Court Opinion

ID: 9564641
Source: CourtListenerOpinion
Date Created: 2023-08-21 19:04:41.804386+00
Date Added: 2024-06-11T09:18:35.599080
License: Public Domain

Judge CASEBOLT
dissenting.
In my view the term “pedestrian” should be given the meaning that the parties both contracted for and defined in the insurance policy. Accordingly, I respectfully dissent.
The rights and duties of the parties to an automobile insurance policy are defined by the terms and conditions of the insurance contract. As in other areas of contract law, the language of an insurance policy is determinative of the intent of the parties. Lopez v. Dairyland Insurance Co., 890 P.2d 192 (Colo.App.1994). See Radiology Professional Corp. v. Trinidad Area Health Ass’n, 195 Colo. 253, 577 P.2d 748 (1978) (intent of the parties to a contract is to be determined primarily from the language of the document itself).
Insurance contract terms are to be construed as they would be understood by a person of ordinary intelligence. Simon v. Shelter General Insurance Co., 842 P.2d 236 (Colo.1992). When construing the language of an insurance contract, one should not read its provisions in isolation, but must consider them as a whole. Security Insurance Co. v. Houser, 191 Colo. 189, 552 P.2d 308 (1976).
If a limitation or exclusion in the policy is unambiguous, the limitation or exclusion must be enforced. State Farm Mutual Automobile Insurance Co. v. Mendiola, 865 P.2d 909 (Colo.App.1993).
An integrated contract is to be interpreted in its entirety with the end of seeking to harmonize and to give effect to all provisions so that none will be rendered meaningless. Pepcol Manufacturing Co. v. Denver Union Corp., 687 P.2d 1310 (Colo.1984). When the parties give contractual terms specific meanings, those provisions should control. See Thomas v. Great Western Sugar Co., 773 P.2d 582 (Colo.App.1988).
Here, each policy contains an identical “anti-stacking” clause that essentially limits uninsured benefits to the proceeds of one policy if the insured sustains bodily injury as a pedestrian. While the term “pedestrian” is not specifically defined in the uninsured or general definitions section of the policy, it is defined in the no-fault section of the contract to mean “a person not occupying a motor vehicle or machine operated by a motor or engine.”
Because of the presence of the definition of that term in the contract, in my view a person of ordinary intelligence would understand that such definition would apply throughout the entire agreement. It would defeat, rather than fulfill, the expectations of a policyholder to convey two different meanings for the same word. Indeed, to permit defined terms to have variable meanings could throw into question whether there had been a “meeting of the minds” necessary for the formation of a contract. Thus, because the intent of the parties is to be ascertained primarily from the terms of the contract itself, and the parties have supplied a definition in the contract, I see no need to supply a “common meaning” that conflicts with that understanding.
The majority reasons that, because “pedestrian” is italicized within the no-fault coverage and is not italicized in the uninsured motorist section, different meanings are required. I disagree. The policy does not state that certain words have a different meaning from definitions set forth if they are not italicized. The mere failure to italicize a word should not affect its meaning when the parties have supplied their own definition. The stated definition should control throughout.
The majority further reasons that the term “pedestrian” in the no-fault section of the policies is technical in nature because it is based on the statutory definition of this term contained in § 10-4-703(9), C.R.S. (1994 RepLVol. 4A). That is precisely the point. The parties here decided to give the term the technical meaning set forth in the statute and the policy, and we are not at liberty to rewrite their contract. See Federal Deposit Insurance Corp. v. American Casualty Co., 843 P.2d 1285 (Colo.1992).
The majority further states that the statutory definition of “pedestrian” under the No-Fault Act is used to define expansively the persons who may obtain no-fault benefits *1160rather than, as here, to specify those who are restricted from obtaining benefits. However, the anti-stacking provision does not prevent the insured from obtaining benefits. Rather, it simply limits benefits to the proceeds of one policy, an effect which is consistent with the public policy of this state. See Shelter Mutual Insurance Co. v. Thompson, 852 P.2d 459 (Colo.1993).
Moreover, uninsured motorist coverage merely permits an injured insured to recover for loss caused by an uninsured motorist in the same manner and to the same extent that recovery would be permitted for a loss due to the negligence of an insured motorist. Cung La v. State Farm Automobile Insurance Co., 830 P.2d 1007 (Colo.1992). Hence, the statute does not require full indemnification of losses suffered at the hands of uninsured motorists under all circumstances. Terranova v. State Farm Mutual Automobile Insurance Co., 800 P.2d 58 (Colo.1990).
Furthermore, it is incongruous to define a term statutorily as broader than its common meaning for the purpose of granting no-fault coverage, see, e.g., Trinity Universal Insurance Co. v. Hall, 690 P.2d 227 (Colo.1984), but then to disregard that statutory meaning and judicially interpret the very same word in a much narrower sense here for the purpose of defeating a coverage limitation. See Rau v. Liberty Mutual Insurance Co., 21 Wash.App. 326, 585 P.2d 157 (1978) (statutory policy vitiates any attempt to make meaning of “insured” for purposes of uninsured motorist coverage narrower than meaning of term under liability section).
