Case Title: McGoff v. Acadia Insurance Co.

Citation: 

Docket Number: 2010-264

State: vermont

Court: Vermont Supreme Court

Date: 2011-09-01T00:00:00Z

Document:
McGoff v. Acadia Insurance Co. and
Fireman's Insurance Co. (2010-264)
 
2011 VT 102
 
[Filed 01-Sep-2011]
 
ENTRY ORDER
 
2011 VT 102
 
SUPREME COURT
  DOCKET NO. 2010-264
 
MARCH TERM, 2010 
 
Thomas P. McGoff
  and Margaret P. McGoff
}
APPEALED FROM:
 
}
 
    v.  
}
Superior Court, Washington Unit,
 
}
Civil Division
 
}
 
Acadia Insurance Company and
  Fireman's Insurance Company of Washington, D.C.
}
}
DOCKET NO. 192-3-07 Wncv
 
 
 
 
 
Trial Judge: Geoffrey W. Crawford
 
In the above-entitled
cause, the Clerk will enter:
 
¶ 1.            
Plaintiffs Thomas and Margaret McGoff appeal
an order of the Washington Superior Court's Civil Division granting defendant
Acadia Insurance Company summary judgment with respect to plaintiffs'
underinsured motorists (UIM) claim arising from an automobile accident in which
Thomas McGoff was injured.  We affirm.
¶ 2.            
At all relevant times, Thomas McGoff was
employed by A.R. Sandri, Inc., a Massachusetts
corporation that operates gas stations and other businesses in New England and
New York.  McGoff was a sales manager whose
territory included northern Vermont and New Hampshire.  At the time of the
accident that led to the instant lawsuit, Sandri had
supplied McGoff with a company car, a Pymouth Caravan, which he kept at his Barre, Vermont
home.  The Plymouth was owned by Sandri,
registered in Massachusetts, and insured by Acadia.  Sandri
had two fleet insurance policies with Acadiaone for vehicles registered in
Massachusetts and one for vehicles registered in other states.  The
Plymouth, along with 133 other vehicles, was covered by the policy issued for
vehicles registered in Massachusetts.  The policy listed the vehicles,
including the Plymouth driven by McGoff, as being
garaged in Massachusetts, apparently based on Sandri's
representation.  The policy had elective UIM coverage of $20,000 per
person and elective liability coverage of $1,000,000 per occurrence.
¶ 3.            
In June 2004, McGoff was seriously injured in
a two-car automobile accident in Richmond, Vermont.  McGoff
made a claim against the other driver, who carried liability coverage of
$100,000.  In the spring of 2007, he also made the instant claim for
additional UIM coverage against Acadia.  Acadia denied coverage because
the policy's $20,000 UIM coverage is less than the alleged tortfeasor's
$100,000 liability coverage.  See 23 V.S.A. § 941(f) (providing that
motor vehicle is underinsured to extent that liability insurance limits are
less than limits of insured's UIM coverage or that liability insurance has been
reduced by payments to others to amount less than limits of insured's UIM
coverage); Concord Gen. Mut. Ins.
Co. v. Estate of Lawton,
2003 VT 7, ¶ 1, 175 Vt. 475, 820 A.2d 196 (mem.)
(reaffirming "that 23 V.S.A. § 941(f) entitles an injured insured to [UIM]
coverage only when the total limits of liability laid out in the tortfeasor's policy are less than the [UM/UIM] coverage
stated in the insured's policy"); Monteith
v. Jefferson Ins. Co., 159 Vt. 378, 386, 618 A.2d 488, 492-93 (1992)
(noting that UIM coverage "fills the gap' between the tortfeasor's
liability coverage and the injured party's [UIM] coverage") (quotation
omitted).  Based on this principle, Acadia moved for summary
judgment.  The superior court denied Acadia's initial motion for summary
judgment in August 2007, noting that there were disputed factual questions
concerning where the Plymouth had been garaged and what coverage Sandri had elected in the Acadia policy.  Acadia
renewed its motion for summary judgment in December 2007 and updated the motion
in October 2008 and September 2009.  In May 2010, the court granted
Acadia's motion, ruling that Vermont's uninsured/underinsured (UM/UIM) insurance requirements do not apply to the Acadia fleet
policy because the policy was not "delivered or issued for delivery in this
state."  23 V.S.A. § 941(a).
¶ 4.            
Without setting forth "[a] statement of the issues presented for
review," as required by V.R.A.P. 28(a)(1), plaintiffs
