Smith v. State Farm Mut. Auto. Ins. Co., Court of Appeals No. 15CA2037

• Decision Date: 12 January 2017
• Docket Number: Court of Appeals No. 15CA2037
• Citation: 399 P.3d 771
• Court: Colorado Court of Appeals
• Parties: Neill SMITH and Bliss Bishop, Plaintiffs-Appellants, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, an Illinois corporation, Defendant-Appellee.

399 P.3d 771

Neill SMITH and Bliss Bishop, Plaintiffs-Appellants,

v.STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, an Illinois corporation, Defendant-Appellee.

Court of Appeals No. 15CA2037

Colorado Court of Appeals, Div. I.

Announced January 12, 2017

Franklin D. Azar & Associates, William C. Marlin, Peter J. McCaffrey, Aurora, Colorado, for Plaintiffs-Appellants

Patterson & Salg, P.C., Franklin D. Patterson, Karl S. Chambers, Greenwood Village, Colorado, for Defendant-Appellee

Opinion by JUDGE DUNN

¶ 1 Neill Smith suffered serious injuries when he was skewered by hay spears attached to a farm tractor driven by Robert Bunker. The district court dismissed the complaint he and his wife, Bliss Bishop, filed against State Farm Mutual Automobile Insurance Company, concluding that the tractor was not a covered motor vehicle under their State Farm insurance policy.¹ Mr. Smith now asks us to undo that ruling. The question before us then is whether State Farm's underinsured motorist (UIM) provision provides coverage to Mr. Smith for bodily injury sustained in an automobile accident with a farm tractor. We conclude that it does, and so we reverse the judgment dismissing the complaint and remand the case for further proceedings.

I. Background

¶ 2 It happened on a county road in Moffat, Colorado. Mr. Bunker was driving a John Deere tractor (the tractor) when he collided with Mr. Smith's truck. The hay spears attached to the tractor pierced the truck and impaled Mr. Smith, leaving him seriously injured. Mr. Bunker later pleaded guilty to careless driving. Mr. Smith settled his claim against Mr. Bunker for Mr. Bunker's liability policy limits. This amount, however, did not fully compensate Mr. Smith for his injuries, according to Mr. Smith.

¶ 3 But Mr. Smith had UIM coverage with State Farm. So, he filed a claim with State Farm for UIM benefits. Taking the position that a farm tractor is not a motor vehicle, State Farm denied coverage.

¶ 4 Unsurprisingly, Mr. Smith sued State Farm, asserting claims for breach of contract, bad faith breach of an insurance contract, and improper denial of an insurance claim. State Farm moved the court to determine as a matter of law that the tractor is not a motor vehicle under the policy's UIM coverage provision. The court granted the motion, finding that the tractor "is not a covered motor vehicle for purposes of ... [the] UIM coverage policy." It then dismissed the complaint.

II. Standard of Review and Principles of Interpretation

¶ 5 We review de novo a district court's order determining a question of law under C.R.C.P. 56(h). Patterson v. BP Am. Prod. Co. , 2015 COA 28, ¶ 20, 360 P.3d 211. The interpretation of an insurance policy is also reviewed de novo. Grippin v. State Farm Mut. Auto. Ins. Co. , 2016 COA 127, ¶ 9, –––P.3d ––––.

¶ 6 An insurance policy is a contract, and it is interpreted like any contract. Allstate Ins. Co. v. Huizar , 52 P.3d 816, 819 (Colo. 2002). This means it is our job to determine and give effect to the parties' intent, "and, when possible, the parties' intent should be determined by the language of the policy alone." Mt. Hawley Ins. Co. v. Casson Duncan Constr., Inc. , 2016 COA 164, ¶ 12, ––– P.3d ––––.

¶ 7 Unless defined, we give a policy's words their plain meaning and construe the terms "as they would be understood by a person of ordinary intelligence." State Farm Mut. Auto. Ins. Co. v. Nissen , 851 P.2d 165, 167 (Colo. 1993) ; see also Huizar , 52 P.3d at 819. We will enforce the policy as written, unless there is an ambiguity in the policy language. State Farm Mut. Auto. Ins. Co. v. Stein , 940 P.2d 384, 387 (Colo. 1997). A term in an insurance policy is ambiguous if, on its face, it is susceptible of more than one reasonable interpretation. Am. Family Mut. Ins. Co. v. Hansen , 2016 CO 46, ¶ 24, 375 P.3d 115. If such an ambiguity exists, we interpret the policy in favor of the insured and against the insurance company. Stein , 940 P.2d at 390 ; Mt. Hawley , ¶ 13.

III. Discussion

¶ 8 Mr. Smith disagrees with the district court's conclusion that the tractor is not a covered "motor vehicle" under his policy's UIM coverage provision. Specifically, he argues that (1) the definition of "uninsured motor vehicle" within the policy applies to the tractor; (2) the ordinary meaning of "motor vehicle" includes the tractor; and (3) State Farm is statutorily required to provide UIM coverage for injuries caused by the tractor, and the public policy behind this statute supports coverage. We address each contention in turn.

