Karlov v. Home Indemnity Co.

THIRD DIVISION
OCTOBER 30, 1996
No. 1-95-1754
JASON KARLOV, ) Appeal from the
Plaintiff-Appellant, ) Circuit Court of
) Cook County.
)
v. ) No. 93 CH 2381
)
)
THE HOME INDEMNITY COMPANY and ) Honorable
THE HOME INSURANCE COMPANIES, ) Thomas P. Durkin,
Defendants-Appellees. ) Judge Presiding.
JUSTICE CERDA delivered the opinion of the court:
Plaintiff, Jason Karlov, brought this declaratory judgment
action seeking a determination that he was covered under a
business auto policy issued by defendants, The Home Indemnity
Company and The Home Insurance Companies (hereinafter Home), to
Crown Glass Corporation (Crown) and others, including his
stepfather, Berle Blitzstein. Plaintiff alleged that he was
injured as a result of a motor vehicle collision with David
Gardner on March 13, 1991, in Newton, Massachusetts, and sought a
declaration that he was entitled to underinsured motorists
coverage from Home under the policy. Plaintiff now appeals from
the trial court's grant of summary judgment to Home. The trial
court found that even if Berle Blitzstein was a named insured,
and plaintiff was a member of Blitzstein's family, Blitzstein did
not own the motorcycle plaintiff was riding and the underinsured
motorists coverage in the policy applied only to "those autos you
own." On appeal, plaintiff contends the insurance policy
unambiguously provides coverage to plaintiff; or, if ambiguous,
the policy should be construed in plaintiff's favor; and the
"Drive Other Car" endorsement does not apply to restrict coverage
to plaintiff.
Defendant's motion for summary judgment stated that at the
time of the collision plaintiff was operating a motorcycle which
he owned and which was not a "covered auto" under the Home
policy. Following the collision, plaintiff received payment of
the $100,000 policy limits from Gardner's automobile insurance
policy. Plaintiff's own policy of insurance contained liability
limits of $15,000 per person, so that underinsured motorists
coverage under that policy was not available to plaintiff once
the limits of Gardner's policy had been paid to plaintiff. The
Home business auto policy here was issued to Crown. Home relied
in part on a section entitled "COVERED AUTOS," which limited
uninsured/underinsured motorist coverage to owned autos.
Defendants also contended that coverage for plaintiff as a family
member of Berle Blitzstein was excluded by a "Drive Other Car"
endorsement, which excluded uninsured/underinsured coverage for
family members injured while occupying any auto owned by any
family member. Since plaintiff was injured while operating a
motorcycle he owned, defendant argued plaintiff was excluded from
coverage.
Plaintiff argued that he was an insured under the business
auto policy and that the "drive other car" provisions were not
applicable in the context of underinsured motorists coverage to
deny him coverage. In order to establish that he was a family
member of a named insured under the policy, plaintiff submitted
his own affidavit and the affidavit of his mother, stating that
on or before March 13, 1991, he was a resident of the household
of his stepfather Berle Blitzstein; he was away from home
attending Brandeis University in Waltham, Massachusetts; and
Berle Blitzstein was president and chief operating officer of
Crown and married to Barbara Blitzstein, plaintiff's mother.
Berle Blitzstein's affidavit further stated that he was an agent
and beneficiary of a partnership and two trusts listed as insured
under the Crown policy.
Plaintiff argued that the "Drive Other Car" endorsement did
not restrict the underinsured motorists coverage. Plaintiff
noted that the "Drive Other Car" endorsement, by its express
terms, only applied to medical payments coverage and uninsured
motorists coverage and the title of the endorsement, "Drive Other
Car Coverage-Broadened Coverage For Named Individuals," showed
that the endorsement was not meant to restrict the coverage
provided elsewhere in the policy but was intended to broaden it.
Plaintiff stated that the endorsement added to who was an insured
and that it did not make sense that a policy holder would pay an
extra premium for an endorsement broadening coverage that, when
applied, had the effect of narrowing coverage.
Home replied that although the Drive Other Car endorsement
broadened coverage to certain potential insureds, coverage did
not extend to the situation here where the vehicle was owned by
the potential insured. Under the declarations section of the
policy only automobiles owned by a named insured required to have
uninsured motorists coverage were included in the scope of the
uninsured/underinsured motorists coverage. Plaintiff was not a
named insured, the motorcycle he owned was not covered, and no
uninsured or underinsured motorists coverage extended to
plaintiff.
