Court Opinion

ID: 9513657
Source: CourtListenerOpinion
Date Created: 2023-08-06 22:38:46.404533+00
Date Added: 2024-06-11T09:05:57.629319
License: Public Domain

SANDSTROM, Justice,
concurring in part and dissenting in part.
[¶ 57] I concur in Part I, Part II A, B and C, and Part III of the majority opin*383ion. I respectfully dissent from Part II D and E, Part IV, and Part V.
I
[¶ 58] I would hold there is no basis for allocation of losses between Center and Grinnell because Grinnell’s “Farm-Guard Policy” does not provide any coverage in this case. The liability section of Grin-nell’s “Farm-Guard Policy” obligates it to “pay subject to the liability limits and the terms of the policy all sums arising out of any one loss which an insured person becomes legally obligated to pay as damages because of bodily injury or property damage covered by this policy.” Grinnell concedes this provision could provide coverage in this case, but argues an exclusion in its policy applies that takes this coverage away: “We will not pay for bodily injury or property damage arising out of the ownership, operation, maintenance, rental or use of ... any motor vehicle by any insured person.” The majority, at ¶20, misanalyzes this exclusion by engaging in a logical fallacy:
The language of the policy is unambiguous. It does exclude liability arising out of the use of the pickup. However, it is equally as clear that it does not exclude liability arising out of “the ownership, operation, maintenance, rental or use of’ a farm implement. The next logical question is whether the insured, Has-kins, was using a farm implement, the tractor, at the time of the accident. Liability arising out of the use of a farm implement in the context of this case is a covered risk. Haskins was “using” the tractor within the meaning of the policy and there is coverage.
The majority concedes that the policy excludes liability arising from the use of the pickup. The policy explicitly states the exclusion. But then the majority claims, “However, it is equally as clear that it does not exclude liability arising out of ‘the ownership, operation, maintenance, rental or use of a farm implement.” Id. The majority’s statement is misleading in a number of ways. The policy contains no such statement, despite the majority’s use of quotation marks. It is not “equally clear” when it is not stated. Further, the majority uses the phrase “does not exclude” but proceeds to treat that phrase as the equivalent of “includes.” The policy does not state that it “includes liability arising out of the ownership, operation, maintenance, rental or use of a farm implement.” Contrary to the implication of the majority, this is not a policy that both explicitly includes all liability arising out of the use of a farm implement and excludes all liability arising out of the use of a motor vehicle such as the pickup. The policy would provide liability coverage in general except that it excludes all liability arising out of the use of a motor vehicle as defined by the policy.
[¶ 59] The logical fallacy of the majority is similar to this: North Dakota law excludes all incarcerated felons from voting. North Dakota law does not exclude persons over 18 years of age from voting. Therefore, under the majority’s logic, an incarcerated felon over 18 years of age is eligible to vote because persons over 18 years of age are not excluded from voting.
[¶ 60] Here the policy excluded an accident arising from the use of “any motor vehicle.” The “motor vehicle” in use, which triggers the exclusion, is not the tractor that was being towed, but the pickup truck that was doing the towing. Liability here is unambiguously excluded.
II
[¶ 61] The majority next proceeds into analysis of concurrent coverage.
[¶ 62] Concurrent coverage under both an automobile policy and a general liability *384policy exists when a vehicle-related act of negligence and a nonvehicle-related act of negligence are involved in the same accident. Houser v. Gilbert, 389 N.W.2d 626, 631 (N.D.1986). A general liability policy will apply only if the liability of the insured exists independently of any “use” of the insured’s vehicle. See, e.g., Columbia Mut. Cas. Ins. Co. v. Coger, 35 Ark.App. 85, 811 S.W.2d 345, 347 (1991); Allstate Ins. Co. v. Jones, 139 Cal.App.3d 271, 188 Cal.Rptr. 557, 561 (1983); North Star Mut. Ins. Co. v. Holty, 402 N.W.2d 452, 455 (Iowa 1987). Newton v. Nicholas, 20 Kan.App.2d 335, 887 P.2d 1158, 1165 (1995); State Farm Fire and Cas. Co. v. Huyghe, 144 Mich.App. 341, 375 N.W.2d 442, 444 (1985); American States Ins. Co. v. Porterfield, 844 S.W.2d 13, 16 (Mo.Ct.App.1992). For example, in Coger, 811 S.W.2d at 346, a truck owned by a lumber company and operated by its employees was delivering lumber when part of the load fell off the truck, landed on the highway, and collided with a van. The lumber company had a general liability policy with an automobile exclusion similar to the one in this case. Id. The trial court had ruled the exclusion did not apply because negligence was alleged in the maintenance of the straps used to secure the load and in securing the load. Id. The appellate court reversed, concluding “whether or not the lumber briefly came to rest before being struck by the van, and whether the negligent act was the operation of the vehicle, the securing of the load, or the maintenance of the straps securing the load, the injury and damage clearly arose out of the ownership, maintenance, or use of the truck or attached equipment and was therefore not covered by the policy.” Id. at 347.
