Schelmety v. Yamaha Motor Corp., USA

• Decision Date: 13 April 2016
• Docket Number: 50,586–CA.
• Citation: 193 So.3d 194
• Parties: Danielle SCHELMETY, Plaintiff–Appellant, v. YAMAHA MOTOR CORPORATION, USA; Yamaha Motor Manufacturing Corporation of America; Yamaha Motor Company, Ltd. Louisiana; James Johnson; William Smith; Michael Smith; and Safeco Ins. Co., Defendants–Appellees.
• Court: Court of Appeal of Louisiana — District of US

193 So.3d 194

Danielle SCHELMETY, Plaintiff–Appellant,

v.YAMAHA MOTOR CORPORATION, USA; Yamaha Motor Manufacturing Corporation of America; Yamaha Motor Company, Ltd. Louisiana; James Johnson; William Smith; Michael Smith; and Safeco Ins. Co., Defendants–Appellees.

50,586–CA.

Court of Appeal of Louisiana, Second Circuit.

April 13, 2016.

Breithaupt, Dunn, Dubos, Shafto & Wolleson, LLC by Patrick S. Wolleson, Michael L. DuBos, Monroe, LA, Russell A. Woodard, Jr., for Plaintiff–Appellant, Danielle.

Bolen, Parker, Brenner, Lee & Engelsman, Ltd. by Daniel G. Brenner, Christina S. Slay, R. Preston Mansour, Jr., Alexandria, LA, for Defendant–Appellant, James Johnson.

Barrasso, Usdin, Kupperman, Freeman & Sarver, LLC by H. Minor Pipes, Susan M. Rogge III, for Defendants–Appellees, Safeco Ins. Co. of Oregon & Safeco Ins. Co. of America.

Raymond Paul Augustin, Jr., Mickey Stephens deLaup, Valerie E. Fontenot, for Defendants–Appellees, William Smith and Michael Smith.

Before BROWN, CARAWAY, and BLEICH (Ad Hoc), JJ.

BROWN

, Chief Judge.

This is a tort case seeking damages for injuries sustained by plaintiff, Danielle Schelmety, while riding in a Rhino “side by side” four-wheel off-road vehicle driven by defendant, James Johnson. The instant appeal by both Danielle and James is from a summary judgment dismissing with prejudice Danielle's claim against defendants, Safeco Insurance of America and Safeco Insurance Company of Oregon (“Safeco”), the homeowners' and umbrella insurers of the Rhino owner, Dr. William Smith, and his son, Michael.¹ Finding no error, however, we affirm.

Facts and Procedural Background

Michael Smith, Danielle and James were law students at Mississippi College School of Law at the time of this accident. Danielle and Michael were dating, and Michael and James were roommates. On the night before the accident, the trio rode together to Ruston, Louisiana, to attend a crawfish boil in celebration of Michael's birthday. They stayed at the home of Michael's parents, Dr. William and Kelly Smith, which is located at 1024 Wedgewood Drive in Ruston. This was the first time that the Smiths met both Danielle and James. The next day, March 29, 2013, before the crawfish boil and with permission from Michael and Dr. Smith, James and Danielle took a ride on the Rhino, leaving from the driveway of the Smiths' home, with James driving and Danielle as his passenger. James drove the Rhino down Wedgewood Drive, made a loop on Pennington Lane, and turned onto Cooktown Road, a two-lane highway also identified as State Highway 544, before taking a right onto Bittersweet Avenue. He then took a left on Dixie Street and turned right on Mimosa Drive. In the cul-de-sac on Mimosa Drive, as James was in the middle of the turn, the Rhino flipped onto its passenger side, pinning Danielle's left arm between the vehicle and the pavement. She was rushed to the hospital where emergency surgery was performed on her shattered and crushed forearm, wrist and hand. Since the accident, Danielle has had multiple surgeries and extensive physical therapy. She is permanently disfigured and partially disabled.

On August 13, 2013, Safeco denied a claim filed by the Smiths, contending that there was no coverage for Danielle's injuries because “the loss did not occur at an insured location.” Thereafter, on March 20, 2014, Danielle filed the instant action, asserting products liability claims against Yamaha, the Rhino's manufacturer; a claim against James Johnson for his negligence in attempting to turn too sharply and/or too quickly; and negligent entrustment claims against William and Michael Smith. She also named Safeco as a defendant, urging, inter alia, Safeco's liability for the Smiths' negligent entrustment of the Rhino to James Johnson and James' general operational negligence. Safeco filed an answer, as did other named defendants, and a third-party demand was filed by the Smiths against their insurance agency.

On September 2, 2014, Safeco filed their motion for summary judgment, urging the trial court to grant summary judgment in their favor and dismiss plaintiff's claims against them because:

Based on the undisputed facts, there is no possibility of coverage for plaintiff's claims for injuries arising out of the use of a recreational vehicle on a public street under either the Homeowners Policy or Personal Umbrella Policy issued to William and Kelly Smith. First, plaintiff's claims against the driver, James Johnson, are not covered because Johnson does not qualify as an insured under either policy since he is not a relative of the Smiths nor is he a resident of their home. Even if Mr. Johnson was somehow deemed an insured, plaintiff's claims against Johnson, along with her claim against William and Michael Smith, are all unambiguously barred from coverage under both policies' motorized land vehicle/recreational vehicle use exclusions because plaintiff's injuries undisputedly arose out of use of a motorized land vehicle/recreational vehicle on a public street approximately 1/2 mile away from the Smith residence.

