Lott v. State Farm Fire & Cas. Co.

• Decision Date: 15 December 1995
• Docket Number: No. C6-94-1759,C6-94-1759
• Citation: 541 N.W.2d 304
• Parties: Carla C. LOTT, Respondent, v. STATE FARM FIRE & CASUALTY COMPANY, a foreign corporation, petitioner, Appellant.
• Court: Minnesota Supreme Court

Page 304

541 N.W.2d 304

Carla C. LOTT, Respondent, v. STATE FARM FIRE & CASUALTY COMPANY, a foreign corporation,

petitioner, Appellant.

No. C6-94-1759.

Supreme Court of Minnesota.

Dec. 15, 1995.

Syllabus by the Court

1. The phrase "residents of your household" is unambiguous.

2. Under the facts of this case, the insured's adult child was not a resident of the insured's household and therefore was not an insured under the insurance policy.

Steven J. Cahill, Moorhead, for appellant.

Steven E. McCullough, West Fargo, ND, for respondent.

William M. Hart, Christopher G. Schulte, Minneapolis, for amicus curiae Insurance Federation of Minnesota.

Heard, considered, and decided by the court en banc.

OPINION

PAGE, Justice.

Carla C. Lott (Lott) commenced a state district court action in North Dakota against Scott Roesler (Roesler) as a result of injuries she sustained on September 1, 1990, when she was thrown from a dock into Tamarac Lake by Roesler during a Labor Day weekend party. Roesler's mother, Zona Roesler, and his mother's brothers and sister owned the lake property where Lott sustained her injuries. The lake property was insured by State Farm Fire & Casualty Company (State Farm) pursuant to a homeowner's insurance policy issued to Zona Roesler as the insured. Roesler tendered his defense of Lott's claim to State Farm. State Farm denied coverage and declined to defend Roesler based on State Farm's contention that Roesler was not an insured under the insurance policy covering the lake property. Subsequently, Roesler assigned and transferred to Lott his right to sue State Farm. Lott then commenced this Minnesota declaratory judgment action against State Farm in Clay County District Court, seeking a determination that State Farm has a duty to defend and indemnify Roesler in her North Dakota action and that the insurance policy provides coverage for her injuries.

Lott and State Farm filed cross motions for summary judgment, and the district court granted summary judgment for Lott and denied State Farm's motion. The district court, finding that "the defining household is that embraced by the policy's specifically identified residence premises; i.e., the lake property," also found that Roesler was a resident of that household and granted Lott's motion. The court of appeals affirmed, holding that: (1) the insurance policy in question is ambiguous as it relates to whether the insured's household referred to in the policy is Zona Roesler's primary domicile in Fargo, North Dakota, or the cabin located on the lake property; (2) under the facts of this case, the cabin located on the lake property is the relevant household for making a determination as to whether Roesler was a resident of the insured's household; and (3) Roesler was a resident of the insured's household. We reverse.

On September 1, 1990, Lott was a guest of Roesler's at a cabin located on Tamarac Lake in Otter Tail County, Minnesota. They were spending Labor Day weekend at the cabin with Roesler's family, which included Roesler's parents, Zona and Ed Roesler; his brothers, Tyler and Barry Roesler; and his grandmother; in addition to an unspecified number of Roesler's cousins. ¹

At the time Lott was injured, the people at the cabin were engaging in the Roesler family's annual Labor Day weekend toga party. A regular feature of the toga party involved the participants jumping into Tamarac Lake. Lott was not taking part in the party and did not want to get wet. In spite of her objections to getting wet, Roesler threw Lott off a dock into the lake. According to Lott, she sustained a bimalleolar fracture of the right ankle, showering bone chips in the fracture area, internal blood clots in the fracture area, as well as severe pain, mental anguish, and permanent impairment as a result of being thrown into the lake.

Roesler's mother, Zona Roesler, who lives in Fargo, North Dakota; her brothers, Eldon D. Chrest of San Bernadino, California, and Lyle Chrest of Riverside, California; and her sister, Lona Nelson of Bismarck, North Dakota, own the lake property where Lott sustained her injuries. The cabin is a one-story structure with three bedrooms and a bath. The cabin is "open" each year from the middle of May until it is "closed" for the winter in the latter part of September. The cabin is used on a regular basis by members of Zona Roesler's extended family, including her brothers and sister, her mother, and her mother's grandchildren. Zona Roesler and her immediate family, Ed Roesler, Tyler Roesler, as well as Zona Roesler's mother, have identified bedrooms in the cabin and use the cabin more than any of the other family members.

Roesler, who was a self-supporting 30-year-old on the date of Lott's injuries, lived in an apartment on 45th Street in Fargo, North Dakota, and had not lived with his parents since 1982. Roesler had lived at the 45th Street address since 1986, received his mail there, and maintained all of his clothing and furnishings there. The apartment was not covered by renter's insurance. Roesler visited the cabin on average 10 weekends a season and spent at least one full week on vacation there each season. On the weekends when other family members were present at the cabin, Roesler usually slept in his "pickup camper." However, during the vacation week, when no one else was around, he slept in the cabin. Roesler owned a speed boat which he kept at the cabin.

On the weekend Lott was injured, Roesler's parents, his brother Tyler, his grandmother, and possibly three other people slept in the cabin. Roesler, as he usually did when others were present at the lake cabin, slept in his "pickup camper."

The record indicates that members of Zona Roesler's extended family, who used the cabin regularly, had keys to the cabin and did not have any restrictions on their use of the cabin. These family members were free to eat whatever food was at the cabin and to use any of the recreational equipment kept at the cabin. Family members, including Roesler, who regularly spent time at the cabin, contributed to a monetary fund used for paying the lake property's expenses such as insurance premiums, phone bills, and general maintenance. Married family members contributed $100 per season to the fund, and single family members contributed $50 per season. Zona Roesler was responsible for writing the checks from the fund to pay for these expenses.

The lake property was insured by State Farm Fire & Casualty Company under a homeowner's policy issued to Zona Roesler as the insured. The insurance policy provides:

DEFINITIONS

4. "insured" means you and, if residents of your household:

a. your relatives;

b. any other person under the age of 21 who is in the care of a person described above;

* * * * * *

5. "insured location" means:

a. the residence premises;

* * * * * *

10. "residence premises" means the one, two, three or four-family dwelling, other structures, and grounds or that part of any other building where you reside and which is shown in the Declarations.

* * * * * *

SECTION II--LIABILITY COVERAGES

COVERAGE L--PERSONAL LIABILITY

If a claim is made or a suit is brought against an insured for damages because of bodily injury * * * to which this...