Jacob W. Beedle v. Wisconsin Mutual Insurance Company ( 2019 )

COURT OF APPEALS
DECISION NOTICE
DATED AND FILED This opinion is subject to further editing. If
published, the official version will appear in
the bound volume of the Official Reports.
August 22, 2019
A party may file with the Supreme Court a
Sheila T. Reiff petition to review an adverse decision by the
Clerk of Court of Appeals Court of Appeals. See WIS. STAT. § 808.10
and RULE 809.62.
Appeal No. 2018AP2147 Cir. Ct. No. 2017CV115
STATE OF WISCONSIN IN COURT OF APPEALS
DISTRICT IV
JACOB W. BEEDLE,
PLAINTIFF-APPELLANT,
GROUP HEALTH COOPERATIVE OF EAU CLAIRE
AND WISCONSIN DEPARTMENT OF HEALTH SERVICES,
SUBROGATED PARTIES-PLAINTIFFS,
V.
WISCONSIN MUTUAL INSURANCE COMPANY,
JEFFREY C. PHILLIPS AND PIERCE J. PHILLIPS,
DEFENDANTS,
IMT INSURANCE COMPANY,
DEFENDANT-RESPONDENT.
APPEAL from an order of the circuit court for Iowa County:
MARGARET MARY KOEHLER, Judge. Affirmed.
No. 2018AP2147
Before Fitzpatrick, P.J., Blanchard, and Kloppenburg, JJ.
¶1 BLANCHARD, J. Jacob Beedle appeals a summary judgment
dismissing IMT Insurance Company (“the insurer”) from Beedle’s suit against the
insurer and its insured, Pierce Phillips (“the insured”), based on the circuit court’s
application of a business exclusion in a homeowner’s insurance policy. While the
insured and Beedle were constructing a pole barn together, Beedle was allegedly
injured. Beedle alleges that his injury was caused by the insured’s negligence.
The insured was primarily employed by a company to construct such barns.
However, the particular project that the insured was working on when Beedle was
allegedly injured was a side job for the insured that was not part of his primary
employment.
¶2 Beedle argues that the court erred in concluding that the business
exclusion applies here to bar coverage for losses “arising out of or in connection
with a business,” the “business” being the insured’s construction of pole barns.
Beedle contends that, because the construction project was a side job for the
insured and not part of his primary employment, it fell outside the policy’s
definition of “business.” We disagree with Beedle and agree with the circuit
court. We conclude that a reasonable insured in the position of the insured here
would understand that the business exclusion applies to exclude coverage for
claims arising out of the activity that the insured was engaged in at the time of the
alleged injuries. Accordingly, we affirm.
BACKGROUND
¶3 The following facts are undisputed. The insured worked for Cleary
Building Corporation as a foreperson in charge of a crew that constructed pole
barns. He agreed to construct a pole barn on his uncle’s farm. While this project
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involved constructing a pole barn of the same type that the insured constructed in
his work for Cleary, the project here was not undertaken pursuant to the insured’s
employment with Cleary. Instead, it was a side job for the insured.
¶4 Before work on the project began, the uncle and the insured agreed
that the uncle would pay the insured for the work. However, they did not settle on
the amount of payment until after construction was complete, when the uncle paid
the insured at least $3,000.
¶5 Beedle, a member of the insured’s crew at Cleary, offered to help on
the project at the uncle’s farm. Beedle was allegedly injured during the
construction. Beedle filed this action against the insured, the insured’s uncle, and
their respective insurers, alleging in pertinent part that the insured’s negligence
caused Beedle’s alleged injuries.
¶6 At the time of Beedle’s alleged injuries, the insured had a
homeowner’s policy that includes coverage for “personal liability” and “medical
payments to others,” subject to various exclusions. At issue here is an exclusion
for losses “arising out of or in connection with a ‘business.’”1
1
The business exclusion excludes the following:
a. “Bodily injury” or “property damage” arising out of
or in connection with a “business” conducted from an “insured
location” or engaged in by an “insured”, whether or not the
“business” is owned or operated by an “insured” or employs an
“insured”.
This Exclusion E.2 applies but is not limited to an act or
omission, regardless of its nature or circumstance, involving a
service or duty rendered, promised, owed, or implied to be
provided because of the nature of the “business”.