generally claim that the superior court erred by granting Acadia summary
judgment and then proceed, over the remainder of their brief, to assert various
points of law and factsome suggesting claims of error, some not, and some
raised for the first time on appeal.  Plaintiffs' main argument, though,
appears to be that the court erred in ruling that Vermont's UIM requirements do
not apply to the instant policy on grounds that the policy was not delivered or
issued for delivery in Vermont.  Plaintiffs appear to argue that because
the Plymouth was garaged in Vermont rather than in Massachusetts, as indicated
in the Acadia policy, and thus should have been registered in Vermont rather
than Massachusetts, § 941's UIM requirements should apply.  This position
is contrary to the plain language of § 941(a) as well as the nearly unanimous
relevant case law, and therefore we decline to adopt it under the present
circumstances.
¶ 5.            
In relevant part, § 941(a) provides that no motor vehicle policy "may be
delivered or issued for delivery in this state with respect to any motor
vehicle registered or principally garaged in this state unless" UM/UIM coverage
is provided for the protection of the insureds. 
Section 941(c) requires that UM/UIM coverage in a policy be provided in the
same amount as the liability coverage "unless the policyholder otherwise
directs."  As noted, the Acadia policy elected $20,000 in UIM coverage,
which was permissible under Massachusetts law.  Plaintiffs, however, seek
to apply § 941(c) to compel UIM coverage of $1,000,000the amount of liability
coverage in the Acadia policy.  In furtherance of this argument,
plaintiffs contend that, although the face of the Acadia policy indicates that Sandri elected $20,000 in UIM coverage, there remains a
question as to whether Acadia notified Sandri that it
had the option of electing UIM coverage up to the policy's $1,000,000 liability
limits.
¶ 6.            
Plaintiffs' attempt at obtaining $1,000,000 in UIM coverage by applying
the requirements of § 941 fails primarily because, on its face, § 941(a) limits
application of that statute's requirements to policies "delivered or issued for
delivery in this state."  The Acadia policy in question was not delivered
or issued for delivery in Vermont.  Rather, it was a Massachusetts fleet
policy that was written on a Massachusetts form and approved by a Massachusetts
regulator.  The policy was issued and delivered to Sandri, a Massachusetts
company with its principal place of business in Massachusetts, by a
Massachusetts agent, for vehiclesincluding the Plymouth supplied to McGoffregistered in Massachusetts.  In short, given
§ 941(a)'s plain language, the statute does not apply to the subject
policy.
¶ 7.            
Plaintiffs do not benefit from the fact that the language in § 941(a)
also refers to vehicles "registered or principally garaged in this
state."  Even if we assume that the critical fact is where the Plymouth
was actually garaged rather than where the policy indicated it was garaged, but
see Liberty Mut. Ins. Co. v. Craddock, 338 A.2d 363, 374 (Md. Ct. Spec. App. 1975) (holding that, for purposes of
determining applicability of UM provisions, "statement in the policy is
conclusive of where the vehicle was principally garaged"), the salient language
in § 941(a) limits application of the statute to policies "delivered or
issued for delivery in this state with respect to any motor vehicle
registered or principally garaged in this state."  (Emphasis added.) 
The two key phrases are connected by the term "with respect to" and thus are
conjunctive rather than disjunctive, thereby requiring both elements to be
satisfied for the statute to apply.  See Pierzchalski
v. Northbrook Prop. & Cas.
Co., No. 89-15862, 1990 WL 127604, at *3 (9th Cir. Sept. 5, 1990)
(construing statute nearly identical to § 941(a) to apply to "all vehicles
registered or principally garaged in Arizona, but only when the policy insuring
those vehicles is delivered or issued for delivery' in Arizona"); see also Fletcher
Hill, Inc. v. Crosbie, 2005 VT 1, ¶ 17, 178 Vt.
77, 872 A.2d 292 ("[W]e presume that legislative language is inserted advisedly