[¶ 63] In Jones, 188 Cal.Rptr. at 558, the insured owned a pickup truck that was equipped with an open-ended, overhead steel rack used to store and transport re-bar. The truck collided with another vehicle, and as a result of the impact and improper storage of the load of rebar, the rebar struck the driver of the other vehicle, killing him. Id. at 559. The insured had a general liability policy with an automobile exclusion similar to the one in this case. Id. The court rejected the argument that the exclusion did not apply because there was non-auto-related independent negligence in inspecting, supervising, loading, securing, and fastening the rebar to the rack on the truck:
[W]e have no alternative but to conclude that both of the acts of negligence which occurred to cause the death of Mr. Jones were auto-related. Defendants contend that we cannot so conclude because the parties stipulated that the first act of negligence was the failure of Alberts to properly “load, secure, fasten, supervise and inspect the rebar.” Yet this argument ignores the obvious. Alberts’ failure to inspect, etc. would not have been negligent were it not for his use of the truck. The stipulated failure to “load, secure, fasten, supervise and inspect the rebar” in a non-negligent manner, implicitly refers to the failure to do so on the truck.
Id. at 561.
[¶ 64] In Holty, 402 N.W.2d at 453, a farmer was driving his truck when an auger, attached to the truck’s left side, came loose and extended across the center line of the road, injuring a person in an oncoming vehicle. The farmer had a farm liability policy with an automobile exclusion similar to the one in this case. Id. The court ruled the farm liability policy did not provide coverage because “the accident cannot be properly characterized as nonvehicle-related and caused solely by the auger.” Id. at 455. The court noted, not only did the “truck, box and auger constitute one motorized vehicle,” but “[i]f Holty is hable *385it is not for a general failure to adequately tie down the auger; that act could not render him liable without his use of the vehicle on a public road,” and “the movement of the auger depended on the truck’s movement and velocity to become a hazard.” Id.
[¶ 65] In Huyghe, 375 N.W.2d at 443, a woman was injured when she was struck in the back of the head by a cleat attached to the insured’s house to secure a clothesline between the house and garage. The cleat was pulled free when the insured hit the clothesline while driving his pickup truck under the clothesline. Id. The woman alleged the insured had negligently maintained the premises and negligently located and installed the clothesline and cleat because the insured regularly drove his truck under the clothesline between the house and garage. Id. The court concluded a similar automobile exclusion to the insured’s homeowner’s policy precluded coverage because “[a]ny risk created by the location or the installation of the clothesline and cleat was the result of the truck’s being driven in that area,” and therefore, “the non-auto-related negligence is connected to the use of a motor vehicle.” Id. at 444.
[¶ 66] In Porterfield, 844 S.W.2d at 14, an employee of the insured was driving a truck that was pulling a trailer carrying a small tractor when the trailer became unhitched and collided with another vehicle. The court rejected the argument that a similar automobile exclusion to the insured’s general liability policy did not apply because the insured was negligent in the supervision of his employees in the proper method of hitching the trailer to the truck. Id. at 15. The court concluded the “injuries arose out of the use of the truck and not from negligent supervision and therefore there is no coverage for any injuries arising out of the automobile accident.” Id. at 16.
[¶ 67] In Newton, 887 P.2d at 1159, several vehicle passengers were injured when they were struck by a 500-gallon water tank that had fallen from a flatbed truck driven and owned by the insured. The insured attached the tank to the truck by using a logging chain, the principal use of the truck was to haul water, and the tank was attached to the truck “75% or more of the time.” Id. at 1160. The plaintiff alleged the collision was caused solely by the insured’s “nonvehicle-related acts of negligence and carelessness in failing to tie down or secure the water tank.” Id. The insured’s homeowner’s liability insurer argued its policy did not provide coverage because of a similar automobile exclusion, and the court agreed:
There is no question that the activity in the present case involved the direct use of a motor vehicle. The negligence which occurred in this case by hauling a water tank that had not been properly inspected or secured to the truck bed does not exist independent of the ownership, maintenance, use, and loading and unloading of the vehicle. The injury occurred in this case because the water tank was being negligently hauled by a motor Vehicle, and Nicholas’ negligent actions in failing to inspect the apparatus holding the tank to the truck bed and his failure to properly secure it in the first place were directly connected to the transportation of the tank and do not exist independently from the use of the truck.... [T]he failure to inspect and properly secure the tank implicitly and logically refers to the failure to do so on the truck.
