IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF OREGON 

IDS PROPERTY CASUALTY 

INSURANCE COMPANY, a foreign 

msurance company 

Plaintiff, 

v. 

MICHELLE MULLINS and RYAN 

MULLINS, 

Defendants, 

MCSHANE, Judge: 

Civ. No. 6:14-cv-01344-MC 

OPINION AND ORDER 

On January 31, 2014, defendant Ryan Mullins (Mr. Mullins) was involved in a serious 

car accident as a passenger. Mr. Mullins exhausted the driver's policy limits and subsequently 

sought Underinsured Motorist (UIM) benefits as a "resident relative" 1 under a policy issued to 

his mother, defendant Michelle Mullins (Ms. Mullins). The insurance provider, plaintiffiDS 

Property Casualty Insurance Company (IDS), filed this action for declaratory relief seeking a 

rescission and no coverage. 

This Court is asked to consider whether alleged misrepresentations made by Ms. Mullins 

may preclude coverage as to Mr. Mullins under the fraud provision of the insurance policy. 

Because the fraud provision is limited to the insured party who commits the fraudulent act, 

alleged misrepresentations made by Ms. Mullins do not preclude coverage as to Mr. Mullins 

1 "Resident relative means a person related to you by blood, marriage, or adoption who resides in your household. 

This includes a ward or foster child." Compl. 9, ECF No. 1-2 (emphasis in original). 

1 -OPINION AND ORDER 

Case 6:14-cv-01344-MC Document 45 Filed 05/12/15 Page 1 of 7
under that provision. Thus, defendant's motion for partial summary judgment, ECF No. 29, is 

GRANTED IN PART and DENIED IN PART, and defendant's motion in limine to exclude 

evidence, ECF No. 35, is GRANTED IN PART and DENIED IN PART. 

PROCEDURALANDFACTUALBACKGROUND 

This action arises out of an insurance claim under a motor vehicle policy, which was 

effective from October 6, 2013 to April6, 2014. See Compl. 1, ECF No. 1-2. 

On October 5, 2013, Ms. Mullins contacted IDS to contract a motor vehicle policy. See 

id. at 2, ECF No. 1. During that telephone conversation, Ms. Mullins informed IDS that her son, 

Mr. Mullins, did not live at her residence. !d. at 3; Notice of Conventional Filing Ex. B, ECF No. 

36 (compact disk filed conventionally). 

On January 24, 2014, Ms. Mullins contacted IDS to add an additional vehicle and update 

her address. Compl. 3, ECF No. 1. Ms. Mullins again informed IDS that Mr. Mullins did not live 

at her residence. !d. at 3; Notice of Conventional Filing Ex. D, ECF No. 37 (compact disk filed 

conventionally). 

On January 31, 2014, Mr. Mullins was involved in a motor vehicle2 collision as a 

passenger and sustained severe injuries. See Ryan Mullins's Answer 4, ECF No.7. Mr. Mullins 

exhausted the driver's policy limits and subsequently sought UIM as a "resident relative" under 

Ms. Mullins's policy. See id. 

On May 20,2014, IDS examined Ms. Mullins and Mr. Mullins under oath. Ms. Mullins 

testified that Mr. Mullins moved in with her in December 2013. See Decl. of Daniel E. Thenell 

4-6, 10, ECF No. 33-1. Mr. Mullins also testified that he moved in with Ms. Mullins in 

December 2013. See Decl. of Daniel E. Thenell4-5, ECF No. 33-2. 

2 The vehicle at issue was owned and driven by Jason Ray Gibbs. See id. 

2- OPINION AND ORDER 

Case 6:14-cv-01344-MC Document 45 Filed 05/12/15 Page 2 of 7
On August 20, 2014, IDS filed this action seeking two counts of declaratory relief: 

rescission and no coverage. See Compl. 6-8, ECF No. 1. 

STANDARD OF REVIEW 

This Court must grant summary judgment if there is no genuine issue of material fact and 

the moving party is entitled to judgment as a matter oflaw. Fed. R. Civ. P. 56( a). An issue is 

"genuine" if a reasonable jury could return a verdict in favor of the non-moving party. Rivera v. 

