McConnell v. St. Paul Fire and Marine Ins. Co., 94SC726

• Decision Date: 14 November 1995
• Docket Number: No. 94SC726,94SC726
• Citation: 906 P.2d 109
• Parties: Carol McCONNELL, Petitioner, v. ST. PAUL FIRE AND MARINE INSURANCE COMPANY, Respondent.
• Court: Colorado Supreme Court

Page 109

906 P.2d 109

Carol McCONNELL, Petitioner, v. ST. PAUL FIRE AND MARINE INSURANCE COMPANY, Respondent.

No. 94SC726.

Supreme Court of Colorado En Banc.

Nov. 14, 1995.

Norton Frickey & Associates of Colorado Springs, P.C., Dan O. Adkins, Colorado Springs, for Petitioner.

Law Offices of Taylor, McQuiston, McCune & Barbo, John E. Taylor, Aurora, for Respondent.

Justice KOURLIS delivered the Opinion of the Court.

We granted certiorari to review McConnell v. St. Paul Fire and Marine Insurance Co., 894 P.2d 11 (Colo.App.1994), denying Carol McConnell, the plaintiff, personal injury protection benefits for injuries she sustained in an automobile accident. The court of appeals held that the Colorado Auto Accident Reparations Act, sections 10-4-701 to -725, 4A C.R.S. (1994 & 1995 Supp.) ("No-Fault Act"), does not mandate coverage for a passenger riding in a vehicle without consent from an insured, regardless of the passenger's good faith belief to the contrary. See McConnell, 894 P.2d at 13. We affirm the judgment of the Colorado Court of Appeals.

I.

The facts pertinent to this appeal are not in dispute and derive from the parties' attachments to their respective summary judgment motions before the trial court.

Carol McConnell, the plaintiff below and the petitioner here, was injured while riding as a passenger in an automobile driven by Byron Brewer and owned by James Dart. James Dart is the father of Brewer's girlfriend, Jean Dart. James Dart allowed his daughter primary use of the vehicle but forbade Brewer, an unlicensed driver, to drive it. Brewer was aware of this prohibition. James Dart maintained insurance on the car through St. Paul Fire and Marine Insurance Company (St. Paul), the respondent. Brewer also maintained automobile insurance for himself through Mid-Century Insurance Company (Mid-Century).

On July 20, 1991, Jean Dart parked the vehicle in front of Brewer's apartment and left the keys for the vehicle inside the apartment. Jean had specifically told Brewer on prior occasions that he was not allowed to use the car. However, Brewer did use the car at least once and at that time offered McConnell transportation. When McConnell accepted the ride, she was unaware that Brewer was forbidden from using the vehicle and that he was driving without a license. ¹ While Brewer was driving the vehicle, he lost control and an accident occurred. McConnell was injured and incurred damages in the amount of approximately $20,000 for medical expenses and approximately $7,000 for lost wages. She sought recovery for these expenses from St. Paul under James Dart's insurance policy. McConnell also sought recovery from Mid-Century Insurance Company (Mid-Century) under Brewer's automobile insurance policy.

St. Paul and Mid-Century denied coverage and McConnell filed the present suit. St. Paul, McConnell, and Mid-Century filed cross-summary judgment motions. The St. Paul insurance policy provided coverage for "any other person who sustains bodily injury while occupying a motor vehicle with the consent of the named insured." St. Paul argued that McConnell was not covered by James Dart's insurance policy because she was not occupying the car with consent at the time of the accident. McConnell and Mid-Century argued that the No-Fault Act required the St. Paul insurance policy to cover McConnell because she had a good faith belief that she had permission to occupy the car.

The trial court interpreted the No-Fault Act to mandate insurance coverage for individuals occupying a motor vehicle with a good faith belief that the driver has permission or authority to operate the vehicle even though the driver does not have actual authority. Thus, the trial court granted McConnell and Mid-Century's motions for summary judgment. ² St. Paul appealed the trial court's ruling to the Colorado Court of Appeals.

The court of appeals reversed the trial court's order. McConnell v. St. Paul Fire & Marine Ins. Co., 894 P.2d 11 (Colo.App.1994). The court of appeals held that under the No-Fault Act an insurer may deny coverage to non-permissive users of automobiles, and thereby, to good faith passengers occupying the vehicle with the purported consent of a non-permissive user. Id. at 12.

We granted certiorari to determine whether the No-Fault Act requires St. Paul to extend coverage to a passenger who has a good faith belief that the driver has permission to operate the insured vehicle when in actuality the driver does not. ³ We hold that the No-Fault Act mandates coverage only for those who are occupying a motor vehicle with the consent of an insured. In this case, Brewer did not have permission to drive the vehicle and he could not provide consent to McConnell. Despite her good faith belief to the contrary, McConnell did not have the requisite consent necessary under the Act to entitle her to coverage.

