Case Name: Donald ROERING, as trustee for the heirs of Randy Donald Roering, decedent, Appellant, v. GRINNELL MUTUAL REINSURANCE COMPANY, Respondent
Court: Minnesota Supreme Court
Jurisdiction: Minnesota
Decision Date: 1989-09-01
Citations: 444 N.W.2d 829
Docket Number: No. C1-88-2213
Parties: Donald ROERING, as trustee for the heirs of Randy Donald Roering, decedent, Appellant, v. GRINNELL MUTUAL REINSURANCE COMPANY, Respondent.
Judges: 
Reporter: North Western Reporter 2d
Volume: 444
Pages: 829–836

Head Matter:
Donald ROERING, as trustee for the heirs of Randy Donald Roering, decedent, Appellant, v. GRINNELL MUTUAL REINSURANCE COMPANY, Respondent.
No. C1-88-2213.
Supreme Court of Minnesota.
Sept. 1, 1989.
Michael Fargione, Haver, Lewis & Far-gione, P.A., Minneapolis, for appellant.
Kay Nord Hunt, Y. Owen Nelson, Kathryn H. Davis, Lommen, Nelson, Cole & Stageberg, P.A., Minneapolis, for respondent.

Opinion:
POPOVICH, Chief Justice.
Pursuant to Minn.Stat. § 480.061 (1988) the Honorable Edward J. Devitt, of the United States District Court, District of Minnesota, Sixth Division, certified the following questions to this court after denying a motion to dismiss:
1. Does Minn.Stat. § 65B.49, subd. 3a(7), preclude underinsured motorist coverage where the motorcycle is an insured vehicle but not for uninsured/underinsured motorist coverage?
2. Pursuant to Minn.Stat. § 65B.49, subd. 3a(5), when a person is injured while operating his own motorcycle which is insured for liability coverage only, is he considered to be "occupying a motor vehicle" for purposes of claims to underinsured motorist benefits?
3. May an insurer enforce an exclusion in its policy of insurance which provides that underinsured motorist coverage does not apply to bodily injury sustained by a person "while occupying a motor vehicle owned by you or a relative for which insurance is not afforded under this part, or when struck by the motor vehicle"?
I.
In its order of October 20, 1988, the federal district court set forth the following facts giving rise to the certified questions:
On September 9, 1986, Randy Donald Roering was involved in a collision with a motor vehicle operated by Kenneth Proell. Randy Roering was operating a motorcycle he owned and was killed as a result of the collision. The motorcycle, which was owned and operated by Randy Roering, was insured through a policy of insurance issued by Foremost Insurance Company. This policy did not provide uninsured/underinsured motorist coverage.
On the date of the accident, Donald Roer-ing, the deceased's father, was insured by respondent Grinnell Mutual Reinsurance Company. Randy Roering was a member of Donald Roering's household on September 9, 1986. The Grinnell policy of insurance contained underinsured motorist coverage in the amount of $50,000. The vehicles for which insurance was afforded under Grinnell's policy issued to Donald Roering were a 1977 GMC pickup truck and a 1979 Chevrolet Caprice.
Donald Roering submitted a claim to Grinnell Mutual for underinsured motorist benefits to cover the accident of September 9,1986, when his son was riding the motorcycle. Grinnell denied coverage, pursuant to the exclusions portion of Donald Roer-ing's policy governing uninsured/underin-sured motorist coverage. The policy states:
This coverage [uninsured motorist/underinsured motorist] does not apply to bodily injury sustained by a person:
(1) while occupying a motor vehicle owned by you or a relative for which insurance is not afforded under this part, or when struck by the motor vehicle.
(Emphasis in original).
Donald Roering, as trustee for the heirs of Randy Donald Roering, decedent, brought this action seeking a declaration by the federal district court, pursuant to 28 U.S.C. § 2201 (1982), establishing the rights and obligations of the parties under Minnesota law and the insurance policy issued by Grinnell Mutual Reinsurance Company.
II.
Minn.Stat. § 65B.49, subd. 3a(7)
Respondent argues that underin-sured motorist coverage under the Grinnell policy is precluded by Minn.Stat. § 65B.49, subd. 3a(7). The statute provides in pertinent 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.
Under subdivision 3a(7), an insured operating a motor vehicle owned by the insured, but not covered by insurance, is precluded from obtaining uninsured or underinsured motorist coverage under a policy issued on another car for which he is insured. This policy is designed to encourage motor vehicle owners to secure insurance on all of their vehicles. See Balderrama v. Milbank Mutual Ins. Co., 324 N.W.2d 355, 358 (Minn.1982).
