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United National Insurance Co. v. St. Paul Reinsurance Co.

United States District Court,M.D. Pennsylvania.

UNITED NATIONAL INSURANCE COMPANY, Plaintiff

v.

ST. PAUL REINSURANCE COMPANY, Centennial Insurance Company, Defendant.

Civil No. 1:CV-07-2092.

Oct. 17, 2008.

MEMORANDUM

WILLIAM W. CALDWELL, District Judge.

I. Introduction

We are considering motions for judgment on the pleadings filed by Defendants, St. Paul Reinsurance Company and Centennial Insurance Company (doc. 16 and 30, respectively). Plaintiff, United National Insurance Company, filed this declaratory judgment action concerning the obligation of St. Paul and Centennial to defend their insured, Clouse Trucking, Inc. Clouse was a defendant in an action filed by Land O’Lakes, Inc. (“LOL”) and Dairy Marketing Services, LLC (“DMS”) in the Court of Common Pleas of Cumberland County, Pennsylvania (“original action”). United National undertook Clouse’s defense and later settled the matter. St. Paul and Centennial, however, declined to defend Clouse in the original action. St. Paul’s and Centennial’s motions seek a declaration that, as a matter of law, they had neither a duty to defend Clouse nor an obligation to contribute or indemnify United National. We will grant the motions for judgment on the pleadings and enter a declaratory judgment in favor of Defendants.

II. Background

The original action alleged that Clouse delivered a load of raw milk, that had been previously rejected due to the presence of antibiotics, to LOL’s Mt. Holly Springs facility. Complaint ¶ 4. Upon delivery, the contaminated milk was pumped into a silo containing uncontaminated milk. Id. Consequently, LOL was forced to dispose of 484,360 pounds of milk. Id.

LOL and DMS filed an amended complaint alleging seven counts against Clouse Trucking, namely:

Count VI-fraudulent misrepresentation

Count VII-vicarious liability

Count VIII-negligent misrepresentation

Count IX-vicarious liability

Count X-negligence

Count XI-breach of contract implied in fact or in law

Count XII-negligence.

Complaint ¶ 9. United National undertook the defense of Clouse pursuant to a reservation of rights. Complaint ¶ 13. Defendants denied coverage under their policies. Complaint ¶ 14.

In August of 2006, a mediation was held and a settlement was reached of $85,000. United National for Clouse agreed to pay $47,500, while the remaining settlment amount was to be paid by others. Complaint ¶ 15. Plaintiff also incurred attorney and litigation expenses of $73,333.91. Complaint ¶ 17.

Plaintiff filed a three count complaint in the Court of Common Pleas of Cumberland County. Count I sought contribution from St. Paul. Count II sought indemnification and Count III alleged St. Paul was unjustly enriched. United National sought damages of $120,833.91. Counts IV, V and VI raised the same claims against Centennial. Complaint ¶¶ 29-38.

United National filed its complaint for declaratory judgment in state court; however, St. Paul removed the case to this Court. (doc. 1). We have subject matter jurisdiction pursuant to 28 U.S.C. § 1332(a), and we may consider an action seeking a declaratory judgment under 28 U.S.C. § 2201.

III. Discussion

As indicated, United National’s complaint sets forth claims for contribution, indemnity, and unjust enrichment based on St. Paul’s and Centennial’s refusals to defend Clouse in the original action. Upon review of the terms of St. Paul’s policy, we find St. Paul had no duty to defend Clouse because the events were not an “occurrence” as defined by the insurance policy. Also, upon review of the terms of Centennial’s policy, we find Centennial had no duty to defend based on the policy exclusions and limits of coverage.

A. Standard of Review

The Defendants have filed motions for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c).Rule 12(c) provides: “After the pleadings are closed-but early enough not to delay trial-a party may move for judgment on the pleadings.”In such a motion, the moving party must show that “there are no material issues of fact, and that he is entitled to judgment as a matter of law.”  Sikirica v. Nationwide Ins. Co., 416 F.3d 214, 220 (3d Cir.2005). We view the facts and any inferences to be drawn from the facts in the light most favorable to the nonmoving party. Id.

B. Duty to Defend

We first consider whether Clouse’s allegations triggered St. Paul’s duty to defend under the terms of its insurance policy. “The duty to defend is different from and greater than the duty to indemnify.”  Biborosch v. Transamerica Ins. Co., Inc., 412 Pa.Super. 505, 603 A.2d 1050, 1052 (Pa.1992). The insurer has a duty to defend if the complaint’s factual allegations state a claim which could potentially be covered under the policy. Id. Our analysis focuses on the terms of the insurance policy and the allegations in the complaint. Roman Mosaic & Tile Co. v. Aetna Cas. & Sur. Co., 704 A.2d 665, 669 (Pa.Super.1997). We are to take the factual allegations of the complaint as true and liberally construe the complaint, resolving doubts in favor of the insured. Unionamerica Ins. Co., Ltd. v. J.B. Johnson, 806 A.2d 431, 433-34 (Pa.Super.2002) (citing Cadwallader v. New Amsterdam Cas. Co., 396 Pa. 582, 152 A.2d 484 (Pa.1959)). We note, however, the importance of the factual allegations, not merely the causes of action set forth in the complaint. See  Mutual Benefit Ins. Co. v. Haver, 555 Pa. 534, 725 A.2d 743, 745 (Pa.1999) ( “The particular cause of action that a complainant pleads is not determinative of whether coverage has been triggered.”); Pacific Indem. Co. v. Linn, 766 F.2d 754, 760 (3d Cir.1985) (“The obligation to defend is determined solely by the allegations of the complaint in the action.”). Here, the insurance policy is a Commercial General Insurance Policy that St. Paul issued to Clouse, and the relevant allegations are found in the original action filed by LOL and DMS against Clouse and other defendants (“the Original Complaint”).

