Court Opinion

ID: 2810137
Source: CourtListenerOpinion
Date Created: 2015-06-19 15:09:17.006744+00
Date Added: 2024-06-11T11:30:15.634027
License: Public Domain

IN THE SUPREME COURT OF THE STATE OF KANSAS

                                              No. 107,174

          JESUS RODRIGUEZ, by and through His Next Friend and Natural Mother,
                               GRACIELA RODRIGUEZ,
                                      Appellant,

                                                     v.

                            UNIFIED SCHOOL DISTRICT NO. 500, et al.,
                                        Defendants,

                                                    and

                           MUTUAL OF OMAHA INSURANCE COMPANY,
                                        Appellee.

                                   SYLLABUS BY THE COURT

        Under relevant statutes and the school district policies and administrative
guidelines in the record on this appeal, private vehicle transportation to a school soccer
match during which a student was injured was "covered travel," as that phrase is defined
in the insurance policy at issue. A reasonably prudent insured would understand the travel
to be both "authorized" and "subject to reimbursement."

        Review of the judgment of the Court of Appeals in 49 Kan. App. 2d 262, 306 P.3d 327 (2013).
Appeal from Wyandotte District Court; R. WAYNE LAMPSON, judge. Opinion filed June 12, 2015.
Judgment of the Court of Appeals affirming the district court in part and reversing in part is reversed.
Judgment of the district court is reversed and remanded.

        Stephen R. McAllister, of counsel, of Thompson Ramsdell Qualseth & Warner, P.A., of
Lawrence, argued the cause, Henri J. Watson and Russell S. Dameron, of Watson & Dameron, LLP, of
Kansas City, Missouri, and were on the briefs for appellant.

                                                     1
        Robert J. Hoffman, of Bryan Cave LLP, of Kansas City, Missouri, argued the cause, and Lauren
A. Horsman, of the same firm, was with him on the briefs for appellee.

The opinion of the court was delivered by

        BEIER, J.: This appeal addresses whether a Mutual of Omaha Insurance Company
policy issued to the Kansas State High School Activities Association provided coverage
for catastrophic personal injury suffered by 10th grader Jesus Rodriguez.

        We hold that coverage exists. We therefore reverse contrary rulings by the district
court judge and a panel of our Court of Appeals, and we remand the case to the district
court for further proceedings.

                           FACTUAL AND PROCEDURAL BACKGROUND

        The accident that injured Rodriguez occurred on August 29, 2006, while he was
traveling to his first match of the Sumner Academy soccer season. Rodriguez was riding
in the bed of a pickup truck driven by fellow student and teammate Mike Hitze when the
pickup collided with another car. Rodriguez was thrown from the pickup and sustained
the injury that now requires him to have round-the-clock care.

        Rodriguez' mother, Graciela, initially filed this lawsuit on his behalf against the
school district, Hitze, and the driver of the car that had collided with Hitze's truck.

        During the course of the lawsuit, plaintiff learned that the Association, which
administers various extracurricular activities in the state, had purchased a Mutual of
Omaha policy to cover injuries sustained by participants during events the Association

                                                   2
sanctioned, as well as during certain types of travel to and from such events. The
insurance policy covered

       "[s]tudents participating in interscholastic competition or activities under the jurisdiction
       of the KSHSAA including school-supervised practice, try-outs, pre and post game-related
       activities including award banquets and covered travel as defined under the policy."

There is no dispute that the soccer match was a competition that fit this description. The
policy defined "covered travel" as

       "team or individual travel, for purposes of representing the Participating School, that is to
       or from the location of a Covered Event and is authorized by the Insured Person's
       Participating School, provided the travel is paid for or subject to reimbursement by the
       Participating School. Covered Travel to a Covered Event will commence upon
       embarkation from an authorized departure point and terminate upon arrival at the location
       of the Covered Event." (Emphasis added.)

       Rodriguez filed a claim, and Mutual of Omaha denied it, reasoning that the travel
during which Rodriguez was injured did not qualify as covered under the policy.
According to Mutual of Omaha, the school had indicated no request for reimbursement
for the travel had been made; moreover, the travel was not "subject to reimbursement"
because the school also had indicated that it had "been unable to locate any requests for
reimbursement, or payment of, expenses incurred by a parent or student using a private
vehicle to transport students to a sporting event." Mutual of Omaha asserted that all
expenditures of the school system must be authorized by law, and there was no statutory
authorization for a school to pay a private individual for use of a private car to transport a
student in Rodriguez' circumstances.

       After the denial of coverage, Mutual of Omaha was added as a defendant in this
lawsuit. A bench trial limited to the insurance coverage issue followed.
                                                     3
       Rodriguez' mother testified that Rodriguez' father had signed a permission form
covering travel options for members of the soccer team. The form granted permission for
Rodriguez to, among other things, "[r]ide with other players from school to practice,
home meets, or to meet the bus for away meets" and to "[r]ide to team events with other
players."

       Israel Ocanas, one of the other team members who rode with Hitze and Rodriguez
on the day of the accident, testified that he was unaware whether the school had provided
a bus for team members. He said that no one had directed him to travel by bus. According
to Ocanas, it was "normal . . . to just catch a ride with whoever was heading that way in a
car." Ocanas testified that, when the campus officer let Hitze's pickup exit the school
parking lot, Rodriguez was sitting in the pickup bed. The group then waited across from
the school for other team members to arrive. Eventually a total of three, including
Rodriguez, rode in the bed of the pickup.

