National Family Ins. Co. v. Muellerleile, 45866

• Decision Date: 07 May 1976
• Docket Number: No. 45866,45866
• Citation: National Family Ins. Co. v. Muellerleile, 242 N.W.2d 598, 308 Minn. 340 (Minn. 1976)
• Parties: NATIONAL FAMILY INSURANCE COMPANY, Respondent, v. Patricia MUELLERLEILE, Trustee for the Heirs of Sophie Hinderscheid, Deceased, et al., Appellants.
• Court: Minnesota Supreme Court

Page 598

242 N.W.2d 598

308 Minn. 340

NATIONAL FAMILY INSURANCE COMPANY, Respondent, v. Patricia MUELLERLEILE, Trustee for the Heirs of Sophie Hinderscheid, Deceased, et al., Appellants.

No. 45866.

Supreme Court of Minnesota.

May 7, 1976.

Syllabus by the Court

Under applicable Minnesota statutes, an exclusionary clause in an automobile insurance policy which includes by definition as named insured the spouse of the named insured is prohibited and unenforceable.

Korman & Peterson, Faribault, O. C. Adamson II, Minneapolis, for appellants.

David W. Nord, St. Paul, for respondent.

Heard before ROGOSHESKE, TODD and BREUNIG, JJ., and considered and decided by the court en banc.

TODD, Justice.

Defendants, Patricia Muellerleile, trustee, and Henry J. Hinderscheid, appeal from a declaratory judgment that a policy issued by National Family Insurance Company (National) did not afford coverage for claims arising out of the death of Sophie Hinderscheid while a passenger in the family automobile being driven by her husband, Henry. National claimed, and the trial court ruled, that it was not obliged to defend and indemnify Henry against the claims of Sophie's trustee for her wrongful death because of an exclusion in the policy, and that the statute in effect at the time of the accident did not preclude such an exclusion. We reverse.

The facts are not disputed. Relevant portions of the parties' agreed case are as follows:

'On May 7, 1971, Henry J. Hinderscheid was driving a 1967 Dodge Coronet 500 automobile on Interstate 35 in Rice County, Minnesota, when a collision occurred between that car and a 1967 Pontiac driven by Roger Speikers. As a result of this collision, Sophie Hinderscheid, the wife of Henry J. Hinderscheid, who was a resident of the same household * * * was killed.

'The automobile being driven by Henry J. Hinderscheid was insured by National Family Insurance Company under its policy of insurance number 215 116, issued February 11, 1971 and to expire August 11, 1971.

'Patricia Muellerleile, as Trustee for the heirs of Sophie Hinderscheid has commenced a civil action for the wrongful death in the (District) Court against Henry J. Hinderscheid. Henry J. Hinderscheid has demanded that National Family Insurance Company defend him in that action.'

The company denied coverage, basing its denial upon the following policy language:

'Part I--LIABILITY

'Coverage A * * * To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of:

A. bodily injury * * * including death resulting therefrom * * * sustained by any person; * * * arising out of the ownership, maintenance or use of the owned automobile * * *, and the company shall defend any suit alleging such bodily injury * * * which are payable under the terms of this policy, * * *.

'Definitions: Under Part I:

"named insured' means the individual named in Item 1 of the declarations and also includes his spouse, if a resident of the same household.

'Exclusions: This policy does not apply under Part I: * * *

(k) to bodily injury to the named insured as defined herein.'

The trial court held that exclusion (k) has the effect of depriving the named insured, Henry J. Hinderscheid, of the coverage which otherwise would be afforded to him by the policy.

The parties agree that the policy language clearly excludes coverage in this case. The only issue is whether such an exclusionary clause was prohibited by statute. In 1969, the Minnesota Legislature adopted L.1969, c. 474, § 1, entitled 'An act relating to insurance; forbidding the household or family exclusion in automobile insurance,' which provided:

'No policy of automobile liability insurance as defined in Minnesota Statutes, Section 72A.141, written or renewed after July 1, 1969, shall contain an exclusion of liability for damages for bodily injury solely because the injured person is a resident or member of an insured's household or related to the insured by blood or marriage. Nothing contained in this section shall prohibit issuance of a policy excluding coverage for a named driver.' (Italics supplied.)

The 1969 act was in effect at the time of the issuance of the National policy involved and at the time of the accident in question.

In 1971, the Minnesota Legislature adopted L.1971, c. 719, § 1, entitled 'An act relating to insurance; forbidding certain exclusions of liability in automobile liability insurance policies; amending (L.1969, c. 474, § 1,),' which provided:

'Subdivision 1. (a) No policy of automobile liability insurance as defined in section 72A.141, written or renewed after July 1, 1969, shall contain an exclusion of liability for damages for bodily injury solely because the injured person is a resident or member of an insured's household or related to the insured by blood or marriage.

'(b) No policy of automobile liability insurance as defined in Minnesota Statutes, Section 72A.141, written or renewed after July 1, 1971, shall contain an exclusion of liability for damages for bodily injury sustained by any person who is a named insured, except where such injury is sustained by a named insured who is driving the insured automobile at the time such injury is sustained. Nothing contained in this subdivision shall prohibit an insurer from issuing a named driver exclusionary endorsement voiding the policy wherein the insured automobile is being driven by the excluded driver.'

The 1971 act was not in effect at the time of the issuance of...