Court Opinion

ID: 6553259
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:31:10.189758+00
Date Added: 2024-06-11T15:56:09.827864
License: Public Domain

Andree LAYTON Roaf, Judge, concurring. On December 12, 1997, Dennis J. Smith, a single man, purchased a policy of liability-only automobile insurance from appellee Atlantic Casualty Insurance Company, to cover his 1988 Ford Aerostar Van. In his application, under “driver information,” Smith listed himself and his sister, who was also single. Nevertheless, in the same application, Smith contracted with Atlantic Casualty to exclude himself as driver of the insured vehicle. Nine days later, Smith was involved in an accident while driving the insured vehicle. He was at fault and allegedly caused injuries to the appellants. After the appellants filed a negligence action against Smith in Desha County, Atlantic Casualty filed this action for declaratory judgment in Pulaski County Circuit Court, asking that the court find that it had no obligations arising from the December 21, 1997, accident, due to the named-driver exclusion contained in Smith’s policy. The trial court agreed and granted Atlantic Casualty’s motion for summary judgment. I concur with the decision to affirm the award of summary judgment, but only because the question of a named-driver-exclusion clause excluding from liability coverage the sole owner of a vehicle, while an issue of first impression in Arkansas, is a matter to be addressed by the General Assembly, not this court. Further, our supreme court has consistently upheld the validity of such provisions, albeit in cases involving facts distinguishable from the present case. See Smith v. Shelter Mutual Ins. Co., 327 Ark. 208, 937 S.W.2d 180 (1997) (upholding a clause in an automobile liability insurance policy that excluded coverage to the minor son), Cook v. Wausau Underwriters Ins. Co., 53 Ark. App. 106, 919 S.W.2d 515 (1996) (upholding a clause in an automobile liability insurance policy that excluded coverage to the spouse of the policy holder). Arkansas does not have a statute dealing specifically with named-driver exclusions. These provisions are generally authorized by Ark. Code Ann. § 27-22-101 (a) (Repl. 1994), which provides that: “This chapter is not intended in any way to alter or affect the validity of any policy provisions, exclusions, exceptions, or limitations contained in a motor vehicle insurance policy required by this chapter.” (Emphasis added.) The chapter further provides in Ark. Code Ann. § 27-22-104(a)(l), that “It shall be unlawful for any person to operate a motor vehicle within this state unless the vehicle is covered by a certificate of self-insurance under the provisions of § 27-19-107, or by an insurance policy issued by an insurance company authorized to do business in this state.” Our neighbor to the south, Louisiana, has declared named-driver exclusions invalid as to liability coverage for a named insured, in Williams v. U.S. Agencies Cas. Ins. Co., Inc., 758 So.2d 1010 (La. Ct. App. 2000). In Williams, the owner and operator of the vehicle, like Smith, was legally at fault in an accident involving the Wil-liamses and, like Smith, had purchased a liability policy with a named-driver exclusion that purported to exclude him from coverage. However, the Louisiana Court of Appeal had far different legislation to work with in reaching its conclusion that such exclusions are invalid. The relevant Louisiana statute, La. R. S. § 32-900(B)(2) provides that all automobile owner’s liability policies: Shall insure the person named therein and any other person, as insured, using any such motor vehicle or motor vehicles with the express or implied permission of such named insured against loss from the liability imposed by law for damages arising out of the ownership, maintenance, or use of such motor vehicle. The statute further provides that “notwithstanding the provisions of Paragraph (B) (2) of this Section, an insurer and an insured may by written agreement exclude from coverage any named person who is a resident of the same household as the named insured.” The Louisiana Court of Appeal found that the statute “clearly requires” that a policy provide coverage for the named insured. We have no comparable legislation in Arkansas. Consequently, insurance companies doing business in this state are free to issue liability policies such as the one issued to Dennis Smith, in which there is no liability coverage whatsoever from day one on the named owner-operator. Clearly, they may do so without fear of interference from this court.