Phillip Morris, Inc., 395 F.3d 1142, 1146 (9th Cir. 2005) (citing Anderson v. Liberty Lobby, Inc., 

477 U.S. 242, 248 (1986)). A fact is "material" if it could affect the outcome of the case. !d. The 

court reviews evidence and draws inferences in the light most favorable to the non-moving party. 

Miller v. Glenn Miller Prods., Inc., 454 F.3d 975, 988 (9th Cir. 2006) (quoting Hunt v. 

Cromartie, 526 U.S. 541, 552 (1999)). When the moving party has met its burden, the nonmoving party must present "specific facts showing that there is a genuine issue for trial." 

Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986) (emphasis in 

original) (quoting Fed. R. Civ. P. 56( e)). 

DISCUSSION 

Mr. Mullins moves for summary judgment as to both of plaintiffs declaratory relief 

counts: rescission and no coverage. Mr. Mullins asserts that he is entitled to judgment in his 

favor as to both claims under ORS § 742.456,3 Walker v. Fireman's Fund Ins. Co., 114 Or. 545 

3 ORS § 742.456 provides: 

The liability of an insurer with respect to the motor vehicle liability insurance policy 

required by ORS 806.060, 806.240 or 806.270 shall become absolute whenever injury or 

damage covered by the policy occurs. The policy may not be canceled or annulled as to 

such liability by any agreement between the insurer and the insured after the occurrence 

of the injury or damage. No statement made by the insured or on behalf of the insured 

and in violation of the policy shall defeat or void the policy. This section does not apply 

to motor vehicle liability insurance policies other than those required in connection with 

ORS 806.060, 806.240 or 806.270. 

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Case 6:14-cv-01344-MC Document 45 Filed 05/12/15 Page 3 of 7
(1925), and the terms of the contract. Because this Court finds that the terms of the contract are 

sufficient to settle the issue, this Court's inquiry focuses on those terms and Mr. Mullins's 

related motion in limine. 

I. The Contract 

Interpretation of an insurance policy is a question of law, and this Court's task is to 

ascertain the intention of the parties to the insurance policy. Hoffman v. Foremost Signature Ins. 

Co., 989 F. Supp. 2d 1070, 1079 (D. Or. 2013) (citation and internal quotation marks omitted). 

The parties' intent is determined by the terms and conditions of the underlying policy. See 

Holloway v. Republic Indemnity Co. of Am .. 341 Or. 642, 649-50 (2006) (citation omitted). "If 

the policy does not define the phrase in question, [this Court] resort[s] to various aids of 

interpretation to discern the parties' intended meaning." !d. at 650 (citation and internal quotation 

marks omitted). Under that framework, this Court first considers whether the phrase in question 

has a plain meaning. !d. (citation omitted). "If the phrase in question has more than one plausible 

interpretation," this Court will then '"examine the phrase in light of the particular context in 

which that [phrase] is used in the policy and the broader context of the policy as a whole."' !d. 

(citations omitted). "lfthe ambiguity remains after [this Court] has engaged in those analytical 

exercises, then any reasonable doubt as to the intended meaning of such [a] term[ ] will be 

resolved against the insurance company." Id. (citations and internal quotation marks omitted). 

However, "a term is ambiguous ... only if two or more plausible interpretations of that term 

withstand scrutiny." !d. (emphasis in original) (citations and internal quotation marks omitted). 

The contract provides, in relevant part: 

Fraud 

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Case 6:14-cv-01344-MC Document 45 Filed 05/12/15 Page 4 of 7
We do not provide coverage for any insured4 

or person making claim 

under this policy who, whether before or after a loss, has: 

1. Intentionally concealed or misrepresented any material fact or 

circumstance; 

2. Engaged in fraudulent conduct; or 

3. Made false representations; 

relating to this insurance and/or in connection with any accident or loss for 

which coverage is sought under this policy. 

Compl. 22, ECF No. 1-2 (emphasis in original). The parties dispute whether Ms. Mullins's 

alleged misrepresentations preclude coverage as to Mr. Mullins under this fraud provision. This 

Court, having reviewed the terms and conditions of the underlying policy, can only derive a 

single reasonable plain meaning from the terms of the fraud provision: coverage is not provided 

to an insured party who commits a fraudulent act. As a result, this provision only applies to Mr. 

