Bushey v. Northern Assurance

Decision Date08 February 2001
Docket NumberNo. 19,19
PartiesWilliam B. BUSHEY, Personal Representative of the Estate of Miranda L. Bushey, et al., v. NORTHERN ASSURANCE COMPANY OF AMERICA, et al.
CourtMaryland Court of Appeals

Michael J. Schreyer (Donahue, Seidman & Schreyer, LLC, on brief), Waldorf, for petitioners.

Mark T. Mixter (John M. Oliveri of Law Office of Mark T. Mixer, on brief), Baltimore, for respondents.



In this review of a declaratory judgment, we consider two issues: first, the interpretation of an uninsured/underinsured motorist (UM/UIM) endorsement and, second, parent-child tort immunity where the defendant child is deceased.

On January 25, 1997, a tragic automobile accident resulted in the deaths of two sisters, Miranda L. Bushey (Miranda), a high school sophomore, and Susan C. Bushey (Susan), a high school senior. The accident occurred while Susan was driving a 1983 Cadillac Cimarron in which Miranda was riding as a passenger. The Cadillac was owned by the sisters' grandfather, Earl T. Weeks (Weeks). Susan crossed a double yellow line while attempting to pass a slower moving vehicle and struck an oncoming vehicle head-on. She died within one-half hour after the accident, and Miranda died from her injuries five days later. At the time of the accident, the Cadillac was insured under a Nationwide Mutual Insurance Company motor vehicle liability policy with limits of $20,000/$40,000. The policy was issued to Weeks, and Susan was a named insured under it.

Also in effect at the time of the accident was a commercial lines policy that William B. Bushey (Bushey), the father of Susan and Miranda, had purchased from the respondent, Northern Assurance Company of America (Northern), for his gasoline station and automotive repair business. Northern's policy contains UM/UIM provisions. The limit for that coverage is $1,000,000.

Bushey and his wife, Linda K. Bushey, (jointly, the Parents) have asserted a wrongful death claim against the Estate of Susan. Bushey, as Personal Representative of the Estate of Miranda, also has asserted a survival claim against the Estate of Susan. The Parents, individually, and Bushey, as Personal Representative of the Estate of Miranda, are the petitioners in this Court (the Petitioners).

A controversy exists between the Petitioners and Northern concerning coverage under the UM/UIM provisions of Northern's policy for the claims asserted by the Petitioners against Susan's estate. To resolve the controversy the Petitioners instituted in the Circuit Court for Charles County a declaratory judgment action which named Northern as a defendant. Northern denied coverage and, alternatively, asserted that Susan had no liability to the Parents on the wrongful death claim because of parent-child immunity. The circuit court entered judgment in favor of Northern.2

Petitioners appealed to the Court of Special Appeals which affirmed. Bushey v. Northern Assurance Co., 130 Md.App. 169, 745 A.2d 444 (2000). That court gave two reasons in support of its holding that there was no coverage. First, it said that Bushey's sole proprietorship, the named insured under the commercial lines policy, was "a business entity, not an individual," so that a critical definition in the policy concerning "family members" was said not to apply. Id. at 178, 745 A.2d at 449. Further, the court construed the UM/UIM endorsement in the context of the entire policy as, in effect, unambiguously requiring that the motor vehicle occupied by Miranda at the time of the fatal accident be a "covered `auto' "that was scheduled in the "Garage Declarations" of the "Commercial Auto Coverage Part" of the Northern policy. The Court of Special Appeals also held that parent-child immunity applied. Id. at 178-81, 745 A.2d at 449-50.

Petitioners sought certiorari review in this Court, which we granted. Bushey v. Northern Assurance, 358 Md. 608, 751 A.2d 470 (2000). As explained below, we disagree on the interpretation of the policy with respect to the coverage issue, and we disagree as to the immunity issue.3


In Sullins v. Allstate Ins. Co., 340 Md. 503, 667 A.2d 617 (1995), we summarized the rules for interpretation of insurance policies that apply here. There we said:

"In Maryland, insurance policies, like other contracts, are construed as a whole to determine the parties' intentions. Cheney v. Bell National Life [Ins. Co.], 315 Md. 761, 766-67, 556 A.2d 1135[, 1138] (1989). Words are given their `customary, ordinary, and accepted meaning,' unless there is an indication that the parties intended to use the words in a technical sense. Id., see also Chantel Associates v. [Mount ] Vernon [Fire Ins. Co.], 338 Md. 131, 142, 656 A.2d 779[, 784] (1995). `A word's ordinary signification is tested by what meaning a reasonably prudent layperson would attach to the term.' Bausch & Lomb [Inc.] v. Utica Mutual [Ins. Co.], 330 Md. 758, 779, 625 A.2d 1021[, 1031] (1993). If the language in an insurance policy suggests more than one meaning to a reasonably prudent layperson, it is ambiguous. Collier v. MD-Individual Practice [Ass'n ], 327 Md. 1, [6,] 607 A.2d 537[, 539] (1992); Pacific Indem. [Co.] v. Interstate Fire & Cas. [Co.], 302 Md. 383, [389,] 488 A.2d 486[, 489] (1985). A term which is clear in one context may be ambiguous in another. Tucker v. Fireman's Fund Ins. Co., 308 Md. 69, 74, 517 A.2d 730[, 732] (1986); Bentz v. Mutual Fire [, Marine & Inland Ins. Co.], 83 Md.App. 524, 537, 575 A.2d 795[, 801] (1990).