       Much of the testimony at trial focused on the school district's policies and
administrative guidelines. The administrative guidelines mirror the numbering system of
the policies but are amended with an "-A." As one of the school district's administrators
would testify, the guidelines are not "policy per se. But they're . . . guidelines that
administrators are expected to follow. They help them in making their decisions in order
to implement policy correctly."

       The clerk for the Board of Education, Susan Westfahl, testified about a school
district administrative guideline, 3.5.5.0.0-A, which was titled "Pupil Transportation."
The guideline included the following passage:

                                               4
       ".3.0     Field Trips, Curricular Activities, Extracurricular Activities

       ".3.1             Field Trips and Curricular Activities

                                 "Arrangements for activity transportation shall be made
                         by the Building Administrator using the Field Trip Request
                         procedure.

                                 "When district equipment or drivers are unavailable or
                         when it is economically advantageous to use other means of
                         activity transportation, arrangements for hired or non- district-
                         owned activity transportation shall be made by the building
                         administrator.

       ....

       ".3.1.4                   Private Vehicle

                                 "Use of private automobiles for field trips and activity
                                 transportation shall not be authorized except in such
                                 instances where drivers are fully responsible adults (over
                                 21 years of age). Authorized drivers shall verify
                                 insurance coverage in accordance with established
                                 Kansas insurance minimums to the building principal or
                                 his designated representative."

No copy of the guideline in the record on appeal includes a subsection covering
extracurricular activities such as soccer matches. Westfahl also testified that, in the 10
years she had worked for the Board, she could not recall an instance in which the Board
had approved reimbursement for a student who had transported another student to a
school activity.

                                                      5
       Testimony of Tom Petz, executive director of human resource services for the
school district, was submitted during the bench trial by way of transcribed deposition and
exhibits. The exhibits to Petz' deposition included a school district policy, 3.5.5.0.0, titled
"Pupil Transportation." It stated in part:

                         "Responsibility for general administration of pupil transportation
                 programs shall be subject to the direction of the Superintendent of Schools with a
                 delegation of responsibility through the Assistant Superintendent for Business
                 Affairs to the Director of Pupil Transportation Services.

       ".1.0     Equipment

                         "Depending upon the demands of services involved, transportation shall
                 be provided with equipment which may be:

                 •       Owned by the school district
                 •       Leased by the school district and operated by the school district itself
                 •       Contracted with a contract carrier.

       ".1.1             Use of Privately-Owned Cars

       ".1.1.1                   Privately-owned cars shall not be employed by Unified
                                 School District #500 of Kansas City in the transportation of
                                 pupils to and from schools except as outlined in Policy
                                 3.5.5.2.3 et seq. [dealing with exceptional students].

       ".1.1.2                   Privately-owned cars driven to and from school shall be
                                 subject to such rules and regulations as established by the
                                 Board of Education for the control of traffic on or around
                                 school grounds as provided by KSA 72-9101.

                                                      6
".2.0     Service Areas

".2.1             High Schools and Middle School

                          "Transportation for high school and middle school pupils will be
                  provided for those pupils living one and one-half (1-1/2) miles or more
                  from the school by the nearest commonly traveled route. Bus stops and
                  routes shall be so arranged as to be of maximum convenience and safety
                  and shall be so located that no pupil eligible to be transported shall be
                  required to walk more than .5 (1/2) miles to the nearest stop.

".2.1.1                   High School Magnet Programs

                          "A routing plan shall be established to provide transportation for
                          students enrolled in the high school magnet program.

....

".3.0     Field Trips, Curricular Activities, Extracurricular Activities

                  "When appropriate and feasible in the regular course of instruction, bus
          transportation may be furnished for field trips, programs and the general instructional
          program. Transportation shall be furnished to the extent that such transportation can be
          provided without impairment of the general transportation program and within the
          limitation of funds budgeted for such transportation.

".3.1             Field Trips and Curricular Activities

                           "Any transportation for field trips and curricular activities shall be
                  provided only upon the specific approval of the Superintendent of Schools or his
                  designated agent. Requests for such transportation must be made at such time
                  and in such form as may be required by the Superintendent.

                                               7
      ".3.2             Extracurricular Activities and School Associated Groups

                                "Transportation shall be provided for various music, athletic and other
                        school associated groups. Arrangements for transportation shall follow the
                        administrative guideline for Pupil Transportation 3.5.5.0.0.-A.

      ".4.0     Special Activity Transportation

                        "Special activity transportation shall be provided for pupils as identified in Board
                Policy 3.5.5.2.1 and 3.5.5.2.1.1 enrolled at secondary (high schools and middle schools)
                attendance centers.

      ".4.1             After-School Activities

                                "Administration guidelines shall provide for service to permit
                        participation in activities conducted in a period of not to exceed two and one-half
                        (2 1/2) hours after the close of the regular school day and at such other times as
                        may be necessary to permit normal participation.

      ".4.1.1                   No special activity transportation shall be provided for spectators,
                        guests, parents or other non-participants in the specific activity involved."

