appeal were timely filed by the Pruetts on October 22, 2004, AIG on November 15, 2004, and Allstate on November 16, 2004.
On appeal, the grant or denial of summary judgment is reviewed de novo. See State ex. rel. Anzai v. City and County of Honolulu, 99 Hawai`i 508, 514, 57 P.3d 433, 439 (2002); Bitney v. Honolulu Police Dep't, 96 Hawai`i 243, 250, 30 P.3d 257, 264 (2001).
[S]ummary judgment is appropriate if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. A fact is material if proof of that fact would have the effect of establishing or refuting one of the essential elements of a cause of action or defense asserted by the parties. The evidence must be viewed in the light most favorable to the non-moving party. In other words, we must view all of the evidence and inferences drawn therefrom in the light most favorable to the party opposing the motion.
Kahale v. City and County of Honolulu, 104 Hawai`i 341, 344, 90 P.3d 233, 236 (2004) (citation omitted).
Regarding interpretation of insurance policies, this court has stated:
[I]nsurers have the same rights as individuals to limit their liability and to impose whatever conditions they please on their obligation, provided they are...
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