Both Danielle and James filed oppositions to the motion for summary judgment. The trial court granted Safeco's motion, finding that neither the Smiths' homeowners' policy nor their umbrella policy provided coverage for James or the accident and the injuries sustained by Danielle. It is from this judgment that both Danielle and James have appealed, urging that the trial court erred in finding no coverage under the Smiths' homeowners' policy.

Discussion

Summary judgment is favored and is designed to secure the just, speedy, and inexpensive determination of every action, except those disallowed by law. La. C.C.P. art. 966(A)(2)

. After an opportunity for adequate discovery, a motion for summary judgment shall be granted if the motion, memorandum, and supporting documents show that there is no genuine issue as to material fact and that the mover is entitled to judgment as a matter of law. La. C.C.P. art. 966(A)(3). Appellate courts review summary judgment de novo under the same criteria governing the trial court's consideration of whether summary judgment is appropriate. Costello v. Hardy, 03–1146 (La.01/21/04), 864 So.2d 129 ; Walters v. City of West Monroe, 49,502 (La.App.2d Cir.02/04/15), 162 So.3d 419, writ denied, 15–0440 (La.05/15/15), 170 So.3d 161 ; In re Succession of Crowson, 48,985 (La.App.2d Cir.05/14/14), 139 So.3d 43.

The interpretation of an insurance contract is usually a legal question that can be properly resolved by means of a motion for summary judgment. Bernard v. Ellis, 11–2377 (La.07/02/12), 111 So.3d 995

; Cutsinger v. Redfern, 08–2607 (La.05/22/09), 12 So.3d 945 ; Bumgardner v. Terra Nova Ins. Co. Ltd., 35,615 (La.App.2d Cir.01/23/02), 806 So.2d 945. However, summary judgment declaring a lack of coverage under an insurance policy may not be rendered unless there is no reasonable interpretation of the policy, when applied to the undisputed material facts shown by the evidence supporting the motion, under which coverage could be afforded. Elliott v. Continental Casualty Co., 06–1505 (La.02/22/07), 949 So.2d 1247

; Reynolds v. Select Properties, Ltd., 93–1480 (La.04/11/94), 634 So.2d 1180.

An insurance policy is a contract between the parties and should be construed using the general rules of interpretation of contracts set forth in the Louisiana Civil Code. Green ex rel. Peterson v. Johnson, 14–0292 (La.10/15/14), 149 So.3d 766

; Marshall v. Louisiana Farm Bureau Cas. Ins. Co., 50,190 (La.App.2d Cir.11/18/15), 182 So.3d 214. An insurance contract must be “construed according to the entirety of its terms and conditions as set forth in the policy, and as amplified, extended, or modified by any rider, endorsement, or application attached to or made a part of the policy.” La. R.S. 22:881 ; Burmaster v. Plaquemines Parish Government, 10–1543 (La.App. 4th Cir.03/30/11), 64 So.3d 312. When the words of a contract are clear and explicit and lead to no absurd consequences, no further interpretation may be made in search of the parties' intent. La. C.C. art. 2046. In such cases, the insurance contract must be enforced as written. Bumgardner, supra.

Insurance companies may limit coverage in any manner they desire, so long as the limitations do not conflict with statutory provisions or public policy. Elliott, supra ; Jones v. Youngblood, 50,115 (La.App.2d Cir.09/30/15), 180 So.3d 455

; Bumgardner, supra. However, exclusionary provisions in insurance contracts are strictly construed against the insurer, and any ambiguity is construed in favor of the insured. Elliott, supra ; Byrnside v. Hutto, 47,685 (La.App.2d Cir.02/27/13), 110 So.3d 603 ; Bumgardner, supra. The burden is on the insurer to prove that a loss comes within a policy exclusion. Rodgers v. State Farm Mut. Auto. Ins., 15–0868 (La.06/30/15), 168 So.3d 375 ; Byrnside, supra.

Is James Johnson a resident of the Smith household such that he is covered by the Safeco homeowners' policy?

Appellants dispute the trial court's determination that James Johnson was not a resident of the Smith household and therefore not an insured under the Safeco policy. According to appellants, based upon the language in the policy, and the fact that the term “resident” is not defined, James should be considered to be a resident and thus an “insured” at the time of the accident.

We find this provision to be clear and unambiguous. Under the explicit terms of the Safeco policy, James Johnson was not one of the named insureds (William and Kelly Smith), nor was he a relative or, as a first-time, temporary houseguest of their grown son, did he qualify as “any other person who is in the care of any person” described in (1) (William or Kelly Smith) or (2)(a) (a relative of William and Kelly Smith's, such as their son Michael, who was covered as an insured by (2)(a) and as a student temporarily residing away from the residence premises). The lack of a definition for the term “resident” does not confer coverage for...