State Farm Mut. Auto. Ins. Co. v. Goyeneche

• Citation: 429 S.C. 211,837 S.E.2d 910
• Decision Date: 18 December 2019
• Docket Number: Opinion No. 5697,Appellate Case No. 2016-000840
• Parties: STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Respondent, v. Beverly GOYENECHE, David R. Gray, III and Amanda Goyeneche (a/k/a Amanda Goyeneche-Gray), individually and as Parent and Natural Guardian of S.G., Defendants, Of Whom Beveryly Goyeneche, and Amanda Goyeneche are the Appellants.
• Court: Court of Appeals of South Carolina

429 S.C. 211
837 S.E.2d 910

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Respondent,
v.
Beverly GOYENECHE, David R. Gray, III and Amanda Goyeneche (a/k/a Amanda Goyeneche-Gray), individually and as Parent and Natural Guardian of S.G., Defendants,

Of Whom Beveryly Goyeneche, and Amanda Goyeneche are the Appellants.

Appellate Case No. 2016-000840
Opinion No. 5697

Court of Appeals of South Carolina.

Heard June 7, 2018
Filed December 18, 2019
Rehearing Denied February 20, 2020

Karl Huggins Smith, of Smith Watts & Associates, LLC, of Hartsville, for Appellants.

Jonathan M. Robinson, of DuBose Robinson Morgan, PC, of Camden, for Respondent.

MCDONALD, J.:

429 S.C. 215

This is a declaratory judgment action to determine whether State Farm Mutual Automobile

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Insurance Co. (State Farm) has a duty to defend and provide liability and underinsured motorist (UIM) coverage following the death of an unattended child (S.G.) in a vehicle insured by a State Farm automobile policy. Appellants Beverly Goyeneche (Grandmother) and Amanda Goyeneche (Mother) appeal the circuit court's order finding their claims arising from S.G.'s death are excluded from coverage and State Farm has no duty to defend or indemnify Grandmother, Mother, or David R. Gray, III (Father).¹ Appellants argue the circuit court erred in (1) finding the State Farm policies issued to S.G.'s parents and grandmother provide no coverage for S.G.'s death; (2) rejecting persuasive authority from other jurisdictions; and (3) determining S.G. was a resident relative of only Mother's household. We affirm.

Stipulated Facts²

The underlying facts of this case are tragic. On the morning of May 8, 2014, Father placed thirteen-month-old S.G. into her car seat in the back seat of his truck, intending to take her to daycare. However, Father instead drove to work, leaving S.G. unattended in the back seat of the truck. Father's truck was parked, with the ignition off, from approximately 9:30 a.m. until 1:00 p.m., 1:15 p.m. until 2:15 p.m., and again from 2:30 p.m. until 5:15 p.m. At the end of his work day, Father found S.G. unresponsive in his vehicle; she was pronounced dead from complications of hyperthermia at 5:50 p.m.

429 S.C. 216

Mother made claims under the liability and UIM coverage of the following insurance policies (the Policies) issued by State Farm:

1. Policy Number 4891-309-40: issued to Father on February 28, 2014, insuring a 2001 Ford F150 pickup truck, and providing liability and UIM coverage of $25,000 per person, $50,000 per occurrence, and $25,000 for property damage.

2. Policy Number C483241E: issued to Mother on October 30, 1998, insuring a 2013 Jeep Wrangler, and providing liability and UIM coverage of $50,000 per person, $100,000 per occurrence, and $25,000 for property damage.

3. Policy Number 1003667A: issued to Grandmother on September 27, 2004, insuring a 2004 Chevrolet Impala, and providing liability and UIM coverage of $50,000 per person, $100,000 per occurrence, and $25,000 for property damage.

4. Policy Number 1772085A: issued to Grandmother on June 3, 2008, insuring a 2007 Chevrolet C1500, and providing liability and UIM coverage of $50,000 per person, $100,000 per occurrence, and $25,000 for property damage.

The Policies provided coverage for "bodily injuries and property damage caused by an accident and arising out of the ownership, maintenance or use of the insured automobile, and otherwise subject to the terms of the policy."

Procedural History

On September 24, 2014, State Farm brought this declaratory judgment action seeking a declaration that the Policies did not provide coverage for S.G.'s death, and, therefore, State Farm owed no duty to defend or indemnify Grandmother, Mother, or Father. Appellants filed a joint answer and counterclaim, asserting S.G.'s death arose from the operation, ownership, maintenance or use of vehicles covered by the Policies. Appellants also sought a declaration that the Policies provide coverage for S.G.'s death.