The policy provided, in relevant part:

We will pay those sums that the insured becomes legally obligated to pay as damages because of ‘bodily injury’ or ‘property damage’ to which this insurance applies. We will have the right and duty to defend the insured against any ‘suit’ seeking those damages. However, we will have no duty to defend the insured against any ‘suit’ seeking damages for ‘bodily injury’ or ‘property damage to which this insurance does not apply.

(doc. 16, ¶ 23). With respect to its applicability, the policy provided:

This insurance applies to ‘bodily injury’ and ‘property damage’ only if:

(1) The ‘bodily injury’ or ‘property damage’ is caused by an ‘occurrence’ that takes place in the ‘coverage territory’; and

(2) The ‘bodily injury’ or ‘property damage’ occurs during the policy period;

Id.The policy defined “occurrence” as follows: “ ‘Occurrence’ means an accident, including continuous or repeated exposure to substantially the same general harmful conditions.”Id.  ¶ 24.While the policy did not define “accident,” the Pennsylvania Supreme Court has explained that “the term ‘accident’ within insurance policies refers to an unexpected and undesirable event occurring unintentionally, and that the key term in the definition of the accident is ‘unexpected’ which implies a degree of fortuity.”  Donegal Mut. Ins. Co. v. Baumhammers, 595 Pa. 147, 938 A.2d 286, 292 (Pa.2007).

In considering the relationship between the allegations and the terms of the policy, we also consider “whether the injuries that are the impetus of the action were caused by an ‘accident’ so as to constitute an occurrence under the policy.”Id. Put another way, our inquiry is “whether the conduct causing the harm was alleged to be intentional or negligent.”  Commerce & Indus. Ins. Co. v. Snow Envtl. Serv., Inc., No. 95-2241, 1996 WL 750018, at(E.D.Pa. Dec.30, 1996).

As already noted, LOL set forth the following claims against Clouse: (1) Fraudulent Misrepresentation, (2) Negligent Misrepresentation, (3) Negligence and (4) two claims of Vicarious Liability. (doc. 16, pp. 14-20). DMS set forth claims for Breach of Contract Implied in Fact or in Law, and Negligence. Id. at 20-22.Each vicarious liability claim is based on the allegations supporting the fraudulent and negligent misrepresentation claims. Amended Complaint, ¶¶ 97, 98, 112, 113.

1. LOL’s Claims Against Clouse

St. Paul argues that it had no duty to defend Clouse in the Underlying Suit because the factual allegations supporting LOL’s claims “set forth merely breach of contract and fraud claims, with no basis for a claim in negligence.”(doc. 16, p. 18). United National contends that coverage is not precluded simply because it alleged alternate theories of liability. (doc. 25, p. 9). That is, in addition to allegations of intentional conduct, United National’s complaint contained allegations of negligent conduct and negligent misrepresentation falling under the “occurrence” language in St. Paul’s policy. Id. As a result, according to United National, at least some of the allegations came within the area of coverage, triggering St. Paul’s duty to defend. See  Agora Syndicate, Inc. v. Levin, 977 F.Supp. 713, 715 (E.D.Pa.1997) (insurer has duty to defend “if any of the allegations in the complaint may potentially fall within the area of coverage”).

Taking the allegations of the original complaint as true, we find that the allegations sound in intentional conduct by Clouse. LOL’s injury was the destruction of milk resulting from the mixing of the condemned milk delivered by Clouse with other milk in LOL’s storage silo. Original Complaint ¶ 54. A review of the allegations leading to LOL’s injury shows a series of intentional acts by Clouse in delivering condemned milk when it knew it was not fit for human consumption. According to LOL, Clouse was familiar with state requirements for the testing of milk, particularly with respect to the presence of antibiotics. Id.  ¶ 16.When the milk involved here was first delivered to the Lehigh Valley Dairy (“LVD”) processing plant, LVD officials informed Clouse that the milk was condemned due to the presence of such antibiotics and had to be dumped. Id.  ¶ 26.LVD officials placed metal seals on the compartments containing the condemned milk, id.  ¶ 24, placed a tag on the delivery truck indicating the milk’s status, id.  ¶ 25, noted its rejection on the delivery receipt, id.  ¶ 27, and forwarded results of the milk tests to state officials, id.  ¶ 29.

Clouse’s alleged actions in the face of LVD’s rejection of the milk reveal the intentional nature of Clouse’s conduct. According to LOL, Clouse, despite its familiarity with state requirements concerning the handling of condemned milk, id.  ¶ 16, engaged in the following activity in an attempt to resell the milk to LOL: it created a new delivery receipt omitting LVD’s rejection of the milk, id.  ¶ 36; it forged the signature of the driver who delivered the milk to LVD, id.; it removed the seal placed by LVD on the delivery truck, id.  ¶ 38; it removed the antibiotics tag placed on the truck by LVD, id.; it delivered false samples of raw milk to LOL, id.  ¶ 41; it directed its driver to deliver the condemned milk to LOL and present the forged receipt, id.  ¶ 43; and it represented to LOL that there was no reason not to accept the milk, id.  ¶ 47.

