Johnson v. Metropolitan Property and Casualty Insurance Company, No. 63198-5-I (Wash. App. 2/16/2010)
| Decision Date | 16 February 2010 |
| Docket Number | No. 63198-5-I.,63198-5-I. |
| Court | Washington Court of Appeals |
| Parties | EDWARD D. JOHNSON, Appellant, v. METROPOLITAN PROPERTY AND CASUALTY INSURANCE COMPANY, a Rhode Island Insurance Company, Respondent. |
Appeal from King County Superior Court. Docket No: 07-2-34047-5. Judgment or order under review. Date filed: 03/13/2009. Judge signing: Honorable Richard D Eadie.
Counsel for Appellant(s), Gary Williams, Attorney at Law, 252 Blueberry Hill Dr, Quilcene, WA, 98376-9667.
Marc L. Silverman, Attorney at Law, Bellefield Office Park, 1621 114th Ave Se Ste 229, Bellevue, WA, 98004-6905.
Counsel for Respondent(s), Pamela A. Okano, Reed McClure, Two Union Square, 601 Union St Ste 1500, Seattle, WA, 98101-1363.
John Woodruff Rankin Jr., Reed McClure, Two Union Square, 601 Union St Ste 1500, Seattle, WA, 98101-1363.
UNPUBLISHED OPINION
Edward D. Johnson appeals a summary judgment dismissing his claims for breach of insurance contract, declaratory judgment, and damages. The terms in Metropolitan Property and Casualty Insurance Company's (MetLife) policy concerning entitlement to underinsured motorist coverage are clear and unambiguous. These terms do not violate Washington statutes or public policies. Because Johnson was not listed as a named insured on MetLife's policy and did not otherwise qualify, he is not entitled to underinsured motorist coverage under the policy. We affirm.
Johnson and Carol S. Collins were engaged to marry, had a child, and lived together. She owned a Honda, and they jointly owned a Ford van. At Johnson's request, Collins added him to a MetLife auto insurance policy, which she previously purchased at a discount through her employer. The couple believed that this would give Johnson the same coverage as Collins but at a significant costs savings: it was cheaper than paying a full premium on separate policies, and Johnson presumably sought to benefit from Collins's employer-based discount.
The policy declarations pages listed Collins as the "named insured" and both Collins and Johnson as "household drivers." In January 2006, Johnson rented a car for a few days but elected not to purchase personal accident insurance or third party bodily injury and property insurance. He was injured in an auto accident while driving this rental car. He filed claims under the Personal Injury Protection (PIP) and Underinsured Motorist (UIM) coverage of Collins's policy. MetLife paid the PIP claim but denied the UIM claim explaining, The rental vehicle was not a covered automobile.
Johnson filed suit against MetLife for breach of contract, declaratory judgment, and damages, alleging that MetLife had wrongfully denied him UIM coverage, had waived or was estopped from denying coverage, and that MetLife's policy interpretation was contrary to RCW 48.22.030 and therefore violated public policy. MetLife counterclaimed for a declaration that its policy did not provide Johnson with UIM coverage for the rental car accident. The parties filed cross motions for summary judgment. The trial court granted MetLife's motion. Johnson appeals.
This court reviews a summary judgment order de novo, engaging in the same inquiry as the trial court.1 Summary judgment is proper if the court, viewing all facts and reasonable inferences in the light most favorable to the nonmoving party, finds no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law.2
Interpretation of an insurance policy is a question of law reviewed de novo.3 Insurance policies are contracts, and rules of contract interpretation apply.4 Accordingly, Washington courts review the policy as a whole to give it a "`fair, reasonable, and sensible construction as would be given to the contract by the average person purchasing insurance.'"5 Courts enforce clear and unambiguous policy language as written and will not create ambiguity where none exists.6
A term, phrase, or clause is ambiguous when, on its face, it is susceptible to different but reasonable interpretations.7 No ambiguity exists simply because the parties favor competing interpretations. If policy language is ambiguous, the court may look to extrinsic evidence of the parties' mutual intent.8 Any remaining ambiguity is resolved in favor of the insured.9 But unilateral expectations of the insured do not override the contract's plain language.10
Johnson asserts that since he was a "household driver," he qualified for coverage as a "named insured." He also contends that MetLife's policy violates public policies codified in RCW 48.22.030, which requires insurers provide UIM coverage, and RCW 48.30.300, which prohibits discrimination on the basis of marital status. Finally, Johnson seeks attorney fees and costs.
