Engstrom v. MSI Ins. Co., No. 95-1415-FT

CourtCourt of Appeals of Wisconsin
Writing for the CourtCANE
Citation542 N.W.2d 481,198 Wis.2d 195
Docket NumberNo. 95-1415-FT
Decision Date21 November 1995
PartiesTerri ENGSTROM, Allan Engstrom, and Carolyn Engstrom, Plaintiffs-Appellants, v. MSI INSURANCE COMPANY, d Defendant-Respondent.

Page 481

542 N.W.2d 481
198 Wis.2d 195
Terri ENGSTROM, Allan Engstrom, and Carolyn Engstrom,
Plaintiffs-Appellants,
v.
MSI INSURANCE COMPANY, d Defendant-Respondent.
No. 95-1415-FT.
Court of Appeals of Wisconsin.
Submitted on Briefs Sept. 13, 1995.
Opinion Released Nov. 21, 1995.
Opinion Filed Nov. 21, 1995.

Page 482

[198 Wis.2d 198] On behalf of the plaintiffs-appellants, the cause was submitted on the briefs of Ardell W. Skow and [198 Wis.2d 199] Matthew A. Biegert of Doar, Drill and Skow, S.C. of New Richmond.

On behalf of the defendant-respondent, the cause was submitted on the brief of Theodore A. Franti of Thrasher, Doyle, Pelish & Franti, Ltd. of Rice Lake.

Before CANE, P.J., and LaROCQUE and MYSE, JJ.

CANE, Presiding Judge.

Terri, Allan and Carolyn Engstrom appeal a summary judgment in favor of MSI Insurance Company that dismissed their claim for underinsured motorist (UIM) benefits because the trial court concluded the vehicle that injured Terri was not an underinsured vehicle under the definition provided in the Engstroms' insurance policy. 1 Because we conclude that the motor vehicle that injured Terri was underinsured with respect to one of the two liability policies covering it, we reverse the summary judgment and remand the case for further proceedings.

Terri was injured when the automobile she was driving was struck by an automobile driven by John Jeffrey. Terri and her parents sued Jeffrey and his insurer, Milwaukee Mutual Insurance Company, alleging negligence

Page 483

on Jeffrey's part. Jeffrey was driving his father's car at the time of the accident, which was covered by a Milwaukee Mutual policy with a $100,000 liability limit. A second Milwaukee Mutual policy had a liability limit of $25,000 and covered Jeffrey as the named insured on his own vehicle, which was not involved in the accident. The Engstroms ultimately settled their claims with Jeffrey and Milwaukee Mutual for the full amounts of the two liability policies, and those defendants were dismissed from the suit.

[198 Wis.2d 200] The Engstroms in an amended complaint sued their insurance carrier, MSI, alleging they were entitled to UIM benefits under their policy. MSI moved for summary judgment, arguing that Jeffrey's automobile was not an underinsured motor vehicle. The trial court granted MSI's motion, and the Engstroms now appeal.

The sole issue before this court is whether Jeffrey's vehicle was an underinsured motor vehicle under the definition provided in MSI's insurance policy. The interpretation of words or clauses in an insurance contract is a question of law this court decides independently of the trial court's decision. Smith v. Atlantic Mut. Ins. Co., 155 Wis.2d 808, 810, 456 N.W.2d 597, 598 (1990). This construction is controlled by the same rules of construction as are applied to contracts generally. Kremers-Urban Co. v. American Employers Ins. Co., 119 Wis.2d 722, 735, 351 N.W.2d 156, 163 (1984). "[T]he test is ... what a reasonable person in the position of the insured would have understood the words to mean." Id.

The Engstroms' insurance policy provided in relevant part:

Underinsured motor vehicle means a land motor vehicle or trailer to which a bodily injury liability bond or policy applies at the time of the accident but the limits of that bond or policy are:

1. Less than the limit of liability for this coverage....

The Engstroms argue that Jeffrey's vehicle meets this definition because he had an applicable $25,000 liability insurance policy. They explain: "[A] liability policy that had limits of less than $50,000 applied to the Jeffrey vehicle. The fact that a different $100,000 [198 Wis.2d 201] liability insurance policy also applied, while relevant to the operation of the reducing clause, does not take the vehicle out from under the underinsured motor vehicle definition."