      The exhibits to Petz' deposition also included administrative guideline 3.5.5.0.0-A
about which Westfahl had testified. The administrative guideline's provision for
insurance coverage included the following language:

      ".3.0     Field Trips, Curricular Activities, Extracurricular Activities (Continued)

      ".3.2             Insurance Coverage

                                                     8
".3.2.1            The District Fleet Policy covering bodily injury and personal
                   injury protection extends coverage to students, employees and
                   sponsors involved in authorized activity transportation.
                   Drivers/owners of private automobiles authorized for field trips
                   and activity transportation are covered by the District Fleet
                   Policy.

".3.2.2            Students being transported to events sanctioned by the Kansas
                   State High School Activities Association are eligible for
                   catastrophic coverage.

".3.3       Insurance Coverage—Non-District Owned Vehicles

".3.3.1            The list of approved carriers shall include only contractors who
                   meet or exceed district insurance minimums and, in addition,
                   name District #500 as 'additional insured' while transporting
                   District #500 students, employees and non-employees.

".3.3.2            Schools renting or leasing vehicles shall take 'additional
                   coverage.'

".3.3.2.1                    The additional package of collision, comprehensive, and
                             liability coverage insurance reduces the schools'
                             responsibility for the deductible. Schools shall purchase
                             the maximum coverage available for collision and
                             comprehensive insurance.

".3.3.2.2                    The District is exempt as a governmental agency and is
                             covered by medical insurance under the Fleet Policy,
                             therefore, it is not necessary to secure Personal Injury
                             Protection (P.I.P[.]) as an additional coverage.

                                         9
      ".3.3.3                  Private Auto

      ".3.3.3.2                         Verify that liability insurance coverage is in effect
                                        covering the owners and driver of the vehicle with state
                                        minimum liability requirements of $25,000.00 per
                                        individual, $50,000.00 per accident, and $10,000.00
                                        property damage."

The administrative guidelines also contained one passage specific to Sumner Academy of
Arts and Science:

      ".4.5.1                  In addition to transportation to and from school as outlined in
                               Policy 3.5.5.2.1, special activity and service buses will be
                               operated to serve all pupils who are involved in various
                               extracurricular activities after the close of the school day. Special
                               transportation schedules are made as follows:

      ".4.5.1.1                         One departure time from the school is to be approximately one
                                        (1) hour after the close of the regular school day.

      ".4.5.1.2                         A second departure time is to be at approximately two and one-
                                        half (2-1/2) hours following the close of the school day."

      Petz was the administrator who differentiated between numbered district policies
and numbered administrative guidelines and explained the role of the administrative
guidelines in an administrator's decision-making process.

      "[A]dministrators have—always have discretion in terms of . . . implementing
      or . . . administering their building based on . . . the individual circumstances
      that may or may not come up.

                  ....
                                                   10
               "You cannot totally tie the hands of an administrator and expect that they have to
       run their building by any one set of guidelines. There's no way that you can write a set of
       guidelines that are going to apply to every situation that may or may not come up in a
       school building.

               "If you've ever worked in a school building or if you've ever been an
       administrator in a school building, you would know that there are a myriad of different
       things that come up, and trying to have one set of guidelines that are going to apply to
       every particular instance that arises would be—you would have a book so voluminous
       that, you know, it wouldn't fit in this room. And then something would happen, and you
       wouldn't be able to find it in there anyway . . . . because there's always a variety of things.
       So these are general administrative guidelines to assist them in their thought process. But
       in most cases, you know, they're going to follow this process and adhere to—it's more or
       less that these are to assist them in interpreting and administering board policy correctly."

       Petz testified that he was unaware of any district policy regarding reimbursement
of costs for transportation of students other than special education students. However, he
said that it was "not necessarily true" that other reimbursement for transportation would
not be permitted. "[D]epending upon the circumstances of the event," he said, "building
principals could make determinations that . . . other alternative forms of transportation are
appropriate. . . . There's not anything that particularly says in policy that they can do that.
But policy does not preclude them from making that judgment." Petz said that the policy
on reimbursement of costs for special education students' transportation would not have
applied to the activity transportation provided Rodriguez by Hitze. To his knowledge,
there was "no written policy that specifically says that it's allowed, but there's not a
specific policy that says it's not allowed."

       Petz also was asked specifically about the transportation provided by the school
for the soccer game on August 29, 2006, and whether the school had "authorized"

                                                     11
Rodriguez to ride with Hitze. Petz said that the administrative guideline numbered
3.5.5.3.1.4-A, which required the presence of a "fully responsible adult[]" when students
traveled by private vehicle, would apply only when the school arranged for private
transportation to a school activity. He said that it did not apply to Rodriguez' travel in
Hitze's pickup truck because "[t]he official mode of transportation that the district had
arranged for [the soccer game] was by bus." Students such as Rodriguez were not
precluded from arranging other forms of transportation on their own, as long as the
students' parents had signed a permission form allowing those forms of transportation.
"The schools permitted the parents to authorize outside travel," he said. Petz said that the
school district could not support someone riding in the back of a pickup truck, but
Rodriguez was still under the "jurisdiction of the school" while he did so because he was
going to the soccer match.

       "Students have the prerogative to utilize private vehicles to transport themselves to
       school-sponsored activities. The school district in most cases will arrange school district
       transportation and have that available to them, but as I mentioned earlier, there are
       instances where students and families may choose to not avail themselves to that
       opportunity that they have. And—

               ....

               "And that's allowed. It's not like if they don't get on the school bus, when they get
       to the game, they don't get to play. You know, so they are allowed to utilize their own
       transportation."

