F I L E D

United States Court of Appeals

Tenth Circuit

OCT 30 1998

PATRICK FISHER

Clerk

PUBLISH

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

MGA INSURANCE COMPANY

INC.,

Plaintiff-Appellee,

v.

KATHLEEN ESTELLE FISHERROUNDTREE,

Defendant-Appellant,

and

CARLTON A. WIGGINS; MARTHA

WIGGINS, individually and d/b/a

Noble Propane Company,

Defendants.

MGA INSURANCE COMPANY

INC.,

Plaintiff-Appellee,

v.

CARLTON A. WIGGINS; MARTHA

WIGGINS, individually and d/b/a

Noble Propane Company,

Defendants-Appellants,

No. 97-6391

 &

 97-6414
-2-

and

KATHLEEN ESTELLE FISHERROUNDTREE,

Defendant.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF OKLAHOMA

(D.C. No. 97-CV-65)

Submitted on the briefs:

Harry A. Parrish of Knight, Wilkerson, Parrish, Wassall & Warman, Tulsa,

Oklahoma, for Plaintiff-Appellee.

Gary C. Bachman and J.R. “Randy” Baker of Holloway, Dobson, Hudson,

Bachman, Alden, Jennings & Holloway, Inc., Oklahoma City, Oklahoma, for

Defendant-Appellant Kathleen Estelle Fisher-Roundtree.

David C. Johnston, Jr., Law Office of David C. Johnston, Jr., P.C., Oklahoma

City, Oklahoma, for Defendants-Appellants Carlton A. Wiggins and Martha

Wiggins, individually and d/b/a Nobel Propane Company.

Before PORFILIO , KELLY , and HENRY , Circuit Judges.

PER CURIAM .

Plaintiff MGA Insurance Company brought this diversity action under 28

U.S.C. § 2201 seeking a judgment declaring that the insurance policy it issued to
1 After examining the briefs and appellate record, this panel has

determined unanimously to grant the parties’ request for a decision on the briefs

without oral argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1.9. These

cases are therefore ordered submitted without oral argument. 

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defendants Carlton and Martha Wiggins did not cover the injuries suffered by

defendant Kathleen Fisher-Roundtree allegedly caused by the Wiggins’

negligence. The district court granted summary judgment in MGA’s favor, and

defendants appeal. Reviewing the district court’s grant of summary judgment and

its interpretation of the insurance policy de novo, see Wolf v. Prudential Ins. Co.,

50 F.3d 793, 796 (10th Cir. 1995); Houston Gen. Ins. Co. v. American Fence Co.,

115 F.3d 805, 806 (10th Cir. 1997), we conclude that the policy does provide

coverage and reverse.1

The Wiggins own and operate Noble Propane Company, a retail seller of

liquified petroleum, or LP, gas located in Noble, Oklahoma. MGA issued them a

commercial general liability policy to cover their business operations. On

July 17, 1996, Martha Wiggins filled a propane bottle for Fisher-Roundtree and

helped Fisher-Roundtree place the bottle in the trunk of her car. After FisherRoundtree left the premises, the bottle exploded, injuring her and her property. 

She brought suit in state court contending that the Wiggins’ negligence caused her

injuries. The Wiggins tendered the defense of Fisher-Roundtree’s suit to MGA

and sought indemnification for any damages they might owe her.
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MGA thereafter brought this action in federal district court asserting that

the policy did not cover Fisher-Roundtree’s claim and denying any responsibility

to defend the Wiggins. It contended that her claim would fall within the type of

coverage provided for completed operations and that this type of coverage had

been expressly excluded from the policy. Defendants apparently agreed that

Fisher-Roundtree’s accident fell within completed operations coverage, but

disagreed that the policy excluded this type of coverage. They contended that the

policy was ambiguous as to whether it excluded completed operations coverage

and that it should be construed in their favor; that the coverage should be read

into the policy because it was required by the statute and regulations under which

the Wiggins obtained their permit to sell LP gas; that MGA’s agent represented to