"Where terms are ambiguous, extrinsic and parol evidence may be considered to ascertain the intentions of the parties. Cheney, supra, 315 Md. at 766-67, 556 A.2d [at 1138]. `Maryland does not follow the rule, adopted in many jurisdictions, that an insurance policy is to be construed most strongly against the insurer.' Id. Nevertheless, `if no extrinsic or parol evidence is introduced, or if the ambiguity remains after consideration of the extrinsic or parol evidence that is introduced, it will be construed against the insurer as the drafter of the instrument.' Id.; see also, e.g., Collier, supra, 327 Md. at 5-6, 607 A.2d [at 539]; Mut[ual] Fire, Marine & Inland Ins. [Co.] v. Vollmer, 306 Md. 243, 251, 508 A.2d 130[, 134] (1986); St. Paul Fire & Mar. Ins. [Co.] v. Pryseski, 292 Md. 187, 193-96, 438 A.2d 282[, 285-87] (1981); Truck Ins. Exch. v. Marks Rentals, 288 Md. 428, 435, 418 A.2d 1187[, 1191] (1980); Aragona v. St. Paul Fire & Mar. Ins. [Co.], 281 Md. 371, 375, 378 A.2d 1346[, 1349] (1977)."

Id. at 508-09, 667 A.2d at 619.

Northern's policy contains "COMMON POLICY DECLARATIONS" which, by a Policy Change Endorsement, identify the named insured as "William B. Bushey t/a Bushey's Automotive." The policy is divided into three sections: a property section insuring the building out of which the business was conducted and insuring personal property stored in that building, a crime section insuring against theft and employee dishonesty, and a "COMMERCIAL AUTO COVERAGE PART." The "GARAGE DECLARATIONS" of that part inquire as to the "Form of Business," followed by four blocks respectively labeled "Individual," "Partnership," "Corporation," and "Other." The block identifying the form of business as "Individual" was checked.

The "GARAGE DECLARATIONS" contain a chart consisting of four columns, "Coverages," "Covered Autos," "Limit," and "Premium." Among the coverages offered and purchased were "Uninsured Motorists" and "Underinsured Motorists." Under the "Covered Autos" column, on the lines referring to UM/UIM coverage were inserted the numerals "26" and "32." These insertions were pursuant to a direction under the heading, "Covered Autos," reading: "(Entry of one or more of the symbols from the COVERED AUTOS Section of the Garage Coverage form shows which autos are covered autos)." The "GARAGE COVERAGE FORM" in "Section I-Covered Autos" converts code "26" to

"OWNED `AUTOS' SUBJECT TO A COMPULSORY UNINSURED MOTORISTS LAW." Only those `autos' you own that because of the law in the state where they are licensed or principally garaged are required to have and cannot reject Uninsured Motorists Coverage...."4

The policy also contains a "vehicle schedule" which lists three vehicles, a 1994 Ford Explorer, a 1984 Ford Pickup, and a 1986 Ford "Rollback." Each of these is described on the schedule as "Titled to Business."

Section II of the Commercial Auto Coverage Part of the policy deals with liability coverage, § III with garage keepers coverage, § IV with physical damage coverage, § V with garage conditions, and § VI with definitions. In § VI "`Insured' means any person or organization qualifying as an insured in the Who Is an Insured provision of the applicable coverage." The Commercial Auto Coverage Part of the policy contains a number of endorsements, e.g., auto medical payments coverage and a "Maryland Personal Injury Protection Endorsement." Our principal concern here is with the endorsement titled, "Maryland Uninsured Motorists Coverage" (the Endorsement).

The Endorsement is headed by a notice reading, "THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY." Immediately below its title the Endorsement reads: "For a covered `auto' licensed or principally garaged in, or `garage operations' conducted in Maryland, this Endorsement modifies insurance provided under the following." Included among "the following" are the "BUSINESS AUTO COVERAGE FORM" and the "GARAGE COVERAGE FORM."

Based on the above provisions, Northern argues that the UM/UIM coverage is limited to claimants who suffer bodily injury while occupying a covered vehicle. Northern's position, however, does not take into account the provisions of the policy, set forth below, on which the Petitioners rely. Part "A. COVERAGE" of the Endorsement provides in ¶ 1 as follows:

"We will pay all sums the `insured' is legally entitled to recover as

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