Court Opinion

ID: 2726236
Source: CourtListenerOpinion
Date Created: 2014-09-08 21:00:00.639654+00
Date Added: 2024-06-11T10:52:46.869072
License: Public Domain

Pursuant to Ind.Appellate Rule 65(D),                                       Oct 17 2013, 5:47 am
this Memorandum Decision shall not be
regarded as precedent or cited before
any court except for the purpose of
establishing the defense of res judicata,
collateral estoppel, or the law of the case.

ATTORNEYS FOR APPELLANTS:                         ATTORNEY FOR APPELLEES:

JEREMY J. GROGG                                   RANDALL W. GRAFF
ALLISON O. RAHRIG                                 Kopka, Pinkus, Dolin & Eads, PC
Burt, Blee, Dixon, Sutton & Bloom, LLP            Indianapolis, Indiana
Fort Wayne, Indiana

                               IN THE
                     COURT OF APPEALS OF INDIANA

BUSH TRUCK LEASING, INC.,                          )
                                                   )
       Appellant-Plaintiff,                        )
                                                   )
               vs.                                 )      No. 49A05-1304-CT-189
                                                   )
INDIANA FARMERS MUTUAL INSURANCE                   )
COMPANY,                                           )
                                                   )
       Appellee-Defendant.                         )

                     APPEAL FROM THE MARION SUPERIOR COURT
                         The Honorable Timothy W. Oakes, Judge
                            Cause No. 49D13-1107-CT-28064

                                       October 17, 2013

                MEMORANDUM DECISION - NOT FOR PUBLICATION

NAJAM, Judge
                            STATEMENT OF THE CASE

        Bush Truck Leasing, Inc. (“Bush”) filed a complaint for declaratory judgment and

damages against Indiana Farmers Mutual Insurance Company (“Indiana Farmers”).

Indiana Farmers moved for summary judgment, which the trial court granted following a

hearing. Bush appeals and presents a single dispositive issue, namely, whether the trial

court erred when it entered summary judgment in favor of Indiana Farmers.

        We affirm.

                       FACTS AND PROCEDURAL HISTORY

        On July 8, 2010, Eric Reed was driving a truck his company, Rapid Moving, LLC

(“Rapid”), had leased from Bush when Ryan Howell, driving an SUV, ran a red traffic

light and collided with Reed’s truck. As part of the lease agreement Rapid and Bush had

executed in April 2009, Rapid was required to obtain insurance for the truck Reed was

driving at the time of the accident (“the truck”). Rapid had an existing “Commercial

Lines Policy” with Indiana Farmers, and that policy had effective dates of June 1, 2008

through June 1, 2009. Effective April 2009, Rapid had named Bush as an “additional

insured” on that policy “in regard[] to” two vehicles, including the truck involved in the

July 2010 accident. Appellant’s App. at 138. Thereafter, Rapid renewed its policy with

Indiana Farmers for one year, effective on June 1, 2009. But on April 2, 2010, Indiana

Farmers notified Rapid by mail that the policy would be terminated effective June 1,

2010.

        After the accident on July 8, 2010, Bush attempted to file a claim of loss with

Indiana Farmers only to learn that the policy had been terminated in June. On July 22,

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2011, Bush filed a complaint against Indiana Farmers seeking declaratory judgment and

alleging bad faith in denying the claim of loss. Bush then moved for summary judgment,

which the trial court denied. Indiana Farmers moved for summary judgment, which the

trial court granted following a hearing. This appeal ensued.

                            DISCUSSION AND DECISION

       Bush contends that the trial court erred when it granted Indiana Farmers’ summary

judgment motion.     Our standard of review for summary judgment appeals is well

established:

       When reviewing a grant of summary judgment, our standard of review is
       the same as that of the trial court. Considering only those facts that the
       parties designated to the trial court, we must determine whether there is a
       “genuine issue as to any material fact” and whether “the moving party is
       entitled to a judgment as a matter of law.” In answering these questions,
       the reviewing court construes all factual inferences in the non-moving
       party’s favor and resolves all doubts as to the existence of a material issue
       against the moving party. The moving party bears the burden of making a
       prima facie showing that there are no genuine issues of material fact and
       that the movant is entitled to judgment as a matter of law; and once the
       movant satisfies the burden, the burden then shifts to the non-moving party
       to designate and produce evidence of facts showing the existence of a
       genuine issue of material fact.

Dreaded, Inc. v. St. Paul Guardian Ins. Co., 904 N.E.2d 1267, 1269-70 (Ind. 2009)

(citations omitted). The party appealing a summary judgment decision has the burden of

persuading this court that the grant or denial of summary judgment was erroneous.