These allegations, particularly the false representations concerning the quality of the milk, formed the basis for LOL’s fraudulent misrepresentation claim in the original action. See Original Complaint, ¶¶ 87-95. St. Paul had no duty to defend based on this cause of action because fraudulent misrepresentation, as defined in Pennsylvania, requires intent to mislead. See  Bouriez v. Carnegie Mellon Univ., No. 02-2104, 2007 WL 2492735, at(W.D.Pa. Aug.30, 2007). The fraudulent misrepresentation claim alleged that Clouse made representations “with the intent of misleading LOL into relying upon such representations so that it would accept the raw milk.”Original Complaint, ¶ 91. An intentional act is not a covered “occurrence” under a liability policy because it is not an accident. See  Davis v. Maryland Ins. Co., 38 F.Supp.2d 387, 392-93 (E.D.Pa.1999) (finding insurer had no duty to defend a fraudulent misrepresentation claim because it was not an accident). The policy St. Paul issued to Clouse defined “occurrence” as an “accident”, therefore, St. Paul had no duty to defend Clouse, based on LOL’s misrepresentation claim. Additionally, since one of the vicarious liability claims was based entirely on the fraudulent misrepresentation allegations, St. Paul had no duty to defend this cause of action as well. See  Selective Ins. Co. v. Bean Funeral Homes & Crematory, Inc., No. 06-03828, 2008 WL 879840, at(E.D.Pa. Mar.31, 2008) (finding no duty to defend vicarious liability claim based on underlying claim for which there was no duty to defend).

We also find that St. Paul had no duty to defend Clouse on the negligent misrepresentation and negligence claims. This conclusion is based on our evaluation of the factual allegations supporting these claims. The negligent misrepresentation claim alleged, in relevant part:

104. The Defendants owed a duty to LOL to supply milk not prohibited from use in products for human consumption.

105. The Defendants breached the duty by supplying raw milk to LOL when they had actual knowledge, or had reason to know, that such raw milk was prohibited from use in products for human consumption.

106. The representations of the Defendants as aforementioned were made with the intent that LOL would rely upon such representations.

107. The Defendants failed to exercise reasonable care or competence in communicating to LOL the fitness of the raw milk for human consumption.

108. LOL did justifiably rely upon the representations of the Defendants to its detriment.

109. The negligent misrepresentations made by the Defendants were the proximate cause of the damages suffered by LOL.

110. As a result of the negligent misrepresentations of the Defendants, LOL was caused to suffer damages in the amount of $100,898.

Original Complaint, ¶¶ 103-110. The allegations in the negligence claim provided:

119. Clouse Trucking and Cloverland knew that the Condemned Milk within the Clouse Trucking truck could not be used for dairy products for human consumption.

120. Clouse Trucking and Cloverland knew that LOL intended to use raw milk delivered by them to LOL for dairy products for human consumption.

121. Clouse Trucking and Cloverland had a duty not to cause to be delivered to LOL raw milk that could not be used for human consumption.

122. Clouse Trucking and Cloverland had a duty to notify LOL that the Condemned Milk could not be used in dairy products for human consumption.

123. Clouse Trucking and Cloverland breached the aforesaid duties when they delivered to LOL the Condemned Milk that was not suitable to be used in dairy products for human consumption.

124. Clouse Trucking and Cloverland breached the aforesaid duty when they failed to notify LOL that the Condemned Milk could not be used in dairy products for human consumption.

LOL’s general allegations that Clouse was merely negligent by misrepresenting the quality of the milk or by delivering unfit milk are belied, however, by the complaint’s specific allegations which were incorporated by reference into each claim. See id.  ¶¶ 103.LOL alleged that its personnel “specifically asked Clouse if there was any reason not to take the milk, and he responded that there was not,”id.  ¶ 47, despite Clouse’s instructions to its driver to deliver the condemned milk and to present the forged receipt, id.  ¶ 44.LOL also alleged that Clouse knew that the condemned milk did not meet state safety requirements, id.  ¶¶ 22-28, and that such milk was not fit for human consumption, id.  ¶ 43.The specific allegations concerning the steps Clouse took to conceal the nature of the condemned milk, see id.  ¶¶ 36-47, also show Clouse’s awareness that the milk was not suitable for human consumption.

These allegations, which indicate intentional conduct, are not saved by designating them as negligence claims. See  Agora Syndicate, Inc. v. Levin, 977 F.Supp. 713, 715-16 (E.D.Pa.1997) (explaining: “[I]f the factual allegations of the complaint sound in intentional tort, arbitrary use of the word ‘negligence’ will not trigger an insurer’s duty to defend.”). As discussed, the nature of these factual allegations, not the label of the cause of action, controls St. Paul’s duty to defend. See supra, at 3. The allegations regarding Clouse’s conduct do not support a conclusion LOL’s injury was the type of “unexpected and undesirable event occurring unintentionally” which would constitute an accident. See  Donegal, 938 A.2d at 292. Indeed, Clouse was allegedly well aware that the condemned milk could not be used for human consumption. See Original Complaint, ¶ 43. Lacking allegations that LOL’s injury was caused by anything other than intentional conduct, we cannot conclude that there was an “accident .” Consequently, St. Paul’s had no duty to defend based on the negligent misrepresentation and negligence claims contained in the Original complaint.

