Blazekovic v. City of Milwaukee, 98-1821-FT.

• Decision Date: 16 May 2000
• Docket Number: No. 98-1821-FT.,98-1821-FT.
• Citation: 2000 WI 41,234 Wis.2d 587,610 N.W.2d 467
• Parties: Monica M. BLAZEKOVIC, Plaintiff-Respondent, CITY OF MILWAUKEE, Plaintiff, v. CITY OF MILWAUKEE, City of Milwaukee Fire Department, Donald V. Dillard, Linda O. Dillard, Defendants, AMERICAN FAMILY MUTUAL INSURANCE COMPANY and American Standard Insurance Company of Wisconsin, Defendants-Appellants-Petitioners.
• Court: Wisconsin Supreme Court

234 Wis.2d 587

2000 WI 41

610 N.W.2d 467

Monica M. BLAZEKOVIC, Plaintiff-Respondent, CITY OF MILWAUKEE, Plaintiff, v. CITY OF MILWAUKEE, City of Milwaukee Fire Department, Donald V. Dillard, Linda O. Dillard, Defendants, AMERICAN FAMILY MUTUAL INSURANCE COMPANY and American Standard Insurance Company of Wisconsin, Defendants-Appellants-Petitioners.

No. 98-1821-FT.

Supreme Court of Wisconsin.

Oral argument January 6, 2000.

Decided May 16, 2000.

For the defendants-appellants-petitioners, there were briefs and oral argument by Beth A. Boyer-Ryan, Milwaukee.

For the plaintiff-respondent, there was a brief and oral argument by Robert L. Elliot, Milwaukee.

¶ 1. ANN WALSH BRADLEY, J.

Petitioners American Standard Insurance Company (American Standard) and American Family Mutual Insurance Company (American Family) seek review of a published decision of the court of appeals that affirmed the circuit court order denying their motion for summary judgment.¹ The insurers contend that the exclusion contained in their insurance policies precludes uninsured motorist coverage for injuries sustained by Monica M. Blazekovic while employed as a firefighter and riding in a City of Milwaukee fire truck. Because we determine that the exclusion does not fit the narrow definition of a permissible "drive other car" exclusion under Wis. Stat. § 632.32(5)(j) (1997-98),² we affirm the court of appeals.

¶ 2. The relevant facts are brief and undisputed. Monica M. Blazekovic, a City of Milwaukee firefighter, suffered injuries when the fire truck she was occupying was struck by an uninsured motor vehicle on August 25, 1995. At that time, Blazekovic had automobile insurance policies in effect on two vehicles. American Family provided coverage for her pick-up truck and American Standard provided coverage for her car.

¶ 3. Both policies included uninsured motorist coverage as required by statute, with limits of $50,000 per person and $100,000 per accident. Both policies also contained the following exclusion, identified as "Endorsement 44":

EXCLUSION OF NON-OWNED EMERGENCY TYPE AUTOMOBILE ENDORSEMENT

The insurance provided by this policy under Part I, Part II, Part III [Uninsured Motorists Coverage], Part IV, Part V or Underinsured Motorists Coverage shall not apply to Blazekovic, Monica when using non-owned emergency type vehicles in connection with his or her employment, occupation, or profession.

Endorsement 44 is a particular breed of "drive other car" exclusion, which seeks to limit uninsured motorist coverage based on the car being driven.

¶ 4. Blazekovic initially filed suit against the uninsured motorist and the City of Milwaukee Fire Department, subsequently amending her complaint to include American Standard and American Family as named defendants. She sought uninsured motorist coverage for the injuries she sustained as a result of the accident. In response, the insurers filed for summary judgment and claimed that Endorsement 44 precludes coverage because Blazekovic was using a non-owned emergency vehicle in connection with her employment.

¶ 5. The circuit court denied summary judgment and determined that Endorsement 44 was an invalid exclusion. Accordingly, the court declared that the insurers' policies provided uninsured motorist coverage for Blazekovic's injuries. ¶ 6. Prior to the circuit court's order, Blazekovic settled her uninsured motorist claim with the City of Milwaukee for $25,000 as payment towards the expenses for her injuries. Thereafter, American Family and American Standard stipulated that the additional value of Blazekovic's claim was $9,000 and permitted the entry of judgment against them for that amount. The insurers then filed a notice of appeal from that judgment.

¶ 7. The court of appeals affirmed, agreeing with the circuit court that Endorsement 44 is an invalid exclusion of uninsured motorist coverage. Observing that legislative changes in 1995 validated certain exclusions of uninsured motorist coverage that had been held invalid by prior case law, the court of appeals nevertheless concluded that Endorsement 44 remains a prohibited exclusion. Because Wis. Stat. § 632.32(5)(j) explicitly permits "drive other car" exclusions only when three conditions are met, and Endorsement 44 fails to meet one of those conditions, the court determined that Endorsement 44 may not be used by the insurers to deny Blazekovic relief for her injuries. Blazekovic v. City of Milwaukee, 225 Wis. 2d 837, 844, 593 N.W.2d 809 (Ct. App. 1999).