Appellant argues that Randy Roering was occupying an "insured motor vehicle" at the time of his accident and therefore is eligible to receive uninsured and underin-sured motorist coverage under his father, Donald Roering's, policy. Randy Roering purchased the necessary level of coverage required by Minn.Stat. § 65B.48, subd. 5 (1988), the Minnesota statute governing insurance for motorcycles. The insurance policy on his motorcycle contained only liability coverage and did not have any provision for underinsured motorist coverage, since such coverage is not required for motorcycles in Minnesota.
In Hanson v. American Family Mutual Ins. Co., 417 N.W.2d 94 (Minn.1987), we interpreted the language of Minn.Stat. § 65B.49, subd. 3a(7). The plaintiff Thomas Hanson was injured when an uninsured jeep struck the uninsured motorcycle he was operating. In addition to the motorcycle, Hanson owned a 1974 Ford pickup truck at the time of the accident. The truck was insured by defendant American Family under a policy that included uninsured motorist coverage in the amount of $25,000 per person. Hanson filed a claim under the policy on his pickup truck, alleging that coverage extended to an accident that occurred while he was operating his motorcycle. We denied coverage to Hanson based on our reading of the intent of the legislature in enacting subdivision 3a(7) under the 1985 amendments to the No-Fault Act:
The amendments also designated the occupied motor vehicle as the primary source of uninsured or underinsured motorist coverage, and otherwise limited the occupant's ability to collect additional like coverage. Minn.Stat. § 65B.49, subd. 3a(5). The legislature hoped, by these changes, to stem rising insurance costs, which it traced in part to prior law requiring expansive interpretation of vehicle insurance coverage. Allowing a claimant to extend uninsured motorist coverage from an automobile to an owned but uninsured motorcycle runs counter to the thrust of the 1985 legislation.
Id. at 96 (citation omitted).
This case differs from Hanson since Roering's motorcycle was fully insured under the law. Judge Devitt reached the same conclusion in denying respondent's motion to dismiss:
Section 65B.49, subd. 3a(7), as construed in Hanson, does not preclude coverage in this case because here the motorcycle was insured, not uninsured. Following the Hanson court's lead, this court looks to the definition of "uninsured motor vehicle" in § 65B.43, subd. 16, for guidance in construing "insured motor vehicle'*' in § 65B.49, subd. 3a(7). From that definition, the court concludes that decedent's motorcycle was an "insured motor vehicle" for purposes of subd. 3a(7) because it carried the mandatory coverage required by the Act. Subdivision 3a(7) does not preclude coverage where "the occupied vehicle is an insured motor vehicle."
Since Roering carried the necessary amount of insurance required under the law, his motorcycle qualifies as an "insured motor vehicle" under subdivision 3a(7). We agree with the federal district court and answer the first certified question in the negative.
III.
Minn.Stat. § 65B49, subd. 3a(5)
Minn.Stat. § 65B.49, subd. 3a(5) provides:
(5) If at the time of the accident the injured person is occupying a motor vehicle, the limit of liability for uninsured and underinsured motorist coverages available to the injured person is the limit specified for that motor vehicle. However, if the injured person is occupying a motor vehicle of which the injured person is not an insured, the injured person may be entitled to excess insurance protection afforded by a policy in which the injured party is otherwise insured. The excess insurance protection is limited to the extent of covered damages sustained, and further is available only to the extent by which the limit of liability for like coverage applicable to any one motor vehicle listed on the automobile insurance policy of which the injured person is an insured exceeds the limit of liability of the coverage available to the injured person from the occupied motor vehicle.
If at the time of the accident the injured person is not occupying a motor vehicle, the injured person is entitled to select any one limit of liability for any one vehicle afforded by a policy under which the injured person is insured.
This subdivision provides different levels of coverage for an injured person based on whether he was "occupying a motor vehicle" at the timé of the accident. If the injured person is occupying a motor vehicle under the policy of which he is an insured, his limit of liability for uninsured and underinsured motorist coverage is the limit specified for that particular motor vehicle. If the injured person is not occupying a motor vehicle, he is entitled to select any one limit of liability afforded by another policy under which he is insured.
Appellant argues that Roering was not "occupying a motor vehicle" at the time of his accident since a motorcycle is not a "motor vehicle" under this statute. Minn. Stat. § 65B.43 (1988) sets forth three definitions involving the term "motor vehicle":
Subd. 2. "Motor vehicle" means every vehicle, other than a motorcycle or other vehicle with fewer than four wheels, which (a) is required to be registered pursuant to chapter 168, and (b) is designed to be self-propelled by an engine or motor for use primarily upon public roads, highways or streets in the transportation of persons or property, and includes a trailer with one or more wheels, when the trailer is connected to or being towed by a motor vehicle.