Based on this rationale, St. Paul had no duty to defend based on the vicarious liability claim that was linked to the negligent misrepresentation claim.

2. DMS’s Claims

The original complaint contained two claims by DMS against Clouse. DMS, a company that marketed milk from producers in Pennsylvania, used Clouse to pick up raw milk from producers and deliver it to dairy plants. Original Complaint, ¶ 10. The implied breach of contract claim alleges that Clouse had an implied agreement with DMS to deliver milk and that delivery of DMS’s milk in the same sanitary condition as when received was one of the implied terms of the agreement. Id.  ¶¶ 128-29.Clouse allegedly breached this agreement by commingling the DMS milk and the condemned milk, resulting in the contamination of the DMS milk. Id.  ¶ 130-31.These allegations also form the basis for DMS’s negligence claim against Clouse. See id.  ¶¶ 133-38.

As with LOL’s claims, we find that DMS’s implied breach of contract and negligence claims did not trigger St. Paul’s duty to defend. St. Paul argues that DMS’s breach of implied contract claim fell within the policy’s contractual liability exclusion. See doc. 16, p. 22. According to St. Paul, when the underlying facts reveal a breach of contract claim, a contractual liability exclusion clause in the policy precludes coverage, even when alternative tort theories are presented. Id. (citing Snyder’s Hearing Co. v. Pa. Manuf. Assoc. Ins. Co., 715 A.2d 483 (Pa.Super.1998)). United National attempts to distinguish Snyder’s by arguing that DMS and Clouse had no written agreement, and that the implied agreement did not rise “to the level of creating a contractual relationship regarding the harm alleged.”(doc. 25, p. 16). We are not persuaded by this distinction. The policy excludes coverage for “ ‘property damage’ for which the insured is obligated to pay damages by reason of the assumption of liability in a contract or agreement.”(doc. 16, pp. 2-3). DMS and Clouse are alleged to have had an “implied agreement” in which Clouse’s duties were to pick up DMS’s uncontaminated milk and deliver it to dairy plants. See Original Complaint, ¶ 127. DMS’s implied breach of contract claim alleged a breach of the duties arising from this agreement. Accordingly, it is excluded from coverage pursuant to the language of the policy.

Similarly, by contaminating the DMS milk during its delivery to LOL, the negligence claim concerns a breach in the performance of one of Clouse’s duties in the implied agreement. Inasmuch as this duty arose from an agreement between DMS and Clouse concerning the carriage and delivery of milk, it sounds in breach of contract and is also excluded from coverage. Thus, St. Paul had no duty to defend based on DMS’s causes of action in the original action.

St. Paul also argues that other exclusions in the insurance policy support its decision not to defend Clouse, but based on our conclusions, we need not consider these arguments.

C. Centennials Motion for Judgment on the Pleadings

Centennial sets forth four arguments in support of its motion, namely: 1) The policy did not cover the loss since LOL’s milk was not in transit on Clouse’s vehicle; 2) The policy excludes coverage for property damage caused by dishonest acts or “any willful act intended to cause a ‘loss’;” 3) The policy was excess coverage only; and 4) It had no duty to defend. (Def.’ Br. in Supp. J. On the Pleadings at 5-6). Here, the relevant policy is Centennial’s Cargo Carrier Liability.

Under Pennsylvania law, “a court must ascertain the intent of the parties as manifested by the language of the written agreement” when interpreting an insurance policy. Harleysville Ins. Companies v. AETNA Casualty and Surety Ins. Co., 568 Pa. 255, 795 A.2d 383, 386 (Pa.2002) (citations omitted).“When the policy language is clear and unambiguous, the court must give effect to the language of the contract.”Id.

We agree with Centennial’s argument that its policy does not cover LOL’s loss. Under the clear and unambiguous terms of Centennial’s policy, only “Covered Property … of others in due course of transit under tariff, bill of lading, shipping receipt or contract of carriage issued by [Clouse]” is protected under the policy. (doc. 30, ¶ 16). LOL’s milk was at no time in transit on a truck operated by Clouse. LOL’s milk was located in a silo at their facility. The condemned milk was transported to the facility by Clouse and pumped into LOL’s silo. Only at that time did LOL’s milk become contaminated.

We also agree that Centennial’s policy precludes coverage. Clouse’s actions were dishonest, or willful acts intended to cause a loss. The policy excludes from coverage loss caused by “dishonest or criminal” acts, and “[a]ny willful act intended to cause a ‘loss’ committed by you or anyone else at your direction.”Id. Our previous discussion concerning St. Paul’s policy is applicable here. Since the allegations of the original complaint sound in intentional or dishonest conduct by Clouse, Centennial had no duty to defend.

Based on the rationale discussed supra, Centennial also had no duty to defend based on the vicarious liability claim that was linked to the negligent misrepresentation claim.

We also find that Centennial did not have a duty to defend based on the language of its policy. Centennial argues its policy only provides it the right to defend, but not the duty to defend. The policy grants Centennial “the right to … provide a defense for legal proceedings….”Id.There is no duty to defend where the policy does not impose one. See  King Aluminum Corp. v. Hyndman III Ins. Agency, Inc., 370 F.Supp. 621 (E.D.Pa.1974); Widener University v. Fred S. James & Co., Inc., 371 Pa.Super. 79, 537 A.2d 829 (Pa.Super.1988). The clear and unambiguous language of the policy dictates Centennial had the right, but not the duty, to defend.

