Mid-Century Ins. Co. v. French
| Decision Date | 12 September 2019 |
| Docket Number | Case No. 2:19-cv-00563-JDW |
| Parties | MID-CENTURY INSURANCE COMPANY, LLC, Plaintiff v. Annemarie FRENCH, et al., Defendants |
| Court | U.S. District Court — Eastern District of Pennsylvania |
William K. Conkin, Eileen Margaret Bradley, Marshall Dennehey Warner Coleman & Goggin, Philadelphia, PA, for Plaintiff.
Michael A. Cancelliere, Jr., Michael A. Rowe, Nass Cancelliere Brenner, Philadelphia, PA, for Defendants.
This insurance coverage dispute turns on the application of two exclusions in an auto insurance policy that Plaintiff Mid-Century Insurance Company, LLC, issued to Annemarie and Timothy French (the "Policy"). For the reasons stated below, the Court concludes that both the named driver exclusion and the regular use exclusion apply and are enforceable under Pennsylvania law. Therefore, the Court will grant summary judgment in favor of Mid-Century and against Defendant Robert Stern.
Annemarie and Timothy French insured their family car, a 2001 Ford F350, with Mid-Century. The Policy bears policy number 1FTWW33F21EC33540, and has a policy period from May 9, 2017, to May 9, 2019. (ECF No. 33-2 at Ex. D.) It provides, among other things, "We do not insure bodily injury or property damage arising out of the ownership, maintenance, or use of any car , other than your insured car , which is owned by, furnished or available for regular use by you or a family member ." (Id. at p. 12 of 73 (emphasis in original) (the "Regular Use Exclusion").)
Gavin French is Annemarie's and Timothy's adult son. When Gavin went to college, Annemarie and Timothy sought to exclude him from their auto coverage. (ECF No. 33-2 at Ex. H, 6:16-17.) As a result, the Policy that Mid-Century issued to them contains a named driver exclusion endorsement that lists their son Gavin French as the "Person(s) Restricted" (the "Named Driver Exclusion"). (ECF No. 33-2 at Ex. D, p. 34 of 73.) The exclusion provides that "all coverage for bodily injury , loss or damages afforded by this policy and all liability or obligation of any kind shall not, at any time or after the effective date shown, apply to the operation or use of any vehicle by the person(s) named above." (Id. (emphasis in original).) After Annemarie and Timothy excluded Gavin from coverage, their insurance premiums went down. (ECF No. 33-2 at Ex. H, 8:17-19.)
Gavin French owned his own car, a 2014 Toyota Corolla. (ECF No. 33-2 at Ex. E, 17:8-12.) He co-owned this car with his fiancée, Carlie Lambert. (Id. ) Carlie also owned another car, a 2008 Honda CR-V. (Id. at 16:4-11.) Both cars were covered by a GEICO insurance policy on which Carlie was listed as the named insured, and Gavin was listed as an additional driver. (ECF No. 33-2 at Ex. F.) Gavin was included on the GEICO policy because he was driving both cars at the time. Indeed, he had a key to Carlie's Honda. (ECF No. 33-2 at Ex. E, 27:15-17.)
On August 20, 2017, Gavin was driving Carlie's Honda and struck Robert Stern, who suffered serious injuries and filed a personal injury lawsuit against Gavin in the Court of Common Pleas for Bucks County, Pennsylvania. See Stern v. French , Case No. 2017-07378 (Bucks Cty.) (the "Bucks County Action"). GEICO has defended Gavin in that matter. At the time of the accident, Gavin and his fiancée, Carlie, lived at Annemarie's and Timothy's house in Perkasie, Pennsylvania. (ECF No. 33-2 at Ex. H, 5:2-6.) Annemarie and Timothy, however, were residing at another residence in Maine and had their Ford F350 there with them. (Id. at 7:4-11.)
On February 7, 2019, Mid-Century filed a Complaint against the Frenches, Gavin, and Stern, seeking a declaratory judgment that the Policy does not provide liability coverage for any claim made by Stern against French in the Bucks County Action. (ECF No. 1.) On April 5, 2019, Stern filed an answer and counterclaim for a declaratory judgment that he is entitled to coverage under the Policy. (ECF No. 7.) The Frenches have not answered, appeared, or otherwise defended themselves in this action. Thus, on June 24, 2019, the Clerk of Court entered a default against each of these three defendants.