       Petz also testified that any reimbursement that had been requested would have
come from the building activity fund and that it would be up to the principal whether to
pay reimbursement.

                                                   12
       "To my knowledge, there's not anything in policy that says you are to pay mileage to
       students or that you're not to or you can't. It's left to the discretion of the building
       administrator as the manager of that budget as to what he or she determines are
       appropriate costs as to pay out of those funds.

                ....

                "I testified that there's nothing in policy that would prevent a principal from
       making a determination that mileage was a justifiable expense out of his or her activity
       fund. So there's nothing that says they have to. There's nothing that says they can't. It's
       basically a discretionary decision of the administrator as the budget manager of that
       fund."

Petz testified that, in his opinion, any request for reimbursement that Hitze might file
would be "subject to reimbursement" under the Mutual of Omaha insurance policy.

       The school district's attorney, Gregory Goheen, testified live at the bench trial.
Goheen said that he had provided Mutual of Omaha with certain information about the
school district's policies and procedures relating to reimbursement of travel expenses, the
statute he believed to provide the basis for travel reimbursement, and information on
whether there were records of any student previously submitting a reimbursement request
for expenses of driving to or from athletic events. According to Goheen, the school
district could not find any record of a student filing a claim to be reimbursed for
providing transportation for another student. He described a letter he sent to counsel for
Mutual of Omaha that states it encloses a school district policy labeled 4.1.13.3.1. The
enclosed policy included the following language:

                                                      13
       ".3.1     Travel Mode and Rate

                 "Persons authorized to travel at Board expenses should adhere to administrative
                 guidelines.

       ....

       ".3.1.2           Travel by personal automobile will be reimbursed at the official mileage
                         rate established by the State of Kansas when this mode of travel is
                         approved by the Superintendent or appropriate assistant superintendent.

       ....

       ".3.2     Expense Reimbursement

                 "Expenses approved for reimbursement are subject to administrative guidelines
                 and the following limits:

       ....

       ".3.2.5           . . . mileage at the official mileage rate established by the State of
                         Kansas."

       Goheen also testified that Mutual of Omaha had asked him whether the school
district would have paid a claim for mileage had a request for mileage reimbursement
actually been made by Hitze. Goheen said he declined to answer Mutual of Omaha's
question because it was "a hypothetical and we hadn't received the claim."

       At the conclusion of the bench trial, the district judge ruled that Rodriguez' travel
in Hitze's truck was neither "authorized" by the school district nor "subject to
reimbursement," the two requirements for "covered travel" under the definition in the

                                                      14
Mutual of Omaha policy. The judge based his decision on his belief that the school was
prohibited by state law and district policies from authorizing travel by private vehicle
when no adult was present. And, in his view, the travel would have qualified as subject to
reimbursement only if the driver had a contract with the school district to pay for
gasoline; there was no evidence that Hitze had such a contract. The district judge
therefore held that Mutual of Omaha should be dismissed as a defendant in the case.

       Rodriguez appealed to the Court of Appeals.

       The Court of Appeals panel began its analysis of whether the accident occurred
during "covered travel" by holding that there was no ambiguity in the insurance policy's
language requiring the travel to be "'authorized'" and "'subject to reimbursement.'"
Rodriguez v. U.S.D. No. 500, 49 Kan. App. 2d 262, 265, 306 P.3d 327 (2013). It therefore
"attribute[d] ordinary everyday meanings to the ordinary words used in this clause
dealing with covered travel." 49 Kan. App. 2d at 265.

       The panel held that Sumner Academy's system of parental permission forms

       "created an informal method of transporting team members to soccer games by
       permitting teammates to ride with each other instead of riding on the school bus—the
       'official' mode of transportation. Employing permission slips from parents gave ample
       notice to all participants that the district would permit this form of travel. We do not
       speculate why this was done because the record is unclear on that point. . . .

               "These words and deeds compel us to conclude that the school permitted this
       transportation—this trip was not some impromptu act of two young men trying to break
       the rules as an act of rebellion. This system of informal transportation of students was
       created and sanctioned by the school. In our view, this was authorized travel as
       contemplated by the insurance policy." 49 Kan. App. 2d at 267.

                                                    15
       The panel then turned to the question of whether the travel was "subject to
reimbursement." It held that travel could not qualify as subject to reimbursement if a
claim could not actually be paid. Quoting from the administrative guideline discussed by
Westfahl during the bench trial, which it mislabeled a district "policy," the panel said that
a person older than 21 must have been present and proof of insurance coverage must have
been supplied to enable payment of any claim by Hitze. 49 Kan. App. 2d at 272-73. Thus,
despite the panel's disagreement with the district judge on whether Sumner Academy
authorized the travel, it held that the travel involved in this case did not qualify as subject
to reimbursement, and thus there was no coverage under the Mutual of Omaha policy. 49
Kan. App. 2d at 275.