Lastly, Centennial argues that its policy was for excess coverage. To resolve a dispute over primary and excess coverage, we must not focus “solely on the nature of the policy,” but must look to the “plain meaning of the policy terms.”  Harleysville Ins. Companies, 795 A.2d at 386-87. The Centennial policy provides:

If you have other insurance covering the same “loss” as the insurance under this Coverage Part, we will pay only the excess over what you should have received from the other insurance. We will pay the excess whether you can collect on the other insurance or not.

(doc. 30, ¶ 16) (emphasis added). Centennial’s policy clearly states it will pay “only the excess” over what a insured should receive from “other insurance.” The other insurance in this case was United National’s policy, and its settlement was well below its policy limits. Centennial was not obligated to contribute to or indemnify the Plaintiff.

VI. Conclusion

Based on the foregoing discussion, we will grant Defendants’ motions for judgment on the pleadings.

ORDER

AND NOW, this 17th day of October, 2008, upon consideration of Defendants’ motions for judgment on the pleadings, filed April 29th, 2008 (doc. 16) and August 27th, 2008 (doc. 30), and pursuant to the accompanying Memorandum, it is ordered and decreed that:

1. Defendants’ Motions for Judgment on the Pleadings, are granted;

2. St. Paul Reinsurance Company was not required to provide a defense or indemnification to the Named Insured, Clouse Trucking, Inc., pursuant to the terms and conditions of the St. Paul Reinsurance Policy No. SPL50277, in the suit initially filed in the Court of Common Pleas of Cumberland County, Pennsylvania on June 13, 2003 (No. 03-2782);

3. Centennial Insurance Company was not required to provide a defense or indemnification to the Named Insured, Clouse Trucking, Inc., pursuant to the terms and conditions of the Centennial Insurance Company Policy No. 259018819, in the suit initially filed in the Court of Common Pleas of Cumberland County, Pennsylvania on June 13, 2003 (No. 03-2782);

4. The Clerk of Court shall close this file.

United Farm Family Mutual Ins Co. v. Pearce

Court of Appeals of Ohio,Third District, Auglaize County.

UNITED FARM FAMILY MUTUAL INSURANCE COMPANY, Plaintiff-Appellee,

v.

Michael N. PEARCE, Jr., et al., Defendants-Appellees,

andCarol Shaner, et al., Intervenors-Appellants.

No. 2-08-07.

Decided Oct. 20, 2008.

PRESTON, J.

I. Facts/Procedural Posture

{¶ 1} Intervenors-appellants, Carol and Phillip Shaner (hereinafter “the Shaners”), appeal the Auglaize County Court of Common Pleas grant of summary judgment in favor plaintiff-appellee, United Farm Family Mutual Insurance Company (hereinafter “United Farm”). For reasons that follow, we affirm.

{¶ 2} Defendant-appellee, Michael N. Pearce, Jr. (hereinafter “Pearce”), owns and operates a blacktop business called “Blacktop Services.” On October 18, 2006, Pearce was blacktopping a private driveway off of State Route 66 near St. Mary’s, Ohio. Toward the evening hours and the end of the job, Pearce backed his dump truck up to the back of the driveway to unload some blacktop and finish the job. The dump truck was blocking State Route 66’s northbound lane. Carol Shaner was driving northbound on State Route 66, struck the dump truck, and was injured.

{¶ 3} On November 15, 2006, the Shaners filed a complaint against Pearce, Blacktop Services, and Motorists Mutual Insurance Company  alleging negligence and seeking damages sustained as a result of the accident. Sometime after the accident, Pearce notified United Farm of a potential claim by the Shaners under the commercial general liability (CGL) policy it issued for Blacktop Services. On October 4, 2007, United Farm filed a declaratory action with the trial court seeking a declaration of its rights and responsibilities under the policy. United Farm argued that it was not required to defend against claims or provide coverage, because bodily injury arising out of the ownership, maintenance, or use or entrustment to others of an “auto,” as that term is defined in the policy, is excluded.

The complaint named several “John Does” as well. It is unclear from the record herein whether the complaint was later amended to add United Farm or whether Motorists Mutual Ins. Co. is a subsidiary of United Farm. However, it appears that United Farm issued a separate motor vehicle insurance policy for Pearce’s dump truck. (Doc. No. 20, Ex. C).

{¶ 4} On October 31, 2007, the Shaners filed a motion to intervene in the declaratory action, and the trial court granted the motion on November 2, 2007. On March 27, 2008, United Farm filed a motion for summary judgment. On April 14, 2008, the Shaner’s filed a memorandum in opposition to summary judgment. On April 17, 2008, the trial court granted United Farm’s motion for summary judgment finding that the insurance policy excludes coverage because Pearce’s dump truck is an “auto” and not “mobile equipment,” as those terms are defined in the policy.

{¶ 5} On May 16, 2008, the Shaners filed a notice of appeal to this Court and now assert two assignments of error for review.