(continued)
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¶7 The policy defines “business” in the following subdivision, using
two paragraphs to describe alternative definitions that we now quote in pertinent
part:
3. “Business” means:
a. A trade, profession or occupation engaged in on a
full-time, part-time, or occasional basis; or
b. Any other activity engaged in for money or other
compensation, except the following:
(1) One or more activities, … for which no
“insured” receives more than $2,000 in total
compensation for the 12 months before the
beginning of the policy period.
¶8 The insurer contested coverage under the policy. The parties
stipulated to bifurcating the action to address issues of coverage before
determining liability. After the parties conducted discovery, the insurer moved for
declaratory judgment and summary judgment, arguing that the policy does not
provide coverage.
¶9 The circuit court agreed with the insurer and, accordingly, granted
both declaratory and summary judgments and dismissed the insurer from the case.
The court based its decision on a test adopted by our supreme court to construe
business exclusions in policies similar to the exclusion here. See Bertler v.
Employer Ins. of Wausau, 86 Wis. 2d 13, 20-22, 271 N.W.2d 603 (1978)
(reasonable insured would understand that any activity that an insured engages in
with “continuity” and for a “profit motive” constitutes “a trade, profession or
occupation” under a policy business exclusion).
Not pertinent to this appeal is Paragraph “b.” of the business exclusion, which provides
exceptions to the business exclusion.
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¶10 Beedle appeals the order dismissing the insurer from the case. We
provide additional facts as necessary below.
DISCUSSION
¶11 The parties agree that the dispositive issue in this appeal is whether,
based on undisputed facts, the insured’s work in constructing the barn for the
uncle was part of “[a] trade” that the insured engaged in on at least an “occasional
basis,” and therefore the exclusion applies to bar coverage. There is no dispute
that the insurer is entitled to summary judgment if the exclusion applies. The
parties also agree that whether the business exclusion applies depends on
interpretation and application of the policy’s definition of the term “business.”
¶12 We now briefly summarize the main arguments of the parties and
explain why we agree with the insurer. Thereafter we provide applicable legal
standards, address pertinent case law, and explain in more detail why we conclude
that paragraph 3.a. of the policy unambiguously excludes coverage here and why
we reject Beedle’s contrary arguments.
¶13 The dispute here turns on whether the first paragraph of the
definition of “business”—3.a.’s reference to “[a] trade, profession or
occupation”—brings Beedle’s claim against the insured within the scope of the
business exclusion. The insurer does not argue that the alternative “other activity”
definition of “business” in the second paragraph, 3.b., could provide the basis for
summary judgment in its favor. However, the parties contest how a reasonable
insured would understand paragraphs 3.a. and 3.b., when they are considered
together.
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No. 2018AP2147
¶14 The insurer argues that the only reasonable reading is that paragraph
3.a. applies to activities that constitute any trade, profession, or occupation that the
insured at least occasionally engaged in, while 3.b. addresses activities that the
insured has not engaged in even occasionally before the alleged injuries at issue
and activities such as hobbies that are often not compensated or only nominally
compensated. Under this view, 3.a. applies to exclude coverage here, because
there is no dispute that the insured at least occasionally engaged in the trade of
pole barn construction and that this was the activity he was engaged in when the
alleged injuries occurred.
¶15 In contrast, Beedle argues that one reasonable reading is that the
exclusive domains of paragraphs 3.a. and 3.b. are defined by whether the insured’s
activity at issue is primary employment work of the insured or instead is a side job
for the insured. Under this reading, all primary employment work of an insured
that might be excluded is addressed in 3.a. and all other work of any kind that
might be excluded is addressed in 3.b. As a result, the argument proceeds, “[a]
trade, profession or occupation” must involve activities that are part of the
insured’s primary source of employment, and all “other activities” must involve
non-primary employment. Using this approach, Beedle argues that, because the
project here was a side job for the insured, it is governed by 3.b. as work that
constitutes “other activity.” If this is so, coverage could be excluded only if there
is no genuine dispute that the insured made more than $2,000 on side jobs in the
year leading up to the policy period. See 3.b.(1) excluding from coverage “[o]ne
or more activities, … for which no ‘insured’ receives more than $2,000 in total
compensation for the 12 months before the beginning of the policy period.”).
¶16 For reasons we explain below, we reject Beedle’s argument as an
unreasonable reading of the definition of business in paragraph 3.a. of the policy.
