Court Opinion

ID: 3029213
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:42:26.29713+00
Date Added: 2024-06-11T09:28:49.935524
License: Public Domain

NOT FOR PUBLICATION

                    UNITED STATES COURT OF APPEALS                            FILED
                           FOR THE NINTH CIRCUIT                              NOV 16 2009

                                                                          MOLLY C. DWYER, CLERK
                                                                            U.S. COURT OF APPEALS

CLARENDON NATIONAL                               No. 08-55924
INSURANCE COMPANY,
                                                 D.C. No. 2:07-cv-04526-MMM-
             Plaintiff - Appellant,              MAN

  v.
                                                 MEMORANDUM *
STATE FARM MUTUAL AUTO
INSURANCE COMPANY;
TRANSPORTATION CONNECTION,
INC, DBA Los Angeles Sightseeing Tour
and Charters, DBA Los Angeles
Sightseeing Tours of Santa Monica DBA
Santa Monica LAX Bus,

             Defendants - Appellees.

                   Appeal from the United States District Court
                      for the Central District of California
                  Margaret M. Morrow, District Judge, Presiding

                      Argued and Submitted October 8, 2009
                              Pasadena, California

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Before: KLEINFELD and TALLMAN, Circuit Judges, and LAWSON,** District
Judge.

        Clarendon appeals from the district court’s summary judgment for State

Farm. We have jurisdiction pursuant to 28 U.S.C. § 1291, and affirm.

        The district court correctly concluded that the insurance policy term,

excluding coverage when an insured vehicle is “used to carry persons for a

charge,” does not violate California law. Although the exclusion is not one of the

enumerated exclusions found under California’s Insurance Code section

11580.1(c), other exclusions are allowed under California law so long as the

insurance policy provides an “explicit description” of “the purposes for which

coverage . . . is specifically excluded.” Cal. Ins. Code § 11580.1(b)(3); see also §

11580.1(c) (stating that coverage may be excluded for the eight enumerated

reasons “[i]n addition to any exclusion provided in paragraph (3) of subdivision

(b) . . .”).

         **
             The Honorable David M. Lawson, United States District Judge for the
Eastern District of Michigan, sitting by designation.
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      State Farm’s exclusion does not violate California’s Insurance Code section

11580.1(b)(4), which mandates coverage for permissive users. As the district court

correctly explained, unlike the exclusion in Metz v. Universal Underwriters

Insurance Co., 513 P.2d 922 (1973), the exclusion in the State Farm policy applies

both to the named insureds and to permissive users equally and relates to a

particular purpose—“carrying persons for a charge”—rather than to a particular

user. Nor is the policy provision ambiguous or illusory. See Farmers Ins. Exch. v.

Knopp, 58 Cal. Rptr. 2d 331, 333 (Cal. Ct. App. 1996) (finding an almost identical

policy term excluding “[b]odily injury or property damage arising out of the

ownership, maintenance or use of a vehicle while used to carry persons or property

for a charge” unambiguous and enforceable) (emphasis added).

      The district court correctly ruled, based on the uncontradicted evidence, that

the van was being “used to carry persons for a charge” when the alleged injury

occurred. The owner of Transportation Connection “explained that the website’s

reference to ‘complimentary round-trip hotel transportation was designed simply to

avoid complaints by customers who wanted to be taken on a tour directly from

their hotel instead of being driven to Transportation Connection’s terminal in Santa

Monica.” ER 31. Though passengers paid nothing beyond the Transportation

                                         3
Connection tour fee for the “free” ride from their hotels to the tour bus terminal,

the vehicle was being used to transport only paying tour group passengers.

Transportation Connection admitted that round-trip hotel transportation was

included in the price of the tickets the Snyder party purchased. Therefore, the

exclusion was in effect, and there was no coverage under the State Farm

noncommercial policy at the time Snyder was allegedly injured.

      AFFIRMED.

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