II. Standard of Review

{¶ 6} An appellate court reviews a grant or denial of summary judgment pursuant to Civ.R. 56(C) de novo. Wampler v. Higgins (2001), 93 Ohio St.3d 111, 127, 752 N.E.2d 962, citing Doe v. Shaffer (2000), 90 Ohio St.3d 388, 390, 738 N.E.2d 1243, citing Grafton v. Ohio Edison Co. (1996), 77 Ohio St.3d 102, 105, 671 N.E.2d 241. To prevail under Civ.R. 56(C), a party must show: (1) there are no genuine issues of material fact; (2) it appears from the evidence that reasonable minds can reach but one conclusion when viewing evidence in the nonmoving party’s favor, and that conclusion is adverse to the nonmoving party; and (3) the moving party is entitled to judgment as a matter of law. Civ.R. 56(C); Shaffer, 90 Ohio St.3d at 390; Grafton, 77 Ohio St.3d at 105.

{¶ 7} Material facts have been identified as those facts “that might affect the outcome of the suit under the governing law.”  Turner v. Turner (1993), 67 Ohio St.3d 337, 340, 617 N.E.2d 1123, citing Anderson v. Liberty Lobby, Inc. (1986), 477 U.S. 242, 248 91 L.Ed.2d 202, 106 S.Ct. 2505. “Whether a genuine issue exists is answered by the following inquiry: Does the evidence present “a sufficient disagreement to require submission to a jury” or is it “so one-sided that one party must prevail as a matter of law[?]”Id., citing Liberty Lobby, Inc., 477 U.S. at 251-52.

{¶ 8} Summary judgment should be granted with caution, resolving all doubts in favor of the nonmoving party. Perez v. Scripts-Howard Broadcasting Co. (1988), 35 Ohio St.3d 215, 217, 520 N.E.2d 198. “The purpose of summary judgment is not to try issues of fact, but is rather to determine whether triable issues of fact exist.”  Lakota Loc. Schools Dist. Bd. of Edn. v. Brickner (1996), 108 Ohio App.3d 637, 643, 671 N.E.2d 578.

III. Analysis

ASSIGNMENT OF ERROR NO. I

The trial court erred in granting summary judgment finding that the commercial general liability policy of insurance excludes coverage for the injuries sustained by Carol Shaner on October 18, 2006.

{¶ 9} In their first assignment of error, the Shaners argue that the trial court erred in granting summary judgment in favor of United Farm because it incorrectly determined that the dump truck was an “auto” and not “mobile equipment,” as those terms are defined in the CGL policy. Specifically, the Shaners argue that the dump truck qualifies as “mobile equipment” under policy section V.11.d.(1) because the dump truck was maintained primarily to provide mobility to a permanently mounted loader. The Shaners also argue that the dump truck qualifies as “mobile equipment” under policy section V.11.d.(2) because it was used to haul the roller. Finally, the Shaners argue that the dump truck qualifies as “mobile equipment” under policy section V.11.f. because it was maintained for purposes other than the transportation of cargo and persons.

{¶ 10} “An insurance policy is a contract whose interpretation is a matter of law.”  Cincinnati Ins. Co. v. CPS Holdings, Inc., 115 Ohio St.3d 306, 2007-Ohio-4917, 875 N.E.2d 31, ¶ 7, citing Sharonville v. Am. Employers Ins. Co., 109 Ohio St .3d 186, 2006-Ohio-2180, 846 N.E.2d 833, ¶ 6. In determining a contract’s interpretation, a reviewing court must give effect to the parties’ intent. Id., citing Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216, 2003-Ohio-5849, 797 N.E.2d 1256, ¶ 11. A contract is examined as a whole, and the court presumes that the parties’ intent is reflected by the language of the policy. Id., citing Kelly v. Med. Life Ins. Co. (1987), 31 Ohio St.3d 130, 509 N.E.2d 411, paragraph one of the syllabus. “When the language of a written contract is clear, a court may look no further than the writing itself to find the intent of the parties.”Id., citing Alexander v. Buckeye Pipe Line Co. (1978), 53 Ohio St.2d 241, 374 N.E.2d 146, paragraph two of the syllabus. A contract is unambiguous as a matter of law if it can be given a definite legal meaning. Id., citing Gulf Ins. Co. v. Burns Motors, Inc. (Tex.2000), 22 S.W.3d 417, 423.

{¶ 11} “Ambiguity in an insurance contract is construed against the insurer and in favor of the insured.”Id. at ¶ 8, citing King v. Nationwide Ins. Co. (1988), 35 Ohio St.3d 208, 519 N.E.2d 1380, syllabus. However, a court should not apply this rule if it results in an unreasonable interpretation of the words of the policy. Id., citing Morfoot v. Stake (1963), 174 Ohio St. 506, 190 N.E.2d 573, paragraph one of the syllabus.

{¶ 12} With the applicable rules of law in view, we now turn to the CGL policy language at issue in this case. The policy provides the following pertinent exclusion:

g. Aircraft, Auto, or Watercraft

“Bodily injury” or “property damage” arising out of the ownership, maintenance, use or entrustment to others of any aircraft, “auto” or water craft owned or operated by or rented or loaned to any insured. Use includes operation and “loading and unloading”.

(CGL Policy Section I, 2.g.). The policy provides the following applicable definitions:

2. “Auto” means a land motor vehicle, trailer or semitrailer designed for travel on public roads, including any attached machinery or equipment. But “auto” does not include “mobile equipment”.

