Bindrim v. B. & J. Ins. Agency

Citation527 N.W.2d 320,190 Wis.2d 525
Decision Date08 November 1994
Docket NumberNos. 92-1279 and 92-1645,s. 92-1279 and 92-1645
PartiesThomas D. BINDRIM, Plaintiff, Colonial Insurance Company, Defendant-Appellant-Petitioner, Dairyland Insurance Company and Threshermen's Mutual Insurance Company, Defendants-Respondents, Deborah Hommeland and The Cincinnati Insurance Company, Defendants, Susan J. Degano and Giuliano Degano, Defendants-Third Party Plaintiffs-Respondents, v. B. & J. INSURANCE AGENCY, Third Party Defendant. Thomas D. BINDRIM, Plaintiff-Respondent-Cross Appellant, v. COLONIAL INSURANCE COMPANY, Defendant-Appellant-Petitioner, Dairyland Insurance Company and Threshermen's Mutual Insurance Company, Defendants-Respondents, Deborah Hommeland, Defendant, The Cincinnati Insurance Company, Defendants-Cross Respondent, Susan J. Degano and Giuliano Degano, Defendants-Third Party Plaintiffs-Respondents-Cross Appellants, v. B. & J. INSURANCE AGENCY, Third Party Defendant-Cross Respondent. . Oral Argument
CourtUnited States State Supreme Court of Wisconsin

For the defendant-appellant-petitioner there were briefs by Thomas J. Binder and Otjen, Van Ert, Stangle, Lieb & Weir, S.C., Milwaukee and oral argument by Thomas J. Binder.

For the defendant-respondent, Dairyland Ins. Co. there was a brief and oral argument by John M. Swietlik, Jr., counsel for Dairyland Ins. Co., Milwaukee.

For the defendant-respondent, Threshermen's Mut. Ins. Co., there was a brief (in the court of appeals) by Kristi L. Fry and Wagner & Fry, Fond du Lac and oral argument by Kristi L. Fry.

For the defendant-cross respondent, The Cincinnati Ins. Co., there was a brief by James M. Ryan, Timothy S. Trecek and Kasdorf, Lewis & Swietlik, S.C., Milwaukee and oral argument by James M. Ryan.

For the defendants-third party plaintiffs-respondents-cross appellants, Susan J. DeGano & Giuliano Degano, there was a brief by Thomas B. Hartley and Heide, Hartley, Thom, Wilk & Guttormsen, Kenosha and oral argument by Thomas B. Hartley.

DAY, Justice.

This is a review of a decision of the court of appeals that affirmed the decision of the circuit court for Walworth County, Honorable Robert J. Kennedy, Judge. 1 The circuit court granted summary judgment in favor of the plaintiff, Thomas D. Bindrim, and against the defendant, Colonial Insurance Company (Colonial), holding that the policy issued to its insured, Giuliano Degano, also covered his wife, Susan Degano, for her negligent acts that caused injury to the plaintiff. The court of appeals affirmed the trial court's ruling that Colonial's policy provision that excluded Mrs. Degano from coverage was void as against the requirements of sec. 632.32(6)(b)1, Stats., 2 of the Omnibus Coverage Statute. We affirm the court of appeals.

The court of appeals also affirmed the trial court's dismissal of Dairyland Insurance Company (Dairyland), The Cincinnati Insurance Company (Cincinnati) and Threshermen's Mutual Insurance Company (Threshermen's), all uninsured motorist carriers. We affirm the court of appeals on that issue also.

The facts are not in dispute. On August 15, 1988, Susan Degano struck a motorcycle operated by Thomas D. Bindrim while driving an automobile owned by Deborah Hommeland. Mr. Bindrim brought suit for injuries he sustained against Colonial alleging that Susan Degano was covered by an insurance policy issued by Colonial to her husband, Giuliano Degano. In the alternative, he alleged that he was entitled to uninsured motorist benefits under policies issued to him by Dairyland, and Cincinnati, and under a policy issued to his father by Threshermen's.

The policy form used by Colonial to insure Mrs. Degano was a general automobile liability policy which Colonial attempted to modify by endorsements. The endorsements changed several definitions in the original policy form as follows:

It is agreed that the insurance as is afforded by the policy for Bodily Injury Liability and for Property Damage Liability, (Part I) applies subject to the following provisions:

(1) DEFINITIONS (2) and (3) are deleted and replaced as follows:

As to the insurance for bodily injury and property damage liability, the definitions, (2) you and your, (3) insured person or insured persons are restricted to the individual named on the policy, you, while using the car, provided the actual use of the car is with permission of the owner.

(2) DEFINITIONS, your insured car, is deleted and replaced as follows:

The words, your insured car, means a private passenger car not owned in full or in part by or registered by you....

Colonial called the resulting policy "Named Operators Coverage for non-owned vehicles."