them that the policy satisfied their insurance requirements; and that MGA should

be prohibited from denying coverage under the doctrine of reasonable

expectations. In granting summary judgment in MGA’s favor, the district court

concluded that the policy unambiguously excluded coverage for completed

operations and that because the policy was not ambiguous, the doctrine of

reasonable expectations did not apply. It did not specifically address defendants’

other arguments. On appeal, defendants essentially repeat the same arguments

they raised in the district court. 
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We can quickly reject three of defendants’ arguments. Their contention

that the policy is ambiguous regarding whether completed operations coverage is

excluded derives from a certificate of insurance issued under the policy. The

column on the certificate showing limits for various types of coverage contains

the word “excluded” for completed operations coverage. Defendants contend that

this can be reasonably interpreted to mean that the policy includes completed

operations coverage and that only the “aggregate limit” for this coverage is

excluded. Construing the policy as a whole, see Liberty Mutual Ins. Co. v. East

Cent. Okla. Elec. Coop., 97 F.3d 383, 388-89 (10th Cir. 1996) (applying

Oklahoma law), we disagree that this is a reasonable interpretation of the policy. 

The policy contained an endorsement specifically and clearly excluding completed

operations coverage. See Appellants’ App. at 106. In light of this endorsement,

the only reasonable meaning of the certificate is that completed operations

coverage is excluded, not that only an aggregate limit is excluded. Defendants’

interpretation would require us to “indulge in forced or constrained

interpretation[]” to create an ambiguity, which we will not do. Max True

Plastering Co. v. United States Fidelity & Guar. Co., 912 P.2d 861, 869 (Okla.

1996). Moreover, as the district court found, this lack of ambiguity defeats

defendants’ argument that the certificate created a reasonable expectation of

coverage to which MGA should be held. See id. at 870 (doctrine of reasonable
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expectations applies only where policy is ambiguous or contains technical,

obscure or hidden exclusions). 

We also reject defendants’ argument regarding whether John Imhoff, the

insurance agent with whom the Wiggins dealt in buying the policy, was MGA’s

agent. At most, Imhoff told the Wiggins that they had all the coverage required

by law, not that they had coverage for completed operations. Further, defendants

cite no Oklahoma authority indicating that even if he were MGA’s agent, any

representations he made would modify the unambiguous written policy or

otherwise bind MGA, and we will not make defendants’ arguments for them. See

Phillips v. Calhoun, 956 F.2d 949, 953-54 (10th Cir. 1992) (party must support its

argument with legal authority).

We now turn to the more difficult issue defendants raise--whether coverage

for completed operations should be imposed as a matter of law. The statute and

regulations under which the Wiggins obtained their permit to sell LP gas required

that they maintain various insurance coverages including coverage for completed

operations. Defendants contend that even if, as we have already concluded, the

policy language itself does not provide completed operations coverage, coverage

should be read into the policy based on the general rule that statutes regarding

insurance in effect at the time a policy is negotiated are made part of the policy as

a matter of law. 
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As a general rule, 

[a]ll statutes in force at the time the contract or insurance is made (or

renewed) will be considered to be part of the contract provided that

such statutes bear on the subject matter of the contract and define the

rights and liabilities of the parties to the agreement. . . .

[A]ny provision in a policy subject to a particular statute which is in

derogation with the explicit terms of the statute or the public policy

evidenced by its terms, will be invalid. 

Eric Mills Holmes, Appleman on Insurance, § 22.1, Vol. 4 at 366 (2d ed. 1998). It

is clear that Oklahoma follows the general rule at least as it applies to statutes

directly relating to the issuance of insurance policies. See Shepard v. Farmers Ins.

