Progressive N. Ins. Co. v. McGrath

• Decision Date: 15 October 2021
• Docket Number: 2021-026
• Citation: 2021 VT 79
• Court: Vermont Supreme Court
• Parties: Progressive Northern Insurance Company v. Kevin McGrath

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2021 VT 79

Progressive Northern Insurance Company
v.
Kevin McGrath

No. 2021-026

Supreme Court of Vermont

October 15, 2021

On Appeal from Superior Court, Orleans Unit, Civil Division Mary Miles Teachout, J.

Daniel L. Burchard of McCormick, Fitzpatrick, Kasper & Burchard, P.C., Burlington, for Plaintiff-Appellee.

Steven A. Adler of Adler & McCabe, PLC, St. Johnsbury, for Defendant-Appellant.

PRESENT: Reiber, C.J., Robinson, Eaton, Carroll and Cohen, JJ.

EATON, J.

¶ 1. Plaintiff-appellant Kevin McGrath challenges the superior court's decision granting summary judgment to appellee Progressive Northern Insurance Company. Specifically, he argues that the court erred in concluding that he was not "occupying" a vehicle, as that term is defined in the insurance policy at issue, when he was struck and injured by an underinsured motorist. We affirm.

¶ 2. The following facts are undisputed. In the early morning, plaintiff was traveling from his home in Lowell, Vermont, to the Burlington International Airport, to catch a flight. Plaintiff was driving a car with the owner riding in the passenger seat. Plaintiff stopped at a gas station/convenience store in Johnson, Vermont. After pulling up to the pump at approximately

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6:28 a.m., plaintiff got out of the car, inserted a credit or debit card into the pump, and began pumping gas. The owner got out of the car and went into the convenience store. At approximately 6:31 a.m., plaintiff finished pumping gas and walked toward the store., Approximately three minutes later, plaintiff and the owner left the store; they were carrying coffee and walking toward the car with the intention of re-entering and continuing their trip to the airport. When they were about thirty-to-forty feet from the owner's car, a pickup truck struck both plaintiff and the owner.

¶ 3. Plaintiff filed a claim for underinsured motorist (UIM) benefits with the owner's auto insurer, Progressive, asserting that he qualified for coverage under the terms of the policy. By its terms, the policy provides coverage for "damages that an insured person is legally entitled to recover from the owner or operator of . . . an underinsured motor vehicle" because of injuries sustained by an insured person caused by an accident involving the underinsured motor vehicle. The policy defines "insured person" for purposes of UIM benefits to include: (1) the individuals who are named insureds under the terms of the policy-i.e., the owner; (2) "[a]ny person while operating a covered auto with the permission of" a named insured; and (3) "[a]ny person occupying, but not operating, a covered auto."

¶ 4. Plaintiff is not a named insured, so he is only entitled to UIM coverage under the owner's policy if he was "operating" or "occupying" the car under the terms of the policy. The policy does not define the term "operating"; it defines "occupying" to mean "in, on, entering or exiting."

¶ 5. Progressive denied plaintiff coverage under the owner's policy based on its determination that he was not "operating" or "occupying" the car under the terms of the policy. Plaintiff filed suit, and the parties agreed to a declaratory judgment action on stipulated facts; without discovery, they filed cross-motions for summary judgment.

¶ 6. The trial court granted summary judgment to Progressive, concluding that neither "operating" nor "occupying" was ambiguous with respect to an individual who was 30-40 feet

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from the car. Specifically, the court said that, based on a "common sense lay person's understanding" of those terms, plaintiff "was not controlling the operation of the vehicle at the time, nor was he near enough to be in the process of entering it," and thus plaintiff was not entitled to UIM coverage under the owner's policy.

¶ 7. Plaintiff appeals the trial court's decision, arguing that the court adopted an overly narrow interpretation of the policy language. Specifically, plaintiff argues that modern technology necessitates an understanding of "operating" that takes into account that people can do things incidental to the operation of a car, such as locking or unlocking the doors, or even starting the ignition, from a distance. As to "occupying," plaintiff urges this Court to follow what he argues is the modern trend embraced by a majority of courts and adopt a multi-factorial approach in determining whether he was "occupying" the vehicle in this case.

¶ 8. We review summary judgment decisions applying the same standard as the trial court, and we will uphold the court's ruling if there is no genuine issue of material fact and the prevailing party is entitled to judgment as a matter of law. Ziniti v. New England Cent. R.R., 2019 VT 9, ¶ 14, 209 Vt. 433, 207 A.3d 463; V.R.C.P. 56(a). "The nonmoving party receives the benefit of all reasonable doubts and inferences." Pettersen v. Monaghan Safar Ducham PLLC, 2021 VT 16, ¶ 9, __ Vt.__, 256 A.3d 604 (quotation omitted).