       Rodriguez filed a petition for review to this court, asking us to reverse the panel's
holding that the travel was not subject to reimbursement. He attached a document labeled
"Plaintiff's Exhibit D" but referred to as "Appendix, Demonstrative Exhibit 1," apparently
to illustrate the difference between a school policy and a school administrative guideline.
We note that this comparison document appears nowhere else in the record on appeal in
this format and that the language in what is represented as Policy 3.5.5.3.2.1 is not
included in the copy of the policy that was marked during Petz' deposition. We therefore
will not rely on this portion of the appendix. See Supreme Court Rule 8.03(h)(2) (2014
Kan. Ct. R. Annot. 77) (case heard on petition for review to be considered on basis of
record previously filed with Court of Appeals); see also Supreme Court Rule
8.03(a)(4)(F) (2014 Kan. Ct. R. Annot. 78) (appendix to contain copy of Court of
Appeals opinion, other "opinions, findings of fact, conclusions of law, orders, judgments,
or decrees issued by the district court or administrative agency, if relevant to the issues
presented for review"); cf. Supreme Court Rule 6.02(b) (2014 Kan. Ct. R. Annot. 40)
(optional appendix to appellant's brief to contain limited extracts from record on appeal;
appendix not substitute for record itself); Supreme Court Rule 6.03(b) (2014 Kan. Ct. R.

                                              16
Annot. 47) (optional appendix to appellee's brief subject to same restrictions as optional
appendix to appellant's brief).

       Mutual of Omaha filed no cross-petition of the panel's holding that the travel was
authorized, but its counsel asserted at oral argument before this court that we are
permitted to review that issue as well. See Supreme Court Rule 8.03(h)(1) (2014 Kan. Ct.
R. Annot. 77) (permitting Supreme Court to revisit issue preserved and considered by
Court of Appeals in civil case). We therefore address both aspects of the Mutual of
Omaha policy's definition of "covered travel" in our discussion below.

                                        DISCUSSION

       Interpretation of an insurance policy raises "a question of law over which appellate
courts have unlimited review." Bussman v. Safeco Ins. Co. of America, 298 Kan. 700,
707, 317 P.3d 70 (2014). "'As a general rule, the construction and effect of a contract of
insurance is a matter of law to be determined by the court. If the facts are admitted, then
it is for the court to decide whether they come within the terms of the policy.'" Harris v.
Richards, 254 Kan. 549, 552, 867 P.2d 325 (1994) (quoting Farm Bureau Mut. Ins. Co. v.
Horinek, 233 Kan. 175, Syl. ¶ 1, 660 P.2d 1374 [1983]). We assign language in an
insurance policy the meaning a reasonably prudent insured would understand it to have.
See Marshall v. Kansas Med. Mut. Ins. Co., 276 Kan. 97, 111, 73 P.3d 120 (2003).

       On this appeal, no significant facts are in issue. The authenticity of the signature of
Rodriguez' father on the travel permission form is unchallenged. The circumstances of
Rodriguez' accident and injury are, for purposes of resolving the coverage controversy,
undisputed. The fact that Hitze had never submitted a request for reimbursement to
Sumner Academy or to the school district by the time of the bench trial is established
beyond question. Likewise, the content of potentially controlling law and documents—
                                             17
the insurance policy, statutes, district policies, or administrative guidelines—is set and
merely awaits interpretation or construction.

       We therefore face two pure questions of law subject to de novo review: Was
Rodriguez' travel authorized by Sumner Academy? And was the travel subject to
reimbursement by Sumner Academy?

Authorization

       We agree with the Court of Appeals panel that Sumner Academy's system of
obtaining parental consent and then allowing the type of travel at issue here leads
inexorably to the legal conclusion that Rodriguez' travel in Hitze's pickup truck was
"authorized" by the school, as that unambiguous word is commonly understood. See
Webster's Third New Int'l Dictionary 146 (1993) ("authorize" means "to endorse,
empower, justify, or permit by or as if by some recognized or proper authority).

       As the panel explained, the district judge misinterpreted and misapplied both a
district administrative guideline, mischaracterized by the panel as a "policy," and Kansas
statutes.

       The district judge relied in part on administrative guideline 3.5.5.3.1.4-A, which
requires the presence of an adult and verification of insurance if a private vehicle is used.
But Petz emphasized more than once that this guideline, to the extent any guideline had
binding effect, was not applicable to travel such as that at issue here. Rather, it applied
only when the school arranged a specific mode of travel, such as the bus he believed to
have been provided for the August 29, 2006, soccer match. Petz repeatedly made clear
that Rodriguez' travel with Hitze was not arranged or supervised by the school. It was

                                              18
not the official transportation subject to district requirements that an adult be present and
insurance coverage verified. The bus was.

       We also note that the administrative guideline falls under the subheading specific
to "Field Trips and Curricular Activities," not extracurricular activities such as soccer
matches.

       The statutes on which the district judge relied, K.S.A. 72-8305 and K.S.A. 72-
8301(c), also were not actually helpful to his analysis of whether Rodriguez' travel with
Hitze was "authorized."

       K.S.A. 72-8305 states that a board of education of any school district may provide
and furnish transportation for students involved in extracurricular school activities:

               "The board of education of any school district . . . which school district . . . is: . . .
       (c) engaged in any extracurricular school activity, may provide and furnish transportation
       for students . . . . The school district . . . may pay mileage for those school buses
       contracted, leased or hired for such purposes, and may adopt rules and regulations
       governing the use and operation of such school buses. All students so transported shall be
       under school control and discipline and in every case shall be accompanied by a suitable
       adult person."