A. The Insurance Policy

¶ 9 The policy begins with a general "definitions" section that defines certain words and phrases "for use throughout the policy." And it instructs that "[e]ach coverage includes additional definitions only for use with that coverage." The policy explains that defined terms "are printed in boldface italics."

¶ 10 After the definitions, the policy describes seven different types of coverage. The coverage provision in question here—"Uninsured Motor Vehicle Coverage"—deals with situations where the insured is injured in an accident with an uninsured or underinsured driver. It states:

[State Farm] will pay compensatory damages for bodily injury an insured is legally entitled to collect from the owner or driver of an uninsured motor vehicle or an underinsured motor vehicle. The bodily injury must be:

a. sustained by an insured; and

b. caused by an accident that involves the operation, maintenance, or use of either an uninsured motor vehicle or an underinsured motor vehicle as a motor vehicle.

¶ 11 Although State Farm promises coverage for the "operation, maintenance, or use" of an uninsured or underinsured "motor vehicle," neither the UIM coverage provision nor the general definitions section defines the term "motor vehicle." Thus, on its face, the UIM coverage provision neither includes nor excludes the tractor from coverage.

¶ 12 Given this, Mr. Smith urges us to consider the definition of "uninsured motor vehicle" in a separate policy provision, which provides for "Uninsured Motor Vehicle Property Damage Coverage" (property damage coverage).² In his view, the definition in this separate coverage provision includes the tractor. And he argues that because contracts must be construed as a whole, the "only reasonable interpretation" of the policy is to import the property damage coverage's "uninsured motor vehicle" definition into the UIM coverage provision.

¶ 13 But even assuming the "uninsured motor vehicle" definition in the property damage coverage provision extends to the tractor—an issue we do not reach—we do not agree with Mr. Smith that the parties intended to incorporate that definition into the UIM coverage provision. To do so would require us to ignore the policy's unambiguous instruction that additional definitions within each coverage provision are "only for use with that coverage." Following this plain direction, we will not extend the "uninsured motor vehicle" definition found only in the property damage coverage provision beyond that provision. See Huizar , 52 P.3d at 819 ("When a contract is organized into separate parts, a provision or definition found in one part or section of the contract is not necessarily intended to apply to other parts."); accord Cont'l W. Ins. Co. v. Heritage Estates Mut. Hous. Ass'n, Inc. , 77 P.3d 911, 913 (Colo. App. 2003) (declining to extend attorney fee provision in the liability portion of the insurance policy to the policy's property coverage portion).

¶ 14 The policy's use of distinct typeface in different coverage provisions further reassures us that the "uninsured motor vehicle" definition is limited to the property damage coverage provision. The policy explains that defined terms are signified by "boldface italics." And in the property damage coverage provision, the defined term "uninsured motor vehicle" is written in boldface italics.

In contrast, the term is in plain typeface in the UIM coverage provision. This different typeface is further evidence that the "uninsured motor vehicle" definition is meant to apply to just the property damage coverage provision. See Stein , 940 P.2d at 388 (highlighting the typeface of a word in one section of an insurance policy, but not in another section, indicated the parties' intent to apply a different meaning).

¶ 15 For these reasons, we reject Mr. Smith's contention that the property damage coverage's definition of "uninsured motor vehicle" is included in the UIM coverage provision.

B. Plain Meaning

¶ 16 Having established that the UIM coverage provision says nothing about whether the tractor is a covered motor vehicle, the question remains whether Mr. Smith is entitled to UIM coverage. We therefore consider his contention that the plain and ordinary meaning of motor vehicle includes the tractor.

¶ 17 We are not the first to be asked to define the term "motor vehicle." Faced with this same question for purposes of the Colorado Governmental Immunity Act, our supreme court turned to the dictionary. Bertrand v. Bd. of Cty. Comm'rs , 872 P.2d 223, 229 (Colo. 1994) (adopting definition of motor vehicle in Webster's New World Dictionary of the American Language 930 (2d college ed. 1974)), superseded by statute , Ch. 262, sec. 1, § 24-10-103(2.7), 2007 Colo. Sess. Laws 1025. Although the General Assembly later redefined the term for purposes of the Colorado Governmental Immunity Act, see Ch. 262, sec. 1, § 24-10-103(2.7), 2007 Colo. Sess. Laws 1025, we agree with Bertrand that "motor vehicle" is a term of "ordinary and common usage." Bertrand , 872 P.2d at 228. And we agree a proper place to look for the plain meaning of such a common term is the dictionary. See Miller v. Hartford Cas. Ins. Co. , 160 P.3d 408, 410 (Colo. App. 2007) (In interpreting the language of an insurance policy, "[d]ictionaries may be used to assist in the determination of the plain and ordinary meaning of words....").

¶ 18 Following Bertrand 's path, we conclude that for purposes of the UIM...