Court Opinion

ID: 3139800
Source: CourtListenerOpinion
Date Created: 2015-10-22 17:50:09.535499+00
Date Added: 2024-06-11T12:47:04.633259
License: Public Domain

No. 3--05--0524
_________________________________________________________________
Filed August 15, 2006.
                                 IN THE

                          APPELLATE COURT OF ILLINOIS

                                   THIRD DISTRICT

                               A.D., 2006
_________________________________________________________________

STANDARD MUTUAL INSURANCE         ) Appeal from the Circuit Court of the 13th
COMPANY,                          ) Judicial Circuit, Grundy County, Illinois,
                                  )
     Plaintiff-Appellee,          )
                                  )
     v.                           )
                                  ) No. 03--CH--89
JOHN D. MARX,                     )
                                  )
     Defendant,                   )
                                  )
     and                          )
                                  )
M&S RENTALS, INC., and            )
SPRINGFIELD FIRE & CASUALTY       ) Honorable
COMPANY,                          ) Lance
                                    Judge,R.  Peterson,
                                            Presiding.
                                  )
     Defendants-Appellants.       )
_________________________________________________________________

     JUSTICE SLATER delivered the opinion of the court:
_________________________________________________________________

      After a fire occurred in a storage unit rented by defendant John Marx,

plaintiff Standard Mutual Insurance Company filed a declaratory judgment action to

determine its obligations to Marx under a homeowner's insurance policy. Also named

as defendants were M&S Rentals, Inc. (M&S), the owner of the storage facility, and its

insurer, Springfield Fire and Casualty Insurance Company (Springfield), which sought to

recover from Marx for damage caused to the storage facility. The trial court granted
summary judgment in favor of plaintiff, finding that the motorcycle which caused the fire

was excluded from coverage under the policy. On appeal, M&S and Springfield

(hereinafter "defendants" 1) contend that the trial court erred in finding that Marx's

motorcycle was not in "dead storage." We affirm.

                                            Facts

       Marx rented two bays in a storage facility owned by M&S in Morris, Illinois.

Among the items stored in the bays were four motorcycles which Marx considered to be

collector's items: a 1976 Honda Goldwing; a 1980 Honda Goldwing; and two 1979

Yamaha 750 cc motorcycles. Only the 1980 Honda was licensed and insured. Marx

would occasionally operate the three unlicensed motorcycles in the parking lot of the

storage facility. On September 1, 2003, Marx went to the storage facility and tried to

start one of the 1979 Yamahas. He had last ridden it a month earlier. Marx used the

foot pedal to prime the cycle and pushed the electric start button. There was an

explosion and Marx was thrown from the motorcycle. After unsuccessfully trying to put

out the ensuing fire with a towel, Marx called 911. The fire damaged both Marx's

belongings and the storage facility. M&S, through its insurer, Springfield, subsequently

made a claim against Marx for damages caused by the fire in excess of $177,000.

Marx sought a defense and coverage under his homeowner's policy issued by plaintiff,

which responded with a reservation of rights and a declaratory judgment action. The

trial court granted summary judgment in favor of plaintiff, finding that the

       1
              Defendant Marx did not file a notice of appeal. His motion for leave to
adopt the brief and argument of M&S and Springfield was denied by this court.

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motorcycle was excluded from coverage and that an exception to the exclusion for

vehicles in "dead storage" did not apply. This appeal followed.

                                          Analysis

       In construing the language of an insurance policy, the primary objective is to

ascertain and give effect to the intent of the parties; the policy must be construed as a

whole, taking into account the type of insurance, the nature of the risks involved and the

overall purpose of the contract. Travelers Insurance Co. v. Eljer Manufacturing, Inc.,

197 Ill. 2d 278, 757 N.E.2d 481 (2001). Construction of the provisions of an insurance

policy is a question of law subject to de novo review. Eljer, 197 Ill. 2d 278, 757 N.E.2d
481.

       The homeowner's policy issued to Marx by plaintiff excluded liability and medical

payments coverage for injury or property damage arising out of:

       "The ownership, maintenance, use, loading or unloading of motor vehicles

       or all other motorized land conveyances, including trailers, owned or

       operated by or rented or loaned to an 'insured'[.]"

       The policy further provided, however, that the exclusion did not apply to:

       "A vehicle or conveyance not subject to motor vehicle registration which is:

                                            ***

       (c) In dead storage on an 'insured location'[.]"

       Defendants maintain that the trial court erroneously found

that the motorcycle was not in dead storage.                    As there are no

reported cases in Illinois construing that phrase, defendants rely

on several cases from other jurisdictions for the proposition

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that a vehicle can be in dead storage even when it is being

started or is undergoing maintenance.   See Allstate Insurance Co.

v. Burns, 837 N.E.2d 645 (Ind. Ct. App. 2005) (unlicensed car

which had been inoperable for over a month was in dead storage

notwithstanding that fire occurred while insured was attempting

to start car); Allstate Insurance Co. v. Geiwitz, 86 Md. App.
704, 587 A.2d 1185 (1991) (car kept by insured as collectible

rather than for transportation was in dead storage despite fact

that car was occasionally driven on property where it was stored

and accident occurred while repairing gas gauge); Nationwide

Mutual Fire Insurance Co. v. Allen, 68 N.C. App. 184, 314 S.E.2d
552 (1984) (motorcycle which had been inoperable for six months

prior to fire caused when insured was "inspecting" cycle in his

living room was in dead storage); Sharpe v. State Farm Fire &

Casualty Co., 558 F. Supp. 10 (E.D. Tenn. 1982) (old, unlicensed

vehicles that were not driven on highway but were occasionally

driven on insured's property were in dead storage).

