Auto-Owners Ins. Co. v. Rasmus
| Decision Date | 13 October 1998 |
| Docket Number | AUTO-OWNERS,No. 98-0168,98-0168 |
| Citation | 222 Wis.2d 342,588 N.W.2d 49 |
| Parties | INSURANCE COMPANY, Plaintiff-Cross-Appellant, v. Lori Ann RASMUS and Richard P. Rasmus, Defendants-Cross-Respondents. Ray W. Chandler and Mildred A. Chandler, Plaintiffs, v. General Casualty Company of Wisconsin, Defendant-Appellant, Auto-Owners Insurance Company, Defendant-Respondent-Cross-Appellant, Lori Ann Rasmus, n/k/a Lori Ann Desomer, Richard P. Rasmus, and Kathy Ann Rasmus, n/k/a Kathy Ann Davis, Defendants-Cross-Respondents, ABC Insurance Company, Wisconsin Physicians Service, Medicare Part B, and Donna Shalala, Secretary of the Department of Health and Human Services, a/k/a Medicare Part A, Defendants. |
| Court | Wisconsin Court of Appeals |
On behalf of the defendant-appellant, the cause was submitted on the briefs of Robert N. Duimstra of Menn, Nelson, Sharratt, Teetaert & Beisenstein, Ltd., of Appleton.
On behalf of the plaintiff-cross-appellant-defendant-respondent-cross-appellant, the cause was submitted on the brief of Christine A. Gimber of Weld, Riley, Prenn Ricci, S.C., of Eau Claire. On behalf of defendants-cross-respondents, the cause was submitted on the brief of William M. Gabler of Garvey, Anderson, Johnson, Gabler & Geraci, S.C., of Eau Claire.
Before CANE, C.J., MYSE, P.J., and HOOVER, JJ.
General Casualty Company of Wisconsin appeals a judgment concluding that the business auto policy it issued to Richard Rasmus provided insurance coverage for a 1986 Ford Escort involved in an automobile accident and for its driver, Lori Ann Desomer. General Casualty claims that the trial court erred by concluding that Desomer was an insured, irrespective of permission, and further that the Escort was covered under its business auto policy. We affirm the judgment based on our conclusion that General Casualty provided insurance coverage under its business auto policy. 1
This action arises out of an automobile accident in which Desomer's vehicle struck a vehicle driven by Ray Chandler and occupied by his wife, Mildred Chandler. Desomer's vehicle was a Ford Escort that her father, Rasmus, had purchased for her several days before the accident. It is undisputed that Desomer, a minor, did not have permission to drive the vehicle on the day of the collision.
As a result of the accident, two separate lawsuits were initiated and later consolidated. The Chandlers filed a personal injury action against Desomer; her mother (Davis); Rasmus, and his insurer (General Casualty Company); the Chandlers' insurer (Auto Owners); Wisconsin Physicians Service; and Donna Shalala. In a second action, Auto-Owners, the Chandler's subrogated uninsured carrier, sued Desomer, Rasmus and Davis.
General Casualty subsequently brought a motion for summary judgment alleging that it did not provide insurance coverage for the accident and therefore had no duty to defend or indemnify Rasmus and/or Desomer under either its business or personal automobile policy. General Casualty claimed that the Escort was not a covered "auto" and that Desomer was not "an insured" because she did not have permission to drive the vehicle. The trial court denied General Casualty's motion, concluding that General Casualty's business auto policy covered the accident because it included family members as insureds regardless of permission, and the Escort was a covered auto under the policy's "automatic insurance" clause. See Offerdahl v. Glasser, 5 Wis.2d 498, 93 N.W.2d 362 (1958). The court further held that the personal auto policy required permission and issues of fact existed whether Desomer had permission to drive the Escort.
In September 1997, the parties entered into a stipulation and order for partial dismissal. Auto Owners and General Casualty agreed to pay $40,250 each, for a total of $80,500, to settle the Chandlers' claims. The parties further agreed that the only remaining litigants would be Auto-Owners, Desomer, Davis, Rasmus and General Casualty. It was understood that General Casualty and Auto-Owners would appeal the coverage issue. If General Casualty was found to provide coverage, it would then reimburse Auto-Owners $40,250. If General Casualty was not liable, then Auto-Owners would be responsible for the $40,250 it paid under the settlement agreement.
A bench trial was held in October 1997. The trial court found, in pertinent part, that Desomer did not have implied or express permission to drive the Escort. From this it concluded that General Casualty's personal auto policy did not provide coverage. The trial court ordered that Rasmus and the Estate of Richard P. Rasmus, 2 Desomer and Davis be dismissed with prejudice. 3 The court further ordered that Auto-Owners recover a judgment against General Casualty in the amount of $47,864.00, including the $40,250 Auto-Owners paid under the settlement with the Chandlers and $7,614 as reimbursement for property damage Auto Owners paid. General Casualty appeals the trial court's denial of summary judgment and, specifically, its conclusion that General Casualty's business auto policy provided liability coverage for Desomer and the Escort.
