Long v. American Standard Ins. Co. of Wis.
| Decision Date | 23 April 2007 |
| Docket Number | No. 05-1272-JTM.,05-1272-JTM. |
| Citation | 483 F.Supp.2d 1099 |
| Parties | Natalie LONG, Individually, as Heir at Law, and as Special Administrator of the Estate of Charles Rhoten, Jr., a Deceased Minor, and as Parent and Natural Guardian of Jennifer Rhoten, a Minor, Plaintiff, v. AMERICAN STANDARD INSURANCE COMPANY OF WISCONSIN, Defendant. |
| Court | U.S. District Court — District of Kansas |
Deborah B. McIlhenny, J. Darin Hayes, Hutton & Hutton, Wichita, KS, for Plaintiff.
Brooks G. Kancel, Ron L. Campbell, Fleeson, Gooing, Coulson & Kitch, L.L.C., Wichita, KS, for Defendant.
This matter is before the court on the motion for summary judgment of defendant American Standard Insurance Company. The plaintiff Natalie Long is the mother of two children who were riding in the bed of a pickup truck owned by Nowak Construction Company and driven, without permission of its owner, by Jack Nowak, a minor. The truck was involved in a motor vehicle accident; one of the plaintiff's children was killed, one was injured. The truck was insured by the defendant St. Paul Fire and Marine Insurance Company. St. Paul denied coverage citing a policy exclusion for non-permissive users.
Long filed this action against St. Paul for uninsured motorist benefits. On March 28, 2006, this court granted in part and denied in part Long's motion for summary judgment, holding that Jack Nowak was a non-permissive user. St. Paul subsequently filed its own summary judgment motion (Dkt. No. 26). Long filed a motion to add American Standard as an additional party, (Dkt. No. 24), which was granted (Dkt. No. 28). Long alleged in the amended complaint her children were entitled to the uninsured motorist benefits under the automobile liability policy which American Standard issued to Charles and Natalie Long. (Doc. 29). The court later granted St. Paul's motion for judgment, along with its motion (Dkt. No. 35) to dismiss the amended complaint. (Doc. 39).
On September 5, 2004, C.J. and Jennifer Rhoten were traveling as passengers in a pickup truck driven by Jack Nowak, a minor. At approximately 1:50 p.m., the truck, traveling south on 231st Street West in Sedgwick County, Kansas, left the road and overturned, ejecting the Rhoten children. C.J. Rhoten died as a result of the injuries he sustained in the accident and Jennifer Rhoten was seriously injured. Plaintiff Natalie Long is the natural mother of C.J. and Jennifer Rhoten. She is also the administrator of C.J. Rhoten's estate. Long is a resident of Sedgwick County, Kansas. At the time of the accident, C.J. Rhoten was 14 years old and Jennifer Rhoten was 15 years old. The plaintiff alleges that Jack Nowak was negligent in the operation of the truck.
The defendant St. Paul insured the pickup truck driven by Jack Nowak. Nowak Construction Company is the policy holder. The defendant American Standard issued a policy to Charles and Natalie Long which could provide benefits to C.J. Rhoten and Jennifer Rhoten.
On September 30, 2004, by letter to Jack Nowak in care of his parents, Joe and Yolanda Nowak, St. Paul denied direct liability coverage for Jack Nowak under the terms of the policy as it claimed its investigation of the accident revealed that Jack Nowak was not a permissive user of the vehicle at the time of the accident.
On January 24, 2005, Long's attorneys sent a demand letter to St. Paul. A copy of the letter was also sent to Jack Nowak's personal counsel, Duane Coyle, and Nowak Construction Company's counsel, Richard Honeyman.
On February 28, 2005, Honeyman responded to the letter. On March 1, 2005, Coyle responded to the letter. Coyle's eleven-page response letter sets forth a detailed opinion as to why uninsured motorist coverage should be available to the plaintiff under the terms of the St. Paul policy of insurance.
On March 10, 2005, Long's attorney forwarded the letters of Coyle and Honeyman to St. Paul along with a letter specifically demanding settlement under the uninsured motorist coverage provisions of the policy. Due to a clerical error, this letter sought a response to the demand by May 28, instead of an intended deadline date of March 28. Long's attorney corrected this oversight by letter dated March 22.
St. Paul did not seek any extension of the provided deadline of March 28, 2005, within which to respond to the uninsured motorist settlement demand.
On March 28, 2005, St. Paul sent a letter to Long's attorney denying coverage under the uninsured motorist provisions of the policy. The letter states:
I have reviewed your claim for UM benefits arising out of the insurance policy held by Nowak Construction, and have determined that no coverage is available for that claim in these circumstances.
Our policy form, a standard St. Paul Fire and Marine insurance Company form W029 (3-01 edition) contains the following "grant of coverage" language:
"We'll pay all sum any protected person is legally entitled to recover from the owner or driver of an uninsured or underinsured vehicle ..."
We have previously denied coverage responsibility for any claims against the liability of the driver of the vehicle at issue, because that person was not a permitted driver of that vehicle, and so his use of the vehicle was outside of the bounds of our coverage. However, that denial of coverage did not mean that the vehicle itself was an uninsured vehicle. In fact, it was an insured vehicle.
The Kansas courts have specifically held that this situation does not invoke UM or UIM coverage. In Grimmett v. Burke, 21 Kan.App.2d 638, 906 P.2d 156 (1995), the court stated as follows:
Grimmett appears to argue that under K.S.A. 40-284, uninsured motorist coverage is available when the operator is uninsured even though the owner of the automobile is covered by a policy. Grimmett is wrong. "The majority view in this country, which we adopt in the present case, is that a vehicle of which either the owner or driver is covered by minimum insurance coverage is not `uninsured' even though one of those persons has no insurance." State Farm Mut. Auto. Ins. Co. v. Cummings, 13 Kan.App.2d 630, 634, 778 P.2d 370 (1989), rev. denied 245 Kn. 786 (1989).
So, St. Paul Travelers is not denying that there is coverage for this vehicle. We have denied coverage for the driver who caused the accident. Kansas law recognizes this difference. For these reasons, we must deny your claim for UM benefits arising from the Nowak Construction policy. Should you have any information that you believe would affect or change our determination, please bring it to my attention.
(Plf.Exh.11).
On July 27, 2005, plaintiff filed a state court petition against St. Paul alleging the company is responsible for paying uninsured motorist benefits for the injuries to the Rhoten children. The matter was removed to federal court on August 30, 2005. On October 10, 2005, St. Paul answered plaintiff's allegations and denied that uninsured motorist coverage existed, in part because Jack Nowak was not operating an uninsured vehicle.
On December 23, 2005, plaintiff filed a motion for summary judgment seeking, in part, to exclude St. Paul's affirmative defense contending that plaintiff was not covered under the uninsured motorists protection provisions of the subject policy of insurance "because the driver was not operating an uninsured vehicle." On March 28, 2006, the court issued an order denying plaintiff's motion on that issue.
American Standard insured Natalie Long, C.J. Rhoten, and Jennifer Rhoten under a policy of insurance, which includes uninsured motorist coverage.
The policy holders and named insureds...
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Long v. St. Paul Fire and Marine Ins. Co.
...that the American Standard policy did not unambiguously deny coverage under the facts of the case. Long v. Am. Standard Ins. Co. of Wis., 483 F.Supp.2d 1099, 1103 (D.Kan. 2007). In light of this ruling, American Standard opted to settle Long's claim, and paid out the full extent of her poli......