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A reasonable insured would understand that the activity that the insured was
engaged in here unambiguously falls within the scope of the business exclusion as
“engage[ment] in” “[a] trade,” on an “occasional basis.” Addressing Beedle’s
argument, we conclude that 3.a. is not affected by 3.b.’s exclusion of “other
activities” and that our reading does not render 3.b. surplusage.
Standard of Review And Legal Standards
¶17 “We review a summary judgment pursuant to the same standards
and methodology as the circuit court.” American Family Mut. Ins. Co. v.
American Girl, Inc., 2004 WI 2, ¶22, 268 Wis. 2d 16, 673 N.W.2d 65. “Summary
judgment is properly granted if there is no genuine issue of material fact in dispute
and the moving party is entitled to judgment as a matter of law.” Id.; see also
WIS. STAT. § 802.08(2) (2017-18). We also review de novo the interpretation and
application of insurance policy terms to undisputed facts. See American Girl, 268
Wis. 2d 16, ¶23. The insurer’s parallel request for declaratory relief presents a
question of law and turns on the same issue of how to interpret the insurance
policy in light of relevant facts, and our review is independent. See Olson v.
Farrar, 2012 WI 3, ¶24, 338 Wis. 2d 215, 809 N.W.2d 1 (citing Bellile v.
American Family Mut. Ins. Co., 2004 WI App 72, ¶6, 272 Wis. 2d 324, 679
N.W.2d 827).
¶18 We apply the following “well-established principles when
interpreting an insurance policy”:
“An insurance policy is construed to give effect to the
intent of the parties, expressed in the language of the policy
itself, which we interpret as a reasonable person in the
position of the insured would understand it. The words of
an insurance policy are given their common and ordinary
meaning. Where the language of the policy is plain and
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No. 2018AP2147
unambiguous, we enforce it as written, without resort to
rules of construction or principles in case law.”
Fontana Builders, Inc. v. Assurance Co. of Am., 2016 WI 52, ¶37, 369 Wis. 2d
495, 882 N.W.2d 398 (quoted source omitted). “Terms, words, or phrases in an
insurance policy are ambiguous rather than plain if they are ‘fairly susceptible to
more than one reasonable interpretation.’” Preisler v. General Cas. Ins. Co., 2014
WI 135, ¶19, 360 Wis. 2d 129, 857 N.W.2d 136 (quoted source omitted). We
construe ambiguous language in favor of coverage. Fontana Builders, 369
Wis. 2d 495, ¶37.
Paragraph 3.a. Of “Business” Definition
¶19 Beedle acknowledges in his principal brief that the test adopted by
our supreme court in Bertler “gives meaning” to the policy definition of “trade,
profession or occupation,” contained in paragraph 3.a. of the business definition.2
In Bertler, our supreme court interpreted the scope of a “business pursuit”
exclusion of liability coverage in a homeowner’s policy, which defined “business”
as “‘a trade, profession or occupation.’” Bertler, 86 Wis. 2d at 20 (describing the
2
In his reply brief, Beedle makes what appears to be an alternative argument that we
reject. Beedle contends that Bertler and its progeny are distinguishable based on differences in
language between the policy here and the policy discussed in Bertler. Specifically, he notes that
the policy in Bertler excluded coverage for “‘bodily injury or property damage arising out of
business pursuits of any insured except activities therein which are ordinarily incident to non-
business pursuits.’” State v. Bertler, 86 Wis. 2d 13, 20, 271 N.W.2d 603 (1978) (quoted source
omitted). The business exclusion here, to repeat, excluded “‘bodily injury’ or ‘property damage’
arising out of or in connection with a ‘business’ … engaged in by an insured.” However, putting
to the side the problem of Beedle’s failure to raise this argument in his opening brief on appeal,
Beedle fails to develop an argument that this difference distinguishes Bertler’s interpretation of
“a trade, profession or occupation,” the key phrase in the policy’s definition of “business.”
Moreover, as we discuss in the text below, at least one other difference between the policy
language here in paragraph 3.a. and in Bertler only reinforces our conclusion that coverage is
excluded here. Similarly, as we also address in the text below, we disagree with Beedle that
paragraph 3.b.—another feature of the policy here not present in Bertler—alters our reading of
3.a.
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No. 2018AP2147
phrase “a trade, profession or occupation” as using “broad terms” and
characterizing this phrase as being “typical” of “business pursuit” policy
exclusions in homeowner policies). Interpreting this language, the court identified
and applied a two-element test for determining whether an activity constitutes a
business pursuit that is excluded. Id. at 20-22. We will call this the continuity-
profit motive test.