       K.S.A. 72-8301(c) defines the phrase "'provide or furnish transportation'" to
include a school district's right to reimburse persons who provide transportation to
students in private vehicles:

       "The words 'provide or furnish transportation' in addition to their ordinary meaning shall
       mean and include the right of a school district to: (1) Purchase, operate and maintain
       school buses and other motor vehicles; (2) contract, lease or hire school buses and other
       motor vehicles for the transportation of pupils, students and school personnel; (3)
                                                      19
       purchase, operate and maintain buses other than school buses for the transportation of
       pupils, students or school personnel to or from school-related functions or activities; (4)
       contract, lease or hire buses other than school buses for the transportation of pupils,
       students and school personnel if the buses are owned and operated by a public common
       carrier of passengers under a certificate of convenience and necessity granted by the state
       corporation commission or the interstate commerce commission and are operating within
       the authority granted to the public common carrier; and (5) reimburse persons who
       furnish transportation to pupils, students or school personnel in privately owned motor
       vehicles."

       The district judge combined the multipart definition from K.S.A. 72-8301(c) with
the plainly bus-specific language in the last sentence of K.S.A. 72-8305 to read in a
requirement, similar to that in the administrative guideline above, for an adult presence.
As the panel recognized, this was error, "too much of a stretch." Rodriguez, 49 Kan. App.
2d at 269.

       Petz' deposition testimony, admitted at the bench trial, made clear that Rodriguez'
travel with Hitze, although not arranged for or supervised by Sumner Academy, was
nevertheless authorized by it. Nothing in the administrative guideline 3.5.5.3.1-A or in
K.S.A. 72-8305 or K.S.A. 72-8301(c) runs contrary to Sumner Academy's system of
allowing such travel once parents agreed to it.

Subject to Reimbursement

       Our agreement with the Court of Appeals panel ends with the authorization issue.
Unlike the panel, we also conclude that Hitze's expense in transporting Rodriguez to the
soccer match qualified as "subject to reimbursement" under the Mutual of Omaha policy.

                                                    20
       It was the responsibility of Mutual of Omaha, as it is with any insurance company,
to draft the coverage language it deemed necessary to define and contain its risk. See
Marshall, 276 Kan. at 112 (insurer assumes duty to define limitations to insured's
coverage clearly, explicitly). In this case, it did not restrict the definition of covered travel
to that actually paid for or even likely to be paid for. Rather, it expressly included travel
merely "subject to" being paid for. Neither party argues that "subject to reimbursement"
is an ambiguous phrase, and we agree that it is not. Even if we did regard the phrase as
ambiguous, we would be required to interpret it in the insured's favor. Bussman v. Safeco
Ins. Co. of America, 298 Kan. 700, 707, 317 P.3d 70 (2014). In our view, a reasonably
prudent insured would understand the phrase to include travel that could be reimbursed
and not limit its application to travel that was likely or would be or was required to be
reimbursed.

       State statutes do not compel a contrary conclusion. K.S.A. 72-8305 permits the
board of education of a school district to provide and furnish transportation for
extracurricular activities. As the Court of Appeals recognized, K.S.A. 72-8301(c)
contemplates the possibility that a school district reimburse persons who provide
transportation to students in private vehicles. And K.S.A. 72-8208a addresses the creation
and disbursement, as well as the accounting necessary, for such funds:

               "(a) The board of education of any school district may authorize, by separate
       resolutions, the establishment of school activity funds from which to make needed
       expenditures for the payment of expenses attributable to activities in which pupils of the
       district may participate directly or indirectly. Every such resolution shall specify the
       general purpose for which the fund is to be established and shall authorize an employee
       of the school district to administer the fund.

               "(b) The employee authorized to administer any school activity fund established
       by any resolution provided for in this section shall keep a record of all receipts and

                                                    21
       expenditures from the fund, and shall, from time to time, and at the end of each school
       year, prepare a statement for the board of education showing all receipts, expenditures,
       and the balance in the fund. The fund shall be kept separate from all other funds and be
       used only for authorized expenditures, and itemized receipts shall be taken for each
       expenditure.

               "(c) All moneys received from the sale of admissions to activities which the
       school district sponsors shall be credited to school activity funds in accordance with
       policies and procedures adopted by the board of education. Such moneys shall not be
       considered to be moneys of the school district for the purposes of K.S.A. 72-8202d, and
       amendments thereto.

               "(d) The provisions of K.S.A. 12-105b, and amendments thereto, shall not apply
       to claims against any school activity fund established by any resolution provided for in
       this section.

               "(e) As used in this section, the term 'activities' means activities, events, and
       competitions in such fields as athletics, music, forensics, and dramatics, and other
       interschool or intraschool extracurricular activities in which pupils may participate
       directly or indirectly."

This statutory scheme appears to be consistent with Petz' testimony, which indicated that
a district principal would have discretion to choose whether to reimburse one student for
transporting another student to a soccer match, tapping student activity funds for that
purpose.

       We also see nothing in the school policies or administrative guidelines that would
prohibit reimbursement of Hitze if he had chosen to seek it. As already discussed, Petz
fully reviewed the distinction between school policies and administrative guidelines. He
also made clear that neither the policies nor the guidelines prohibited reimbursement in
the situation before us. We have carefully reviewed the language of all of the policies and
                                                    22
administrative guidelines in the record on appeal and agree with his assessment. Most of
the policies and guidelines contained are irrelevant to transportation for extracurricular
activities. They instead govern daily travel to and from school, transportation of special
education students, field trips, and curricular activities. They are silent about a
prohibition of reimbursement in the situation before us. Any contrary interpretation by
the parties, their counsel, the district judge, or the Court of Appeals is simply incorrect,
adding material and meaning to these provisions that does not exist.

