PC RENTAL, INC. v. Chase Manhattan Bank
| Citation | 998 P.2d 1168,2000 MT 106 |
| Decision Date | 27 April 2000 |
| Docket Number | No. 99-448.,99-448. |
| Parties | P.C. RENTAL, INC., d/b/a Budget Rent-A-Car, Plaintiff and Appellant, v. CHASE MANHATTAN BANK and Visa U.S.A., Defendants and Respondents. |
| Court | Montana Supreme Court |
William A. D'Alton, Brown Law Firm, P.C., Billings, Montana, For Appellant.
Allan H. Baris, Moore, O'Connell & Refling, P.C., Bozeman, Montana, For Respondents.
¶ 1 P.C. Rental, Inc., d/b/a Budget Rent-a-Car (P.C. Rental), appeals from the judgment entered by the Eighteenth Judicial District Court in Gallatin County, awarding summary judgment in favor of Chase Manhattan Bank and Visa U.S.A. (collectively, Visa) and dismissing P.C. Rental's Amended Complaint with prejudice. We affirm.
¶ 2 Of the issues raised on appeal by P.C. Rental, only one is dispositive: Whether the District Court erred when it concluded that P.C. Rental's physical damage coverage was primary coverage and Visa's auto rental insurance coverage was excess coverage? The other issues raised involve consideration of P.C. Rental's liability coverage. While the District Court addressed the arguments raised by the parties with regard to P.C. Rental's liability coverage, the District Court's ultimate resolution of this case rested on the primary versus excess coverage provisions of the respective property damage policies. Therefore, the issues presented involving consideration of P.C. Rental's liability policy are not germane to our resolution of this case and will not be addressed.
¶ 3 In the District Court proceeding, the parties stipulated to the following underlying facts: On May 7, 1995, John Hudson used his Visa Gold Card at the Gallatin County Airport to rent a 1995 Ford Mustang convertible from P.C. Rental. On May 10, 1995, Hudson lost control of the vehicle, causing damage rendering the vehicle a total loss.
¶ 4 At the time of the accident, P.C. Rental had a commercial lines policy through Empire Fire and Marine Insurance Company (Empire), which included liability and physical damage coverage. As of May 10, 1995, Hudson did not own an automobile and was not covered by a personal automobile insurance policy at the time of the accident. However, one of the benefits provided by the Visa Gold Card Hudson used to rent the Mustang was auto rental insurance.
¶ 5 Empire paid P.C. Rental the agreed actual cash value of the vehicle in the amount of $18,223 (rounded off to the nearest dollar amount), minus a $1000 policy deductible. Empire subsequently sold the damaged vehicle for salvage and received $1108, resulting in a net payout of $17,115 to P.C. Rental. In addition, Visa paid P.C. Rental approximately $7800 to cover P.C. Rental's deductible and lost rental fees.
¶ 6 On July 25, 1996, P.C. Rental brought a breach of contract action against Hudson for failing to return the car in the same condition in which it had been rented to him as required by the rental agreement. Hudson filed an Answer and Third Party Claim on October 2, 1996, alleging that Chase Manhattan Bank, as the issuer of his Visa Gold Card, was responsible for any damage sustained to the rental car under the terms of the auto rental insurance.
¶ 7 Hudson subsequently filed for bankruptcy and assigned all his rights in the third-party claim against Chase Manhattan Bank to P.C. Rental. Based on those events, P.C. Rental filed a motion for leave to amend its complaint on June 20, 1997, which was granted. In its Amended Complaint, P.C. Rental added Visa U.S.A., as a defendant on the basis that the auto rental insurance Hudson obtained through his Visa Gold Card, issued by Chase Manhattan Bank, was provided by Visa U.S.A. P.C. Rental alleged that the auto rental insurance provided coverage on a 24-hour basis for damage to a rental car rented with the credit card up to the full value of the car in the event of collision or rollover. Visa filed an answer to the Amended Complaint denying P.C. Rental's allegations regarding the auto rental insurance.
¶ 8 On September 10, 1998, the parties entered into a Stipulation of Fact Concerning Real Party in Interest, which stated that this lawsuit was a subrogation action brought by Empire in the name of its insured, P.C. Rental, and that Empire was an additional real party in interest agreeing to be bound as if named as a party plaintiff. In addition, the parties entered into a Stipulation of Fact for Purposes of Submitting Coverage Issue to Court for Ruling on Summary Judgment.
¶ 9 The parties subsequently filed cross-motions for summary judgment. Visa alleged that they had met their obligation under the auto rental insurance when they paid P.C. Rental approximately $7800 to cover P.C. Rental's policy deductible and lost rental fees. In addition, Visa asserted that the auto rental insurance provided excess coverage and Empire's property damage coverage provided primary coverage for the loss of the rental vehicle. Furthermore, Visa alleged that Hudson was an insured under the liability coverage issued by Empire and thus, Empire could not subrogate against its own insured.
¶ 10 P.C. Rental/Empire argued that Hudson was not a designated insured under the property damage/collision coverage and thus, Empire was not attempting to subrogate against its own insured. Moreover, P.C. Rental/Empire asserted that no issue of primary or excess coverage existed in this subrogation action and Visa was ultimately responsible for the loss of the vehicle.
¶ 11 The District Court concluded that Hudson was an insured under the liability policy provided to P.C. Rental by Empire and thus, Empire was not entitled to subrogate against its own insured under the liability coverage. With regard to the property damage/collision coverage, the District Court stated that since both policies provided property damage coverage for the same vehicle, the court must honor the "other insurance" clauses of the policies. The policy issued by Empire states that its coverage is primary and the auto rental insurance provided through Visa states that it is excess coverage. Accordingly, the District Court concluded that Empire was not entitled to recover any of the amount it paid to P.C. Rental from Visa.
¶ 12 After its ruling, the District Court entered judgment granting Visa's motion for summary judgment, denying P.C. Rental's motion for summary judgment, and dismissing P.C. Rental's Amended Complaint with prejudice. P.C. Rental appeals from the judgment entered by the District Court.
¶ 13 Our standard of review in appeals from summary judgment rulings is de novo. See Ruckdaschel v. State Farm Mut. Auto. Ins. (1997), 285 Mont. 395, 398, 948 P.2d 700, 702
(citations omitted). When we review a district court's grant of summary judgment, we apply the same evaluation, based on Rule 56, M.R.Civ.P., as the district court. See ...
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