¶20 The continuity element of the continuity-profit motive test is
established when the activity is a “‘stated occupation’” of the insured or the
activity is a “‘customary engagement’” for the insured. Id. at 21 (quoted source
omitted). The profit motive element is established when the activity is a “‘means
of livelihood, gainful employment’” for the insured; is a means of “‘earning a
living’” for the insured; or is a means of “‘procuring subsistence[,] profit,
commercial transactions[,] or engagements’” for the insured. Id. (quoted source
omitted).
¶21 The court explained in Bertler that the continuity-profit motive test
is derived from an assessment of the “‘understanding of the ordinary insured,’”
based in part on dictionary definitions of “‘[b]usiness,’” “‘[p]ursuit,’” “‘[t]rade,’”
“‘[p]rofession,’” and “‘[o]ccupation.’” Id. at 20-22 (quoted source omitted).
Bertler teaches that an ordinary insured would understand that homeowner’s
policies are intended “‘to insure primarily within the personal sphere of the
policyholder’s life and to exclude coverage for hazards associated with regular
income-producing activities.’” Id. at 19-20 (quoted source omitted).
¶22 With the Bertler continuity-profit motive test and its rationale in
mind, we now provide additional facts here pertinent to its application in this case.
We then explain why we reject Beedle’s argument that one of this court’s later
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decisions applying Bertler supports his interpretation that Bertler distinguishes
between primary employment and side jobs, and we further explain that at least
one other feature of paragraph 3.a. reinforces our conclusion that Bertler applies
here to preclude coverage.
¶23 The following is undisputed testimony given by the insured and his
uncle in depositions regarding both the insured’s side jobs (non-Cleary work)
generally and his work on the specific construction project in which Beedle was
allegedly injured. The insured engaged in one to two side jobs per year, outside of
his Cleary assignments. He acknowledged that these side jobs were “basically
related to [his] trade in construction,” namely, constructing pole barns.
¶24 The uncle testified that, at some point before the insured began
building the barn, the uncle and the insured discussed how much money the uncle
would pay the insured for the work, but that no dollar amount was agreed to and
the uncle paid the insured only after the barn was built.
¶25 The insured testified that he had a profit motive to engage in the side
jobs, acknowledging that he did it to earn “a little extra cash” beyond what he
earned in his primary employment. The insured further testified, however, that he
did not consider the project for his uncle to be a typical side job, suggesting that
the difference from the typical side job was that he was merely helping out his
uncle by taking on the project. At the same time, however, the insured
acknowledged that the uncle paid him at least $3,000 for the work.
¶26 With that additional background, we now explain why we conclude
that the continuity and profit motive elements are met, satisfying the Bertler
continuity-profit motive test.
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¶27 Beginning with continuity, that element is clearly met once, as we
now explain, it is understood that Beedle’s focus on a distinction between primary
employment and side jobs misses the mark. Instead, what matters under the policy
language is that the insured’s primary employment and the side job here both
consisted of pole barn construction. Beedle argues that it was neither a “stated
occupation” nor a “customary engagement” for the insured here to perform one to
two side jobs per year consisting of pole barn construction, even if that work
consisted of the same activity that the insured engaged in for Cleary. Beedle relies
on the proposition that, in assessing either means of establishing continuity, a
reasonable insured would understand that only activity that an insured engaged in
as part of primary employment fits the definition of “‘business’” as a “trade,
profession or occupation.” Thus, according to Beedle, the reasonable insured in
the insured’s situation would state that his or her occupation is work for Cleary,
not building pole barns. Similarly, Beedle would determine whether an insured
“customarily” engaged in an activity as a side job by focusing exclusively on
activities engaged in as side jobs and not on activities engaged in as primary
employment. However, as we now explain, Beedle fails to recognize broad
statements in Bertler and subsequent case law that defeat his attempt to draw a
sharp line between an activity engaged in as primary employment as opposed to a
side job.
¶28 We have noted in a prior decision that Bertler characterized business
exclusions using the formulation of “a trade, profession or occupation” as
constituting “an ‘expansive definition’ of the word ‘business.’” Williams v. State
Farm Fire and Cas. Co., 180 Wis. 2d 221, 229-30, 509 N.W.2d 294 (Ct. App.