Mullins to the extent that he committed a fraudulent act as defined in the contract. 

II. Motion in Limine 

Mr. Mullins also moves to exclude audio recordings of conversations between Ms. 

Mullins and IDS on October 5, 2013 (Ex. B) and January 24, 2014 (Ex. D) under ORS §§ 

4 Insured means: 

1. You or a resident relative. 

2. Any person using your insured vehicle. 

3. Any person or organization but only with respect to legal responsibility for acts or 

omissions of: 

a. A person covered under this Part while using your insured vehicle; or 

b. You or a resident relative covered under this Part while using a vehicle or trailer 

other than your insured vehicle if the vehicle or trailer is not owned or hired by 

that person or organization .... 

Compl. 10, ECF No. 1-2. 

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742.013 and 742.016. See Def. Ryan Mullins's Mot. in Limine 1-4, ECF No. 35. Those statutory 

provisions provide in relevant part: 

ORS § 742.013 

(1) All statements and descriptions in any application for an insurance 

policy by or in behalf of the insured, shall be deemed to be representations 

and not warranties. Misrepresentations, omissions, concealments of facts 

and incorrect statements shall not prevent a recovery under the policy 

unless the misrepresentations, omissions, concealments of fact and 

incorrect statements: 

(a) Are contained in a written application for the insurance policy, and 

a copy of the application is indorsed upon or attached to the insurance 

policy when iss11ed; 

(b) Are shown by the insurer to be material, and the insurer also shows 

reliance thereon; and 

(c) Are either: 

(A) Fraudulent; or 

(B) Material either to the acceptance of the risk or to the hazard 

assumed by the insurer. 

ORS § 742.016 

(1) Except as provided in ORS 742.043, every contract of insurance shall 

be construed according to the terms and conditions of the policy. When 

the contract is made pursuant to a written application therefor, if the 

insurer delivers a copy of such application with the policy to the insured, 

thereupon such application shall become a part of the insurance policy. 

Any application that is not so delivered to the insured shall not be a part of 

the insurance policy and the insurer shall be precluded from introducing 

such application as evidence in any action based upon or involving the 

policy. Any oral representations by the insured that are not included in an 

application shall not be a part of the insurance policy and the insurer shall 

be precluded from introducing such representations as evidence in any 

action based upon or involving the policy. 

Mr. Mullins, in reliance on these provisions, contends that IDS "is not entitled to use" the 

exhibits because they "are oral representations that were not included in a written application 

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which was made part of the insurance policy when issued." Def. Ryan Mullins's Mot. in Limine 

2, ECF No. 35. In response, IDS argues that these provisions are not rules of evidence and that 

the recordings are relevant as to whether Mr. Mullins qualifies as a "resident relative" at the time 

of the accident. Because of limitations in the briefings and IDS's evolving theory of the case, this 

Court declines to exclude all consideration of these exhibits at this time. 5 For example, if Mr. 

Mullins did not reside in Ms. Mullins's household at the time of the accident, then these 

recordings, particularly exhibit D, support IDS's theory independent of any contract 

interpretation relating to misrepresentation. 

CONCLUSION 

For these reasons, defendant's motion for partial summary judgment, ECF No. 29, is 

GRANTED IN PART and DENIED IN PART, and defendant's motion in limine to exclude 

evidence, ECF No. 35, is GRANTED IN PART and DENIED IN PART. The parties shall confer 

to determine whether an amended complaint is necessary. If an agreement is not reached, IDS 

shall submit an amended complaint clarifying its sought declaratory relief within thirty days of 

the date of this order. 

IT IS SO ORDERED. 

DATED this 12th day of May, 2015. 

Michael J. McShane 

United States District Judge 

5 This Court notes that § 742.0 13( 1) "limits the circumstances under which an insurer may rescind the insurance 

contract." James River Ins. Co. v. Breitenbush Hot Springs & Conference Ctr., No. Civ. 04-6139-HO, 2005 WL 

1278942, at *1 (D. Or. May 25, 2005). 

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