and not intended to create surplusage." (quotation omitted)).
¶ 8.            
Whether the issue is framed as one of statutory construction or
choice-of-law, the courts construing statutes similar to § 941(a) are nearly
unanimous in concluding that insurance policies such as the instant Acadia
policy are not subject to that state's statutory UM/UIM coverage requirements
unless the policy was delivered or issued for delivery in that state, even if
the subject vehicle was regularly garaged in that state.  See Cherokee
Ins. Co., Inc. v. Sanches, 975 So. 2d 287, 293
(Ala. 2007) (declining to apply Alabama UM statute to fleet policy "issued and
delivered in Tennessee" even though "undisputed evidence" indicated that
vehicle was operated, maintained, and "principally garaged" in Alabama); Gilbert
v. Hodgkins, No. Civ. A CV-05-149, 2006 WL 1545532, at *2 (Me. Super. Ct. Mar. 16,
2006) (holding that because "Maine's UIM requirement reaches only insurance
contracts issued in the state of Maine, with respect to vehicles registered in
or garaged in Maine," the state "only has an interest in implementing its
policy with respect to UIM recovery where the injured party is covered by a UIM
contract issued in Maine"); Central Transport, Inc. v. Blake, 985 S.W.2d 805, 809-10 (Mo. Ct. App. 1999) (concluding that Missouri statute nearly
identical to § 941(a) did not apply because, even though vehicle was
garaged in Missouri, policy was issued and delivered in Michigan); Insurance
Co. of Penn. v. Hampton, 657 A.2d 976, 978-79 (Pa. Super. Ct. 1995)
(declining to apply nearly identical Pennsylvania statute where vehicle was
frequently garaged in Pennsylvania, but policy was issued, and vehicle
registered, in Delaware); Burns v. Aetna Cas. & Sur. Co., 741 S.W.2d 318, 322 (Tenn.
1987) (concluding that similar statute did not apply to fleet insurance policy
issued in Connecticut and delivered in Rhode Island, even though vehicle was
principally garaged in Tennessee).  We find unavailing plaintiffs'
attempts to distinguish these cases, which are consistent with the plain
language of § 941(a).
¶ 9.            
This majority position is also consistent with the relevant provision of
the Restatement on Conflicts of Law.  See Restatement (Second) of
Conflicts of Law § 188 (1971) (stating that rights and duties with respect to
contracts are determined by state with "most significant relationship to the
transaction and the parties," taking into account place of contract, place of
negotiation and performance of contract, location of subject matter of
contract, and residence, incorporation, and place of business of contracting
parties; noting that if negotiation and performance of contract are in same
state, that state's law will usually be applied).  Plaintiffs' reliance on
§ 193 of the Restatement is unavailing.  See Restatement (Second) of
Conflicts of Law § 193 cmt. a (1971) (stating that
law governing contracts for insurance of things such as trucks that move
constantly from state to state must be determined by principles set forth in §
188).
¶ 10.         The
only case law that plaintiffs cite to the contrary is Henderson v. Lincoln
Nat'l Speciality Ins. Co., 626 N.E.2d 657 (Ohio
1994), which has little persuasive value.  In that case, the court, by a
5-2 margin, answered a certified question in one sentence in the affirmative
without explanationwhether a statute nearly identical to § 941(a) applied
to policies not delivered or issued for delivery in Ohio when the vehicles were
registered and principally garaged in Ohio.  The dissenting opinion, on
the other hand, persuasively followed the rationale of other courts in adhering
to the plain language of the statute.  Id. at
658.  In short, there is no analysis from the Henderson
majority to inform our decision.
¶ 11.         According
to plaintiffs, the "central issue" in this case is whether the Acadia policy,
which was "meant" for delivery in Vermont, must comply with § 941(c).  The
premise to this argument is faulty, however.  Nothing in the record
suggests that the Acadia policy in question was "meant" to be delivered in
Vermont.  As noted, Sandri, a Massachusetts