In the present case, every act which occurred leading to the claimants’ injuries was directly connected with the hauling of the water tank by use of a *386motor vehicle, an event excluded by the policy provision at issue.
Id. at 1165.
[¶ 68] In Heimerman v. Franklin Mut. Ins. Co., No. 89-0495, 1989 WL 154479, 450 N.W.2d 255 (Wis.Ct.App.1989) (Unpublished), a pickup truck owned by the insured was towing a bale thrower wagon when the truck and wagon were involved in a collision with another vehicle. The owner of the pickup truck had a farmowner’s policy with an automobile exclusion similar to the one in this case. A hearing examiner (the insurer was undergoing liquidation) ruled there was no coverage, concluding “the accident resulted from the ownership and use of a motorized vehicle as defined by the policy and would not have occurred absent negligent operation of the motorized vehicle.” Id. at *1. The appellate court affirmed and rejected the argument that the policy should be interpreted to provide coverage because it did not specifically exclude coverage for the towing of a farm implement:
[The policy] excludes coverage for liability resulting from the use of a motorized vehicle. The accident occurred due to the use of a motorized vehicle which was towing a nonmotorized vehicle. The policy cannot be read to cover the towing of the baler wagon merely because the insurer did not list specifically the countless uses of a motorized vehicle.
Id. at *2.
[¶ 69] Application of the concurrent coverage doctrine has not been uniform among the various jurisdictions, not even among the appellate courts in particular jurisdictions. See Annot., Construction and effect of provision excluding liability for automobile-related injuries or damage from coverage of homeoimer’s or personal liability policy, 6 A.L.R.4th 555 (1981). I agree, however, that because liability insurance is written for a specific hazard to enable the underwriter to calculate premiums on an equitable and predictable basis, “[t]he coverage under [an] automobile policy is ... ‘dovetailed’ into the exclusion under [a] comprehensive policy to provide for uniform, non-duplicative liability coverage.” Northern Ins. Co. of New York v. Ekstrom, 784 P.2d 320, 324 (Colo.1989). Consequently, whenever possible, “[t]he coverage provision in an automobile liability policy and an exclusionary clause in a general liability policy should therefore be construed the same.” Id.
[¶ 70] The majority’s reliance on the fact situation in Houser, 389 N.W.2d at 630, to support concurrent coverage in this case is unpersuasive, because in Houser the farm liability insurer “concede[d] that it is liable under the general farm coverage for the loss caused by the failure to remove the mud and the failure to warn” subsequent to the use of the truck. Under the undisputed facts of this case, I believe Haskins’ alleged negligence in hooking up the rope was inextricably intertwined with his “use” of the pickup to tow the tractor and cannot be considered a nonvehicle-related act of negligence. Because Jones’s injuries arose from the use of Haskins’ pickup, the exclusion applies. There is an exception to this exclusion relating to farm employees, but there is no evidence that Jones was Haskins’ employee, gratuitous or otherwise. See Center Mut. Ins. Co. v. Thompson, 2000 ND 192, ¶ 16, 618 N.W.2d 505 (defining employee for purposes of insurance policy as a person who works for another in exchange for compensation). Consequently, I would hold Grinnell’s policy does not provide any coverage in this case, and there is no basis for allocation of losses between Center and Grinnell.
[¶ 71] I would also reject Center’s attempt to invoke the doctrine of reasonable expectations to impose liability under Grin-nell’s policy. The doctrine of reasonable *387expectations has not been adopted by a majority of this Court. See, e.g., Thompson, 2000 ND 192, ¶ 12, 618 N.W.2d 505. Moreover, the doctrine is merely an interpretive tool in the construction of ambiguous insurance contracts, RLI Ins. Co. v. Heling, 520 N.W.2d 849, 854-55 (N.D.1994), and Center has not shown any ambiguity in the Grinnell policy requiring resort to the use of the doctrine. See Medd v. Fonder, 543 N.W.2d 483, 487 (N.D.1996). Even if a majority of this Court were to adopt the doctrine of reasonable expectations, the doctrine cannot create coverage that unambiguously does not exist under Grinnell’s policy.
Ill
[¶ 72] I would hold the trial court correctly ruled Center’s automobile policy provided the sole coverage for Jones’s injuries in this case, and would affirm the trial court’s award of six percent interest to Grinnell on its $25,000 settlement with Jones from the date of the settlement.
[¶ 73] Dale Sandstrom