1993) (quoting Bertler, 86 Wis. 2d at 20, 22). Based on this, we made the broad
statement that an insured’s “‘business need not be the [insured’s] sole
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occupation’” in order to trigger exclusion and that “‘part-time business activities’”
are also excluded under “‘comprehensive personal liability policies.’” Id. at 230
(citing 7A J. APPLEMAN, INSURANCE LAW & PRACTICE § 4501.10 (1979)); see
also Rufener v. State Farm Fire & Cas. Co., 221 Wis. 2d 500, 506, 585 N.W.2d
696 (Ct. App. 1998) (concluding it was “of no importance” that an insured
“worked full-time in another job,” “because part-time businesses are businesses
for the purposes of the exclusion, so long as they meet the requirements of the
Bertler test”).
¶29 Moreover, Beedle fails to support his assertion that the insured’s role
in constructing the pole barn here, ignoring the fact that he engaged in side jobs in
his trade multiple times over a number of years, lacks “continuity” with the
insured’s construction of pole barns as his primary employment. The project here
clearly continued the insured’s primary employment activity. It is difficult for us
to imagine a valid version of this argument. The insured himself accepted the
characterization of his “trade” as being the “construction of the types of buildings
similar” to the pole barn that he was constructing for the uncle. As the insured
here appeared to recognize, one’s “stated occupation” is reasonably defined by the
nature of the activity in which one engages and not by making distinctions
between activities performed for employers and those not performed for
employers. We conclude that it is more than sufficient to meet the continuity
element here that both in the project at issue and in his Cleary work the insured
customarily engaged in the activity of building pole barns, regardless of his other
side jobs, and that he understood that activity to be his occupation.
¶30 Regarding profit motive, Beedle makes a brief argument that focuses
on the insured’s side jobs and asserts that these provided “at most, a nominal
supplement and not a means of livelihood.” It is sufficient to reject this argument
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that the insured acknowledged in his deposition that one of his motives in taking
on side jobs was to make “a little extra cash.” This fits within Bertler’s
description of the profit motive element as being, in pertinent part, as “‘a … means
of … procuring … profit, commercial transactions or engagements.’” See Bertler,
86 Wis. 2d at 21 (quoted source omitted). And, after the insurer provides a
supported argument that the insured was sufficiently motivated by profit to engage
in this particular construction work, Beedle does not develop a counterargument.
¶31 In sum, we conclude that the continuity-profit motive test is met
here. A reasonable insured would understand paragraph 3.a. to exclude coverage
of Beedle’s claim based on the language of “[a] trade, profession or occupation.”
¶32 Beedle argues that our decision in Monfils v. Charles, 216 Wis. 2d
323, 575 N.W.2d 728 (Ct. App. 1998), supports his position that Bertler’s
definition of the phrase “trade, profession and occupation” in paragraph 3.a. refers
only to primary employment, and not to activity engaged in as a side job. In
Monfils, a paper mill worker was sued for negligence allegedly arising from his
capacity as president of a union, and not as a mill worker. Id. at 327. As Beedle
emphasizes, in the course of determining that the insured’s non-primary
employment as union president did not trigger a policy business exclusion, we
noted that the claim against the insured did not arise out of his “primary
occupation” as a mill worker. Id. at 334.
¶33 However, Monfils does not state a categorical rule that a claim
necessarily fails to meet Bertler’s continuity-profit motive test when the pertinent
activity was outside the scope of the insured’s primary occupation. Rather,
applying the continuity-profit motive test, we determined in Monfils that the
insured’s activity outside his primary employment of serving as union president
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did not meet the necessary elements to trigger the exclusion, based on case-
specific facts involving the nature of the union presidency. See id. at 333-35 (“the
necessity of re-election [as union president] and the existence of only intermittent
duties together with the nominal compensation and the lack of a profit motive
[were] insufficient to classify [the insured’s] activities as a union president a
‘business pursuit.’”). We noted that the insured had a “primary occupation” as a
mill worker in Monfils, but only to highlight that his being a mill worker was a
separate activity from his being a union president. Then we applied the
continuity-profit motive test to his work as union president. See id. at 334-35.
This contrasts with the instant case, in which, as we have explained, the insured
engaged in pole barn construction both in his primary employment and in the barn
project here (even putting aside other side jobs), which created a single,
“continuous” activity.
