Simpson v. U.S. Fidelity & Guar. Co., 96-405

• Decision Date: 23 April 1997
• Docket Number: No. 96-405,96-405
• Citation: 562 N.W.2d 627
• Court: Iowa Supreme Court
• Parties: Sidney SIMPSON, Appellant, v. UNITED STATES FIDELITY & GUARANTY CO., Appellee.

Page 627

562 N.W.2d 627

Sidney SIMPSON, Appellant, v. UNITED STATES FIDELITY & GUARANTY CO., Appellee.

No. 96-405.

Supreme Court of Iowa.

April 23, 1997.

Rehearing Denied May 16, 1997.

Christopher D. Spaulding and Phillip Vonderhaar of Hedberg, Ward, Owens & Vonderhaar, Des Moines, for appellant.

Barbara A. Hering and Karl T. Olson of Bradshaw, Fowler, Proctor & Fairgrave, P.C., Des Moines, for appellee.

Considered by HARRIS, P.J., and LARSON, NEUMAN, SNELL, and ANDREASEN, JJ.

ANDREASEN, Justice.

An employee was seriously injured when he was struck by an uninsured motorist in the course of his employment. The injured employee brought a declaratory judgment action against his employer's insurer, claiming he was an insured legally entitled to recover under the uninsured motorist provisions. After the insurer had filed its answer and counterclaim, both parties filed a motion for summary judgment. The court concluded that the employee was not an insured, and that even if he was an insured, he violated the cooperation provision of the policy to the prejudice of the insurer. The court granted summary judgment for the insurer and against the employee. On appeal, we affirm.

I. Background Facts and Proceedings.

Sidney Simpson was severely injured at approximately 2:30 a.m. on April 5, 1991, when, after parking his employer's pickup truck, he was struck by a vehicle driven by Marsha Warren and owned by Lori Warren. Simpson was in the course of his employment for the Board of Waterworks Trustees of the City of Des Moines (Des Moines Waterworks) at the time and, as a result of the injuries, he received workers' compensation benefits in excess of $200,000. Des Moines Waterworks had acquired both workers' compensation and commercial automobile insurance, including uninsured and underinsured coverage up to $1 million, from United States Fidelity & Guaranty Company (USF & G). The employer's pickup truck was a covered "auto."

On March 25, 1993, Simpson filed a personal injury suit for damages against the Warrens. USF & G filed a notice of workers' compensation lien on February 4, 1994. Two months later, the Warrens filed a confession of judgment in the amount of $600,000, which was accepted by Simpson. The confession of judgment and acceptance were made without notice to or consent of USF & G. The Warrens filed bankruptcy in January 1995.

On June 2, 1995, Simpson filed a petition for declaratory judgment. The petition alleged USF & G provided uninsured motorist coverage to him under the terms of the Des Moines Waterworks' policy and that judgment should be entered in the sum of $600,000. After USF & G had filed its answer, both parties filed a motion for summary judgment. Simpson timely appealed from the court's denial of his motion and the court's grant of the motion for summary judgment filed by USF & G.

II. Scope of Review.

Summary judgment is appropriate only when no genuine issue of material fact exists and the moving party is entitled to a judgment as a matter of law. Iowa R. Civ. P. 237(c). In determining if there is a genuine issue of fact, we consider the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any. Id. The interpretation of an insurance policy is a question of law unless extrinsic evidence on the meaning of the policy language is offered. Tropf v. American Family Mut. Ins. Co., 558 N.W.2d 158, 159 (Iowa 1997).

III. Uninsured Motorist Coverage.

Simpson argues he (1) is an insured under the specific definition in the uninsured motorist endorsement and (2) is an insured under the liability coverage provisions and, therefore, must be afforded uninsured motorist coverage as required by Iowa Code section 516A.1 (1991).

A. The uninsured and underinsured motorist coverage endorsement issued by USF & G to Des Moines Waterworks provided:

B. WHO IS AN INSURED

....

3. Anyone else "occupying" a covered "auto" or a temporary substitute for a covered "auto."

....

F. ADDITIONAL DEFINITIONS

The following are added to the DEFINITIONS Section:

....

2. "Occupying" means in, upon, getting in, on, out or off.

This is a typical definition found in uninsured motorist coverage. As we recently stated:

Historically, the term "occupying" has been defined as "in or upon or entering into or alighting from" the insured vehicle. The interpretation of this standard definition has given rise to repeated litigation concerning the scope of coverage. Courts have examined the relationship between the vehicle and the claimant, both as to geographical proximity and the orientation of the claimant's activities, to decide whether a particular claimant was "occupying" the insured vehicle at the time of his or her injury. Physical contact is usually not required for coverage under the traditional definition.

