Minnesota Mut. Fire & Cas. Ins. Co. v. Manderfeld, C6-91-2363

• Decision Date: 07 April 1992
• Docket Number: No. C6-91-2363,C6-91-2363
• Citation: 482 N.W.2d 521
• Court: Minnesota Court of Appeals
• Parties: MINNESOTA MUTUAL FIRE & CASUALTY INSURANCE COMPANY, Respondent, v. Mary MANDERFELD and Michael Manderfeld, individually and as father and natural guardian of Gregory Manderfeld, a minor, Appellants, Snapper Power Equipment, Defendant.

Page 521

482 N.W.2d 521

MINNESOTA MUTUAL FIRE & CASUALTY INSURANCE COMPANY, Respondent, v.Mary MANDERFELD and Michael Manderfeld, individually and as father and natural guardian of Gregory Manderfeld a minor, AppellantsSnapper Power Equipment, Defendant.

No. C6-91-2363.

Court of Appeals of Minnesota.

April 7, 1992.

Review Denied in Part and Dismissed in Part June 10, 1992.

Syllabus by the Court

1.Exclusion provision in insurance policy was unambiguous, because it was not susceptible to more than one meaning.

2.Unambiguous exclusion provision, not hidden and not shown to be an item unknown by the public generally, cannot be said to violate the reasonable expectations of the insured.

3.Whether household exclusion provision frustrates public policy of compensating family members injured by negligence of other members is a question more properly addressed by the supreme court or the legislature.

4.Insurance agent owed no duty to explain presence of household exclusion to insured where no special circumstances existed giving rise to an affirmative duty beyond acting in good faith and following directions.

5.Party to insurance contract need not obtain consent from possible claimants when obtaining coverage.

Barbara R. Hatch, Murnane, Conlin, White, Brandt & Hoffman, St. Paul, for respondent.

Larry Reed, Hassan & Reed, Minneapolis, Clarance E. Hagglund, Britton D. Weimer, William C. Weeding, Hagglund Law Firm, P.A., Minneapolis, for appellants.

James A. O'Neal, Faegre & Benson, Minneapolis, for defendant.

Considered and decided by HARTEN, P.J., and PARKER and CRIPPEN, JJ.

OPINION

PARKER, Judge.

Gregory Manderfeld, through his guardian ad litem, Walter Irwin, sued Mary Manderfeld(his mother), Snapper Power Equipment, and Charles Moran for injuries Gregory suffered when he was run over by a lawnmower operated by his mother.Shortly thereafter, Minnesota Mutual Fire and Casualty Insurance Company sought a declaratory judgment that it was not liable for coverage of Gregory's injuries.The trial court granted Minnesota Mutual's motion for summary judgment.

On appeal, the Manderfelds argue that a residency exclusion in their Minnesota Mutual policy is invalid.They claim the exclusion is ambiguous, is void for lack of consent of the beneficiary, is contrary to the insured's reasonable expectations and contravenes public policy.The Manderfelds further allege that their insurance representative breached a duty to explain the household exclusion.They also moved to strike portions of Minnesota Mutual's brief.We affirm the trial court.

FACTS

On May 22, 1990, Mary Manderfeld was operating a riding lawnmower at the home of her father, Charles Moran.Gregory Manderfeld, age four, suffered injuries when Mary accidentally drove the lawnmower over Gregory's legs, severing his right foot.At the time of the accident, the boy was residing with his parents, Mary and Michael Manderfeld, in Minneapolis.

Minnesota Mutual had issued a homeowner's insurance policy to the Manderfelds.The policy contained a "homeowner's exclusion" providing that the policy would not cover an insured for a bodily injury claim asserted by another insured under the policy.

ISSUES

1.Did the trial court err in finding the household exclusion in the insurance policy unambiguous?

2.Did the trial court err in finding the exclusion provision did not violate the reasonable expectations of the insured?

3.Did the trial court err in failing to find the exclusion void on public policy grounds?

4.Did the trial court err in finding that the Manderfelds' insurance representative did not breach a duty to explain the exclusion?

5.Did the trial court err in failing to find the exclusion void because the claimant did not provide consent?

DISCUSSION

Standard of Review

Minnesota Rule of Civil Procedure 56.03 provides that the trial court shall award summary judgment where "there is no genuine issue as to any material fact and * * * either party is entitled to a judgment as a matter of law."On appeal from an award of summary judgment, this court's sole function is to determine "(1) whether there are any genuine issues of material fact and (2) whether the trial court erred in its application of the law."Betlach v. Wayzata Condominium, 281 N.W.2d 328, 330(Minn.1979).

