DocketNumber: No. 2009AP1422
Citation Numbers: 325 Wis. 2d 740, 2010 WI App 94
Judges: Brunner, Hoover, Peterson
Filed Date: 5/4/2010
Status: Precedential
Modified Date: 9/9/2022
¶ 1. Jessica Siebert appeals a summary judgment in favor of Wisconsin American Mutual Insurance Company declaring there is no coverage for her negligent entrustment claim against Jessica Koehler. The circuit court concluded that, because there was no coverage for the driver's negligent operation of a vehicle, there was also no coverage for Koehler's negligent entrustment of the vehicle to the driver. We disagree. We therefore reverse and remand.
BACKGROUND
¶ 2. Koehler lent her father's car to Jesse Raddatz to run an errand. Raddatz instead used the car to pick up Siebert and go to a party. On the way to the party, Raddatz got into an accident, injuring Siebert. Siebert sued Koehler's father's insurer, Wisconsin American, alleging its automobile liability policy covered Raddatz's negligence. Under the policy, Raddatz's negligence would be covered if he was an insured person. In this situation, that meant he must have had permission to
¶ 3. The court then permitted Siebert to amend her complaint to assert a claim that Koehler negligently entrusted the car to Raddatz. Wisconsin American moved for summary judgment, arguing the independent concurrent cause rule barred coverage for this claim. It contended that Siebert's negligent entrustment claim against Koehler depended on Raddatz's negligent driving. Based on the jury verdict, there was no coverage for Raddatz's driving. Therefore, Wisconsin American argued it follows that there is also no coverage for Koehler's negligent entrustment. Wisconsin American also contended issue preclusion prevented Siebert from proving negligent entrustment: because the jury found Raddatz exceeded the scope of Koehler's permission, Siebert could not prove Koehler permitted Raddatz to use the car the way he did.
¶ 4. The circuit court did not address the latter argument. But it agreed with Wisconsin American that Siebert's negligent entrustment claim was barred by the independent concurrent cause rule:
The alleged negligence of Raddatz is not covered under the policy pursuant to the jury's finding... [he] exceeded the scope of permission. And so Raddatz's negligent operation of the vehicle is an excluded risk. And because the negligent entrustment claim against Koehler requires the occurrence of Raddatz's negligence and because a claim for Raddatz's negligence is excluded under the policy, the alleged negligent entrustment by Koehler is not an independent concurrent cause.
The court therefore granted summary judgment in favor of Wisconsin American.
¶ 5. Whether a circuit court properly granted summary judgment is a question of law we review independently. Torgerson v. Journal/Sentinel, Inc., 210 Wis. 2d 524, 536, 563 N.W.2d 472 (1997). Summary judgment is proper when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Wis. Stat. § 802.08(2).
1. Independent concurrent cause rule
¶ 6. "The independent concurrent cause rule operates to extend coverage to a loss caused by the insured risk even though the excluded risk is a contributory cause, where a policy expressly insures against loss by one risk but excludes loss caused by another risk." Estate of Jones v. Smith, 2009 WI App 88, ¶ 5, 320 Wis. 2d 470, 768 N.W.2d 245 (citation and internal punctuation omitted). "The independent concurrent cause must provide the basis for a cause of action in and of itself and must not require the occurrence of the excluded risk to make it actionable." Id. (citation omitted).
¶ 7. Siebert argues the independent concurrent cause rule does not apply here because her negligent entrustment claim does not implicate an excluded risk. We agree.
¶ 8. The circuit court concluded that because there was no coverage for Raddatz's negligence under the Wisconsin American policy, it was an "excluded risk." However, this conclusion conflates lack of cover
¶ 9. Here, Raddatz was not an insured person under the Wisconsin American policy because he exceeded the scope of Koehler's permission. But that does not mean Koehler's policy excluded the risk that an individual entrusted with the insured car might cause bodily injury while using the car. The policy promises to "pay damages an insured person is legally liable for because of bodily injury and property damage due to the use of a car . . . ." Individuals other than the driver can be insured persons: " [Liability can arise when any person [negligently entrusts another with a vehicle]." Bankert, 110 Wis. 2d at 475-76. There is no dispute Koehler was an insured person under the policy. The risk that Koehler could incur liability for lending her father's car to someone who then operated it negligently, then, was a risk the policy insured. Indeed, Wisconsin American's argument that Koehler's coverage depends on Raddatz's coverage implicitly concedes this. If Koehler's coverage depends on Raddatz's coverage, it would follow that Koehler would be covered for the risk of entrusting Raddatz with her father's car had he operated it within the scope of her permission.
¶ 11. As discussed above, however, Siebert's negligent entrustment claim — unlike the claim in Estate of Jones — does not implicate an excluded risk. Raddatz's own negligence may be excluded from coverage, but the risk associated with Koehler lending her car to him is not. The rule therefore does not apply here.
¶ 12. Wisconsin American also argues that the jury's conclusion Raddatz exceeded the scope of permission precludes Siebert's negligent entrustment claim because it prevents Siebert from arguing Raddatz had permission to use the car the way he did. Siebert counters that it is immaterial Koehler did not permit Raddatz to do what he eventually did. What is important, she contends, is simply that Koehler permitted Raddatz to use the car.
¶ 13. We agree with Siebert. To prove negligent entrustment, Siebert must show Koehler (1) was initially in control of the vehicle, (2) permitted Raddatz to use it, and (3) knew or should have known Raddatz intended or was likely to use the vehicle in a way that would create an unreasonable risk of harm to others. See Bankert, 110 Wis. 2d at 469, 475-76; see also Wis JI—Civil 104 (2003). The issue, then, is not whether Koehler actually permitted Raddatz to use the car as he did, but whether she entrusted it to him and knew or should have known he would use it in a way that would create an unreasonable risk. See id. Therefore, the jury's conclusion Raddatz acted outside the scope of Koehler's permission does not preclude Siebert from showing Koehler negligently entrusted Raddatz with the car.
By the Court. — Judgment reversed and cause remanded.
References to the Wisconsin Statutes are to the 2007-08 version.
Beyond the fact that the independent concurrent cause rule does not apply here, Wisconsin American's argument that it bars coverage is problematic. As described in the text of this opinion, the independent concurrent cause rule extends coverage to an excluded risk when a loss is also caused by an insured