State Farm Ins. Companies v. Seefeld

Decision Date18 June 1991
Docket NumberNo. C4-90-2612,C4-90-2612
PartiesSTATE FARM INSURANCE COMPANIES, Appellant, v. Gary SEEFELD, Kelly Seefeld, Kimberly K. Smith, Craig J. Smith, Respondents.
CourtMinnesota Court of Appeals

Syllabus by the Court

1. A utility trailer, towed by an all-terrain vehicle, is a motor vehicle as defined in the homeowner's insurance policy.

2. A homeowner's insurance policy covering a mobile home, containing a motor vehicle exclusion, does not provide coverage for injuries sustained from the use of a negligently designed and constructed motor vehicle.

Kay Nord Hunt, V. Owen Nelson, Lommen, Nelson, Cole & Stageberg, Minneapolis, for State Farm Ins. Companies.

John T. Anderson, Anderson & Geisheke, P.A., Minneapolis, for Gary Seefeld, and Kelly Seefeld.

David W. Skogerboe, Skogerboe & Skogerboe, Chtd., Blaine, for Kimberly K. Smith, and Craig J. Smith.

Considered and decided by AMUNDSON, P.J., and HUSPENI and MULALLY *, JJ.

OPINION

AMUNDSON, Judge.

Appellant challenges the declaratory judgment that a homeowner's insurance policy provides coverage for injuries sustained by respondent in an all-terrain vehicle accident. Respondents seek review of the trial court's conclusion that the utility trailer towed by the all-terrain vehicle was a motor vehicle as defined in the insurance policy. We reverse.

FACTS

Appellant State Farm Insurance Companies (State Farm) insured respondent Gary Seefeld under a homeowner's liability insurance policy covering his mobile home. In June 1985, his daughter, respondent Kelly Seefeld, and her friend, respondent Kimberly Smith, took the Seefeld family's 250cc four-wheel all-terrain vehicle for a ride on a township road adjacent to the Seefeld property. The all-terrain vehicle towed a two-wheel utility trailer that Gary Seefeld was in the process of designing and constructing. The trailer at this stage of development was attached to the all-terrain vehicle by inserting a bolt through the makeshift trailer hitch without using a cotter pin.

Kelly drove the all-terrain vehicle and Kimberly rode in the trailer. The bolt came out and the trailer detached, causing injury to Kimberly. Kimberly and her father, respondent Craig Smith, commenced a tort action against Gary and Kelly Seefeld. The complaint alleged that Kelly negligently drove the vehicle and Gary negligently designed, constructed and inspected the trailer.

The Seefelds tendered the defense of this action to State Farm. State Farm subsequently commenced a declaratory judgment action requesting a determination whether it had an obligation to defend or indemnify the Seefelds for the defective design claims asserted by the Smiths.

After a court trial, the trial court entered judgment for respondents, holding State Farm was obligated to provide coverage for Kimberly Smith's injuries. The trial court concluded the all-terrain vehicle and the utility trailer were motor vehicles as defined in the policy and any driving negligence was excluded from coverage. The trial court found coverage, however. It determined the negligent design and construction of the trailer was a nonvehicle-related concurrent cause of Kimberly's injuries, and therefore did not fall within the motor vehicle exclusion.

State Farm appeals the trial court's judgment finding coverage. Respondents in turn seek review of the trial court's determination that the utility trailer was a motor vehicle, as defined in the insurance policy and thus not covered.

ISSUES

I. Did the trial court err in determining the utility trailer is a motor vehicle as defined in the mobile homeowner's insurance policy and excluded from coverage?

II. Did the trial court err in determining State Farm is obligated to provide coverage for the injuries under the homeowner's insurance policy despite the motor vehicle exclusion?

ANALYSIS
I.

The interpretation of the language of an insurance contract is a question of law which this court will review de novo on appeal. Iowa Kemper Ins. Co. v. Stone, 269 N.W.2d 885, 886-87 (Minn.1978).