11. “Mobile equipment” means any of the following types of land vehicles, including any attached machinery or equipment:

a. Bulldozers, farm machinery, forklifts, and other vehicles designed for use principally off public roads;

b. Vehicles maintained for use solely on or next to premises you own or rent;

c. Vehicles that travel on crawler treads;

d. Vehicles, whether self-propelled or not, maintained primarily to provide mobility to permanently mounted:

(1) Power cranes, shovels, loaders, diggers, or drills; or

(2) Road construction or resurfacing equipment such as graders, scrapers, or rollers;

e. Vehicles not described in a., b., c., or d. above that are not self-propelled and are maintained primarily to provide mobility to permanently attached equipment of the following types:

(1) Air compressors, pumps, and generators, including spraying, welding, building cleaning, geophysical exploration, lighting and well servicing equipment; or

(2) Cherry pickers and similar devices used to raise or lower workers;

f. Vehicles not described in a., b., c., or d. above maintained primarily for purposes other than the transportation of persons or cargo. However, self-propelled vehicles with the following types of permanently attached equipment are not “mobile equipment” but will be considered “autos”:

(1) Equipment designed primarily for:

(a) Snow removal;

(b) Road maintenance, but not construction or resurfacing; or

(c) Street cleaning;

(2) Cherry pickers and similar devices mounted on automobile or truck chassis and used to raise and lower workers; and

(3) Air compressors, pumps and generators, including spraying, welding, building cleaning, geophysical exploration, lighting and well servicing equipment.

(CGL Policy Sections V, 2; V, 11).

{¶ 13} The Shaners first argue that the dump truck qualifies as “mobile equipment” under policy section V.11.d.(1) because the dump truck was maintained primarily to provide mobility to a permanently mounted loader. We disagree. The Shaners argue that the dump bed on the truck is a permanently mounted loader. “Loader” is not defined in the contract, so we must use the “ordinary meaning unless manifest absurdity results, or some other meaning is clearly evidenced from the face or overall contents of the instrument.”  State ex rel. Petro v. R.J. Reynolds Tobacco Co ., 104 Ohio St.3d 559, 2004-Ohio-7102, 820 N.E.2d 910, ¶ 23, citing, Alexander, 53 Ohio St.2d 241, paragraph two of the syllabus. “Loader” is defined, in pertinent part as: “a device or machine used for loading * * *; a machine (as a belt or bucket conveyor or a power scoop shovel) that picks up loose material (as snow or gravel) and loads it upon a vehicle or into a container within the same unit.”WEBSTER’S THIRD INTERNATIONAL DICTIONARY (2002) 1326. Pearce’s dump truck, on the other hand, has a “dump body,” which is defined as: “a motor-truck or trailer body that can be manipulated to discharge its contents by gravity.”Id. at 701.Consequently, Pearce’s dump truck does not have a “permanently mounted loader” as the Shaners argue; and therefore, it is not “mobile equipment” under section V, d., (1).

{¶ 14} The Shaners also argue that the dump truck qualifies as “mobile equipment” under policy section V.11.d.(2) because it was used to haul the roller. We disagree. Although the dump truck was used to haul a roller, the roller was not “permanently mounted” to the dump truck, as required under section V.11.d(2). Pearce testified that he hauled various pieces of paving equipment, including the roller, with the dump truck using a lowboy trailer. (May 10, 2007 Tr. at 32, 37-38). Pearce testified that he loaded these pieces of equipment onto the lowboy trailer, which indicates that the roller was not permanently mounted to the dump truck as required under section V.11.d(2). Therefore, the dump truck is not “mobile equipment” as the term is defined under subsection V.1 1.d(2) either.

Although Pearce did not specifically use the term “trailer,” it is apparent from the context of his testimony that he was referring to a type of trailer, which was “hitched” to the dump truck for purposes of hauling the paving equipment. (May 10, 2007 Tr. at 32, 37)

{¶ 15} The Shaners next argue that the dump truck qualifies as “mobile equipment” under policy section V.11.f. because it was “maintained primarily for purposes other than the transportation of persons or cargo.”In support of their argument, the Shaners contend that the word “maintained” requires that the court examine how the vehicle at issue was used by the owner, regardless of its intended design. Although we agree with the Shaners that a vehicle may be maintained for purposes different than its intended design, we cannot agree that the dump truck was “maintained primarily for purposes other than the transportation of persons or cargo.”(Section V.11.f.). Pearce testified that he used the dump truck primarily to haul asphalt and equipment to the job site. Pearce testified:

Q: Okay. So you buy [the asphalt], your dump truck goes there, loads it and then takes it to the job site?

A: Yeah. And the dump truck also is what pulls the equipment, too.

* * *

Q: Sometimes the dump truck will take the equipment there, leave, go get the asphalt and then come back?

A: Yeah.

Q: Okay. And when the dump truck gets to the job site, does it then unhitch from the Lowboy?

A: Yes.

* * *

Q: Okay. So the dump truck then transports the equipment on the Lowboy and it also loads and unloads the asphalt. Does it do anything else?

A: I don’t know. I don’t think so.

Q: In the course of your business, does it serve any other purpose?

A: No, that’s about it.