       As we close, we note that we need not go as far as we understood Rodriguez'
counsel to urge us to go at oral argument: We do not reach the further question of
whether the school district could adopt a policy or administrative guideline more
restrictive of reimbursement for student travel in private vehicles than the current
statutory scheme allows. We also do not decide whether a school district could choose to
ignore such a policy or guideline in a specific case. See Mallon v. City of Emporia, 11
Kan. App. 2d 494, 498, 726 P.2d 1354 (1986). These are interesting questions, but they
are not before us. The fact is that, according to the parties' evidence here, U.S.D. No. 500
had not adopted such a policy or guideline at the time Rodriguez was injured.

                                        CONCLUSION

       The travel during which Rodriguez was injured was "authorized" and "subject to
reimbursement," and thus there is coverage under the Mutual of Omaha policy language.
The decision of the Court of Appeals is reversed. The judgment of dismissal of defendant
Mutual of Omaha by the district judge is reversed, and the case is remanded to the district
court for further proceedings.

                                              23
       NUSS, C.J., not participating.
       MICHAEL J. MALONE, Senior Judge, assigned. 1

                                            ***

       JOHNSON, J., dissenting: I have no fuss with the majority's determination that the
mode of transportation to the soccer game—in the uncovered bed of a privately owned
pickup truck driven by a teenaged teammate—was "authorized by the Insured Person's
Participating School" within the meaning of the subject insurance policy, notwithstanding
the nightmarish stupidity of that authorization. Where I part company with the majority is
in its determination that such "travel [was] paid for or subject to reimbursement by the
Participating School," as required by the clear language of the Mutual of Omaha policy.
Specifically, if the school has no obligation to pay for the student's travel or no obligation
to reimburse the student for his or her out-of-pocket travel expenses, then the student has
no right to be reimbursed and the subject to reimbursement proviso has not been met.

       I believe the majority made its decision easier to reach by placing the burden on
Mutual of Omaha. But it was not Mutual of Omaha's obligation to prove that Jesus
Rodriguez was not covered by the policy issued to the Kansas State High School
Activities Association (Association), as will be discussed below. Before proceeding,
however, I would note that this case presents a somewhat unique circumstance in that the
Association contracted with Mutual of Omaha for the insurance policy, but the covered
entities are the participating schools and the potential claimants are students at those

1
 REPORTER'S NOTE: Senior Judge Malone was appointed to hear case No. 107,174
vice Justice Nuss under the authority vested in the Supreme Court by K.S.A. 20-2616.

                                              24
schools. Nevertheless, I will occasionally refer to Mutual of Omaha as the "insurer" and
Rodriguez as the "insured."

          Further, in allocating burdens in an insurance policy dispute, one first needs to
understand if the question presented involves: (1) whether the particular claim or
claimant is covered by the policy ("coverage"); or (2) whether a policy exclusionary
clause exempts or precludes an otherwise covered claim or claimant ("exclusion"). For
example, consider that a policyholder submits a homeowners' policy claim under the
personal liability portion of the policy to pay for a neighbor's bodily injury incurred when
the policyholder's 19-year-old, still-living-at-home son hit the neighbor in anger. A
coverage question would be whether the policy language extended the policy's liability
protection to cover the acts of an adult son who was still living in the household, i.e.,
whether the son was an insured person. If so, an exclusion question would be whether the
exclusionary clause prohibiting coverage for intentional torts would apply to permit a
denial of the otherwise covered claim.

          Applying that distinction to this case, one can see that we are dealing with a
coverage question, i.e., whether Rodriguez was an insured person. Mutual of Omaha is
not asserting that Rodriguez would have been a covered person but for an exclusionary
clause. To the contrary, Mutual of Omaha is simply asserting that Rodriguez was not
engaging in an insured activity at the time he was injured, i.e., was not covered by the
policy.

          The coverage versus exclusion distinction is important because it determines who
has the burden of proof. The burden allocation has been described as follows:

                  "Where, as here, an insured files suit against its insurer seeking coverage under a
          policy of insurance, the insured has the 'burden of proving he or she falls within the

                                                      25
       coverage provisions' of the policy. Brumley v. Lee, 265 Kan. 810, 963 P.2d 1224, 1232
       (Kan. 1998). More specifically, 'the insured has the burden of proof to establish the
       nature and extent of any loss and that the loss claimed was caused by one of the perils
       insured against ("covered") by the policy.' Kansas Farm Bureau Ins. Co. v. Reynolds, 16
       Kan. App. 2d 326, 823 P.2d 216, 218 (Kan. App. 1991) (internal quotation marks
       omitted). Assuming the insured can satisfy this burden, the insurer then has the burden of
       proving that any exclusionary clauses within the policy apply to preclude coverage.
       Exploration Place, Inc. v. Midwest Drywall Co., 277 Kan. 898, 89 P.3d 536, 541 (Kan.
       2004)." Advantage Homebuilding, LLC v. Maryland Cas. Co., 470 F.3d 1003, 1008 (10th
       Cir. 2006).

