Opinion ID: 1584356
Heading Depth: 2
Heading Rank: 2

Heading: Whether a Reasonable Policyholder Would Expect Coverage Under These Facts

Text: Sand Livestock argues Bituminous should be required to provide coverage based on the doctrine of reasonable expectations, which Iowa recognizes. Sand Livestock claims an ordinary lay person would not comprehend the breadth of the pollution exclusions. An insured may utilize the doctrine of reasonable expectations to avoid an exclusion that `(1) is bizarre or oppressive, (2) eviscerates a term to which the parties have explicitly agreed, or (3) eliminates the dominant purpose of the policy.' Iowa Comprehensive Petroleum Underground Storage Tank Fund Bd. v. Federated Mut. Ins. Co., 596 N.W.2d 546, 551 (Iowa 1999) (quoting Benavides v. J.C. Penney Life Ins. Co., 539 N.W.2d 352, 356 (Iowa 1995)). However, in order for the doctrine to apply, the insured must show `circumstances attributable to the insurer that fostered coverage expectations' or that `the policy is such that an ordinary layperson would misunderstand its coverage.' Id. (quoting Benavides, 539 N.W.2d at 357). Because this case comes to us as a certified question from the federal district court, this issue is not properly before us. Iowa Code section 684A.1 (2003) gives this court the power to answer certified questions of law. The applicability of the doctrine of reasonable expectations is a question of fact that is not within the scope of chapter 684A. Wright v. Brooke Group Ltd., 652 N.W.2d 159, 170 n. 1 (Iowa 2002). Sand Livestock and Mrs. Gossage are free to argue the doctrine of reasonable expectations to the federal district court.