MSI points out that Jeffrey had liability coverage of $100,000 plus $25,000, equaling a total of $125,000, while the Engstroms had $50,000 in UIM coverage. MSI argues that because the total liability coverage was more than UIM coverage, "Jeffrey as a matter of definition and [as] a matter of law is not an underinsured motorist." MSI also argues that when comparing the amount of liability coverage to the amount of UIM coverage, this court should examine the $100,000 policy that insured the vehicle Jeffrey was driving, rather than the $25,000 policy which insured Jeffrey's vehicle parked at home, because the $100,000 was "primary" and the $25,000 policy was "excess." MSI explains:

This status of the primary versus excess coverages was the subject [of] a request for admissions (which plaintiffs admitted) and has never been disputed. As a result, the court is comparing the $50,000.00 UIM coverage on the MSI policy against the primary $100,000.00 of...

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4 practice notes
  • Taylor v. Greatway Ins. Co., No. 99-1329.
    • United States
    • Court of Appeals of Wisconsin
    • February 17, 2000
    ...policy to mean. See Kaun v. Industrial Fire & Cas. Ins. Co., 148 Wis. 2d 662, 669, 436 N.W.2d 321, 324 (1989); Engstrom v. MSI Ins. Co., 198 Wis. 2d 195, 200, 542 N.W.2d 481, 483 (Ct. App. 1995). The supreme court has also directed that the interpretation of UIM provisions should be consist......
  • State v. Vander Logt, No. 96-2015-CR
    • United States
    • Court of Appeals of Wisconsin
    • June 17, 1998
    ...it is also clear that the nature of the conduct renders multiple punishments appropriate. Cf. Carol M.D., 198 Wis.2d at 174-75, 542 N.W.2d at 481. Construing Vander Logt's brief liberally, he also appears to argue that there was an insufficient factual basis for his pleas to the possession ......
  • McCann v. Metropolitan Property & Cas. Ins. Co., No. 97-0381
    • United States
    • Court of Appeals of Wisconsin
    • July 31, 1997
    ...Co., 185 Wis.2d 394, 518 N.W.2d 261 (Ct.App.1994); Krech v. Hanson, 164 Wis.2d 170, 473 N.W.2d 600 (1991); and Engstrom v. MSI Ins. Co., 198 Wis.2d 195, 542 N.W.2d 481 (Ct.App.1995). In each case, this court found substantially similar definitions of underinsured motor vehicle to be unambig......
  • Meyer v. Michigan Mut. Ins. Co., No. 99-0228.
    • United States
    • Court of Appeals of Wisconsin
    • January 26, 2000
    ...individually, Millers relies on Krech v. Hanson, 164 Wis. 2d 170, 473 N.W.2d 600 (Ct. App. 1991); Engstrom v. MSI Insurance Co., 198 Wis. 2d 195, 542 N.W.2d 481 (Ct. App. 233 Wis.2d 227 1995); and Smith. However, as we discuss below, we find each of these cases distinguishable from our ¶ 12......
4 cases
  • Taylor v. Greatway Ins. Co., No. 99-1329.
    • United States
    • Court of Appeals of Wisconsin
    • February 17, 2000
    ...policy to mean. See Kaun v. Industrial Fire & Cas. Ins. Co., 148 Wis. 2d 662, 669, 436 N.W.2d 321, 324 (1989); Engstrom v. MSI Ins. Co., 198 Wis. 2d 195, 200, 542 N.W.2d 481, 483 (Ct. App. 1995). The supreme court has also directed that the interpretation of UIM provisions should be consist......
  • State v. Vander Logt, No. 96-2015-CR
    • United States
    • Court of Appeals of Wisconsin
    • June 17, 1998
    ...it is also clear that the nature of the conduct renders multiple punishments appropriate. Cf. Carol M.D., 198 Wis.2d at 174-75, 542 N.W.2d at 481. Construing Vander Logt's brief liberally, he also appears to argue that there was an insufficient factual basis for his pleas to the possession ......
  • McCann v. Metropolitan Property & Cas. Ins. Co., No. 97-0381
    • United States
    • Court of Appeals of Wisconsin
    • July 31, 1997
    ...Co., 185 Wis.2d 394, 518 N.W.2d 261 (Ct.App.1994); Krech v. Hanson, 164 Wis.2d 170, 473 N.W.2d 600 (1991); and Engstrom v. MSI Ins. Co., 198 Wis.2d 195, 542 N.W.2d 481 (Ct.App.1995). In each case, this court found substantially similar definitions of underinsured motor vehicle to be unambig......
  • Meyer v. Michigan Mut. Ins. Co., No. 99-0228.
    • United States
    • Court of Appeals of Wisconsin
    • January 26, 2000
    ...individually, Millers relies on Krech v. Hanson, 164 Wis. 2d 170, 473 N.W.2d 600 (Ct. App. 1991); Engstrom v. MSI Insurance Co., 198 Wis. 2d 195, 542 N.W.2d 481 (Ct. App. 233 Wis.2d 227 1995); and Smith. However, as we discuss below, we find each of these cases distinguishable from our ¶ 12......

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