Washington courts utilize a two-step inquiry to determine whether insurance coverage exists. First, the insured must show that the loss claimed is covered by the policy. Then, the insurer, seeking to avoid coverage, must point to specific policy language excluding the insured's loss. 11
MetLife's policy provides UIM coverage for the following persons:
1. [Y]ou or a relative, caused by an accident arising out of the ownership, maintenance, or use of an underinsured motor vehicle, which you or a relative are legally entitled to collect from the owner or driver of an underinsured motor vehicle; or
2. [A]ny other person, caused by an accident while occupying a covered automobile, who is legally entitled to collect from the owner or driver of an underinsured motor vehicle.
We will also pay damages to any person for damages that person is entitled to recover because of bodily injury sustained by anyone described in 1. or 2. above.
Accordingly, the policy insures those qualifying as "you," a "relative," or those occupying a "covered automobile."
Only the meaning of "you" is at issue in this case.12 The policy defined "you" as "the person(s) named in the Declarations of this policy as named insured and the spouse of such person or persons if a resident of the same household." On the first declarations page only Collins's name appeared under the heading, "Named Insured."
Johnson first argues, without citing any legal authority, that he was entitled to UIM coverage by virtue of being an insured party, i.e., "household driver," listed on the second page of declarations. He writes in his brief:
[Johnson] was named as a person who was added to the policy, a household driver, a person insured by the policy, a person who was covered by the policy. If he was not named as an excluded person, he must be named as an insured person. He must be a named insured.
Case law, however, does not support this sweeping proposition.
Courts are not at liberty, under the guise of interpretation, to rewrite contracts that parties have deliberately made themselves.13 Clear and unambiguous language is enforced as written. The definition of "you" is clear and unambiguous. "You" includes "named insureds" and resident spouses of "named insureds." The only "named insured" identified within the policy was Collins. Only Collins or her resident spouse meets the definition of "you." Johnson, in contrast, was a "household driver."
Supreme Court precedent supports this distinction between "named insured" and "household driver." In Holthe v. Iskowtiz,14 an insurance policy named Bessie Uhlman as the "named insured" and her daughter, Betty Uhlman, as an additional "insured" party. The issue was whether Betty, a resident of Bessie's household who was "to be covered hereunder as insured," was also a "named insured."15 The court answered in the negative. It quoted 7 John Allen Appleman, Appleman Insurance Law and Practice § 4354, at 130, observing that
"`[w]henever the term "named insured" is employed, it refers only to the person specifically designated upon the face of the contract.'"16 Thus, "while . . . the word `insured,' without further qualification, should apply to any person entitled to protection under the policy, including a `named insured,' the latter term could apply only to the person designated in the policy as the named insured."17
Johnson next claims that a statutory definition of "named insured" is incorporated into the policy. RCW 48.22.005(9) defines "named insured" as "the individual named in the declarations of the policy." Relying on this definition, Johnson asserts that since he was named in the declarations (as a "household driver"), he is included within the policy definition of "you."18
This argument is without merit. RCW 48.22.005 also provides that "the definitions in this section apply throughout this chapter." Contrary to Johnson's suggestion, by its own terms this statute does not purport to replace express definitions contained in an insurance policy contract with the definitions contained in the statute. Johnson cites to no authority for the proposition that it does.
Johnson also argues that Collins's intent to purchase equal coverage for herself and Johnson controls the meaning of the policy terms. Though ambiguous policy language may be resolved by looking to extrinsic evidence of shared intent,19 expectations unilaterally held do not trump a contract's plain, clear language.20 Thus, evidence of unilateral intent may not be used to establish an ambiguity.21 Because the contract language in this case is clear and unambiguous, we do not consider Collins's intent.
Johnson makes two additional claims of ambiguity, neither of which is persuasive. First, Johnson points to MetLife's denial letter. This letter explained that Johnson was a "listed" driver rather than a "named insured." Claiming "list...
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