The majority also reasons that the use of three distinct categories in describing when uninsured motorist benefits under multiple policies may not be stacked indicates an intention to limit the anti-stacking clause to only those enumerated circumstances. The majority’s interpretation of “pedestrian” would have the effect of preventing stacking for insureds who are injured while on foot, yet allow stacking for insureds who fortuitously are injured by motor vehicles while riding bicycles, using skate boards, or roller skating. In my view, this distinction would lead to inconsistent and absurd results.
Furthermore, such an interpretation would encourage disputes between insureds and carriers to determine whether the insured qualifies as someone other than a “person who travels on foot,” see Rose v. Allstate Insurance Co., 782 P.2d 19 (Colo.1989), rather than following the statutory and policy no-fault definition which would allow easy application to numerous factual situations. Defining a pedestrian in accordance with the statute and as stated in the policy here is in harmony with the recognition that persons involved in automobile accidents will generally fall into two simple categories: those who are “occupying” a vehicle by riding in or upon it and those who are not, the latter being classified as “pedestrians.” Rose v. Allstate Insurance Co., supra.
In addition, in my view the requirement for uninsured motorist coverage is part of a comprehensive legislative scheme regulating automobile insurance policies. Thus, unless defined otherwise in the policy, the terms used should be afforded the same definitions as those contained in statutes dealing with automobile insurance, in particular, the No-Fault Act.
Provisions of the No-Fault Act have been applied to uninsured motorist coverage. For example, In Lopez v. Dairyland Insurance Co., supra, a division of this court applied § 10-4-721, C.R.S. (1994 Repl.Vol. 4A) to a claim involving uninsured motorist coverage. That statutory section, found in the No-Fault Act, allows insurers to exclude certain named drivers from insurance coverage. The division held that the statute was applicable to preclude uninsured motorist coverage for a passenger injured while riding in the described vehicle because the policy specifically excluded the named individual driver.
In Cung La v. State Farm Automobile Insurance Co., supra, the court held that the meaning of the term “arising out of’ contained in the liability section of an automobile insurance policy had the same meaning when applied to the uninsured motorist provisions of that policy.
In Aetna Casualty & Surety Co. v. McMichael, 906 P.2d 92 (Colo.1995), the court held that the uninsured motorist statute requires insurers to offer uninsured motorist coverage *1161to a class of persons or entities as extensive as the class covered under the liability provisions of an automobile insurance policy.
When an insurer proposes to issue an automobile insurance policy in this state, there are three things it must do. First, it must offer liability coverage in an amount that is required by both the Motor Vehicle Financial Responsibility Act, see § 42-7-103(2), C.R.S. (1993 RepLVol. 17), and the No-Fault Act, see § 10-4r-706(l)(a), C.R.S. (1994 Repl.Vol. 4A). Second, it must provide PIP benefits as set forth in the No-Fault Act. See § 10-4-706(l)(b), C.R.S. (1994 Repl.Vol. 4A). Third, it must offer uninsured and underinsured motorist coverage, which must be included in the policy unless rejected by the insured in writing. See § 10-4-609, C.R.S. (1994 Repl. Vol 4A); Aetna Casualty & Surety Co. v. McMichael, supra.
The purposes of providing these benefits are similar. The declared purpose of the No-Fault Act is to avoid inadequate compensation to victims of automobile accidents. This overall purpose is clearly served by imposing upon the insurer a duty to offer uninsured and underinsured motorist coverage so as to protect the insured against the risk of inadequate compensation for damages sustained in an automobile accident with an uninsured motorist. McMichael v. Aetna Insurance Co., 878 P.2d 61 (Colo.App.1994), aff'd sub nom. Aetna Casualty & Surety Co. v. McMichael, supra.
Thus, because of this overlap and integration, there are cogent policy reasons to read the definitions in one section of an automobile insurance policy to apply in other sections dealing with a different type of coverage when the contract language does not preclude it.
Finally, contrary to the majority’s reasoning, the definition of “pedestrian” in the No-Fault Act is not expressly limited to that Act. Section 10-4-703, C.R.S. (1994 Repl.Vol. 4A) states:
As used in this part 7, unless the context otherwise requires:
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(9) ‘Pedestrian’ means any person not occupying or riding in or upon a motor vehicle or machine operated by a motor or engine.
Nothing in this language limits that definition to part 7. Rather, this section simply indicates that, as used in the No-Fault Act, the term has that specific meaning. Thus, nothing in the statute prohibits the use of the No-Fault Act’s definition of “pedestrian” in other statutes dealing with automobile insurance or in other sections of an automobile insurance policy.
Because I would apply the policy definition and the identical statutory definition here, I would affirm the trial court’s determination.