business and McGoff's employer, owned two fleet
insurance policiesone covering vehicles registered in Massachusetts, including
the Plymouth supplied to McGoff in Vermont, and one
covering vehicles registered in other New England states and New York. 
Even assuming that Sandri and Acadia knew that the
Plymouth would be principally garaged in Vermont, and further assuming that the
vehicle should have beenand in fact had beenregistered in Vermont, the
Plymouth presumably would have been added to the second Acadia policy that
included vehicles not registered in Massachusettsa policy that presumably was
delivered or issued for delivery in Massachusetts, where Sandri's
headquarters was located.  Nothing in the record suggests otherwise. 
Certainly, nothing in the record suggests that the policy would have been
delivered or issued for delivery in Vermont even assuming all of the principals
knew where the Plymouth was actually garaged.  We recognize that in
determining whether material facts exist for trial, all reasonable doubts must
be resolved in favor of the nonmoving party, see O'Donnell v. Bank of Vt.,
166 Vt. 221, 224, 692 A.2d 1212, 1214 (1997), but in this case, despite having
years for discovery, plaintiffs failed to argue before the superior court that
the subject policy would have been delivered or issued for delivery in Vermont
had Acadia known and acknowledged that the Plymouth was being garaged in
Vermont and had Sandri registered the vehicle in
Vermont.  Thus, the issue was not preserved for appeal.  See Progressive
Ins. Co. v. Brown, 2008 VT 103, ¶ 8, 184 Vt. 388, 966 A.2d 666 (noting
that arguments are not preserved for appeal unless they are raised with
specificity and clarity before trial court).
¶ 12.         As
noted earlier, plaintiffs also contend that Acadia failed to notify Sandri that, under Massachusetts law, it could elect UIM
coverage up to the level of the policy's liability coverage.  As
plaintiffs acknowledge, however, Massachusetts law does not require insurance
companies to advise clients of the option to purchase UIM coverage up to the
amount of bodily injury liability coverageunless special circumstances
exist.  Here, the Acadia policy indicates that Sandri
in fact elected to undertake UIM coverage of $20,000, as opposed to none or
some other amount.  Further, as the trial court found, the record did not
demonstrate special circumstances compelling additional notice requirements,
but rather revealed an ordinary business relationship between an insurer, a commercial
broker, and a client corporation operating a fleet of vehicles across several
states.  Therefore, even if we assume that plaintiffs have standing to
bring their lack-of-notice argument, the argument would fail in this
instance.  And even if there was a notice requirement in these
circumstances, we fail to see how the lack of notice could somehow trigger §
941(c), which would nonetheless remain inapplicable in this case for the
reasons stated above.
¶ 13.         Finally,
we reject plaintiffs' argument "that Vermont's UIM law should be applied to
policies that are admittedly excluded by the statutory test because it is the
right thing to do to protect the public."  Our role is to interpret the
law to give effect to the Legislature's intent, not to impose our policy
preferences on the public.  See In re Route 103 Quarry, 2007 VT 66,
¶ 4, 182 Vt. 569, 933 A.2d 189 (noting that this Court's "ultimate goal" in
interpreting statutes is to determine intent of Legislature).  The
Legislature's decision to apply its UIM requirements only to insurance policies
delivered or issued for delivery in this state is not irrational or absurd so
that we are compelled to ignore the plain dictates of the statute.  See State
v. Longley, 2007 VT 101, ¶ 10, 182 Vt. 452, 939 A.2d 1028 (noting
presumption against imposing statutory construction that would lead to absurd
results).
Affirmed.
 
BY THE COURT:
 
 
 
 
 
 
 
Paul L. Reiber,
  Chief Justice
 
 
 
 
 
John A. Dooley, Associate Justice
 
 
 
 
 
Denise R. Johnson,
  Associate Justice
 
 
 
 
 
Marilyn S. Skoglund, Associate Justice
 
 
 
 
 
Brian L. Burgess, Associate
  Justice