I

The Manderfelds argue that portions of Minnesota Mutual's brief should be stricken from the record.First, they move to strike a factual reference identifying Michael Manderfeld as a certified public accountant.The court must strike matters outside the record on appeal.Mitterhauser v. Mitterhauser, 399 N.W.2d 664, 667(Minn.App.1987).

We deny the motion to strike the reference.Mary Manderfeld testified in her deposition that Michael is a certified public accountant.The deposition was in evidence before the trial court.The record therefore provides adequate factual basis to support the assertion.

The Manderfelds also move this court to strike a portion of Minnesota Mutual's argument in respondent's brief.Specifically, the Manderfelds claim that Minnesota Mutual failed to file a notice of review allowing them to raise as an issue whether the Manderfelds' insurance representative acted as Minnesota Mutual's agent.We deny the motion to strike.

The Minnesota Rules of Civil Appellate Procedure provide:

A respondent may obtain review of a judgment or order entered in the same action which may adversely affect him by filing a notice of review with the clerk of the appellate courts.

Minn.R.Civ.App.P. 106.Where the respondent fails to file a notice of review to preserve an issue, the court will decline to address it.Ford v. Chicago, Milwaukee, St. Paul & Pac. R.R. Co., 294 N.W.2d 844, 845(Minn.1980).A respondent who prevails at the trial court level, however, need not file a notice of review to preserve the right to seek remand if the trial court's decision is reversed.Andren v. White-Rodgers Co., 462 N.W.2d 860, 861(Minn.App.1990).

The trial court found that whether the insurance representative acted as an agent for Minnesota Mutual was a question of material fact, but ultimately concluded that the representative had no duty to alert the Manderfelds to the household exclusion.Minnesota Mutual's failure to file a notice of review therefore does not, as the issues are presented in this case, preclude our review of the agency question.

II

The Manderfelds argue that the household exclusion should not preclude coverage, because the exclusion is ambiguous.We hold that this is not the case.Whether the language of an insurance policy is ambiguous presents a question of law.Columbia Heights Motors, Inc. v. Allstate Ins. Co., 275 N.W.2d 32, 34(Minn.1979).If the language of the policy is susceptible to more than one reasonable interpretation, it is ambiguous.Id.The reviewing court, however, may not read an ambiguity into the plain language in order to provide coverage.Id.Because the insurance company selects the language, any reasonable doubt as to the meaning of the policy language is resolved in favor of the insured.Amatuzio v. United States Fire Ins. Co., 409 N.W.2d 278, 280(Minn.App.1987).

The Manderfelds claim that the household exclusion is susceptible to two interpretations: (1) the exclusion applies only when the site of the injury is under the insured's control, i.e., on the insured's premises or in the insured's vehicle; (2) the exclusion applies regardless of the site of the injury.The Manderfelds argue that the exclusion is ambiguous when applied to the facts of Gregory's injury because the accident occurred off the Manderfelds' premises.We agree with the trial court that the policy language does not produce such an ambiguity.

The definitions section of the Manderfelds' policy provides:

3. "insured" means you and residents of your household who are:

a. your relatives; or

b. other persons under the age of 21 and in the care of any person named above.

* * * * * *

2.Coverage E--Personal Liability, does not apply to:

* * * * * *

f. bodily injury to you or an insured within the meaning of part a. or b. of "insured" as defined.

The policy unambiguously excludes from coverage bodily injuries to anyone defined as an insured.The language makes no distinction between injuries occurring on the insured's premises and those occurring off them.We therefore agree with the trial court that to read such an ambiguity into the policy violates its plain language.

III

The Manderfelds next allege that the household exclusion violated their reasonable expectations as insureds.We disagree in this case, although we believe that these exclusions generally run the danger of violating the reasonable expectations of the insured.The supreme court adopted the reasonable expectations doctrine in Atwater Creamery Co. v. Western Nat'l Mut. Ins. Co., 366 N.W.2d 271(Minn.1985).The court stated that, in view of the unique circumstances surrounding a layperson's purchase of insurance,

the objectively reasonable expectations of applicants and intended beneficiaries regarding the terms of insurance contracts will be honored even though painstaking study of the policy provisions would have negated those expectations.

Id. at 277(quoting Robert Keeton, Insurance Law Rights at Variance with Policy Provisions, 83 Harv.L.Rev. 961, 967(1970)).The court set forth factors to determine whether an insurance policy violates the insured's reasonable expectations:

[A]mbiguity in the language of the contract * * * becomes a factor in determining the reasonable expectations of the insured, along with such factors as whether the insured was told of important, but obscure, conditions or exclusions and whether the particular provision in the contract at issue is an item known by the public generally.

Id. at 278.

The trial court found that the household exclusion did not violate the Manderfelds' reasonable expectations, because it was neither ambiguous nor hidden.We have already...