No. 86-89 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1986 

RICHARD PAYNE and SHIRLEY PAYNE, 

Plaintiffs and Appellants, 

SAFECO INSURANCE COMPANIES OF 

AMERICA, 

Defendant and Respondent. 

APPEAL FROM: District Court of the Sixth Judicial District, 

In and for the County of Park, 

The Honorable Byron Robb, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Knuchel & McGregor; Karl Knuchel, Livingston, Montana 

For Respondent: 

Landoe, Brown, Planalp, Kornmers & Johnstone; Gene I. 

Brown, Bozeman, Montana 

Submitted on Briefs: May 15, 1986 

Decided: June 24, 1986 

Filed: JUN 2 4 1986 

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Clerk 
Mr. Justice Fred J. Weber delivered the Opinion of the Court. 

Richard and Shirley Payne held a homeowners insurance 

policy with Safeco Insurance Companies of America (Safeco). 

They appeal the summary judgment of the District Court for 

Park County that their Safeco policy did not cover fire 

damage to several antique vehicles. We affirm. 

The issue is whether the District Court correctly determined that the Paynes' insurance policy clearly and unambiguously excludes the antique cars from coverage. 

The Paynes own several antique vehicles, only one of 

which is licensed for road use. In March 1984, the garage 

containing the antique vehicles burned, damaging the vehicles. The Paynes' insurance policy provided: 

This coverage excludes: . . . 2. motorized vehicles, except such vehicles pertaining to the service of the premises and not licensed for road use. ... 

Safeco denied coverage for damage to the vehicles based on 

this provision. 

The Paynes filed a complaint against Safeco alleging 

failure to pay under the policy, bad faith, and breach of 

contract. Safeco filed a motion for summary judgment based 

on the above provision. The trial judge granted Safeco's 

motion for summary judgment, stating that the language of the 

policy was plain, clear, and unambiguous, that no further 

discovery would change the terms of the insurance contract, 

and that Safeco's denial of the Paynes' claim could not be 

considered as bad faith. 

The Paynes contend that a reasonable person could read 

the exclusionary provision as excluding coverage for motorized vehicles except for two types, 1) vehicles which were 
used to service the premises, or 2) vehicles which were 

unlicensed for road use. They argue that since the policy 

provision is ambiguous, it must be construed against the 

insurer. They city Truck Ins. Exchange v. Woldstad (Mont. 

1984), 687 P.2d 1022, 41 St.Rep. 1750. In that case, the 

Court stated, "[ilt is the rule of construction in Montana 

that language of limitation or exclusion must be clear and 

unequivocal; otherwise, the policy will be strictly construed 

in favor of the insured. I' Truck Ins., 687 P.2d at 1024-25. 

The above rule is set forth in our statutes. Section 

28-3-303, MCA, provides the general rule: 

Writing generally to determine intention. When a 

contract is reduced to writing, the intention of 

the parties is to be ascertained from the writing 

alone if possible, subject, however, to the other 

provisions of this chapter. 

Section 28-3-206, MCA, sets forth the exception for 

ambiguity: 

Uncertainty to be resolved against party causing 

- it. In cases of uncertainty . . . the language of 

a contract should be interpreted most strongly 

against the party who caused the uncertainty to 

exist . . . We conclude that the insurance policy clause at issue here is 

within the general rule. The grammatical structure of the 

clause is such that both "pertaining to the use of the premises" and "not licensed for road use" modify the same word, 

"vehicles." If the clause was meant to include two exceptions to the coverage exclusion, it would properly be written 

either with a disjunctive 'or' between the exceptions, or as: 

"vehicles pertaining to the service of the premises and 

vehicles not licensed for road use . . .." As it is written, 

the policy clearly and unambiguously covers only those vehi- 
cles which meet both of the requirements set forth in the 

provision. 

There have been no allegations that the antique vehicles 

in any way pertained to the service of the premises. We 

therefore affirm the District Court's conclusion that, as a 

matter of law, the Safeco insurance policy did not provide 

coverage for damage to the Paynes' antique vehicles. 

Affirmed. 

We Concur: I 

Justices