Payne v. Safeco Insurance Companies of America , 222 Mont. 198 ( 1986 )

No. 8 6 - 8 9
IN THE SUPREME COURT OF THE STATE OF MONTANA
1986
RICHARD PAYNE and SHIRLEY PAYNE,
Plaintiffs and Appellants,
SAFECO INSURANCE COMPANIES OF
AMERICA,
Defendant and Respondent.
APPEAL FROM: District Court of the Sixth Judicial District,
In and for the County of Park,
The Honorable Byron Robb, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Knuchel & McGregor; Karl Knuchel, Livingston, Montana
For Respondent:
Landoe, Brown, Planalp, Kornmers & Johnstone; Gene I.
Brown, Bozeman, Montana
Submitted on Briefs: May 15, 1 9 8 6
Decided: June 24, 1986
Filed: JUN 2 41986
4
2
&&% Clerk
Mr. Justice Fred J. Weber delivered the Opinion of the Court.
Richard and Shirley Payne held a homeowners insurance
policy with Safeco Insurance Companies of America (Safeco).
They appeal the summary judgment of the District Court for
Park County that their Safeco policy did not cover fire
damage to several antique vehicles. We affirm.
The issue is whether the District Court correctly deter-
mined that the Paynes' insurance policy clearly and unambigu-
ously excludes the antique cars from coverage.
The Paynes own several antique vehicles, only one of
which is licensed for road use. In March 1984, the garage
containing the antique vehicles burned, damaging the vehi-
cles. The Paynes' insurance policy provided:
This coverage excludes: . . .
2. motorized vehi-
cles, except such vehicles pertaining to the ser-
vice of the premises and not licensed for road use.
...
Safeco denied coverage for damage to the vehicles based on
this provision.
The Paynes filed a complaint against Safeco alleging
failure to pay under the policy, bad faith, and breach of
contract. Safeco filed a motion for summary judgment based
on the above provision. The trial judge granted Safeco's
motion for summary judgment, stating that the language of the
policy was plain, clear, and unambiguous, that no further
discovery would change the terms of the insurance contract,
and that Safeco's denial of the Paynes' claim could not be
considered as bad faith.
The Paynes contend that a reasonable person could read
the exclusionary provision as excluding coverage for motor-
ized vehicles except for two types, 1) vehicles which were
used to service the premises, or 2) vehicles which were
unlicensed for road use. They argue that since the policy
provision is ambiguous, it must be construed against the
insurer. They city Truck Ins. Exchange v. Woldstad (Mont.
1984), 687 P.2d 1022, 41 St.Rep. 1750. In that case, the
Court stated, "[ilt is the rule of construction in Montana
that language of limitation or exclusion must be clear and
unequivocal; otherwise, the policy will be strictly construed
in favor of the insured. I
' Truck Ins., 687 P.2d at 1024-25.
The above rule is set forth in our statutes. Section
28-3-303, MCA, provides the general rule:
Writing generally to determine intention. When a
contract is reduced to writing, the intention of
the parties is to be ascertained from the writing
alone if possible, subject, however, to the other
provisions of this chapter.
Section 28-3-206, MCA, sets forth the exception for
ambiguity:
Uncertainty to be resolved against party causing
- In cases of uncertainty
it. ...the language of
a contract should be interpreted most strongly
against the party who caused the uncertainty to
exist ...
We conclude that the insurance policy clause at issue here is
within the general rule. The grammatical structure of the
clause is such that both "pertaining to the use of the prem-
ises" and "not licensed for road use" modify the same word,
"vehicles." If the clause was meant to include two excep-
tions to the coverage exclusion, it would properly be written
either with a disjunctive 'or' between the exceptions, or as:
"vehicles pertaining to the service of the premises and
vehicles not licensed for road use . . .." As it is written,
the policy clearly and unambiguously covers only those vehi-
cles which meet both of the requirements set forth in the
provision.
There have been no allegations that the antique vehicles
in any way pertained to the service of the premises. We
therefore affirm the District Court's conclusion that, as a
matter of law, the Safeco insurance policy did not provide
coverage for damage to the Paynes' antique vehicles.
Affirmed.
We Concur: I
Justices