Meyer v. Michigan Mut. Ins. Co., No. 99-0228.

• Court: Court of Appeals of Wisconsin
• Writing for the Court: Before Brown, P.J., Nettesheim and Anderson, JJ.
• Citation: 233 Wis.2d 221,2000 WI App 37,607 N.W.2d 333
• Docket Number: No. 99-0228.
• Decision Date: 26 January 2000
• Parties: Scott R. MEYER, Plaintiff-Respondent, v. MICHIGAN MUTUAL INSURANCE CO., Defendant, MILLERS CLASSIFIED INSURANCE CO., Defendant-Appellant.

233 Wis.2d 221
2000 WI App 37
607 N.W.2d 333

Scott R. MEYER, Plaintiff-Respondent,
v.
MICHIGAN MUTUAL INSURANCE CO., Defendant,
MILLERS CLASSIFIED INSURANCE CO., Defendant-Appellant.¹

No. 99-0228.

Court of Appeals of Wisconsin.

Submitted on briefs December 6, 1999.

Decided January 26, 2000.

233 Wis.2d 223

On behalf of the defendant-appellant, the cause was submitted on the brief of Randy S. Parlee and Sherry A. Knutson of Millers Classified Ins. Co. of Milwaukee

On behalf of the plaintiff-respondent, the cause was submitted on the brief of Joseph G. Doherty and Patrick R. Griffin of Bunk, Doherty & Griffin, S.C. of West Bend.

Before Brown, P.J., Nettesheim and Anderson, JJ.

¶ 1. ANDERSON, J.

Scott R. Meyer was seriously injured at work when a semi-trailer truck backed into him, crushing him between the truck and a loading dock. The truck was owned by his employer and insured by Michigan Mutual Insurance Co. (Michigan Mutual). The truck's liability policy contains a $1 million limit.² Meyer also sought coverage from several policies issued by Millers Classified Insurance Co. (Millers). Millers appeals from a declaratory judgment, holding that its underinsured motorist (UIM) policies entitled Meyer to $1.5 million in insurance coverage.

¶ 2. At issue are the insurance policies Millers issued to Meyer and his parents. Meyer had a personal automobile liability insurance policy with a UIM liability limit of $50,000 per person. Meyer concedes that there is no coverage under this policy.

¶ 3. Meyer's parents (the Meyers) also had personal automobile liability insurance policies, issued by

233 Wis.2d 224

Millers, that provided UIM coverage of $250,000 per person. These policies covered two separate vehicles, and a separate premium was paid for each vehicle. The policies define "underinsured motor vehicle" as a "land motor vehicle or trailer . . . to which a bodily injury liability bond or policy applies at the time of the accident but its limit of bodily injury liability is less than the limit of liability for this coverage."

¶ 4. Additionally, the Meyers purchased an umbrella, or excess, liability policy from Millers that provided a $1 million liability limit per occurrence. Because the umbrella policy expressly excluded UIM coverage, the Meyers purchased an endorsement to provide the UIM coverage. The endorsement stated:

I hereby accept the opportunity to purchase the above coverages [UIM and uninsured motorist] and agree to maintain in full force Bodily Injury limits of $250,000 each person and $500,000 each occurrence for Underlying Uninsured Motorist Coverage and Underlying Underinsured Motorist Coverage.

Neither the umbrella policy nor the endorsement contains a definition of "Underinsured Motorist Coverage."

¶ 5. Millers moved the circuit court for declaratory judgment, seeking a declaration that UIM coverage did not exist under any of its policies issued to Meyer or his parents. Millers argued that its policies do not provide UIM coverage because the liability limit applicable to the vehicle that struck Meyer is not lower than the limits contained in the Millers policies.

¶ 6. After hearing oral arguments on the issue, the circuit court held that Millers's policies provided $1.5 million in UIM coverage for Meyer's accident and granted summary judgment in favor of Meyer. The circuit

233 Wis.2d 225

court reasoned that the umbrella policy was ambiguous and interpreted it in favor of providing coverage. It then compared a $1.25 million UIM coverage amount—$250,000 from the primary UIM policy plus $1 million from the umbrella policy—to the truck's $1 million Michigan Mutual liability policy and determined Millers's coverage to be greater. Millers appeals

¶ 7. Millers disputes the declaratory judgment in two respects. First, because the primary policy does not provide UIM coverage for Meyer's accident, it argues that the umbrella policy, likewise, provides no UIM coverage. It contends that the umbrella policy's UIM coverage is not ambiguous because a reasonable insured person would assume that the same definition for UIM coverage as provided in the underlying primary policy would be used for the umbrella policy's definition. Second, it disagrees with how the court compared its policy to Michigan Mutual's. Contending that the Meyers' policies should be compared individually to Michigan Mutual's, it argues that Michigan Mutual's UIM liability limit of $1 million is greater than its policy limits of $250,000.

[1, 2]

¶ 8. The interpretation of an insurance contract is a question of law that this court decides independently of the trial court. See Davis v. Allied Processors, Inc., 214 Wis. 2d 294, 298, 571 N.W.2d 692 (Ct. App. 1997). When construing an insurance policy, our objective, like construing any contract, is to ascertain the intentions of the parties. See id. This is determined by considering what a reasonable person in the position of the insured would have understood the policy to mean. See id.

233 Wis.2d 226

[3]

¶ 9. Whether the policy's language is ambiguous is also a question of law. See id. Ambiguity exists if the policy's words or phrases are susceptible to more than one reasonable interpretation. See Smith v. Atlantic Mut. Ins. Co., 155 Wis. 2d 808, 811, 456 N.W.2d 597 (1990). Any ambiguities should be construed in favor of coverage. See id.

¶ 10. Millers argues that Meyer's accident is not covered under its UIM coverage because the...