On August 16, 2019, Stern filed a Motion for Summary Judgment. (ECF No. 33.) The same day, Mid-Century filed a Motion for Judgment on the Pleadings. (ECF No. 32.) Each Party has responded to the motions, and Stern filed evidence in response to Mid-Century's motion. Therefore, in order to consider the entire record before it, the Court will exercise its discretion to treat Mid-Century's motion as a summary judgment motion. See Wolfington v. Reconstructive Orthopaedic Assocs. II PC , 935 F.3d 187, 195-96 (3d Cir. 2019).
Federal Rule of Civil Procedure 56(a) permits a party to seek, and a court to enter, summary judgment "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "[T]he plain language of Rule 56 [ (a) ] mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett , 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) (quotations omitted). In ruling on a summary judgment motion, a court must "view the facts and draw reasonable inferences ‘in the light most favorable to the party opposing the [summary judgment] motion.’ " Scott v. Harris , 550 U.S. 372, 378, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007) (quotation omitted). However, "[t]he non-moving party may not merely deny the allegations in the moving party's pleadings; instead he must show where in the record there exists a genuine dispute over a material fact." Doe v. Abington Friends Sch. , 480 F.3d 252, 256 (3d Cir. 2007) (citation omitted). The movant is entitled to judgment as a matter of law when the non-moving party fails to make such a showing. Dodson v. Coatesville Hosp. Corp. , No. 18-3065, 773 Fed. App'x 78, 80-81 n.6 (3d Cir. 2019) (quotation omitted). "When confronted with cross-motions for summary judgment ‘the court must rule on each party's motion on an individual and separate basis, determining, for each side, whether a judgment may be entered in accordance with the Rule 56 standard.’ " Canal Ins. Co. v. Underwriters at Lloyd's London , 333 F. Supp. 2d 352, 353 n.1 (E.D. Pa. 2004), aff'd , 435 F.3d 431 (3d Cir. 2006).
The Parties' dispute centers on whether the Named Driver Exclusion or the Regular Use Exclusion applies here. If either exclusion applies, then there is no coverage. Because this case is based upon diversity of citizenship jurisdiction, Pennsylvania contract law governs. See Gen. Refractories Co. v. First State Ins. Co. , 855 F.3d 152, 158 (3d Cir. 2017) (citation omitted). In Pennsylvania, "[t]he interpretation of an insurance policy is a question of law for the court." Byoung Suk An v. Victoria Fire & Cas. Co. , 113 A.3d 1283, 1288 (Pa. Super. Ct. 2015). When interpreting an insurance policy, like other contracts, Id. (quotation omitted). "[W]ords of common usage are to be construed in their natural, plain, and ordinary sense[,]" and the court must give effect to the policy's clear and unambiguous language. Id. "A court must not resort to a strained contrivance or distort the meaning of the language in order to find an ambiguity[.]" Id. Instead, "contractual terms are ambiguous if they are subject to more than one reasonable interpretation when applied to a particular set of facts." Id. In cases such as this, "[w]here an insurer seeks to disclaim coverage on the basis of a policy exclusion ... the insurer bears the burden of proving the applicability of the exclusion...." Gen. Refractories , 855 F.3d at 158 (citation omitted).
Neither party disputes that, by its terms, the Named Driver Exclusion applies and excludes coverage for Gavin. Nor could they. Stern, however, argues that Pennsylvania's Motor Vehicle Financial Responsibility Law ("MVFRL") renders the Named Driver Exclusion unenforceable. The MVFRL provides, in relevant part:
75 Pa. C.S.A. § 1718(c)(2) (emphasis added). The undisputed evidence establishes that Annemarie and Timothy—the first named insureds on the Policy—requested that Gavin be excluded from coverage while operating a motor vehicle. Thus, this statutory provision applies as long as Gavin was "insured on another policy of motor vehicle liability insurance." Id.
Both parties identify the relevant statutory language that is the key to this analysis, and both parties argue that the language supports their position. However, neither party has taken the time to analyze the statutory language or to provide the Court with any analysis as to its proper interpretation. Instead, each party makes an unhelpful logical leap to conclude that the statutory language supports its position. Statutory interpretation demands more, however.
When interpreting a statute, the Court's "primary purpose ... is to discern legislative intent." Morgan v. Gay , 466 F.3d 276, 277 (3d Cir. 2006). In most cases, "[t]he plain meaning of legislation should be conclusive[.]" Id. (...
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