¶34 We further note that one other aspect of paragraph 3.a. in the policy
here, not addressed in the course of Bertler’s interpretation of the phrase “a trade,
profession, or occupation,” also points to the conclusion that a reasonable insured
would understand that the policy here treats the pole barn construction in this case
as a “business.” Specifically, the policy here states that the “trade, profession or
occupation” at issue qualifies as a business if “engaged in on a” merely
“occasional basis,” unlike the business definition addressed in Bertler, which did
not speak in terms of merely “occasional” activity. See Bertler, 86 Wis. 2d at 21.
On this frequency-of-activity topic, the Bertler continuity-profit motive test
requires “customary engagement.” Thus, the policy language here, if anything,
sets a lower bar for insurers to clear than is established by the general continuity-
profit motive test. There is no possible argument that pole barn construction
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No. 2018AP2147
activity of the insured as a Cleary employee, even ignoring the side jobs generally,
was not at least “occasional.”
¶35 Beedle proposes a hypothetical that he contends illustrates the
unreasonableness of reading the phrase “[a] trade, profession or occupation” to
include activities that are not part of an insured’s primary employment. Beedle
first posits an insured whose primary employment is as a plumber and who
negligently destroys a home through plumbing as a side job. He then posits the
same plumber-insured destroying the same home, but this time by the means of
negligently engaging in an electrical side job. Beedle argues that, under the
reading of “[a] trade, profession and occupation” that we apply here, coverage
might well be excluded in the first instance, but not in the second, which he asserts
is an illogical or absurd result. We conclude that this hypothetical serves to
illustrate that Beedle fails to come to grips with the teaching of Bertler about what
a reasonable insured would understand about the purposes of a homeowner’s
policy. As the insurer notes, coverage would be excluded if the hypothetical
plumber-insured engaged in electrical work for compensation on a more than
occasional basis. Potential exclusion in both hypothetical situations is consistent
with the logic underlying Bertler’s continuity-profit motive test, which is that the
typical policy language puts insureds on notice that types of risk associated with
certain activities engaged in by an insured are excluded as business pursuits.
¶36 In sum, applying Bertler’s continuity-profit motive test, we agree
with the insurer that a reasonable insured in the shoes of the insured here would
understand that, per paragraph 3.a., “[a] trade, profession or occupation” engaged
in by an insured on an at least occasional basis results in the exclusion of coverage
not only for losses arising out of the insured’s primary employment with Cleary,
but also for losses arising out of the side job in which the insured was engaging at
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No. 2018AP2147
the time of the alleged injuries. We reject Beedle’s contrary reading as
unreasonably focused on primary employment, and accordingly we reject Beedle’s
argument that there is an ambiguity to be construed in favor of coverage. See
Preisler, 360 Wis. 2d 129, ¶19 (parties’ disagreement about the meaning of policy
language does not necessarily render that language ambiguous; policy language
must be susceptible to multiple reasonable interpretations).
Paragraph 3.b. Of Policy’s “Business” Definition
¶37 Beedle contends that the insurer’s reading of paragraph 3.a. fails to
read the policy as a whole, specifically that it ignores paragraph 3.b. See Connors
v. Zurich Am. Ins. Co., 2015 WI App 89, ¶28, 365 Wis. 2d 528, 872 N.W.2d 109(courts interpret insurance policy terms in the context of the policy as a whole).
Specifically, Beedle argues that a reasonable insured reading 3.b. would
understand that it “demonstrates [the insurer’s] intent to limit 3.a. to the insured’s
primary trade, profession or occupation.” Along similar lines, Beedle may also
intend to argue that a broad reading of 3.a.’s “[a] trade, profession or occupation”
would render 3.b.’s partial exclusion of “other activities” as “surplusage,” a
provision with no meaning or operative effect. See id. (“[C]onsistent with the rule
that we interpret insurance policy language from the viewpoint of a reasonable
insured, courts avoid interpreting policy language as though it adds nothing, as if it
were ‘mere surplusage.’”) (quoted source omitted). For reasons we now explain,
we reject Beedle’s arguments that 3.b. alters the analysis of 3.a.
¶38 To explain why paragraph 3.b. does not alter our interpretation of
paragraph 3.a., applying Bertler, and how that interpretation does not render 3.b.
surplusage, we briefly address how these provisions interrelate. To repeat,
paragraph 3.b. covers “[a]ny other activities … for compensation.” (Emphasis
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No. 2018AP2147
added.) That is 3.b. addresses activities “other” than those that constitute “[a]
trade, profession or occupation engaged in” on at least an occasional basis.