II.

In analyzing the coverage mandated by the No-Fault Act, it is first important to review the overall goals and structure of the Act. The purpose of the No-Fault Act, sections 10-4-701 to -725, 4A C.R.S. (1994 & 1995 Supp.), is to avoid inadequate compensation to victims of automobile accidents and to require registrants of this state to procure automobile insurance coverage. § 10-4-702, 4A C.R.S. (1994). To achieve these ends, the No-Fault Act requires every automobile owner to acquire a "complying policy" which provides the requisite amount of coverage mandated by the Act. ⁴ § 10-4-705, 4A C.R.S. (1994).

Under the No-Fault Act, a complying policy may provide more extensive coverage than that mandated. § 10-4-710, 4A C.R.S. (1995 Supp.). However, any clause of a policy that attempts to "dilute, condition, or limit statutorily mandated coverage" is void and unenforceable. Meyer v. State Farm Mut. Auto Ins. Co., 689 P.2d 585, 589 (Colo.1984) (superseded by statute as stated in Allstate Ins. Co. v. Feghali, 814 P.2d 863, 865-66 (Colo.1991)). The St. Paul insurance policy denied coverage to McConnell, a passenger occupying a motor vehicle with the good faith belief that the driver had permission. The issue in this case is whether that policy failed to provide the requisite coverage mandated by the Act.

The No-Fault Act specifically defines the class of individuals who must be provided coverage under complying automobile insurance policies. Section 10-4-707(1)(c) extends liability coverage to individuals who sustain bodily injury while occupying an insured vehicle with the consent of an insured. ⁵ Section 10-4-707(1)(c) states:

(1) The coverage described in section 10-4-706 shall be applicable to:

....

(c) Accidental bodily injury arising out of accidents occurring within this state sustained by any other person while occupying the described motor vehicle with the consent of the insured or while a pedestrian if injured in an accident involving the described motor vehicle.

(Emphasis added.) ⁶ The No-Fault Act also contains a provision for allowing exclusion of certain individuals from coverage: The coverages described in section 10-4-706 may also be subject to exclusions where the injured person:

(a) Sustains injury caused by his own intentional act; or

(b) Is operating a motor vehicle as a converter without a good faith belief that he is legally entitled to operate or use such vehicle.

§ 10-4-712(2), 4A C.R.S. (1994).

A.

McConnell contends that we should construe sections 10-4-707(1)(c) and 10-4-703(6) to mandate coverage for any passenger who has a good faith belief that she has consent to occupy the vehicle. She asserts that section 10-4-712(2) supports her position by authorizing exclusion from coverage only of individuals who do not have a good faith belief in their right to operate an automobile. We disagree.

When construing a statute, we must give full effect to the intent of the legislature. Passamano v. Travelers Indem. Co., 882 P.2d 1312, 1318 (Colo.1994). It is our duty to interpret statutory terms in accordance with their plain and obvious meaning. Bertrand v. Board of County Comm'rs 872 P.2d 223, 228 (Colo.1994); see § 2-4-101, 1B C.R.S. (1980). When the language of a statute is clear and unambiguous, the court must apply the statute as written and need not resort to other interpretative rules of statutory construction. Budget Rent-A-Car Corp. v. Martin, 855 P.2d 1377, 1382 n. 9 (Colo.1993); see § 2-4-203(1)(c), 1B C.R.S. (1980).

The General Assembly intended to avoid inadequate compensation to victims of automobile accidents when it enacted the No-Fault Act. However, the General Assembly did not intend for the category of individuals covered under the No-Fault Act to be unlimited. Budget Rent-A-Car Corp., 855 P.2d at 1382 n. 9.

Section 10-4-707(1)(c), by its plain terms, limits the category of those who must be covered under the No-Fault Act to those who are using the covered vehicle with the permission of an insured. Pursuant to section 10-4-703(6), an insured is a named insured, a resident relative of a named insured, or anyone using the covered vehicle with the permission of the named insured. The dictionary definition of the term consent is: "1: to give assent or approval: agree." Merriam Webster's Collegiate Dictionary 246 (10th ed. 1995). In order for an individual to have consent, one with authority must agree to or approve of the proposed action in some manner. ⁷ See also 7 Am.Jur.2d Automobile Insurance § 254 (1980) ("The word 'permission' or 'consent' connotes the power to grant or withhold it."). Thus, the statutory scheme mandates that an individual with authority, as defined in section 10-4-703(6), must grant consent to the passenger in order for the passenger to be eligible for insurance coverage pursuant to section 10-4-707(1)(c).

Given this statutory language, the status of a passenger is necessarily dependent upon the status of the driver. If the driver does not have permission to use the vehicle, the driver has no authority to consent to the passenger's use. The passenger's good...