Knoebel v. Clark County Superior Court No. 1, 901 N.E.2d 529, 531-32 (Ind. Ct. App.

2009). Where the facts are undisputed and the issue presented is a pure question of law,

we review the matter de novo. Crum v. City of Terre Haute ex rel. Dep’t of Redev., 812

N.E.2d 164, 166 (Ind. Ct. App. 2004).

                                            3
        Bush contends that Indiana Farmers did not effect termination of the policy

covering the truck prior to the accident in July 2010. In particular, Bush maintains that,

as a named insured under the policy, it was entitled to notification of Indiana Farmers’

intent to terminate the policy in April 2010, but it did not receive such notification. We

cannot agree.

        Indiana Code Section 27-7-6-6 provides in relevant part that “[n]o insurer shall fail

to renew a policy unless it shall mail or deliver to the named insured, at the address

shown in the policy, at least twenty (20) days’ advance notice of its intention not to

renew.” On April 2, 2010, Indiana Farmers mailed a “Notice of Termination of Policy”

to Rapid stating that, “[i]n accordance with the terms of your policy contract, all the

coverages and all the liability of [Indiana Farmers] cease at 12:01 AM Standard Time on

06/01/10.”1 Appellant’s App. at 133.

        Bush maintains that it was entitled under the statute to notice of the policy non-

renewal because it was a named insured under the policy. But the policy itself shows

only Rapid as a “named insured.” Id. at 159. Bush is merely listed as an “additional

insured” on a certificate of liability dated April 2009 listing the “policy expiration date”

as June 1, 2009. Id. at 138. There is no designated evidence showing that Bush was a

named insured under the policy.

        The case law Bush relies on for support of its contention on this issue is

inapposite. But our opinion in Little v. Progressive Ins., 783 N.E.2d 307 (Ind. Ct. App.

2003), trans. denied, is on point.          In Little, we interpreted the meaning of “named

        1
         While the mailed notice was delineated as a “termination” of the policy, the policy renewal date
was June 1, 2010, so, in effect, Indiana Farmers notified Rapid that it was not renewing its policy.
                                                   4
insured” as that term is used in Indiana Code Section 27-7-5-2, which gives a named

insured the right to reject uninsured and underinsured motorist coverage. In Little, the

named insured had rejected uninsured and underinsured motorist coverage. Little, who

was not a named insured, was added to the policy as a “listed driver.” Id. at 310. After

Little was involved in an accident with an uninsured motorist, she filed a claim with

Progressive, which it denied. On appeal, Little argued that “she should have had the right

to reject uninsured and underinsured coverage just like a named insured” and that her

failure to do so meant that her claim should have been paid. Id.

      We rejected Little’s contention and held:

      In the insurance context, a “named insured” is “the person specifically
      designated in the policy as the one protected and, commonly, it is the
      person with whom the contract of insurance has been made.” Black’s Law
      Dictionary 1023 (6th ed. 1990). The term is not synonymous with
      “insured”:

             Every contract of insurance specifies an insured. The term
             “named insured” is not synonymous with “insured,” but has a
             restricted meaning; it does not apply to any person other than
             those specified by name in the policy.

             One can only become a named insured by being named as
             such on the policy and not by conduct.

             In addition, policies of automobile liability insurance
             generally define certain other persons, commonly described
             by class, as additional or other insureds. The term “insured”
             is not limited to the named insured, but applies to anyone who
             is insured under the policy.

             To qualify as an “insured” under a policy of automobile
             insurance, parties must either be the named insured or
             establish that they were a driver or occupant of a covered
             vehicle involved in an accident.

                                            5
Lee R. Russ & Thomas F. Segalla, Couch on Insurance § 110:1 (3rd ed.
1997) (hereinafter “Couch on Insurance”) (emphasis added; footnote
omitted).

“Named insured” is also not synonymous with “driver.” For example,
Couch on Insurance provides that “one listed in the policy, but only in the
status of a driver of the vehicle, is not a named insured despite the fact that
such person’s name was physically in the policy.” Id. Also, Couch on
Insurance states that “a regular user of the vehicle, despite additional
premiums charged for such use, is not given the status of a named insured
where such person is not so named in the policy.” Id. at § 110:4. Finally,
Widiss’s treatise on uninsured and underinsured motorist coverage
provides:

       Designating an individual as a “driver” in a motor vehicle
       insurance policy does not mean that the person is a named
       insured. Although such an individual undoubtedly is covered
       when operating an insured vehicle, the individual does not
       become a “named insured” or a family member.