     Plaintiff, on the other hand, relies on cases holding that a

vehicle which is undergoing maintenance or is being started is

not in dead storage.   See, e.g., Nationwide Mutual Insurance Co.

v. McMahon, 365 F. Supp. 2d 671 (E.D. N.C. 2005) (car undergoing

maintenance by priming carburetor in attempt to start it was not

in dead storage); David v. Tanksley, 218 F.3d 928 (8th Cir.

2000) (same); North Star Mutual Insurance Co. v. Carlson, 442
N.W.2d 848 (Minn. Ct. App. 1989) (same); Holliman v. MFA Mutual

                                 4
Insurance Co., 289 Ark. 276, 711 S.W.2d 159 (1986) (same);

Broadway v. Great American Insurance Co., 465 So. 2d 1124 (Ala.

1985) (same); see generally, Annotation, Liability Insurance:

When is Vehicle in "Dead Storage", 48 A.L.R. 4th 591 (1986).      Our

review of these authorities leads us to the same conclusion

reached by the trial court: a vehicle is not in dead storage when

a person is attempting to start it.   As the Minnesota Court of

Appeals explained in Carlson:

     "We believe this determination appropriately highlights

     the distinction between homeowners and automobile

     insurance policies.   Motor vehicles are inherently

     dangerous instrumentalities and homeowners policies

     generally do not contemplate coverage of injuries when

     the vehicle is maintained or used in one of its

     inherently dangerous capacities.   One inherently

     dangerous aspect is a motor vehicle's use of highly

     volatile materials (gasoline) around ignition sources

     (spark plugs).   This was precisely the cause of the

     accident in this case.   Accidents caused by maintenance

     or use of a vehicle in such an inherently dangerous

     capacity are not appropriately covered in a homeowners

     policy, but rather in an automobile policy which

     requires consequently higher premiums for the increased

     risk of injury."   Carlson, 442 N.W.2d at 855.
     We believe that this analysis properly focuses on the

vehicle's status at the time the accident occurred.    For example,

                                 5
if the fire at the rental facility had been caused by spontaneous

combustion of oily rags while Marx was absent, the Yamaha might

very well have been considered to be in dead storage.                        The same

cannot be said for a vehicle which is being started.                       "The 'dead'

in 'dead storage' suggests, at the least, that the engine would

not be running."         American Family Mutual Insurance Co. v. Van

Gerpen, 151 F.3d 886, 888 (8th Cir. 1998).

        Defendants insist, however, that the term "dead storage" is ambiguous, and

therefore it must be construed against the plaintiff.       If the language of an

insurance policy is susceptible to more than one reasonable

meaning, it is considered ambiguous and will be construed against

the insurer.       Gillen v. State Farm Mutual Automobile Insurance

Co., 215 Ill. 2d 381, 830 N.E.2d 575 (2005). Conversely, if the words of a policy are

clear and unambiguous, they must be afforded their plain, ordinary and common

meaning. Eljer, 197 Ill. 2d 278, 757 N.E.2d 481. Ambiguity is not created merely

because the parties disagree (RBC Mortgage Co. v. National Union Fire Insurance Co.,

349 Ill. App. 3d 706, 812 N.E.2d 728 (2004)), and a court will not strain to find

ambiguity in an insurance policy where none exists (Eljer, 197 Ill. 2d 278, 757 N.E.2d
481).

        Contrary to defendants' argument, the phrase "dead storage" is not rendered

ambiguous merely because the courts in various jurisdictions have not interpreted it

uniformly. In determining whether an ambiguity exists, a court must consider the

disputed language in its factual context. American Family Mutual Insurance Co. v.

Martin, 312 Ill. App. 3d 829, 728 N.E.2d 115 (2000). A vehicle which is periodically

                                                    6
driven by its owner, even briefly on private property, is not in dead storage, and an

accident caused by an attempt to start that vehicle is not the type of risk contemplated

by the parties to a homeowner's policy. We find no ambiguity under these

circumstances.

       Moreover, even if we were to accept defendant's argument concerning the

phrase "dead storage," that policy exception also requires the vehicle to be in storage

on an "insured location." As defined in the policy, an insured location includes

"premises occasionally rented to an 'insured' for other than 'business' use." (Emphasis

added.) In State Farm Fire and Casualty Co. v. Wonnell, 178 Ill. App. 3d 823, 825, 533
N.E.2d 1131, 1132 (1989), a homeowner's policy excluded liability and medical

coverage for any injury arising out of the rental of the insured premises unless the rental

was "on an occasional basis." The insured put her house up for sale and rented it to a

tenant on a month to month basis for a seven month period, during which time the

tenant was injured. This court held that the rental had not been occasional, defining the

term as occurring or appearing at irregular or infrequent intervals. Wonnell, 178 Ill. App.
3d at 825, 533 N.E.2d at 1133, quoting Webster's New Collegiate Dictionary 787 (1981).

We noted that the tenancy had not been irregular or infrequent, but had continued for

seven months without interruption, an arrangement that "constituted a full- fledged

rental of the subject premises." Wonnell, 178 Ill. App. 3d at 825, 533 N.E.2d at 1133.

       Similarly in this case, the storage units where the fire occurred cannot be said to

have been rented to Marx on an irregular or infrequent basis. According to Marx's

deposition testimony and his answers to plaintiff's request to admit facts, Marx had

rented the same two storage bays for a period of three years prior to the fire. Such

                                             7
extended and continuous use cannot be characterized as "occasional" and therefore,

even if the motorcycle was considered to be in dead storage, it was not in an "insured

location" within the terms of the policy. Accordingly, we affirm the trial court's order

granting summary judgment to the plaintiff.

       For the reasons stated above, the judgment of the circuit

court is affirmed.

       Affirmed.

       O'BRIEN and HOLDRIDGE, J.J., concur.

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