Quevillon v. State Farm Fire and Cas. Co.

• Decision Date: 11 May 1993
• Docket Number: No. 91-2692,91-2692
• Citation: 501 N.W.2d 855,177 Wis.2d 160
• Parties: Troy R. QUEVILLON and Employers Health Insurance Company, A Wisconsin Corporation, Plaintiffs-Appellants, d v. STATE FARM FIRE AND CASUALTY COMPANY, a foreign corporation, Defendant-Respondent, Kevin Quevillon, Robert H. Quevillon and Kathleen Quevillon, Defendants.
• Court: Wisconsin Court of Appeals

Page 855

501 N.W.2d 855

177 Wis.2d 160

Troy R. QUEVILLON and Employers Health Insurance Company, A Wisconsin Corporation, Plaintiffs-Appellants,^d v. STATE FARM FIRE AND CASUALTY COMPANY, a foreign corporation Defendant-Respondent Kevin Quevillon, Robert H. Quevillon and Kathleen Quevillon Defendants.

No. 91-2692.

Court of Appeals of Wisconsin.

Submitted on Briefs Feb. 3, 1993.

Opinion Released May 11, 1993.

Opinion Filed May 11, 1993.

Before WEDEMEYER, P.J., and SULLIVAN and FINE, JJ.

SULLIVAN, Judge.

Troy R. Quevillon and Employers Health Insurance Company appeal from a partial summary judgment dismissing their personal injury action against State Farm Fire and Casualty Company. State Farm had issued three automobile insurance policies to Troy Quevillon's parents, Robert H. and Kathleen M. Quevillon. The issue on appeal is whether the manner in which the policies' territorial limitation provision is drafted allows State Farm to deny liability coverage for the accident.

The facts are undisputed. In April 1989, Troy Quevillon, a passenger in a motor vehicle rented by his father and operated consensually by his brother Kevin, was injured in a collision in Cancun, Mexico. Subsequently, Quevillon and Employer's Health commenced this action seeking compensation for Quevillon's injuries. State Farm moved for summary judgment arguing that the territorial limitation provision included in the policies restricted coverage for liability to accidents occurring within fifty miles of the United States/Mexican border. Cancun is more than fifty miles from the border of the United States. The trial court granted State Farm's motion for summary judgment, and this appeal followed.

Quevillon's first, and dispositive, issue on appeal is that the territorial limitation provision, which is identical in all three policies, is ambiguous and that the ambiguities must be resolved in his favor. ¹ The trial court determined that the provision was clear and unambiguous, that there was no policy coverage for Quevillon's injuries, and that State Farm was entitled to summary judgment.

"Construction of an insurance policy presents a question of law that may be appropriately decided on summary judgment." Wagner v. Milwaukee Mut. Ins. Co., 145 Wis.2d 609, 612, 427 N.W.2d 854, 855 (Ct.App.1988). This court will affirm the trial court's grant of summary judgment where no material facts were in dispute and the trial court correctly decided questions of law. See ID. ² Because the parties do not contend that there was a material issue of fact, we need only determine whether the trial court properly decided the legal question regarding coverage. See id.

In construing an insurance policy we apply an objective test. St. John's Home v. Continental Casualty Co., 147 Wis.2d 764, 781, 434 N.W.2d 112, 119 (Ct.App.1988). We must interpret the language as would a reasonable person in the position of the insured. Kremers-Urban Co. v. American Employers Ins. Co., 119 Wis.2d 722, 735, 351 N.W.2d 156, 163 (1984). "Language in an insurance contract is to be given the common and ordinary meaning it would have in the mind of a lay person." Id. Whether ambiguity exists is a question of law in which we determine whether the words and phrases are fairly susceptible to more than one meaning. Id. Where an ambiguity does not exist, this court will merely apply the policy to the situation and will not engage in construction. Id. at 736, 351 N.W.2d at 163.

The territorial limitation provision that Quevillon claims is ambiguous provides:

Where Coverage Applies

The coverages you chose apply:

1. in the United States of America, its territories and possessions or Canada; or

2. while the insured vehicle is being shipped between their ports.

The liability, medical payments and physical damage coverages also apply in Mexico within 50 miles of the United States border. A physical damage coverage loss in Mexico is determined on the basis of cost at the nearest United States point.

Death, dismemberment and loss of sight, total disability and loss of earnings coverages apply anywhere in the world.

Quevillon argues that the territorial limitation provision is ambiguous because a reasonable person reading the policies could understand the phrase "apply ... in the United States" to relate to two situations: (1) to an accident occurring in the United States; or (2) to a lawsuit pending in the United States. Quevillon reasons that because the phrase does not read the "coverages apply to an accident or loss that occurs in the United States," the provision is ambiguous. This ambiguity, he urges, must be construed against State Farm and in favor of coverage.

Quevillon notes that the ambiguity easily could have been avoided if State Farm had drafted the provision to explain that coverages apply "to accidents and losses" in the United States. He buttresses this argument by reference to a policy provision entitled "When Coverage Applies," which reads: "The coverages you chose apply to accidents and losses that take place during the policy period." (Emphasis added Because the verbiage to accidents and losses that take place clarifies the "when" of policies, Quevillon asserts that had those same words been used in the "where" of territorial restriction provision, the ambiguity would not be present.

We conclude that Quevillon's interpretation is contrary to that of a reasonable person in the position of the insured. While Quevillon urges that an insurance policy...