Widiss, Alan L., Uninsured And Underinsured Motorist Insurance § 33.2
(2nd ed. rev. 2001).

Regarding the determination of who, in fact, is a named insured, the third
edition of American Law Reports provides:

       An automobile insurance policy ordinarily contains in the
       “declaration” section the printed word “Insured” or, more
       often, the words “Named Insured,” followed by a space in
       which a typed name or names appear. To that extent, the
       term “named insured” is self-defining and the language of
       some cases restricts the meaning of the term to names so
       appearing.

John Harrington, Annotation, Who is “Named Insured” Within Meaning of
Automobile Insurance Coverage, 91 ALR3d 1280 § 2[a]; see also id. § 3[a]
(providing citations to twenty cases from sixteen jurisdictions in which
courts have construed “named insured” to include only the person
designated as such).

                                      6
783 N.E.2d at 310-11. Likewise, here, the undisputed designated evidence shows that

Rapid was listed as the named insured under the policy, but Bush was not. Bush’s

contention on this issue is without merit.

       Still, Bush contends, in effect, that the certificate of liability conferred on Bush a

right to notice of termination. But the certificate does not contain any language regarding

notice of termination to an additional insured. In fact, the certificate provides only that

Indiana Farmers will “endeavor” to provide advance notice of cancellation of the policy

to the certificate holder named on the certificate, Toyota Motor Credit Corp., but that

failure to provide such notice “shall impose no obligation or liability of any kind upon the

insurer, its agents or representatives.” Appellant’s App. at 138. Thus, the only notice of

cancellation required by law was to the named insured, Rapid. And Bush’s coverage as

an additional insured was not independent but was entirely derivative of Rapid’s

coverage.

       Bush further argues that Indiana Farmers’ notice to Rapid was inadequate in that it

was sent to the wrong address. Therefore, Bush maintains, the policy had not been

terminated at the time of the accident in July 2010, and Bush was covered under the

policy. This argument fails for several reasons. First, Bush did not make this argument

to the trial court and asserts it for the first time in its reply brief on appeal. Thus, the

issue is waived. See Evans v. Thomas, 976 N.E.2d 125, 128 (Ind. Ct. App. 2012), trans.

denied. Second, there is no designated evidence in the record showing that Bush was

covered as an additional insured after June 2009, which is the expiration date listed on the

certificate of liability identifying Bush as an additional insured. And third, and foremost,

                                             7
the termination notice was sent to Rapid at an address in Ft. Lauderdale, Florida, which

address appears on a “Business Auto Declarations” page dated June 1, 2009, and on three

“Endorsements” regarding the policy dated March and April 2010. Appellant’s App. at

44-47. Indiana Code Section 27-7-6-6 requires that the nonrenewal notice be sent to the

named insured at the “address shown in the policy.”2 The trial court did not err when it

entered summary judgment in favor of Indiana Farmers.

         Finally, Indiana Farmers asks that we award appellate attorney’s fees pursuant to

Indiana Rule of Appellate Procedure 66(E). In particular, Indiana Farmers asserts that

“[g]iven all of the . . . reasons as to why there is no coverage for the alleged loss, and

certainly no basis for alleging insurer bad faith, Bush’s pursuit of this appeal evidences

its own bad faith and signifies a frivolous appeal.” Brief of Appellee at 12. We cannot

agree.

         Our appellate rules authorize us to “assess damages if an appeal, petition, or

motion, or response, is frivolous or in bad faith. Damages shall be in the Court’s

discretion and may include attorney’s fees.” Ind. Appellate Rule 66(E). Damages will be

assessed only where an appellant, acting in bad faith, maintains a wholly frivolous

appeal.      Harness v. Schmitt, 924 N.E.2d 162, 168 (Ind. Ct. App. 2010) (citations

omitted). While Appellate Rule 66(E) permits us to award damages on appeal, we must

act with extreme restraint in this regard due to the potential chilling effect on the exercise

of the right to appeal. Id. “A strong showing is required to justify an award of appellate

damages, and the sanction is not imposed to punish mere lack of merit, but something

         2
            The policy explicitly includes declarations pages and “any applicable endorsements.”
Appellant’s App. at 8.
                                               8
more egregious.” Id. Here, while we hold that Bush’s contentions are without merit, we

also hold that Indiana Farmers has not demonstrated bad faith on the part of Bush. An

award of appellate attorney’s fees is not warranted.

       Affirmed.

MATHIAS, J., and BRADFORD, J., concur.

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