Opinion ID: 2308721
Heading Depth: 1
Heading Rank: 5

Heading: coverage under globe's garage policy

Text: Section II.A.1.a of the Garage policy provides coverage for anyone using, with Lee Dodge's permission, a covered auto except for [Lee Dodge's] customers, if [the] business is shown in the Declarations as an `auto' dealership. Although the policy provisions provide coverage for a customer whose other available insurance is less than that mandated by law, [2] the plain language of the policy leads us to agree with the Superior Court that, because Jordan was a customer of Lee Dodge, and because Lee Dodge is shown in the declarations as an auto dealership, a fact stipulated to by the parties, Jordan is excluded from primary coverage. Jordan and Keystone attempt to distinguish between Lee Dodge's business as an auto dealership and its rental business. They contend that Jordan was a customer not of the auto dealership, but rather of what they contend is a separate rental business with a separate location in Westbrook. Therefore, they argue, the exclusion for auto dealership customers does not apply. We are unpersuaded by that contention. The Garage policy covers Lee Dodge as a business entity. Lee Dodge is an automobile dealership, and is identified as such in the declarations. The rental of automobiles is an integral part of the business of automobile dealerships. Accordingly, because Jordan was Lee Dodge's customer, the Garage policy by its own terms provides no coverage for her use of the Lee Dodge vehicle. Jordan and Keystone also contend that Jordan is covered under the Garage policy pursuant to Section II.B.7 that excludes from coverage: Any covered auto while leased or rented to others. But this exclusion does not apply to a covered auto you rent to one of your customers while their auto is left with you for service or repair. Jordan and Keystone rely on Stanfield v. Hartford Accident & Indem. Co., 581 So.2d 340 (La.Ct.App.1991) and Connecticut Indem. Co. v. Cordasco, 369 Pa.Super. 439, 535 A.2d 631 (1987). Those cases held that provisions similar to Section II.B.7 covered customers who left an auto for repair as exceptions from the general exclusion for customers of the auto dealership. We are unpersuaded, however, by the holdings in those cases because they are contrary to the basic principle of insurance law that coverage cannot be provided by an exclusion clause. An exclusion clause can subtract from coverage granted somewhere else in the policy; it alone cannot establish coverage. Peerless Ins. Co. v. Brennon, 564 A.2d 383, 387 (Me. 1989). The Superior Court correctly construed Section II.A.1.a of the Garage policy to exclude coverage for Jordan because she was a customer; the exception from exclusion in Section II.B.7 cannot in and of itself create coverage that is not otherwise provided. Nevertheless, 24-A M.R.S.A. § 2909 (1990) and 29 M.R.S.A. § 832 (Supp.1992) [3] require a certain level of coverage for Jordan even though the Garage policy excludes her by its terms. These statutory mandates ($20,000 per person, $40,000 per occurrence, $10,000 property damage) override any contrary provisions in the Garage policy and result in Jordan being covered as a primary insured in the mandatory minimum amounts. See Government Employees Ins. Co. v. Concord Gen. Mut. Ins. Co., 458 A.2d 1205, 1208-09 (Me.1983).