Howe v. Howe

• Decision Date: 17 November 2005
• Docket Number: No. 32573.,32573.
• Court: West Virginia Supreme Court
• Parties: Pamela E. HOWE, individually, and as adoptive parent and next friend of Trey J. Howe, a minor, Appellant v. Duane A. HOWE, American Standard Insurance Company of Ohio and American Family Insurance Company, Appellees.

625 S.E.2d 716

Pamela E. HOWE, individually, and as adoptive parent and next friend of Trey J. Howe, a minor, Appellant v. Duane A. HOWE, American Standard Insurance Company of Ohio and American Family Insurance Company, Appellees.

No. 32573.

Supreme Court of Appeals of West Virginia.

Submitted September 14, 2005.

Decided November 17, 2005.

Dissenting Opinion of Chief Justice Albright November 29, 2005.

Concurring Opinion of Justice Davis December 6, 2005.

Dissenting Opinion of Justice Starcher December 16, 2005.

Syllabus by the Court

1. "A circuit court's entry of summary judgment is reviewed de novo." Syllabus Point 1, Painter v. Peavy, 192 W.Va. 189, 451 S.E.2d 755 (1994).

2. "Determination of the proper coverage of an insurance contract when the facts are not in dispute is a question of law." Syllabus Point 1, Tennant v. Smallwood, 211 W.Va. 703, 568 S.E.2d 10 (2002).

3. "`The law of the state in which a contract is made and to be performed governs the construction of a contract when it is involved in litigation in the courts of this state'. Syl. pt. 1 (in part) Michigan National Bank v. Mattingly, W. Va., 158 W.Va. 621, 212 S.E.2d 754 (1975)." Syllabus Point 2, General Electric Co. v. Keyser, 166 W.Va. 456, 275 S.E.2d 289 (1981).

4. "The provisions of a motor vehicle policy will ordinarily be construed according to the laws of the state where the policy was issued and the risk insured was principally located, unless another state has a more significant relationship to the transaction and the parties." Syllabus Point 2, Lee v. Saliga, 179 W.Va. 762, 373 S.E.2d 345 (1988).

5. "Where a choice of law question arises with regard to the interpretation of coverage provisions in a motor vehicle insurance policy executed in another state, the public policy considerations inherent in the fact that the substantive law of the other state differs from our own will ordinarily be adequately addressed by application of the significant relationship conflict of laws test enunciated in Syllabus Point 2 of Lee v. Saliga, 179 W.Va. 762, 373 S.E.2d 345 (1988)." Syllabus Point 4, Nadler v. Liberty Mut. Fire Ins. Co., 188 W.Va. 329, 424 S.E.2d 256 (1992).

6. The conflicts of law principles announced in Syllabus Point 2 of Lee v. Saliga, 179 W.Va. 762, 373 S.E.2d 345 (1988) and Syllabus Point 4 of Nadler v. Liberty Mut. Fire Ins. Co., 188 W.Va. 329, 424 S.E.2d 256 (1992), applicable to the interpretation of coverage under a motor vehicle insurance policy are also applicable to the interpretation of coverage under a motorcycle insurance policy, a homeowner's insurance policy and a personal liability umbrella insurance policy.

7. "The mere fact that the substantive law of another jurisdiction differs from or is less favorable than the law of the forum state does not, by itself, demonstrate that application of the foreign law under recognized conflict of laws principles is contrary to the public policy of the forum state." Syllabus Point 3, Nadler v. Liberty Mut. Fire Ins. Co., 188 W.Va. 329, 424 S.E.2d 256 (1992).

Paul T. Farrell, Jr., J. Michael Benninger, Wilson, Frame, Benninger & Metheney, P.L.L.C., Morgantown, for Appellant.

Robert P. Martin, Phillip C. Monroe, Campbell, Woods, Bagley, Emerson, McNeer & Herndon, P.L.L.C., Charleston, for Appellees.

BENJAMIN, Justice:

In the instant appeal we are asked to review the Circuit Court of Marion County's July 20, 2004 Opinion Order Denying in Part Plaintiff's Motion for Summary Judgment on the Declaratory Judgment Action and Granting in Part American Standard Insurance Company of Ohio and American Family Insurance Company's Motion for Summary Judgment. In that Order, the circuit court, applying Ohio law, held that liability coverage did not exist under several policies of insurance issued in the State of Ohio to Ohio residents for injuries sustained in a motorcycle accident occurring on September 13, 2000 in Farmington, Marion County, West Virginia. Appellant primarily argues that the "intra-insured suit" exclusions contained in the policies, admittedly valid under the law of the State of Ohio, are unenforceable in this State because they violate West Virginia public policy. Appellant also argues that the circuit court erred in finding liability coverage did not exist under a homeowner's insurance policy for claims arising from an alleged negligent entrustment of a motorcycle helmet due to the policy's exclusion for claims "arising out of the ownership, supervision, entrustment, maintenance, operation, use, loading or unloading of any type of motor vehicle . . .[.]" After due consideration of the record below, the arguments raised by the parties and the relevant legal precedent, we affirm the judgment of the Circuit Court of Marion County.

