Opinion ID: 4025596
Heading Depth: 3
Heading Rank: 1

Heading: Written Trailer Interchange Agreement

Text: Robbins argues that there is insufficient evidence to con‐ clude that the trailer involved in the accident was part of a “written trailer interchange agreement” between Hoker and Lakeville, rendering inapplicable the endorsement’s second exclusion. Robbins is correct. The evidence offered by Great West to support the asser‐ tion that the trailer involved in the accident was subject to a written trailer interchange agreement is: (1) a 2006 trailer in‐ terchange agreement between a “Shipper” and a “Carrier,” and (2) Robbins’s discovery admission that “the trailer that Phillips was pulling at the time of the Accident was being used under a Trailer Exchange Agreement between Hoker and [Lakeville].” The trailer interchange agreement offered by Great West does not indicate who the parties to the agree‐ ment are. Illegible signatures and handwriting appear below the signature blocks for the “Shipper” and “Carrier,” which make it impossible to determine whether this is a “written trailer interchange agreement” between Lakeville and Hoker. As for Robbins’s admission, it did not request Robbins to ad‐ mit that the trailer interchange (“or exchange”) agreement was written. The agreement could have been oral and there‐ fore would not qualify for exclusion under the Great West policy. Reviewing this evidence and drawing all reasonable infer‐ ences in the estate’s favor, we find Great West has not pro‐ duced sufficient evidence so as to leave no genuine issue of material fact regarding whether the trailer was subject to a “written Trailer Interchange Agreement.” 14 No. 15‐1181 2. Trailer Used in a Business Other Than Lakeville’s This conclusion, however, does not affect our decision to affirm summary judgment because the Great West policy en‐ dorsement excludes Hoker and Phillips as “[a]nyone who has leased …rented, or borrowed an ‘auto’ from you that is used in a business other than yours.” For this exclusion to apply, Great West must demonstrate that: (1) Hoker and Phillips “rented” or “borrowed” (2) an “auto” (3) to be used in a busi‐ ness other than Lakeville’s. It is uncontested that the trailer is an “auto” under the Great West policy, so we look to the other two elements of the exclusion. Robbins’s own discovery responses confirm that there is no genuine dispute over the fact that Hoker and Phillips “rented” or “borrowed” the trailer. The term “borrowed” is undefined in the policy. Where a term is undefined under a policy, Minnesota courts permit a court to consult a diction‐ ary to determine the ordinary meaning of a word. See Hubred, 442 N.W.2d at 311; Wakefield Pork, Inc. v. Ram Mut. Ins. Co., 731 N.W.2d 154, 160 (Minn. Ct. App. 2007). Rent means “to take and hold under an agreement to pay rent.” Webster’s Third New Int’l Dictionary. Borrow means “to receive temporarily from another, implying or expressing the intention of either of returning the thing received or of giving its equivalent to the lender.” Id. Robbins admitted in discovery that “the trailer that Phil‐ lips was pulling at the time of the Accident was being used under a Trailer Interchange Agreement between Hoker and [Lakeville].” In the same discovery responses, Robbins admit‐ ted that “Hoker was using the trailer owned by [Lakeville] with [Lakeville’s] permission.” Finally, in response to inter‐ No. 15‐1181 15 rogatories served by Great West, Robbins stated that Lake‐ ville “was being paid for the use of the trailer.” Taken to‐ gether, the only two reasonable inferences from these state‐ ments are that: (1) Lakeville allowed Hoker to use its trailer in exchange for payment; and (2) Hoker temporarily possessed the trailer with the intent of returning it to Lakeville. Having established that Hoker and Phillips “rented” and “borrowed” the trailer, we must determine whether the trailer was being used in a business other than Lakeville’s. Robbins does not dispute that the trailer was being used in Hoker’s business, which is moving freight. Instead, the estate con‐ tends that it was being used at the same time in furtherance of Lakeville’s business, which also is moving freight. To support its position, the estate relies on Scottsdale Insur‐ ance Company v. Transport Leasing/Contract, Inc., 671 N.W.2d 186 (Minn. Ct. App. 