We agree with plaintiff that construction of insurance
contracts is a question of law and thus a proper subject of
motions for summary judgment. Continental Casualty Co. v.
Flomenhoft, 263 Ill. App. 3d 22, 25 (1994). Our review is de
novo. U S G Corporation v. Sterling Plumbing Group, Inc., 247
Ill. App. 3d 316, 318 (1993). Also, where the provisions of the
insurance policy are clear and unambiguous, there is no need
for construction, but where a provision of an insurance policy
can reasonably be considered ambiguous, it will be construed in
favor of the insured. Hartford Casualty Ins. v. Medical
Protective Co., 266 Ill. App. 3d 781, 788 (1994); Ansvar American
Insurance Co. v. Hallberg, 209 Ill. App. 3d 206, 210 (1991).
The trial court concluded that even if Berle Blitzstein was
the named insured, he did not own the motorcycle and there was no
coverage for plaintiff because the policy definition specified
"those autos you own." In ruling, the trial judge "assumed" that
Berle Blitzstein was a named insured and that plaintiff was his
family member. However, since plaintiff owned the motorcycle,
there was no coverage. This result follows from the clear and
unambiguous language in the policy.
The Declarations page of the policy defined different
coverages such as liability, personal injury, medical payments,
uninsured motorists, underinsured motorists, physical damage,
collision and physical damage, towing and labor, by use of
numerical symbols. Using the numerical symbol 6, the
Declarations page of the policy shows uninsured/underinsured (the
terms are used interchangeably) motorists coverage with limits of
$350,000. The section of the policy, entitled "Business Auto
Coverage Form," states that various provisions in the policy
restrict coverage. Section I is entitled "Covered Autos" and
contains a subsection, "A: Description of Covered Auto
Designation Symbols," which states in part:
"6. Owned 'Autos' Subject To A Compulsory
Uninsured Motorists Law.
Only those 'autos' you own that because of the law in
the state where they are licensed or principally
garaged are required to have and cannot reject
Uninsured Motorists Coverage. This includes those
'autos' you acquire ownership of after the policy
begins provided they are subject to the same state
uninsured motorists requirement."
An endorsement, "Drive Other Car Coverage - Broadened Coverage
for Named Individuals," provides in part as follows:
"C. Changes In Auto Medical Payments And
Uninsured Motorists Coverages:
The following is added to WHO IS AN INSURED:
Any individual named in the Schedule and his or her
'family members' are 'insured' while
'occupying' or while a pedestrian when being
struck by any 'auto' you don't own except
Any 'auto' owned by the individual or by any
'family member.'"
These policy provisions, taken together, exclude coverage
for plaintiff since it is not disputed that plaintiff owned the
motorcycle he was driving at the time of the injury. Plaintiff
argues that the "Drive Other Car Coverage - Broadened Coverage
For Named Individuals" endorsement does not apply because it
restricts coverage, and its title, stating that it broadens
coverage cannot make sense. The policy treats uninsured and
underinsured motorists coverage together. A note to the
endorsement states: "When uninsured motorists is provided at
limits higher than the basic limits required by a financial
responsibility law, underinsured motorists is included unless
otherwise noted." It is not inconsistent for an endorsement
broadening covering for "Named Individuals" to contain some
restrictions in that coverage. We do not consider that the
placement of the restrictive language in the "Business Auto
Coverage" portion of the policy and the endorsement creates an
ambiguity. Illinois Farmers Insurance Co. v. Cisco, 278 Ill.
App. 3d 1022, 1025 (1996) (location of clause excluding coverage
for a vehicle other than the insured vehicle, i.e., uninsured
motorists coverage, unless the owner of that vehicle had no other
applicable insurance, in "Other insurance" section rather than
"Exclusions" section of policy, did not create ambiguity where
the wording was clear without regard to its location in the
policy.) Summary judgment was proper. Plaintiff was not
entitled to underinsured motorists coverage under this policy
because he owned the motorcyle he was driving when he was injured
and the policy clearly excludes coverage for such a vehicle even
when the owner is a member of the insured's family.
Therefore, the judgment of the circuit court of Cook County
is affirmed.
Affirmed.
TULLY, P.J., and GALLAGHER, J., concur.