Colonial certified to the Secretary of Transportation that their policy fulfilled the requirements of the Financial Responsibility Statutes, sec. 344.24, et seq., Stats. 3 by filing a Form SR22 with the Department of Transportation pursuant to sec. 344.31, Stats. 4 Mr. Degano was required to satisfy those requirements because he had had his license revoked. Cardinal v. Leader Nat. Ins. Co., 166 Wis.2d 375, 381, 480 N.W.2d 1 (1992).

Both Colonial and Dairyland moved for summary judgment on the issue of coverage. The trial court granted summary judgment against Colonial because it found the Colonial policy to be in violation of sec. 632.32(6)(b) 1 supra n. 1. On May 11, 1992, the circuit court entered a judgment declaring that Colonial owed coverage to Susan Degano and dismissing Bindrim's claims against Dairyland. The court of appeals affirmed the circuit court's decision. Colonial petitioned this Court for review of that decision which was granted.

The policy as issued had two fatal flaws.

First, it purported to limit the coverage given to situations where Mr. Degano was driving an automobile not owned in whole or in part by him. This was directly contrary to the provisions of the Wisconsin Financial Responsibility Statutes which require that such a policy "shall insure the person named therein using any motor vehicle." Section 344.33(2), Stats. 5 Colonial admitted the policy's deficiency in this respect in their petition for review to this Court, and it is no longer an issue:

As in Cardinal, the terms of the Colonial policy, when read in conjunction with the Financial Responsibility Statute, provide coverage for Giuliano Degano while operating any vehicle, regardless of whether he owns the vehicle.

Petition for Review, p. 9-10.

The second fatal flaw in the policy Colonial issued is its purported restriction of coverage to only Mr. Degano, attempted via an endorsement which read, "(2) you and your, (3) insured person or insured persons are restricted to the individual named on the policy, you, while using the car...." This provision is directly contrary to the requirement of sec. 632.32(6)(b)1, Stats., which requires coverage of "persons related by blood or marriage to the insured." This includes Mr. Degano's wife, Susan J. Degano as found by the trial court and affirmed by the court of appeals, and we agree.

The question presented is whether policies issued to drivers who are required to comply with the Financial Responsibility Statutes, sec. 344.24, et seq., Stats., must follow the mandates of the Omnibus Coverage Statute, sec. 632.32, Stats. Because we find the plain language of sec. 632.32(6)(b)1, requires all policies to comply with its terms, we affirm the decision of the court of appeals.

Interpretations of insurance policies and statutes are questions of law. Backhaus v. Krueger, 126 Wis.2d 178, 376 N.W.2d 377 (Ct.App.1985). We review questions of law without deference to the decisions of the trial court and court of appeals. Ball v. District No. 4, Area Board, 117 Wis.2d 529, 537, 345 N.W.2d 389 (1984).

In interpreting a statute the question is: do the words of the statute have a plain and unambiguous meaning; if they do we may not resort to judicial rules of interpretation, and construction is not permitted. Schanke v. Wisconsin County Mut. Ins. Corp., 177 Wis.2d 746, 751, 502 N.W.2d 866 (Ct.App.1993). Instead, the words of the statute must be given their "obvious and intended meaning." Id.

The terms of the Omnibus Coverage Statute are clear. "No policy" may exclude a person related by blood or marriage to the insured. Section 632.32(6)(b)1, Stats. No policy means no policy. It does not mean "no policy except named operators coverage for non-owned vehicles policies." Nor does it mean "no policy except policies that comply with the Financial Responsibility Statutes." Thus, under the statute, the Colonial policy insured Mrs. Degano.

Colonial does not agree that the statute covers their policy and argues that sec. 632.32(6)(b)1, Stats., does not apply because sec. 632.32(3)(a) 6 pertains only to policies that cover vehicles. In contrast, they argue this policy complies with the Financial Responsibility Statutes which "mandate that persons, not their vehicles, are insured ...". Cardinal, 166 Wis.2d at 385, 480 N.W.2d 1. However, the plain language of Chapter 632.32, states that it applies to all policies unless "otherwise provided." Section 632.32(1), Stats. 7 Thus, while sec. 632.32(3)(a), may "otherwise provide" that it applies only to policies that cover vehicles, no such limitation is found in sec. 632.32(6)(b)1. Similarly, the language of the Financial Responsibility Statutes, sec. 344.24, Stats., et seq., does not provide an exemption from the Omnibus Statute. As such, sec. 632.32(6)(b)1, mandates coverage for the spouse of the insured.

Colonial next argues the exclusion of Susan Degano from coverage is permissible because it is incidental to writing a policy the purpose of which is to meet the requirements of the Financial Responsibility Statutes. If this were the case, the Colonial policy could qualify for an exception to the Omnibus Coverage provisions. Section 632.32(5)(e), Stats. (1991-92), provides in part:

632.32 Provisions of motor vehicle insurance policies....

(5) PERMISSIBLE PROVISIONS.... (e) A policy may provide for...

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