Vue v. State Farm Ins. Companies

• Decision Date: 06 August 1998
• Docket Number: No. C1-97-632,C1-97-632
• Parties: Ka Ying VUE, et al., Respondent, v. STATE FARM INSURANCE COMPANIES, petitioner, Appellant.
• Court: Minnesota Supreme Court

Page 264

582 N.W.2d 264

Ka Ying VUE, et al., Respondent, v. STATE FARM INSURANCE COMPANIES, petitioner, Appellant.

No. C1-97-632.

Supreme Court of Minnesota.

Aug. 6, 1998.

Syllabus by the Court

The spouse of the person who is named on an automobile title as owner or buyer of the vehicle is not presumed to be a co-owner of the vehicle, absent extrinsic evidence to rebut the presumption established by the title.

Meagher & Geer, P.L.L.P., William M. Hart, Katherine A. McBride, Leatha G. Wolter, Minneapolis, for appellant.

Katz & Manka, Ltd., Scott A. Teplinsky, Cameron M. Parkhurst, Minneapolis, for respondent.

Heard, considered, and decided by the court en banc.

OPINION

GARDEBRING, Justice.

In this case, an automobile insurer challenges the presumption, created by statute and case law, that the person named on an automobile title as buyer is the vehicle's owner. Instead, the insurer, relying on the theories of joint ownership arising out of marital dissolution laws, asks us to establish a presumption that the spouse of the individual named on the vehicle title is also an owner. Because we find no basis in the Minnesota No-Fault Act or in our previous cases for such a position, we reject the insurer's claim and affirm the court of appeals.

Respondent Ka Ying Vue was a passenger in a 1985 Buick Skylark driven by her husband Ker Vang on January 22, 1996, when the car was involved in a collision with an uninsured stolen motor vehicle. ¹ The Buick Skylark title named only Vang as the buyer of the vehicle; it was not insured at the time of the collision. However, appellant State Farm Insurance Companies ("State Farm") had issued an insurance policy covering Vang's other vehicle, a 1979 Chevrolet van, and Vue was an additional insured under that policy. Vue filed suit against State Farm, claiming uninsured motorist benefits under the State Farm policy covering the Chevrolet van, based on the uninsured status of the stolen vehicle.

State Farm filed a motion for summary judgment against Vue, claiming that Vue was not covered under the policy because she was occupying an owned but uninsured vehicle at the time of the accident. The district court granted State Farm's motion for summary judgment, concluding that there was no coverage because: (1) the Buick Skylark was not an "uninsured vehicle" under the policy, which excluded uninsured motorist coverage if the uninsured vehicle was one "[o]wned by or furnished or available for the regular use of you or any family member;" and (2) the Buick Skylark was a "family vehicle," and therefore the exclusion for injury "to any insured while occupying a motor vehicle owned or leased by the insured if it is not insured for uninsured motor vehicle coverage" was applicable to Vue's claim.

On appeal, the court of appeals reversed. See Vue v. State Farm Ins. Companies, 568 N.W.2d 527 (Minn.App.1997). The court held that Vang, who held legal title to the Buick Skylark, was the vehicle owner, and not Vue. Id. at 529. Since Vue was not an owner of the Buick Skylark, the court held that the exclusion for injury "to any insured while occupying a motor vehicle owned or leased by the insured" did not apply to Vue. Id. The court also held that, to the extent the trial court based its decision on the uninsured status of the Buick Skylark, the court erred in granting summary judgment, since the claim for coverage was based on the uninsured status of the other vehicle involved in the collision, and not on the uninsured status of the Buick Skylark. Id. at fn. 3. State Farm now appeals.

On appeal from summary judgment, this court must determine whether there are any genuine issues of material fact and whether the trial court erred in its application of the law. Vesta State Bank v. Independent State Bank, 518 N.W.2d 850, 853 (Minn.1994). Questions of statutory construction are questions of law, and thus subject to de novo review. Hibbing Educ. Ass'n v. Public Employment Relations Bd., 369 N.W.2d 527, 529 (Minn.1985). Interpretation of an insurance policy, and its application to the facts of the case, are likewise questions of law. Meister v. Western Nat'l Mut. Ins. Co., 479 N.W.2d 372, 376 (Minn.1992).