2003), for the proposition that “Minnesota courts recognize that a vehicle may be used simultaneously in the business of two trucking companies.” (Appellant Br. 32.) But, the court held, in order to find that the vehicle was used simultaneously, evidence must exist that demonstrates the in‐ sured entity had some day‐to‐day operational control over the other’s business or drivers, including employment deci‐ sions, contact with the other company’s customers, or sharing of revenue. Id. at 194. There is no evidence here that Lakeville exerted that same level of control over Hoker and Phillips. Robbins relies on lan‐ guage from the trailer interchange agreement—the same one it contends does not apply to the trailer—to support its posi‐ tion that Lakeville had the requisite control. Notwithstanding the fact that we cannot determine who the parties to the agree‐ ment are, the provisions in the agreement do not establish that 16 No. 15‐1181 Lakeville exerted any control over the manner in which Hoker moved freight or over its drivers. That Lakeville may have “assigned” work to Hoker does not mean that it had the right to determine how that work was performed or have any say in Hoker’s employment decisions, including the choice of Phillips as a driver.3 The only reasonable inferences that can be drawn from the record is that Hoker “rented” and/or “borrowed” Lakeville’s trailer and used it in furtherance of its own business, not Lak‐ eville’s. No facts give rise to a reasonable inference that on the day of the accident, the trailer was being driven in connection with Lakeville’s freight‐moving operations. Therefore, we find that this provision excludes Hoker and Phillips from cov‐ erage under the Great West policy. 3 Robbins relies on Canal Insurance Company v. Great West Casualty Com‐ pany, No. 11‐772, 2013 WL 5275789 (D. Minn. Sept. 18, 2013), to argue that because the Great West exclusion itself is ambiguous as to whether it ap‐ plies when a vehicle is being used simultaneously in the business of two parties, it must be construed in favor of granting coverage. But Robbins’s argument rests on a faulty premise. Accepting the argument that the en‐ dorsement is ambiguous on the point of whether it applies to simultane‐ ous business use does not mean that a court will just “grant coverage” to anybody. Rather, Robbins must show that she is eligible for having the ambiguity construed in her favor. The necessary prerequisite then is that she show the trailer was in fact being used “simultaneously.” It was not. The court in Canal Insurance found that there was a triable issue of fact on whether the vehicle was being used “simultaneously” because the insured company exercised a significant degree of control over the particular ve‐ hicle involved in the accident. Here, however, we have no evidence that Lakeville exercised any significant degree of control over the trailer after it was in Hoker’s possession. No. 15‐1181 17 C. Wisconsin Law’s Effect on Great West’s Policy Exclusions Robbins’s final contention is that notwithstanding the un‐ ambiguous policy language, Hoker and Phillips are covered under the Great West policy because Wisconsin law invali‐ dates the exclusions in the September 2010 endorsement to the extent those provisions exclude permissive users. We dis‐ agree. 1. Wis. Stat. § 632.32 Under Wis. Stat. § 632.32(1), (3), “every policy of insurance issued or delivered in [Wisconsin]” must “provide that: (a) Coverage provided to the named insured applies in the same manner and under the same provisions to any person using any motor vehicle described in the policy when the use is for purposes and in the manner described in the policy.” (empha‐ sis added). The statute goes on to state that “[a] policy may limit coverage to use that is with the permission of the named insured.” § 632.32(5)(a). Wisconsin courts have determined these two provisions in tandem “effectively impose[d] a per‐ missive user requirement” in every automobile insurance con‐ tract “issued or delivered” in Wisconsin. See Blasing v. Zurich Am. Ins. Co., 827 N.W.2d 909, 913 (Wis. Ct. App. 2013). Robbins contends that Great West delivered Lakeville’s policy for the purposes of § 632.32 when it filed its “Motor Carrier Certificate of Bodily Injury and Property Damage Li‐ ability Insurance” with the Wisconsin Department of Trans‐ portation. As such, Great West’s policy must conform to Wis‐ consin law and cover permissive users like Hoker and Phil‐ lips, despite policy language that excludes them from cover‐ age. 18 No. 15‐1181 Wisconsin precedent suggests Robbins’s interpretation is incorrect. In Danielson v. Gasper, 623 N.W.2d 182 (Wis. Ct. App. 2000), the court was confronted with the question of whether a policy issued and “delivered” to a Minnesota company nev‐ ertheless had to comply with the § 632.32’s requirements be‐ cause it contained an “Out of State Coverage” provision. The court found that § 632.32 “does not require a Minnesota in‐ surer issuing a policy in Minnesota to comply with statutes established for policies issued in Wisconsin” and does not ap‐ ply “to an insurance policy issued in Minnesota to a Minne‐ sota resident.” Id. at 185–86. In so holding, the court found the contract was “delivered” to a Minnesota resident who kept the covered vehicle in that state. Id. at 184. Here, the insurance policy was issued and delivered to the Minnesota‐based Lakeville by the Nebraska‐based Great West. Wren, another Minnesota‐based company, was added to the list of insureds under the policy. The facts here are suf‐ ficiently similar to Danielson that we see no reason to depart from it. Robbins attempts to get around these similarities by sug‐ gesting that the individual in Danielson did not submit his in‐ surance policy for approval with the Wisconsin Department of Transpiration. Robbins’s position has a fundamental flaw: Filing a certificate of insurance with the Wisconsin Department of Transportation is not the same as delivering an insurance pol‐ icy to an individual in Wisconsin. Certificates of insurance and insurance policies are not one and the same. The Dan‐ ielson court construed the word “delivered” from § 632.32 to mean that a policy is “delivered” when it is sent to the policy‐ No. 15‐1181 19 holder. We decline to adopt Robbins’s more expansive read‐ ing, as the estate has not directed us to any Wisconsin state precedent interpreting “delivered” in the way it suggests. Robbins also attempts to circumvent Danielson by high‐ lighting that the trailer was registered in Wisconsin. Danielson is silent on where the vehicle was registered. This fact is a dis‐ tinction without a difference. As discussed above, the policy itself was not delivered in the state of Wisconsin. It was the cer‐ tificate of insurance that was delivered in Wisconsin. Alternatively, Robbins contends that even if the policy was not “issued or delivered” in Wisconsin, the Great West policy must still conform to Wisconsin statutory requirements, in‐ cluding § 632.32’s requirement that the policy cover permis‐ sive users. For support, Robbins relies on Amery Motor Co. v. Corey, 174 N.W.2d 540 (Wis. 1970). There, the Wisconsin Su‐ preme Court invalidated an exclusion in an insurance policy issued to a Minnesota company based on the fact that the pol‐ icy contained an endorsement stating it would “conform the policy to the statutory requirements for common motor carri‐ ers of property [in Wisconsin], one of which requires the pol‐ icy to comply with the omnibus statute.” Id. at 542. According to Robbins, Great West’s policy must also conform to § 632.32 because of the certificate of insurance it filed with the state of Wisconsin and the policy endorsement stating it would “com‐ ply with the provisions of the law or regulation to the extent of the coverage and limits of insurance required by that law or regulation” in Wisconsin. But the court in Corey observed that “[w]hile these policies were issued in Minnesota they purport to be governed by Wisconsin law” as the result of a Wisconsin‐specific endorse‐ 20 No. 15‐1181 ment. Corey, 174 N.W.2d at 542. There is no such specific em‐ brace of Wisconsin law contained in the Great West policy. Ra‐ ther, there is a general endorsement that provides the policy will conform to the motor carrier financial responsibility laws in any state where the certificate is filed. In this case, this par‐ ticular certificate has been filed in Wisconsin, Iowa, Illinois, Minnesota, and North Dakota. We do not interpret that gen‐ eral contract provision to constitute a wholesale incorporation of all five of those states’ insurance laws unconditionally. Sec‐ tion 632.32 does not apply to the Great West policy.