Tropf, 558 N.W.2d at 160 (citations omitted).

We employed the "physical contact" test in Tropf because the policy definition of "occupying" required the person seeking insured status to be "in physical contact with" the insured vehicle. When the policy definition does not impose this mandatory requirement of physical contact, most jurisdictions recognize there is a "zone" or "area" around the insured vehicle in which protection is afforded. 1 Alan I. Widiss, Uninsured and Underinsured Motorist Insurance § 5.2, at 192 (2d ed. 1992) [hereinafter "Widiss"]. Coverage has been extended in many cases where the insured has been engaged in an activity associated with the vehicle's use or operation. Id. at 197. As suggested by Widiss:

When persons are engaged in activities that relate to the "use" or the "maintenance" of an insured vehicle, it seems reasonable that they should be accorded the same protection that is afforded for individuals who (a) have completed their "use" of an insured vehicle and are alighting or (b) are about to become occupants of an insured vehicle and are engaged in "entering." Certainly, extending protection to such individuals is fully consistent with the public policy underlying the statutory mandates for the uninsured motorist coverage.

Id. at 198.

B. USF & G liability coverage provided:

A. COVERAGE

....

1. Who Is An Insured

The following are "insureds."

....

b. Anyone else while using with your permission a covered "auto" you own,....

Because he was using the truck with his employer's consent, Simpson argues he is an insured under the liability coverage portion of the policy. He insists Iowa Code section 516A.1 requires uninsured motorist coverage be provided to him as an employee using the Des Moines Waterworks' vehicle at the time of the accident. USF & G argues Simpson was not "using" the vehicle at the time he was injured.

We believe it is appropriate to consider the statutory provision relating to uninsured motorist coverage when construing the policy language. The terms of the policy are construed in light of the purposes and intent of the applicable statute. Veach v. Farmers Ins. Co., 460 N.W.2d 845, 847 (Iowa 1990). It has been stated:

Therefore, if a coverage issue arises about the scope of protection when the insurance policy is subject to such a statutory mandate, there is an additional--and very compelling--justification for the view that coverage must be afforded for anyone who is engaged in the maintenance or use of an insured vehicle--that is, anyone who is engaged in the maintenance or use is an insured because such persons clearly are afforded liability coverage without regard to whether they are defined as "insureds" in the coverage terms for the uninsured motorist insurance.

Widiss § 5.2, at 198.

C. Here, the district court concluded Simpson was not "upon" or "getting in or on" the vehicle at the time of the incident because he was, at best, walking back to the truck from the manhole where he was conducting a valve inspection, some twenty feet from the vehicle. The court also concluded the truck was not being used by Simpson at the time of the accident.

It is undisputed from the record that Simpson was inspecting a water main valve near the intersection of two streets. He had parked the truck on the curb lane of the street. To inspect the valve it was necessary to remove an eight-inch-diameter lid in the street pavement and clean out the box containing the valve. To accomplish this task, he used a variety of tools that were available in the truck. The truck was specially designed with directional arrow board lights, flashers, and strobe lights for safety. The truck was equipped with a hydraulic valve operator's machine that would extend three feet from the side of the truck to assist in opening the valve. The truck was the valve inspector's "toolbox on wheels." Although the trial court suggests Simpson was hit approximately twenty feet from the truck, other statements contained in Simpson's affidavit and the police report would locate the point of impact to be somewhere between five and ten feet from the truck. In his affidavit, Simpson stated:

I parked the Des Moines Waterworks' vehicle on the inside curb lane on N.E. 14th Street, south of Aurora Avenue, facing south. The lights of the company vehicle and directional arrow were activated and in use while I was working just outside of the vehicle. I was working on the valve that needed inspection when it was necessary for me to return to the Des Moines Waterworks' vehicle and get another tool. I was upon the Des Moines Waterworks' vehicle getting into the back of the vehicle to get the tool I needed when I was hit by a car operated by Marsha Lynn Warren.

We conclude as a matter of law that, whether Simpson was twenty feet or five feet from the truck, he was an insured of USF & G at the time he was struck by the uninsured motorist. It is clear he was in close proximity to the truck when he was injured. He had left the location of the valve and was returning to the vehicle to pick up another tool. He was clearly engaged in an activity relating to the use of the...