Although State Farm concedes that Vue has alleged facts sufficient to establish a prima facie case of coverage for uninsured motorist benefits, the insurer argues that Vue is nevertheless precluded from receiving benefits because of an exclusionary clause in the policy. ² The policy on the Chevrolet van provides that "there is no [uninsured motorist] coverage * * * for bodily injury to any insured while occupying a motor vehicle owned or leased by the insured if it is not insured for uninsured motor vehicle coverage." State Farm argues that Vue is a co-owner of the Buick Skylark that she was occupying at the time of the accident and was therefore "occupying a motor vehicle owned or leased by the insured." Thus, it is State Farm's position that she is barred from recovering uninsured motorist benefits under the policy.

Both parties agree that the sole issue on review is whether Vue is an owner of the uninsured Buick Skylark. If Vue is an owner, the exclusionary clause would apply to preclude coverage for her injuries; if Vue is not an owner, then the exclusionary clause would not apply and Vue would be entitled to receive uninsured motorist benefits as an "insured" under her husband's policy on the Chevrolet van. ³

The State Farm policy does not define the "owner" of a motor vehicle. However, the legislature has provided guidance on this issue. The Minnesota No-Fault Automobile Insurance Act, Minn.Stat. §§ 65B.41-.71 (1996) (hereinafter, "No-Fault Act") defines an "owner" of a motor vehicle as "a person, other than a lienholder or secured party, who owns or holds legal title to a motor vehicle or is entitled to the use and possession of a motor vehicle." Minn.Stat. § 65B.43, subd. 4. Vue's husband Vang is listed on the title as the sole buyer of the vehicle. This court has previously established that the certificate of title creates a rebuttable presumption of ownership for purposes of both the No-Fault Act and the Motor Vehicle Certificate of Title Act, Minn.Stat. ch. 168A (1996). Arneson v. Integrity Mut. Ins. Co., 344 N.W.2d 617, 618 (Minn.1984). We have also made clear that a party may introduce extrinsic evidence to rebut the presumption and prove that someone else actually owns the vehicle in question. Id.

State Farm, however, argues that as the spouse of the owner named on the title, Vue is a presumptive co-owner of the vehicle. To support its argument, State Farm points to the statutory presumption in marital dissolution that any property acquired during a marriage "by the parties * * * to a dissolution, legal separation, or annulment" is presumed to be marital property "regardless of whether title is held individually or by the spouses in a form of coownership." Minn.Stat. § 518.54, subd. 5 (1996). State Farm argues that the same deference accorded to the marital relationship in the context of property division for dissolution purposes should be constructively applied to the marital relationship in the context of motor vehicle insurance.

As additional support for its general argument that Vue is not entitled to receive uninsured motorist benefits, State Farm directs our attention to the policy enunciated in Hanson v. American Family Mut. Ins. Co., 417 N.W.2d 94 (Minn.1987). In Hanson and its progeny, this court recognized that the 1985 amendments to the Minnesota No-Fault Act "reflect a broad policy decision to tie uninsured motorist * * * coverage to the particular vehicle involved in an accident." Id. at 96. Hanson interpreted the 1985 amendments to preclude uninsured motorist coverage where the injured claimant was driving his own uninsured vehicle but owned another insured motor vehicle. ⁴ Id. The amendments provided in part:

(7) The uninsured and underinsured motorist coverages required by this subdivision do not apply to bodily injury of the insured while occupying a motor vehicle owned by the insured, unless the occupied vehicle is an insured motor vehicle.

Minn.Stat. § 65B.49, subd. 3a(7). In the present case, however, this statutory provision does not apply, for the same reason that the policy provision that mirrors it does not apply--because, based on the present state of the record, there is no indication that Vue was occupying a motor vehicle she owned.

State Farm also argues that Minn.Stat. § 65B.49, subd. 3a(5) should operate to preclude benefits for Vue in this case. That section provides that

(5) If at the time of the accident the injured person is occupying a motor vehicle, the...