Blasing v. Zurich Am. Ins. Co.

Decision Date17 July 2014
Docket NumberNo. 2012AP858.,2012AP858.
Citation356 Wis.2d 63,850 N.W.2d 138,2014 WI 73
PartiesVicki L. BLASING, Plaintiff, v. ZURICH AMERICAN INSURANCE COMPANY and Menard, Inc., Defendants–Appellants, Jefferson County Human Services Department, Defendant, American Family Mutual Insurance Company, Intervenor–Respondent–Petitioner.
CourtWisconsin Supreme Court


For the intervenor-respondent-petitioner, there were briefs by David J. Pliner, Chester A. Isaacson, and Corneille Law Group, LLC, Madison, and oral argument by David J. Pliner.

For the defendants-appellants, there were briefs by Jeffrey S. Fertl, Melissa J. Lauritch, and Hinshaw & Culbertson LLP, Milwaukee, and oral argument by Jeffrey S. Fertl.

An amicus curiae brief was filed by James A. Friedman, Jonathan T. Smies, and Godfrey & Kahn, S.C., Madison, on behalf of the Wisconsin Insurance Alliance.


¶ 1 This is a review of a published decision of the court of appeals reversing an order of the circuit court for Jefferson County, William F. Hue, Judge, and remanding the cause for further proceedings.1 The circuit court granted American Family Insurance Company's motion for summary judgment, ruling that American Family had no duty to defend or indemnify under its automobile liability insurance policy. The court of appeals reversed the order of the circuit court, holding against American Family. We affirm the decision of the court of appeals.

¶ 2 Vicki Blasing, the plaintiff, was injured when lumber that was being loaded into her pickup truck by an employee of Menard, Inc. fell on her foot. Vicki Blasing is the named insured in the American Family policy.

¶ 3 The plaintiff, a named insured, brought a tort action for personal injury damages against Menard and Zurich American Insurance Company. The plaintiff did not sue the Menard employee. Menard's potential liability is vicarious liability for the torts of its employee. Menard claims its employee is an insured under the American Family policy, as a permissive user of the plaintiff's pickup truck. Menard is insured under a separate general liability insurance policy issued by Zurich Insurance to Menard.

¶ 4 Let us begin by stating what is and what is not at issue before the court.

¶ 5 The ultimate question before the court is whether American Family has a duty to defend and indemnify Menard when the injury was to the named insured under the American Family policy and the alleged tortfeasor (a Menard employee) was a permissive user of the vehicle insured under the American Family policy.

¶ 6 What is not before the court are the merits of the personal injury action; the plaintiff's personal injury action has been stayed pending resolution of this insurance policy dispute.

¶ 7 What is not before the court are the obligations of Zurich Insurance under its general liability insurance policy insuring Menard and the respective duties of American Family and Zurich Insurance if the court holds that American Family has a duty to defend and indemnify in the present case. The Zurich Insurance policy is not in the record, and the parties are not debating Zurich Insurance's obligations in isolation or in relationship to the obligations of American Family. Any such dispute between American Family and Zurich Insurance is for another day. The parties apparently agree that the Zurich Insurance policy will fully cover Menard's liability, if any, for damages, if any, incurred by the plaintiff.

¶ 8 The issue presented in the present case, simply stated, is whether American Family is obliged under the policy it sold to the named insured-plaintiff in the present case to defend and indemnify an alleged tortfeasor when the tortfeasor is a permissive user of the insured vehicle and the plaintiff-injured victim is the named insured.2

¶ 9 In order to answer this question, the court must address three separate inquiries.

¶ 10 First: Do the alleged tortfeasor's actions constitute a “use” of the pickup truck under the American Family liability policy?

¶ 11 Second: Does American Family's automobile liability insurance policy require American Family to defend and indemnify a permissive user tortfeasor when the injured victim is the named insured under the policy? The key and sole argument made by American Family and by the non-party Wisconsin Insurance Alliance is that interpreting American Family's policy to provide a permissive user tortfeasor defense and indemnity for injury to the named insured creates an absurd result.

¶ 12 Third: The third question as phrased by American Family is as follows: “Does the concept of a permissive user under the Omnibus Statute, [Wis. Stat.] § 632.32(3)(a) [2011–12],3 require an injuredperson's own liability insurer to defend and indemnify the tortfeasor who injured the insured, [when] the tortfeasor has its own liability insurance? (Emphasis and footnote added.) This statement of the issue speaks in terms of the concept of the omnibus statute and other insurance coverage available to the permissive user tortfeasor.