(May 10, 2007 Tr. at 37-40). “  Cargo” is defined as “the lading or freight of a ship, airplane, or vehicle: the goods, merchandise, or whatever is conveyed; LOAD, FREIGHT-usu. used of goods only and not of live animals or persons.”WEBSTER’S THIRD INTERNATIONAL DICTIONARY (2002) 339. “Goods” are “tangible movable personal property having intrinsic value * * * ”Id. at 978. “Convey” means “to bear from one place to another: CARRY, TRANSPORT.”Id. at 449.Asphalt and equipment fall within the definition of a good, and thus, cargo. According to the record, then, the dump truck was maintained primarily for the transportation of cargo; and therefore, is not “mobile equipment” under Section V.11.f.

{¶ 16} The dump truck is an “auto” as that term is defined in the policy; and therefore, the injuries sustained by Carol Shaner are excluded from coverage. The dump truck was designed for travel on the public roads. It was registered with the Bureau of Motor Vehicles (BMV), and its operator was required to have a commercial driver’s license. (May 10, 2007 Tr. at 34, 24). Furthermore, Pearce’s testimony indicates that he used the dump truck to haul asphalt and equipment to the job site, which, by necessity, would require that the dump truck travel on public roads. (May 10, 2007 Tr. at 37-40). Accordingly, the dump truck is an “auto” as defined in the CGL policy and is not “mobile equipment” as defined in the CGL policy. As an additional matter, Pearce obtained a separate automobile liability policy to cover the dump truck, and the CGL policy did not list the dump truck on the scheduled list of equipment. (Do. No. 20, Exs. C, D). These two facts, though not dispositive, certainly indicate that it was the parties’ intention that the dump truck not be covered under the CGL policy. Since the dump truck is an “auto” and not “mobile equipment,” any “bodily injury” or “property damage” arising out of its ownership, maintenance, use or entrustment to others is excluded from coverage. (CGL Policy Section I, 2, g.). Therefore, the trial court did not err in granting summary judgment in United Farm’s favor.

{¶ 17} The Shaners’ first assignment of error is, therefore, overruled.

ASSIGNMENT OF ERROR NO. II

The trial court erred in following Brookman v. Estate of Gray (3rd District, December 22, 2003), Allen County Case No. 1-03-38, 2003-Ohio-6994.

{¶ 18} In their second assignment of error, the Shaners argue that the trial court erroneously relied upon Brookman v. Estate of Gray, 3d Dist. No. 1-03-38, 2003-Ohio-6994. Specifically, the Shaners contend that Brookman dealt with UM/UIM coverage and a claim pursuant to Scott-Ponzer v. Liberty Mut. Fire Ins. Co. (1999), 85 Ohio St.3d 660, 710 N.E.2d 1116 wherein the court found that the policy at issue was not a “motor vehicle liability policy” as defined by R.C. 3937.18(L)(1). The Shaners argue that this policy is considered a “motor vehicle liability policy” “because it specifically provides insurance coverage for “mobile equipment,” including Mr. Pearce’s dump truck .”(Appellant’s Brief at 9).

{¶ 19} These arguments lack merit. This Court in Brookman held that the CGL policy in that case was not a “motor vehicle policy” under R.C. 3937.18(L)(1) for purposes of plaintiff’s UM/UIM claim, because the policy failed to specifically identify any motor vehicles to be covered under it. 2003-Ohio-6994, at ¶ 8. The parties do not dispute that the facts in Brookman are distinguishable from the case at bar; however, United Farm argues, and we agree, that Brookman’s holding is, at least, persuasive here. The plaintiff in Brookman attempted to extend her employer’s CGL policy to motor-vehicles in order to assert her claims. Id. at ¶ 3. Likewise, the Shaners are arguing that “the CGL policy is considered a ‘motor vehicle liability policy’ because it specifically provides coverage for ‘mobile equipment,’ including Mr. Pearce’s dump truck.”(Appellant’s Brief at 9). Furthermore, like the CGL policy in Brookman, the United Farm policy does not specifically identify Pearce’s dump truck. Furthermore the CGL policy expressly excludes coverage for “autos,” and Pearce obtained a separate automobile liability policy for the dump truck. (Doc. No. 20, Exs. C, D). Under these circumstances, the Shaners cannot extend the CGL policy’s coverage to include Pearce’s motor vehicle just as the plaintiffs in Brookman could not extend their employer’s CGL policy to include motor vehicles. Therefore, the trial court did not err in relying upon our opinion in Brookman.

{¶ 20} Furthermore, even if this Court determined that the trial court erroneously relied upon Brookman, “[a] judgment by the trial court which is correct, but for a different reason, will be affirmed on appeal as there is no prejudice to the appellant.”Bonner v. Bonner, 3d Dist. No. 14-05-26, 2005-Ohio-6173, ¶ 18, citing Lust v. Lust, 3d Dist. No. 16-02-04, 2002-Ohio-3629, ¶ 32; Smith v. Flesher (1967), 12 Ohio St.2d 107, 110, 233 N.E .2d 137. This Court has reviewed the record and concluded that the trial court did not err in granting summary judgment in United Farm’s favor based on the contract’s language. Thus, the Shaners have not suffered prejudice because of the trial court’s reliance upon Brookman, even if such reliance was erroneous.

{¶ 21} The Shaner’s second assignment of error is, therefore, overruled.

IV. Conclusion

{¶ 22} Having found no error prejudicial to the appellant herein in the particulars assigned and argued, we affirm the judgment of the trial court.

Judgment Afirmed.

SHAW, P.J., and ROGERS, J., concur.

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