[1, 2]

¶ 8. This case comes before the court on a review of a summary judgment motion. In reviewing motions for summary judgment, we follow the same methodology as does the circuit court. Swatek v. County of Dane, 192 Wis. 2d 47, 61, 531 N.W.2d 45 (1995); see also Wis. Stat. § 802.08(2). Summary judgment is properly granted when there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. Green Spring Farms v. Kersten, 136 Wis. 2d 304, 315, 401 N.W.2d 816 (1987). [3, 4]

¶ 9. Because the facts in this case are not in dispute, the determination of whether Endorsement 44 is a valid uninsured motorist exclusion turns on an examination of the statutory bases of uninsured motorist coverage under Wis. Stat § 632.32. Statutory interpretation presents a question of law that we decide independently of the determinations rendered by the circuit court and court of appeals. Theis v. Midwest Ins. Co., 2000 WI 15, ¶ 9, 232 Wis. 2d 749, 606 N.W.2d 162. The primary goal in the interpretation of a statute is to discern the intent of the legislature. Reyes v. Greatway Ins. Co., 227 Wis. 2d 357, 365, 597 N.W.2d 687 (1999).

¶ 10. Before delving into statutory analysis, however, we briefly discuss the background of uninsured motorist insurance to provide context for our analysis. Uninsured motorist coverage in Wisconsin dates back to 1966 and was developed in response to the problems attendant to compensating victims of traffic accidents. Arnold P. Anderson, Wisconsin Insurance Law § 3.1 (4th ed. 1998). See also Alan I. Widiss, Uninsured and Underinsured Motorist Insurance, §§ 1.1-1.14., pp.3-19 (2d rev. ed. 1999). Wisconsin Stat. § 632.32(4)(a) mandates that every policy of automobile insurance issued in the state include uninsured motorist coverage.

[5]

¶ 11. The statute sets forth that such coverage is "[f]or the protection of persons injured who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness or disease, including death resulting therefrom, in limits of at least $25,000 per person and $50,000 per accident." Wis. Stat. § 632.32(4)(a). Underlying the uninsured motorist statute is an intent to compensate the injured victim of an uninsured motorist's negligence to the same extent as if the uninsured motorist were insured. Theis, 2000 WI 15 at ¶ 28. As a legislative creation, uninsured motorist coverage is governed by the legislature's pronouncements on its scope and viability.

[6, 7]

¶ 12. The issue before us is whether Endorsement 44 is a valid uninsured motorist exclusion. We begin our statutory interpretation with an examination of the language of Wis. Stat. § 632.32(5)(e), which states that "[a] policy may provide for exclusions not prohibited by sub. (6) or other applicable law." Based on the statutory language, this court has fashioned a two-part test to determine the validity of a particular exclusion. Clark v. American Family Mut. Ins. Co., 218 Wis. 2d 169, 174, 577 N.W.2d 790 (1998).

[8]

¶ 13. First, we must direct our focus to Wis. Stat. § 632.32(6) and decide whether the exclusion fits the description of any of the enumerated prohibitions.³Id. If it does, the matter is resolved, and the exclusion is invalid. Otherwise, we proceed to the second part of the test, which requires that we examine any "other applicable law" that may prohibit the exclusion. Id. Absent any other applicable law prohibiting the exclusion, it remains valid.

¶ 14. In this case, the parties agree that Endorsement 44 does not fall under the enumerated exclusions prohibited under Wis. Stat. § 632.32(6). However, whether the exclusion is prohibited by other applicable law under the second part of the test forms the crux of our analysis and lies at the center of the parties' disagreement.

¶ 15. Blazekovic directs our attention to Wis. Stat. § 632.32(5)(j) and contends that this provision represents the other applicable law prohibiting Endorsement 44. Section 632.32(5)(j) states:

A policy may provide that any coverage under the policy does not apply to a loss resulting from the use of a motor vehicle that meets all of the following conditions:

1. Is owned by the named insured, or is owned by the named insured's spouse or a relative of the named insured if the spouse or relative resides in the same household as the named insured.

2. Is not described in the policy under which the claim is made.

3. Is not covered under the terms of the policy as a newly acquired or replacement motor vehicle.

(Emphasis supplied.)

¶ 16. Blazekovic posits that the statute is unambiguous and permits "drive other car" exclusions only when all three requirements are satisfied. Here, Blazekovic was using a vehicle owned by the City of Milwaukee. Thus, Endorsement 44 is prohibited because it fails to satisfy the plain language of the first requirement: that the vehicle be owned by the insured or a family member residing with the insured.

¶ 17. American Family and American Standard agree that Wis. Stat. § 632.32(5)(j) is unambiguous, yet maintain that it does not represent other applicable law prohibiting the exclusion. Rather, it represents a permissive statute and nothing therein reflects a prohibitory intent.

¶ 18. The insurers further argue that all case law invalidating such exclusions as Endorsement 44 has been overturned by sweeping legislative changes in 1995 that reinstated those exclusions. They rest...