The parties entered a stipulation of facts, and Appellants gave deposition testimony. The circuit court held a nonjury trial on April 7, 2015; State Farm's South Carolina Policy Form 9840a and the deposition testimonies were offered into evidence without objection. By order dated June 1, 2015, the circuit court declared that the Policies did not provide coverage in this matter. Specifically, the circuit court concluded there was no evidence Father's truck was an "active accessory"

429 S.C. 217

in S.G.'s death. The court further determined that even if a causal connection existed between the truck and the injury, Father's neglect was an act of independent significance severing the causal connection. The

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court also found the third prong of the Aytes test, the "transportation" element, was not satisfied.³ Finally, the circuit court determined S.G. was a resident solely of Mother's home. Defendants' filed a Rule 59(e), SCRCP, motion to alter or amend; following a hearing, the circuit court denied this motion.

Standard of Review

"Declaratory judgment actions are neither legal nor equitable and, therefore, the standard of review depends on the nature of the underlying issues." Judy v. Martin , 381 S.C. 455, 458, 674 S.E.2d 151, 153 (2009). "When the purpose of the underlying dispute is to determine whether coverage exists under an insurance policy, the action is one at law." Crossmann Cmtys. of N.C., Inc. v. Harleysville Mut. Ins. Co. , 395 S.C. 40, 46, 717 S.E.2d 589, 592 (2011). "In an action at law tried without a jury, the appellate court will not disturb the trial court's findings of fact unless there is no evidence to reasonably support them." Id. at 46–47, 717 S.E.2d at 592 (quoting Auto Owners Ins. Co. v. Newman , 385 S.C. 187, 191, 684 S.E.2d 541, 543 (2009) ). "When an appeal involves stipulated or undisputed facts, an appellate court is free to review whether the trial court properly applied the law to those facts." In re Estate of Boynton , 355 S.C. 299, 301, 584 S.E.2d 154, 155 (Ct. App. 2003) (quoting WDW Props. v. City of Sumter , 342 S.C. 6, 10, 535 S.E.2d 631, 632 (2000) ). "In such cases, the appellate court owes no particular deference to the trial court's legal conclusions." Id. at 301–02, 584 S.E.2d at 155 (quoting J.K. Constr., Inc. v. W. Carolina Reg'l Sewer Auth. , 336 S.C. 162, 166, 519 S.E.2d 561, 563 (1999) ).

Law and Analysis

I. The Aytes Test

Appellants assert the circuit court erred in applying the three-pronged test of

429 S.C. 218

State Farm Fire & Casualty Co. v. Aytes in determining the Policies provide no coverage. We disagree.

In Aytes , the insured, Donna Dawson, and Randy Aytes became involved in an altercation while at the home of Aytes's mother. Id. at 32, 503 S.E.2d at 745. Aytes took Dawson's keys and forced her into her car. Id. Although Aytes was forbidden to drive Dawson's car, he drove Dawson to his mother's property with the expressed intent of killing her. Id. While standing outside the car on the passenger side, Aytes fired a pistol towards Dawson, striking her in the foot. Id.

In response to certified questions from the United States district court, our supreme court restated South Carolina's three-prong test for determining whether "[a]n insured is legally entitled to recover damages arising out of the ‘ownership, maintenance, or use’ of an uninsured vehicle." Id. at 33, 503 S.E.2d at 745 ; see also S.C. Code § 38-77-140(A) ("An automobile insurance policy may not be issued or delivered in this State ... unless it contains a provision insuring the persons defined as insured against loss from the liability imposed by law for damages arising out of the ownership, maintenance, or use of these motor vehicles ...."). "First, the party seeking coverage must establish a causal connection between the vehicle and the injury. Second, there must exist no act of independent significance breaking the causal link. ... [Third,] it must be shown the vehicle was being used for transportation at the time of the assault." Id.

In applying this test to the facts presented, the supreme court concluded:

There was not a causal connection in this case as the vehicle was not an active accessory, nor was it being used for transportation at the time of the injury. Further, if there was a causal link, it was broken when the assailant exited the vehicle. The only connection between the car and the injury is the fact that Dawson was sitting in the car when she was shot. Therefore, we do not find Dawson's injuries resulted from the ownership, maintenance, or use of her vehicle.

Id. at 35, 503 S.E.2d at 746.

This court considered the first two requirements that later became part of the Aytes

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test in

429 S.C. 219

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