Opinion ID: 1893197
Heading Depth: 1
Heading Rank: 1

Heading: The Language of the Policy

Text: ¶ 6. Concord General insists that coverage is barred unambiguously by Exclusion 1(f) of the Woods' homeowner's liability policy, which denies coverage to bodily injury arising out of ... the ownership, maintenance, [or] use ... of motor vehicles or all other motorized land conveyances. If the policy had stopped at this point, Concord General would have support for its argument. Section 1(f) of the policy, however, contains several exclusions to the motor vehicle exclusion. In relevant part, the policy states that [t]his [motor vehicle] exclusion does not apply to... [a] motorized land conveyance designed for recreational use off public roads, not subject to motor vehicle registration and ... owned by an `insured' and on an `insured location.' ¶ 7. Concord General argues that the Woods' ATV was subject to motor vehicle registration because 23 V.S.A. § 3502 requires registration of an ATV when it is used even occasionally on public roads, and the Woods' ATV was so registered. Frances Woods argues first that her ATV was not subject to motor vehicle registration but to registration as an ATV, which is a different kind of registration available under Vermont's motor vehicle registration statute. It is not necessary to decide the merits of this contention, however, because Woods also argues that the ATV was not subject to any kind of registration requirement since her ATV was being operated on her own property at the time of the accident. Thus, this second argument does not depend on what kind of registration Woods would have needed to operate her ATV on public roads. Regardless of whether the registration requirement would have barred coverage if the ATV was being used off Woods' property, she contends the ATV was not subject to registration, was owned by an insured and on an insured location, and therefore covered by her policy. ¶ 8. On appeal, Concord General offers four reasons that registration of an ATV under 23 V.S.A. § 3502(a) is motor vehicle registration and that Woods' act of registering her ATV precluded coverage under the policy, none of which we find convincing. First, Concord General notes that the statutory section covering registration of ATVs is located within Title 23, entitled Motor Vehicles, and that § 3502(a) requires ATV registration with the commissioner of motor vehicles. The problem with this argument is that ATVs are specifically excluded from the statutory definition of motor vehicle. 23 V.S.A. § 4(21). Concord General makes much out of the fact that ATVs must be registered if they are driven on public roads. Id. § 3502. This is irrelevant to an accident that occurred on land owned by the insured. The registration requirement covering ATVs is separate from the registration requirements imposed upon other motor vehicles and is governed by a different statutory scheme that does not require any registration whatsoever when the ATV is driven on property owned by the operator. ATV registration is established pursuant to chapter 31 of Title 23. This chapter is labeled rather unambiguously All-terrain Vehicles. The fact that the statutes governing ATV registration are separate from those governing motor vehicle registration, which are found in chapter 7, weighs heavily against Concord General's proposed interpretation of ATV registration as synonymous with motor vehicle registration. [2] For the reasons discussed in paragraph 10 below, moreover, we find that the question of what kind of registration the ATV was subject to when driven on public roads does not determine the outcome of this case. ¶ 9. Concord General's second argument is based on the case Northern Security Insurance Co. v. Rossitto, 171 Vt. 580, 762 A.2d 861 (2000) (mem.). Concord General contends that according to this Court's holding in Rossitto, a case involving insurance provisions identical to the ones in the case today, we must look to 23 V.S.A. § 3502 in determining whether or not an ATV is subject to a registration requirement. We agree, but in Rossitto we concluded that ATVs being driven on the property of the insured are not subject to registration. 171 Vt. at 583, 762 A.2d at 864 ([I]f the accident occurred on defendants' [property], the `not subject to registration' component of the exemption would have been satisfied.). In Rossitto, the question this Court faced was whether defendant's property included land over which defendant held a right-of-way, so that when the ATV in question was driven on the right-of-way no registration was required. The main factual distinction between Rossitto and this case is that in Rossitto the ATV in question had not been registered pursuant to § 3502 because the insured party did not ever use the ATV on public roads, whereas Frances Woods registered her ATV. By Concord General's own admission at oral argument, had Woods never registered her ATV or used it in a way that would require registration, Concord General would have been liable for coverage of Woods for the July 10, 1999 accident. Concord General attempts to distinguish Rossitto by claiming that the act of registration somehow altered Frances Woods' rights to insurance coverage. ¶ 10. We find that Rossitto 's essential holding, which is that ATVs are not subject to a registration requirement when operated on land owned by the ATV-owner, Rossitto, 171 Vt. at 583, 762 A.2d at 864, controls and mandates coverage in this case. Where an ATV is being operated on private property owned by the insured and covered by a homeowner's policy with the same exclusions as the policy in this case, whether an ATV is registered for use on a public road or has in fact been driven on a public road is irrelevant to whether or not there is coverage, as long as the ATV is not being operated on a public road at the time of the accident for which coverage is sought. ¶ 11. Concord General's third argument related to the phrasing of the policy is that reading motor vehicle registration to mean only registration of vehicles within 23 V.S.A. § 4(21) would render the language in the policy exclusion referring to motorized conveyances not subject to motor vehicle registration mere surplusage. Apparently Concord General denies the possibility that the words not subject to motor vehicle registration were employed by the drafters of the policy to exclude coverage for small race cars or motorcycles, which are subject to motor vehicle registration and yet could potentially be described as motorized land conveyance[s] designed for recreational use off public roads. Another possible meaning of this phrase is that ATVs are excluded from coverage when they are being driven on public roads and therefore subject to a registration requirement, while being covered as long as they are operated in such a manner that no registration is required. ¶ 12. Concord General's last argument concerning the phrasing of the policy is completely lacking in merit. Concord General contends that an ATV is a motor vehicle as that term is commonly understood regardless of the statutory definition of motor vehicle. The statutory definition excludes ATVs unambiguously. 23 V.S.A. § 4(21). Given that the disputed phrase from the policy refers to motor vehicle registration, and registration is clearly a statutorily-created process, Concord General's reliance on common usage is misplaced. Unless the phrase at issue is one where a lay reader without legal training is likely to interpret the policy to provide more coverage than it would provide using a more legalistic definition, we see no reason to turn to a dictionary rather than a statutory definition in interpreting a policy drafted by an insurance company. In this case, using a dictionary definition, as Concord General proposes, would result in less coverage than using the statutory definition, a result that conflicts with our rule of resolving ambiguity in insurance contracts in favor of the insureds. Garneau v. Curtis & Bedell, Inc., 158 Vt. 363, 367, 610 A.2d 132, 134 (1992).