Co., 678 P.2d 250, 251 (Okla. 1983) (“Under Oklahoma law, insurance policies are

issued pursuant to statutes, and the provisions of those statutes are given force and

effect as if written into the policy.”). Like other states, Oklahoma has compulsory

insurance laws mandating that, for the benefit of the public, those engaging in

particular activities maintain insurance, the most prominent of which requires

motor vehicle liability coverage. Thus, Oklahoma courts have readily imputed

statutorily required insurance provisions into motor vehicle liability policies where

the policies failed to include or conflicted with these provisions. See, e.g.,

Thomas v. National Auto. & Cas. Ins. Co., 875 P.2d 424, 427 (Okla. 1994)

(“[C]learly articulated public policy of our compulsory insurance law plainly

overrides contrary private agreements that restrict coverage whenever the

contractual strictures do not square with the purpose of the [Financial
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Responsibility] Act.”); Moon v. Guarantee Ins. Co., 764 P.2d 1331, 1335 (Okla.

1988) (unless rejected in writing, mandated uninsured motorist coverage “written

into policy by operation of law”). The statutes applicable in these situations

directly affect the insurance contract. See, e.g., Okla. Stat. tit. 47 § 7-601.1.A.1

(requiring insurer issuing vehicle proof of insurance form to state that it is issued

pursuant to Compulsory Insurance Law); Okla. Stat. tit. 36 § 3636 (requiring all

motor vehicle liability policies to provide uninsured motorists coverage, unless

insured rejects coverage in writing). 

The statute (and regulations) at issue here are somewhat different. To

operate the type of LP gas retailing business that the Wiggins have, the Oklahoma

LP Gas Act requires businesses to obtain a class VI permit from the Oklahoma LP

Gas Administrator. See generally Okla. Stat. tit. 52 § 420.4. As part of the

permitting process, LP gas retailers must furnish the Administrator with a

certificate demonstrating public liability and property damage insurance coverage. 

See id. § 420.4.J. The statute allows the LP Gas Board to establish minimum

coverage limits, see id., and for the period in question, the Board established the

following insurance requirements for the type of permit the Wiggins have: 

General Liability, Bodily Injury, Property Damage, including products

and completed operations liability coverage shall be obtained as

follows: $50,000 per occurrence; $50,000 aggregate.
2 Because the procedural posture of this matter is summary judgment,

and we therefore construe the facts in defendants’ favor, we note that the record

does not support MGA’s implied contention that the Wiggins affirmatively

requested that completed operations coverage be excluded from the policy. The

summary judgment evidence shows that the Wiggins did not request completed

operations coverage in their application. Although MGA contends that the

Wiggins “declined to include that coverage because of cost considerations,”

Appellee’s Br. at 2, the record does not support that contention. MGA does not

cite any authority indicating that the failure of an insured to request compulsory

coverage affects the determination of whether coverage should be imputed as a

matter of law, and we do not consider any factual dispute in this regard material

to our analysis.

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Okla. Admin. Code § 420:10-1-18 (6)(A). Through its agent, MGA issued two

certificates of insurance to the LP Gas Administrator for the Wiggins’ business in

1995 and 1996. 

The insurance requirement at issue here is not as directly applicable to the

issuance of an insurance policy as it is to the issuance of a permit for the Wiggins

to operate their business; that is, it does not affirmatively impose any coverage

requirements directly on the insurer. Without citing any authority, MGA contends

that the insurance regulations promulgated by the LP Gas Board therefore should

not be made part of the policy as a matter of law, especially where, as it contends

is the situation here, the coverage at issue was excluded at the insured’s request.2

However, we see no indication that Oklahoma treats compulsory insurance

requirements mandated as part of a permitting scheme any differently from those
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imposed for motor vehicle liability coverage that are more closely tied to the

insurance transaction itself.

“Administrative bodies other than insurance boards may nonetheless have an

impact on insurance, as where they mandate that the persons or entities under their

authority obtain particular types of insurance coverage.” Lee R. Russ & Thomas

F. Segalla, Couch on Insurance, Vol. 2 § 19:11 (3d 1997). The Oklahoma

Supreme Court has recognized this corollary to the general rule and held that the

insurance requirements associated with permitting statutes, including the LP Gas

Act, may be incorporated into insurance policies. In Daniels v. Scott, 340 P.2d

223 (Okla. 1959), the issue was whether the insurer who had issued an insurance

policy to an LP gas permittee could be joined as a defendant in an action against

the permittee for injuries resulting from the permittee’s alleged negligence. 