The first issue we face is whether the utility trailer is a motor vehicle. This determination is crucial because Gary Seefeld's mobile homeowner's policy excludes liability for injuries arising out of the ownership or use of a motor vehicle. The policy provides:

1. Coverage L [personal liability] and Coverage M [medical payments to others] do not apply to:

* * * * * *

e. bodily injury or property damage arising out of the ownership, maintenance, use, loading or unloading of:

* * * * * *

(2) a motor vehicle owned or operated by, or rented or loaned to an insured.

The insurance policy defines a "motor vehicle" as:

6a. a motorized land vehicle designed for travel on public roads or subject to motor motor vehicle registration * * *;

b. a trailer or semi-trailer designed for travel on public roads and subject to motor vehicle registration. A boat, camp, home or utility trailer not being towed by or carried on a vehicle included in 6a is not a motor vehicle;

c. a motorized golf cart, snowmobile, or other motorized land vehicle owned by an insured and designed for recreational use off public roads, while off an insured location;

* * * * * *

e. any vehicle while being towed by or carried on a vehicle included in 6a, 6b, 6c, or 6d.

We conclude the utility trailer is a motor vehicle as defined in the insurance policy. Under the clear terms of the policy, the trailer was being towed by a vehicle described in paragraph 6c; thus pursuant to paragraph 6e, the trailer is a motor vehicle. Accordingly, we conclude the trial court correctly determined the utility trailer is a motor vehicle and therefore excluded under the mobile homeowner's policy.

Respondents argue paragraph 6b of the policy controls. They assert the trailer was not a motor vehicle because it was not being towed by a vehicle designed for travel on public roads or subject to motor vehicle registration, that is, a vehicle included in paragraph 6a. We disagree. At the time of the accident, the all-terrain vehicle was subject to registration. For statutory purposes, the four-wheel all-terrain vehicle was a "three-wheel off-road vehicle." Minn.Stat. Sec. 84.92 (1984) (includes vehicles of not less than three nor more than six tires). After January 1, 1985, a person could not operate a "three-wheel off-road vehicle" unless the vehicle was registered. Minn.Stat. Sec. 84.922 (1984). Thus, even under respondents' theory, the utility trailer is a motor vehicle according to the policy's definition.

II.

Kimberly Smith seeks to obtain coverage under the general liability provisions of Gary Seefeld's mobile homeowner's insurance policy. The policy excludes coverage for any injury arising out of the "ownership, maintenance, use, loading or unloading of * * * a motor vehicle." Smith alleges the negligent design and construction of the utility trailer was an independent nonvehicle-related cause of her injuries that does not fall within the motor vehicle exclusion.

Coverage by homeowner's insurance policies for vehicle-related injuries was recognized in Minnesota by Waseca Mut. Ins. Co. v. Noska, 331 N.W.2d 917 (Minn.1983). In Noska, the insured drove to his home and shoveled ashes into steel barrels containing burnt material. As the barrels were being towed to a landfill, sparks flew from the barrels causing massive fire damage. The supreme court concluded the insured's negligence was divisible into two independent concurrent causes, one nonvehicular (shoveling ashes at the insured's home) and the other vehicular (sparks flying from the barrels as towed by a truck). Thus, the court held the homeowner insurer could not deny coverage based on the motor vehicle exclusion. Id. at 923.

In North Star Mut. Ins. Co. v. Johnson, 352 N.W.2d 791 (Minn.App.1984), it was alleged the insured was negligent in driving and in failing to secure a chemical sprayer arm bolted to his truck. The sprayer suddenly extended and smashed into an oncoming car. This court held the insured's alleged negligence in failing to secure the sprayer arm was an independent act, not related to the operation or use of the vehicle. Id. at 794. Thus, we determined the insured's farm liability policy provided coverage. In so holding, we noted the insurance policy specifically covered the farm sprayer. However, in this case, State Farm did not separately set out to insure the utility trailer.

This court also addressed the issue of concurrent causes in Auto-Owners Ins. Co. v. Selisker, 435 N.W.2d 866 (Minn.App.1986). We held the failure to take seizure medication before driving an automobile was not a divisible concurrent cause from the negligent driving. Id. at 868. Thus the homeowner's insurance policy did not provide coverage. In Selisker, we discussed the fact that the two acts were only capable of having been done by one person, thus the acts were not divisible in the same sense that the acts in Noska...

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