¶ 13 Zurich Insurance phrases the question somewhat differently, referring directly to the omnibus statute and omitting any reference to the permissive user having its own liability insurance: “Does the omnibus statute, Wis. Stat. § 632.32(3)(a), require that an automobile insurer defend and indemnify a negligent tortfeasor who injures the named insured, where the tortfeasor was a permissive user of the insured vehicle?”

¶ 14 The court of appeals answered the first two questions in the affirmative and answered the third question by stating, [P]ermissive user coverage is required in this case by the omnibus statute, Wis. Stat. § 632.32.” 4

¶ 15 American Family asks us to reverse the court of appeals and hold that the American Family policy does not cover the liability of a permissive user tortfeasor who injures a named insured because such a result is absurd; “insurance policies should be given a reasonable interpretation and not one which leads to an absurd result.” 5

¶ 16 We are not convinced by American Family's argument that the result that the court of appeals reached and that we reach is absurd. Rather, the American Family policy explicitly provides coverage in the present case: The policy promises to cover any insured for liability for damages to any person. It does not exclude recovery by an injured victim who happens to be the named insured or who happens to be another insured under the policy.

¶ 17 Our case law demonstrates that our holding today is not novel and has not been viewed as absurd or unreasonable in past cases. Several Wisconsin cases have held that the named insured under an automobile liability insurance policy is not precluded from recovering on the policy when an additional insured, while using the vehicle within the terms of the policy, inflicts injury upon the named insured.6 Indeed, Wisconsin case law has followed what appears to be the majority rule “recognizing that the named insured under an automobile liability insurance policy may recover from the insurer when injured by another insured under the policy.” 7 “In the greater number of cases, the courts ... have sustained the right of the named insured ... to recover under an automobile liability policy for an injury to ... such insured.” 7A Steven Plitt et al., Couch on Insurance 3d § 110:14 (2013).

¶ 18 Because we dispose of the instant case based on the text of the American Family policy, we need not and do not address the third question, namely whether exclusion of coverage of injury to the named insured contravenes the omnibus statute. An answer to this question would require us to determine the validity of a hypothetical provision in a hypothetical policy. We do not know the exact policy exclusion language or the facts.

¶ 19 For the reasons set forth, we affirm the decision of the court of appeals.


¶ 20 This case requires us to interpret and apply an insurance policy and a statute to undisputed facts. The interpretation of a statute and insurance policy and their application to undisputed facts ordinarily present questions of law that this court decides independently of the circuit court or court of appeals, but benefiting from their analyses. Showers Appraisals, LLC v. Musson Bros., 2013 WI 79, ¶ 21, 350 Wis.2d 509, 835 N.W.2d 226; Schinner v. Gundrum, 2013 WI 71, ¶ 35, 349 Wis.2d 529, 833 N.W.2d 685. 8

¶ 21 We review a grant of summary judgment de novo, using the same methodology as the circuit court. Schinner, 349 Wis.2d 529, ¶ 36, 833 N.W.2d 685. Summary judgment is proper when the record demonstrates that there is no genuine issue of any material fact and that the moving party is entitled to judgment as a matter of law. Wis. Stat. § 802.08(2); Schinner, 349 Wis.2d 529, ¶ 36, 833 N.W.2d 685.


¶ 22 The facts surrounding the alleged incident and injuries are undisputed for purposes of this review. On September 16, 2008, the named insured-plaintiff, Vicki Blasing, visited a store owned and operated by Menard, Inc. in the Village of Johnson Creek, Jefferson County, Wisconsin, to pick up lumber she had purchased at Menard. She drove her 1990 Chevrolet pickup truck to the store and parked it in a lumberyard area.

¶ 23 An employee of Menard used a forklift to place the purchased lumber into the plaintiff's pickup truck, which was insured by the American Family policy. The plaintiff stood near the rear passenger side of her truck. While the employee was attempting to place the lumber into the pickup truck, some of the lumber fell and hit the plaintiff's foot.

¶ 24 The plaintiff initiated a personal injury action against Menard and Zurich Insurance, Menard's insurer, on January 24, 2011, for injuries arising out of the falling lumber incident, alleging both common-law negligence and a violation of the Wisconsin Safe Place Statute, Wis. Stat. § 101.11. It appears to be undisputed that the Zurich Insurance policy will fully indemnify Menard and fully...

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