Relying primarily on cases involving insurance requirements imposed on motor

carriers as a condition of engaging in business, the court concluded that under the

LP Gas Act, the insurer could be joined. See id. at 225-27; see also Wilson v.

District Court, 575 P.2d 112, 114-15 (Okla. 1977) (reaffirming Daniels). In doing

so, Daniels quoted from one of the court’s earlier motor carrier cases:

“When a motor carrier files with the Corporation Commission a

liability insurance bond as a prerequisite to the issuance to it of a

certificate of convenience and necessity, and thereby procures the

issuance of such a certificate by the Corporation Commission, neither

it nor its liability insurance bondsmen may successfully contend that

its bond limits the liability imposed by the statute except as to
3 Although Jacobsen spoke in terms of a bond being provided to the

Corporation Commission, the applicable statute was subsequently amended to

allow a liability insurance policy to be used instead, with no change in the effect

of the statute. See Enders v. Longmire , 67 P.2d 12, 13-14 (Okla. 1937).

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amount. When it files its liability insurance bond with the

Corporation Commission, the provisions of the statute are read into

and become a part of that bond.”

“* * * Under the statute the liability insurance bond maker is liable

for the injuries resulting from the operation of the motor carrier, not

by reason of its bond, but by reason of the statute, after it has filed its

bond.”

Daniels, 340 P.2d at 226 (quoting Jacobsen v. Howard, 23 P.2d 185, 187 (Okla.

1933)).3

 The court also noted the fact that these types of insurance requirements

were compulsory and were imposed as a matter of policy to protect the public. See

id. at 226, 227. Moreover, on the basis that the policy could not restrict coverage

and liability imposed by law, the court specifically rejected the insurer’s argument

seeking to give effect to a policy provision prohibiting joinder of the insurer in an

action against the insured. See id. at 227; see also Enders, 67 P.2d at 16 (“[T]he

bond [required for motor carrier permit] may not contravene the statute, and in

case of conflict, the liability distinctly imposed by statute must be performed by

the surety.”). 

Thus, it appears that the Oklahoma Supreme Court views the compulsory

insurance requirements of permitting statutes the same as it views those relating to

automobiles and the insurance transaction itself; that is, that the statutes are
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incorporated into the policy as a matter of law and override any conflicting policy

provision. Additionally, it does not matter that the specific insurance requirements

here are required by regulation rather than statute since there is no question that

the regulations were promulgated in accordance with the statute. See Commercial

Standard Ins. Co. v. Garrett, 70 F.2d 969, 975-76 (10th Cir. 1934) (noting that

“rules and regulations of the [Oklahoma Corporation] commission made in

conformity to the statute, had the same force and effect as if they had been

incorporated into the statute itself”); see also Appleman, § 22.2, Vol. 4 at 381-82. 

It also does not matter that the insured did not bargain for and pay the increased

premium for the additional coverage imposed by statute, as this is the typical

situation in which coverage is imposed as a matter of law. See id. § 22.1, Vol. 4 at

355 (“[M]issing terms required by statute will be read into the policy . . . even

though increased liability not reflected in original premium is the consequence.”).

We thus conclude that coverage for completed operations must be written

into the policy as a matter of law. The question then becomes the amount of

coverage to be provided. Defendants contend that it should be the $500,000 per

occurrence total provided by the policy. MGA contends that it should be limited

to the statutory minimum as opposed to the maximum liability provided by the

policy. We agree that under Oklahoma law, coverage is imputed only up to the

statutory amount. See May v. National Union Fire Ins. Co., 918 P.2d 43, 48-49
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(Okla. 1996); Equity Mutual Ins. Co. v. Spring Valley Wholesale Nursery, Inc.,

747 P.2d 947, 953 (Okla. 1987). Therefore, the limit of MGA’s liability for

completed operations coverage is $50,000 as required by regulation.

The judgment of the district court is REVERSED, and the case is

REMANDED to the district court for entry of judgment consistent with this

opinion.