Opinion ID: 725427
Heading Depth: 2
Heading Rank: 1

Heading: Policy Terms: Live With and Relative

Text: Trevino argues that the district court should have adopted an expansive reading of the clause lives with you and thus it was error to conclude that because Trevino did not stay in the condominium with Ekeburg year-round, that Trevino did not live with Ekeburg. Trevino argues that the district court failed to take into account Ekeburg's subjective intent as to the Laguna Hills address. Trevino also argues that the clause lives with you is ambiguous and should be interpreted against State Farm. State Farm represents that the California courts have not interpreted the clause lives with in an insurance policy. Trevino does not disagree and the court is aware of no California authority on this specific issue. Trevino relies upon National Automobile & Casualty Ins. Co. v. Underwood, 9 Cal.App. 4th 31, 11 Cal.Rptr.2d 316 (1992) to support her contention that the clause lives with you must be interpreted broadly so as to find coverage. In National, the California appellate court concluded that the term resident in an automobile liability clause which excluded injuries of residents of the insured's household was ambiguous when applied to children of divorced parents subject to joint physical custody. Id. at 41-42. The Court finds the analysis of the insurance provision in National inapplicable to the instant case since it interprets the term resident and construes the exclusion, rather than the extension, of coverage. Trevino provides no authority which makes lives with and resident interchangeable. Under statutory rules of contract interpretation, the mutual intention of the parties at the time the contract is formed governs interpretation. Such intent is to be inferred, if possible, solely from the written provisions of the contract. AIU Ins. Co. v. Superior Court, 51 Cal.3d 807, 821-22, 799 P.2d 1253, 1264, 274 Cal.Rptr. 820, 831 (Cal.1990) (citing Cal.Civ.Code §§ 1636, 1639). Words used in an insurance policy are to be interpreted according to the plain meaning which a layman would ordinarily attach to them. Courts will not adopt a strained or absurd interpretation in order to create ambiguity when none exists. Reserve Ins. Co. v. Pisciotta, 30 Cal.3d 800, 807, 640 P.2d 764, 768, 180 Cal.Rptr. 628, 632 (1982). The provisions are thus interpreted in their ordinary and popular sense. AIU Insurance, 51 Cal.3d at 822 (citing Cal.Civ.Code § 1638). In addition, language in an insurance policy must be construed in the context of the policy as whole and within the circumstances of the particular case. La Jolla Beach & Tennis Club Inc. v. Indus. Indem. Co., 9 Cal.4th 27, 37, 884 P.2d 1048, 1053, 36 Cal.Rptr.2d 100, 105 (1994) (citing Bank of the West v. Superior Court, 2 Cal.4th 1254, 1265, 833 P.2d 545, 552, 10 Cal.Rptr.2d 538, 545 (1992)). Policy language cannot be found to be ambiguous in the abstract. Id. The district court found that Trevino had submitted no evidence that she lived with Ekeburg and that, to the contrary, the evidence submitted demonstrated that they did not live with each other. The court cannot find that this conclusion was in error as the plain meaning of lives with you simply does not contemplate circumstances such as Trevino and Ekeburg's living arrangements. Trevino provides no authority for her contention that the district court must take into account her and Ekeburg's subjective intent that the Laguna Hills condominium be their residence and thus find that they lived with each other. It appears that the California courts reject this argument. See Dalton v. Metropolitan Property & Liability Ins. Co., 136 Cal.App.3d 1037, 1041, 186 Cal.Rptr. 685, 688 (1982) (rejecting rule making determination of whether husband and wife are residents of same household turn on their subjective intent). To the extent that Trevino is arguing that Ekeburg understood his living situation to constitute living with Trevino, and that State Farm must have known of that understanding, when it sold the policy, the law requires that an insured's expectations be objectively reasonable. AIU Insurance, 51 Cal.3d at 822, 799 P.2d at 1264, 274 Cal.Rptr. at 831; Bank of the West, 2 Cal. 4th at 1265, 833 P.2d at 552, 10 Cal.Rptr.2d at 545. The Court cannot find that it is reasonable to interpret Trevino's living arrangements as living with her son. The district court's judgment is sustained on this ground.