Subd. 16. "Uninsured motor vehicle" means a motor vehicle or motorcycle for which a plan of reparation security meeting the requirements of sections 65B.41 to 65B.71 is not in effect.
Subd. 17. "Underinsured motor vehicle" means a motor vehicle or motorcycle to which a bodily injury liability policy applies at the time of the accident but its limit for bodily injury liability is less than the amount needed to compensate the insured for actual damages.
Motorcycles are excluded from the general definition of "motor vehicle" in subdivision 2, but are considered motor vehicles when the motorcycle is uninsured or underin-sured as defined in subdivisions 16 and 17.
In past cases we have held that motorcycles are motor vehicles when the motorcycle involved in the accident was either uninsured or underinsured. See Hanson v. American Family Mutual Ins. Co., 417 N.W.2d 94, 96 (Minn.1987) (plaintiff injured when an uninsured jeep struck the uninsured motorcycle he was operating); Gudvangen v. Austin Mutual Ins. Co., 284 N.W.2d 813, 817 (Minn.1978) (minor injured while a passenger on an uninsured motorcycle). In the present case, Randy Roer-ing's motorcycle was fully insured and does not qualify as an uninsured or underin-sured vehicle under subdivisions 16 or 17. Thus, the general definition of "motor vehicle" contained in subdivision 2 applies in this case and Roering's motorcycle does not qualify as a motor vehicle under that definition. Since Roering was not "occupying a motor vehicle" under Minn.Stat. § 65B.49, subd. 3a(5) at the time of the accident, he is entitled to select any one limit of liability for any one vehicle afforded by a policy under which he is insured. We answer the second certified question in the negative.
IV.
The Grinnell Policy Exclusion
Appellant argues that restrictive language in the Grinnell policy conflicts with the 1985 Minnesota law mandating underinsured motorist coverage and therefore is unenforceable. Donald Roering's policy provides:
This coverage [uninsured motorist/underinsured motorist] does not apply to bodily injury sustained by a person:
(1) while occupying a motor vehicle owned by you or a relative for which insurance is not afforded under this part, or when struck by the motor vehicle.
(Emphasis in original). As a result of this exclusionary language, appellant would be unable to obtain coverage under the Grin-nell policy. Since Randy Roering's motorcycle was a "vehicle owned by you or a relative" but was not "afforded insurance" under the Grinnell policy, the exclusion would apply and he would not qualify for coverage.
This court has held that contract provisions which conflict with statutory law will not be enforced. AMCO Ins. Co. v. Lang, 420 N.W.2d 895, 900 (Minn.1988); Burgraff v. Aetna Life & Casualty Co., 346 N.W.2d 627, 632 (Minn.1984). Under the facts of this case, Grinnell's exclusion would deny appellant coverage guaranteed under the No-Fault Act. The Act provides that:
If at the time of the accident the injured person is not occupying a motor vehicle, the injured person is entitled to select any one limit of liability for any one vehicle afforded by a policy under which the injured person is insured.
Minn.Stat. § 65B.49, subd. 3a(5). The Grin-nell policy language results in an exclusion broader than permitted under the No-Fault Act. Although appellant would be entitled to recover under the Act, the policy exclusion restricts his recovery to accidents occurring with vehicles owned by himself or a relative that are afforded insurance by Grinnell. Such an exclusion conflicts with the coverage guaranteed by the No-Fault Act and is invalid. Therefore, appellant is not excluded from underinsured coverage under Donald Roering's policy. We answer the third certified question in the negative.
Certified questions answered.
. Minn.Stat. § 65B.48, subd. 5 provides:
Subd. 5. Every owner of a motorcycle registered or required to be registered in this state or operated in this state by the owner or with the owner's permission shall provide and maintain security for the payment of tort liabilities arising out of the maintenance or use of the motorcycle in this state. Security may be provided by a contract of liability insurance complying with section 65B.49, subdivision 3, or by qualifying as a self insurer in the manner provided in subdivision 3.
. The dissent relies on 1974 legislative history to interpret the meaning of "insured" status under Minn.Stat. § 65B.49, subd. 3a(7). Subdivision 3a(7), however, was not discussed by the legislature in 1974 and was not adopted until the No-Fault Act of 1985.
. The certified question asks broadly whether an exclusion similar to the one in the Grinnell policy is enforceable. We limit our answer to the facts of the present case and the particular exclusion contained in the Grinnell policy.