       Accordingly, the initial burden was on Rodriguez to establish that he was covered
by the Association's policy through Mutual of Omaha at the time he was injured. The
insurance policy defined the persons covered by the policy as "[s]tudents participating in
interscholastic competition or activities under the jurisdiction of the [Association]
including . . . covered travel as defined under the policy." Rodriguez was not yet
participating or competing when he was injured, so he could only get within the class of
insureds by proving that he was engaged in "covered travel." As the majority notes, the
policy definition of "covered travel" not only requires that the mode of travel be
authorized by the school, but also that the travel must be "paid for or subject to
reimbursement by the Participating School." I see no proof in the record that Rodriguez'
mode of transportation to the soccer game was paid for or subject to reimbursement by
Sumner Academy, i.e., no proof that he "falls within the coverage provisions" of the
policy. See Brumley v. Lee, 265 Kan. 810, 823, 963 P.2d 1224 (1998) (reciting general
rule that insured has burden of proving coverage).

       The owner of the pickup in which Rodriguez was riding to the soccer game did not
seek payment from Sumner Academy for his travel expenses, and Sumner Academy did
not pay for those travel expenses. Apparently, no student in a similar situation has ever

                                                   26
sought payment from Sumner Academy for personal vehicle travel expenses. A school
administrator declined to answer the question of whether the school would have paid the
travel expenses, if a claim for reimbursement had been made. But the majority appears to
be swayed by testimony, together with its independent assessment, that nothing in the
school policies or administrative guidelines would have prohibited Sumner Academy
from gratuitously paying the pickup owner's travel expenses from an activity fund, if a
claim had been made. In my view, the possibility that the school might make a gift to a
student equal to the expenses of private travel to a sporting event at some time in the
future when the building administrator was feeling particularly charitable and the activity
fund was flush with cash does not make Rodriguez' mode of transportation "covered
travel" under the language of the insurance policy.

       Turning to a construction of the insurance policy language, I note that a court
should review the policy as a whole and endeavor to ascertain the intent of the parties
from the language used, taking into account the parties' situation, the nature of the subject
matter of the policy, and the purpose to be accomplished. Bussman v. Safeco Ins. Co. of
America, 298 Kan. 700, 707, 317 P.3d 70 (2014). Moreover, as the majority points out,
"[w]e assign language in an insurance policy the meaning a reasonably prudent insured
would understand it to have. See Marshall v. Kansas Med. Mut. Ins. Co., 276 Kan. 97,
111, 73 P.3d 120 (2003)." Slip op. at 17. Particularly pertinent here is the admonition that
"[a]ll pertinent provisions of an insurance policy must be considered together, rather than
in isolation, and given effect." Lee, 265 Kan. 810, Syl. ¶ 3. Accordingly, we should be
construing the entire proviso—"the travel [was] paid for or subject to reimbursement by
[Sumner Academy]"—in the context of the entire policy, rather than isolating the words,
"subject to reimbursement."

       When read together—paid for or subject to reimbursement by the school—a
reasonably prudent insured would have to understand that the policy language is referring
                                             27
to travel expenses for which the school is obligated to pay and for which the student has a
right to reimbursement. In statutory construction, we sometimes apply the principle of
noscitur a sociis (it is known from its associates). In that vein, "subject to reimbursement
by the Participating School" should refer to an expense that would be in the same class of
expenditures that would be "paid for . . . by the Participating School." And reasonable
people would not understand that class of expenditures to include gratuitous, random
payments for personal travel expenses for which the school was not responsible. After all,
schools are taxpayer-funded entities. Likewise, one would expect travel expenses to be an
operating expense, rather than be paid from an activity fund.

       Moreover, reimbursement connotes an indemnification of expenses that the
student expended on behalf of or for the benefit of the school. See Black's Law
Dictionary 1476 (10th ed. 2014) (defining "reimbursement" as "1. Repayment. 2.
Indemnification."). And among the definitions of "subject to" are "liable" and
"answerable for," further suggesting that the reimbursement is not a discretionary act. See
Black's Law Dictionary 1425 (6th ed. 1990). In other words, reasonably prudent people
would expect to be reimbursed when they pay expenses rightfully charged to another
person or entity, but they generally do not expect to be gratuitously paid for expenses that
are incurred for their own benefit.

       Further, one must presume that the Association purchased the insurance policy for
the benefit of its member schools and intended for covered travel to be that which
benefitted the school. In that context, one could also presume that the insurer would want
to limit its travel exposure to those circumstances over which the school was exercising
some oversight, which would occur if the coverage were limited to students who were
travelling on a school-provided or school-funded mode of transportation.

                                             28
       Finally, a reasonably prudent insured would not expect that Sumner Academy
would be paying for more than one mode of transportation. Here, the school paid for a
bus to carry Rodriguez to the soccer game. Surely, he could not have reasonably expected
that the insurance policy language would be interpreted to mean that he could reject the
bus ride in favor of another mode of transportation, e.g., a rented stretch limousine, and
that the expense of his chosen alternate travel would be "subject to reimbursement by the
Participating School." If such were the case, one would expect a lot of lonely bus drivers.

       Notwithstanding the egregious injuries suffered by the Rodriguez in this case, it is
nevertheless incumbent on this court to construe the insurance policy in a manner to give
effect to the parties' intent. In that regard, I submit that the reason Sumner Academy had
never before had a student request reimbursement for travel expenses under this scenario
is that, as reasonably prudent persons, they knew that they were not entitled to be
reimbursed. I would find that Rodriguez was not an insured covered by the Mutual of
Omaha policy issued to the Association.

                                             29