We review a trial court's decision to grant summary judgment de novo, as a question of law. M & I First Nat'l Bank v. Episcopal Homes Mgmt., 195 Wis.2d 485, 496-97, 536 N.W.2d 175, 182 (Ct.App.1995). In making this determination, we apply the same methodology as the trial court. Id. at 496, 536 N.W.2d at 182. Because summary judgment methodology is well known, we need not repeat it "except to observe that summary judgment is appropriate when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law." Id. at 497, 536 N.W.2d at 182 (citing § 802.08(2), STATS.). Summary judgment may be used to address insurance policy coverage issues. Link v. General Cas. Co., 185 Wis.2d 394, 398, 518 N.W.2d 261, 262 (Ct.App.1994). In this case, the parties stipulated to the material facts, but disagree on the interpretation of the insurance policy General Casualty issued to Rasmus and his business, Rick's Trucking and Bobcat Service. Therefore, we may properly decide this case on summary judgment. See id.
The interpretation of an insurance policy is a question of law this court reviews de novo, and we apply the same rules of construction that we apply to contracts generally. Smith v. Atlantic Mut. Ins. Co., 155 Wis.2d 808, 810, 456 N.W.2d 597, 598 (1990). In interpreting the policy, our objective is to determine the parties' true intentions. Kremers-Urban Co. v. American Employers Ins. Co., 119 Wis.2d 722, 735, 351 N.W.2d 156, 163 (1984). We must give an insurance policy's language its common and ordinary meaning; moreover, we construe the language as would a reasonable person in the position of the insured. Cieslewicz v. Mutual Serv. Cas. Ins. Co., 84 Wis.2d 91, 97-98, 267 N.W.2d 595, 598 (1978).
An insurance policy is ambiguous if the language when read in context is fairly or reasonably susceptible to more than one construction. See Sprangers v. Greatway Ins. Co., 182 Wis.2d 521, 536-37, 514 N.W.2d 1, 6 (1994). We resolve ambiguities in an insurance policy against the insurer and in favor of the insured. See Garriguenc v. Love, 67 Wis.2d 130, 135, 226 N.W.2d 414, 417 (1975). Whether ambiguities exist is a question of law. See Western Cas. & Surety Co. v. Budrus, 112 Wis.2d 348, 351, 332 N.W.2d 837, 839 (Ct.App.1983).
When no ambiguities exist and the policy's terms are plain on their face, we will not rewrite the policy by construction. Limpert v. Smith, 56 Wis.2d 632, 640, 203 N.W.2d 29, 33-34 (1973). Rather, we will apply the policy terms. See Budrus, 112 Wis.2d at 351, 332 N.W.2d at 839. While provisions, conditions, and exceptions tending to limit liability are strictly construed against the insurer, we "will not, under the guise of strict construction ... rewrite a policy to bind the insurer to a risk that it did not contemplate and for which it has not been paid." Bankert v. Threshermen's Mut. Ins. Co., 105 Wis.2d 438, 444-45, 313 N.W.2d 854, 857 (Ct.App.1981).
General Casualty's business auto policy provides that it will "pay all sums an 'insured' legally must pay as damages because of 'bodily injury' or 'property damage' to which this insurance applies, caused by an 'accident' and resulting from the ownership, maintenance or use of a covered 'auto.' " (Emphasis added.) General Casualty asserts that Desomer is not an "insured" under its policy and, further, that the Escort is not a covered "auto."
We first address whether Desomer is an "insured." The policy in question defines an insured as, (Emphasis added.) The policy, however, also contains an endorsement, which reads:
a. The following is added to WHO IS AN INSURED:
"Family members" are "insureds" for any covered "auto" you own of the "private passenger type" and any other "auto" described in paragraph 2.b. of this endorsement.
Family members are defined in the endorsement as, "a person related to you by blood, marriage or adoption who is a resident of your household, 4 including a ward or a foster child." The policy further contains an endorsement entitled "Wisconsin Changes," (WC endorsement) which adds to the definition of insured: "Anyone else is an 'insured' while using a covered 'auto' you own with your or any adult 'family member's' permission."
General Casualty claims that Desomer is not an insured because the policy required that she have permission to drive the Escort. We disagree. The policy's language is clear and unambiguous; permission is not a prerequisite for a family member to be an insured.
General Casualty's policy originally defined an insured as "you" and "Anyone else while using with your permission ." If this was the sole definition, we...
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