Further, as the insurer notes, 3.a. and 3.b. are separated by “or,” with the result that
an activity that falls under either 3.a. “or” 3.b. constitutes a “business.” Thus,
while both paragraphs can trigger the exclusion, 3.b. can do so only through
activities that do not fit within 3.a. (or that do not fit within the exceptions to the
exclusion not pertinent here).
¶39 Given the relationship between paragraphs 3.a. and 3.b., we see
nothing in 3.b. that explicitly or implicitly limits our interpretation of 3.a. As the
insurer observes, the separation of 3.a. and 3.b. with an “or” and the definition of
3.b. as activities “other” than those covered by 3.a. alerts the reasonable insured to
the fact that these provisions are meant to define separate categories of “business”:
one category excluding coverage for “trade, profession or occupation” activities
and another excluding “other activities,” allowing coverage where the “other”
activity leads to less than $2,000 in compensation during the year before the policy
was in force.
¶40 Further, paragraph 3.b. retains meaning when paragraph 3.a. is read,
consistent with Bertler, to focus on the nature of the activity engaged in by an
insured and not on whether the activity is engaged in as primary employment. A
reasonable insured would understand that an insured may engage in for-
compensation activities that do not constitute a “trade, profession or occupation”
or that do not occur on so much as an “occasional basis.” One obvious example
would be a for-compensation activity engaged in less often than “occasionally.”
Beedle does not address the “occasional basis” language of 3.a., and thus fails to
come to grips with how it undermines his argument regarding 3.b.
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¶41 Moreover, paragraph 3.b. can be triggered by any for-compensation
activity that does not otherwise fit within a “trade, profession or occupation.” The
insurer points out that activities that are typically regarded as hobbies may be
examples of such activities, because a hobby may involve earning compensation
(e.g., prize money), but is often engaged in for non-monetary reasons. Beedle fails
to develop a non-conclusory counterargument.
¶42 Stepping back, we are not persuaded by Beedle’s argument that
making a distinction between primary and non-primary employment adds clarity
to what he contends would be an otherwise indeterminate, and thus ambiguous,
line separating the policy’s alternative categories of “business.” In his most
general formulation of this argument, Beedle contends that 3.b. renders 3.a.
ambiguous because, reading the two together, a reasonable insured would not
understand where “a trade, profession or occupation” ends and where “any other
activity engaged in for money or other compensation” begins.3 As we have
explained, however, 3.b.’s definition of activities that are for-compensation and
“other” than those fitting within 3.a.’s “[a] trade, profession or occupation” is not
ambiguous as applied here. It may be true that the policy here defines “business,”
and by extension its business exclusion, in a somewhat complicated way. But
3
Beedle appears to acknowledge, in the course of pursuing this ambiguous-line-
between-categories argument, that Wisconsin Supreme Court precedent addressing a particular
type of exception to business pursuits exclusions, which Beedle initially cites, is off point. At one
point in his briefing, he cites Vandenberg v. Continental Insurance Co., 2001 WI 85, 244
Wis. 2d 802, 628 N.W.2d 876. In Vandenberg, our supreme court concluded that an exception to
a business exclusion for activities that, in the words of the policy, are “usual to non-business
pursuits,” was ambiguous when applied to the facts of that case. Id., ¶¶14, 42. However, at other
points in his briefing, Beedle acknowledges that cases such as Vandenberg, which analyze the
“usual to non-business pursuits” exception, and not a definition of business as “a trade, profession
or occupation,” are distinguishable from cases like this, where the policy has no “usual to non-
business pursuits” exception. We agree that these cases are readily distinguishable.
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No. 2018AP2147
Beedle fails to identify a reasonable basis to conclude that the boundary between
3.a. and 3.b. is ambiguous for purposes of this case. See Stuart v. Weisflog’s
Showroom Gallery, Inc., 2008 WI 86, ¶20, 311 Wis. 2d 492, 753 N.W.2d 448(“An otherwise unambiguous provision is not rendered ambiguous solely because
it is difficult to apply the provision to the facts of a particular case.”).
CONCLUSION
¶43 For all of these reasons, we conclude that the business exclusion in
the insured’s policy applies to bar coverage for Beedle’s claim arising out of the
activity that the insured was engaged in at the time of the alleged injuries.
Accordingly, we affirm the circuit court’s grant of summary judgment.
By the Court.—Order affirmed.
Not recommended for publication in the official reports.
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