¶ 9. In this case, there are no disputed facts; rather, the parties disagree on the interpretation of the policy terms "operating" and "occupying." "Because an insurance policy is a contract, its interpretation is a question of law, and our review is nondeferential and plenary." Com. Constrs. Endeavors, Inc. v. Ohio Sec. Ins. Co., 2019 VT 88, ¶ 9, 211 Vt. 286, 225 A.3d 247. "Disputed terms must be accorded their plain, ordinary, and popular meaning." Progressive N. Ins. Co. v. Muller, 2020 VT 76, ¶ 11, ___Vt.__, 249 A.3d 24 (quotation omitted). Because the insurer drafts the policy with little effective input from the insured, we construe any ambiguity in policy language against the insurer. Id. "Words or phrases in an insurance policy are ambiguous

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if they are fairly susceptible to more than one reasonable interpretation." Brillman v. New England Guar. Ins. Co., 2020 VT 16, ¶ 19, 211 Vt. 550, 228 A.3d 636 (quotation omitted).

¶ 10. We conclude that plaintiff was neither "operating" nor "occupying" the car at the time of the accident. We need not decide whether and to what extent remote control of a car's functions constitutes "operating" because the evidence in this case does not support plaintiff's argument. We decline in this case to adopt a specific test for evaluating whether plaintiff was "entering" or "occupying" the car because we conclude that the facts here do not support coverage in any event.

I. Operating

¶ 11. First, we reject plaintiff's argument that he was "operating" the car at the time of the accident because it is not supported by the stipulated facts. In his brief, plaintiff argues that he was using a key fob "to do things incidental to the operation of the vehicle." However, the stipulated facts are that the car had a key fob, which allowed plaintiff to control certain parts of the car remotely, that plaintiff locked the vehicle remotely, and that prior to the moment he was hit by the pickup truck, he "was intending to unlock the vehicle remotely as he walked back to the car." There is no evidence that plaintiff was, in fact, unlocking the car remotely while he was walking back to the car or at the time of the accident. Even if we were to apply a definition of "operating" that includes remotely controlling one or more vehicle functions, a mere intention to remotely unlock the vehicle is insufficient to trigger coverage under such a definition.

II. Occupying

¶ 12. As to plaintiff's principal argument, we agree with the trial court that plaintiff was not "occupying" the car under the terms of the policy. The question for our analysis is whether plaintiff was "entering" the vehicle at the time he was struck. We conclude that the meaning of "entering" may be ambiguous, note the various approaches courts have taken in resolving the

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ambiguity, and ultimately decline to adopt a specific test because we conclude that the facts here fall clearly outside any reasonable definition of that term.

¶ 13. Although much of the discussion in the parties' briefs focuses on the meaning of "occupying," that is not the central question in this case. "Occupying" is a defined term in the policy: it means "in, on, entering, or exiting." Because the only plausible theory is that plaintiff was "entering" the car at the time of the accident, we must determine the meaning of "entering" and whether it is ambiguous in this case.

¶ 14. "Entering" in the context of the policy is the present participle of "enter," meaning "to come or go into." Enter, Black's Law Dictionary (11th ed. 2019). "Entering" may be susceptible to more than one reasonable meaning depending on at what point a person is considered to begin the process of "coming or going into" the insured car. See Hartford Underwriters Ins. Co. v. Cincinnati Ins. Co., No. 1:09-CV-00267-JGM, 2011 WL 90319, at *3-4 (D. Vt. Jan. 11, 2011) (holding that terms in definition "in, upon, getting in, out, on, or off" were ambiguous applied to the facts because reasonable people could differ "depending on which point in time one believes the process of embarking began"). In a narrow sense, "coming or going into" may mean the point in time at which an individual crosses the threshold of a car to enter it; but, it may also encompass a broader scope of conduct, including some time leading up to the point when an individual actually crosses the threshold into the car. Because we recognize this ambiguity, we consider the factors other courts have used to determine when conduct constitutes "occupying."

¶ 15. Courts have taken a variety of approaches to construing "occupying" in policies with similar or identical definitions to the policy at issue here. See U.S. Fid. & Guar. Co. v. Goudeau, 272 S.W.3d 603, 606-07 (Tex. 2008) (identifying twelve different tests courts have applied in determining whether a person was "occupying" a covered vehicle under terms of an insurance policy). A few courts apply a narrow definition of "occupying" that...