I. FACTUAL AND PROCEDURAL BACKGROUND

Appellant Pamela E. Howe married Appellee Duane Howe on September 9, 2000, in the State of Ohio. Both were at the time, and continue to be, Ohio residents. On September 13, 2000, while traveling through Marion County, West Virginia, Mr. and Mrs. Howe were involved in a motorcycle accident which resulted in Mrs. Howe sustaining serious injuries. The accident occurred when Mr. Howe, who was operating the motorcycle on which Mrs. Howe was a passenger, allegedly struck the rear of a vehicle which was stopped at a red light. The motorcycle involved in the accident was a 1996 Harley Davidson, owned by Mr. Howe, which was garaged, licensed, registered and maintained in the State of Ohio.

At the time of the September 13, 2000 motorcycle accident, Mr. Howe possessed four insurance policies issued by American Standard Insurance Company ["ASIC"] and/or American Family Insurance Company ["AFIC"]. These policies include: (1) ASIC Motorcycle Policy No. 0749-9531-04-SCYC-OH (insuring the 1996 Harley Davidson involved in the accident); (2) AFIC Ohio Homeowners Policy No. 34-P10307-01; (3) AFIC Family Car Policy No. 0749-9531-07-03-FPPA-OH (insuring a 1995 Dodge Dakota); and (4) AFIC Personal Liability Umbrella Policy No. 34-U-00995-01.

On September 3, 2002, Appellant initiated a civil action in the Circuit Court of Marion County alleging damages arising from Mr. Howe's negligence both in operating the motorcycle at the time of the accident and in not providing her with a proper safety helmet. Her complaint also sought a declaration of the liability and underinsured motorist coverage available under the four policies of insurance listed above. After certain discovery was conducted, the parties filed cross-motions for summary judgment relating to the coverage issues.

In her November 18, 2003 Motion for Partial Summary Judgment on the Declaratory Judgment Action, Appellant argued that ASIC and AFIC improperly relied upon Intra-Insured Suit (or "household") exclusions¹ contained in each of the respective policies to deny coverage for the claims asserted against her husband. Appellant asserted in her motion that the validity of these exclusions was unsettled under Ohio law² and that they violate the public policy of this State and should not be enforced in any event. Appellant also argued she was entitled to uninsured motorist coverage³ under the motorcycle policy, the family car policy and the umbrella policy. Conversely, ASIC and AFIC filed their Motion for Summary Judgment on November 20, 2003 arguing that Ohio law applied to determine the scope of coverage, if any, provided by the policies and that, under Ohio law, the policies do not provide either liability or underinsured motorist coverage for Appellant's claims arising from the September 13, 2000 motorcycle accident.

After a May 17, 2004 hearing on the respective motions, the circuit court entered an Opinion Order on July 20, 2004. Invoking West Virginia conflicts of law principles, the circuit court held that the determination as to what coverages were available under the various insurance policies was to be governed by Ohio law as the policies were issued in the State of Ohio to Ohio residents to insure risks principally located in Ohio. The circuit court noted that the only relationship West Virginia has to the parties or transaction was that the motorcycle accident occurred in West Virginia. The circuit court rejected Appellant's argument that West Virginia law should apply because the exclusions at issue violate our public policy. The circuit court distinguished our decision in Paul v. National Life, 177 W.Va. 427, 352 S.E.2d 550 (1986), wherein we refused to apply Indiana's guest passenger statute, by noting that Paul involved a foreign statute which, if applied, would operate to immunize the tortfeasor from liability. By contrast, the instant action involved the determination of coverage available under foreign insurance contracts, not immunization from liability. Thus, the circuit court determined application of Ohio law was justified as Ohio had a more significant relationship to the parties and transactions at issue and West Virginia's relationship to the parties and transactions was minimal. Moreover, the circuit court found West Virginia public policy did not forbid application of Ohio law.

Applying Ohio law, the circuit court found coverage did not exist under any of the policies at issue.⁴ Central to the circuit court's findings was the recognition that "household" exclusions, which were included in each of the policies at issue, are valid under Ohio law.⁵ The "household" exclusion contained in the motorcycle policy issued to Mr. Howe provides:

PART I LIABILITY COVERAGE

Exclusions:

This coverage does not apply to:

. . .

9. Bodily injury to:

b. You or any person related to you and residing in your household.

c. Any person related to the operator and residing in the household of the operator.

Similarly, the umbrella policy contains the following provisions:

DEFINITIONS

. . .

9. Insured means:

a. The named insured;

b. Your relatives;

. . .

18. Relative means a resident of your household who is:

a. Related to you by blood,...