Estate of Rebecca L. Mason v. Amica Mutual Insurance Company

2017 ME 58, 158 A.3d 495, 2017 WL 1149608, 2017 Me. LEXIS 60

• Court: Supreme Judicial Court of Maine
• Decided: March 28, 2017
• Status: Published

Opinion

MAINE SUPREME JUDICIAL COURT Reporter of Decisions Decision: 2017 ME 58 Docket: Oxf-16-50 Argued: November 8, 2016 Decided: March 28, 2017

Panel: SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, HJELM, and HUMPHREY, JJ.

ESTATE OF REBECCA L. MASON et al.

v.

AMICA MUTUAL INSURANCE COMPANY

HUMPHREY, J.

[¶1] The Estates of Rebecca L. Mason and Logan Dam (the Estates)

appeal from summary judgments entered by the Superior Court (Oxford

County, Clifford, J.) in favor of Amica Mutual Insurance Company (Amica) on

the Estates’ consolidated actions to reach and apply insurance money toward

the satisfaction of judgments they obtained against Amica’s insured. See 24-A

M.R.S. § 2904 (2016). The trial court concluded that Amica is entitled to

judgments as a matter of law on the Estates’ complaints because a “regular

use” exclusion in the insured’s automobile insurance policy prohibits the

Estates from reaching the insurance money. We affirm the judgments. 2

I. BACKGROUND

[¶2] Viewing the evidence in the light most favorable to the

nonprevailing parties, the Estates, the summary judgment record reveals the

following undisputed facts.1 See, e.g., Estate of Frost, 2016 ME 132, ¶ 15,

146 A.3d 118. On January 7, 2012, in West Paris, Rebecca L. Mason and Logan

Dam were passengers in a vehicle driven by Kristina I. Lowe. Lowe

negligently caused the vehicle to crash in a single-vehicle accident, and Mason

and Dam died from injuries they sustained.2

[¶3] The vehicle was owned by Lowe’s friend, Dakota Larson. Larson’s

driver’s license had been suspended in November 2011, and Lowe had agreed

to drive Larson to work, to school, and to visit friends. When Lowe’s own car

broke down on December 23, 2011, Larson authorized her to use his car as if

it was her own, as long as she continued to give him rides, until her car was

fixed.3 Around the same time that Lowe’s car broke down, Larson left town

1 The parties do not dispute the essential historical facts; however, they do assign different

significance to those facts in the context of the applicable law.

2 We have previously addressed two appeals regarding the criminal charges and convictions

that arose out of this accident. See State v. Lowe, 2015 ME 124, 124 A.3d 156 (affirming Lowe’s convictions of manslaughter and aggravated leaving the scene of a motor vehicle accident); State v. Lowe, 2013 ME 92, 81 A.3d 360 (affirming the trial court’s decision to suppress certain evidence in the criminal proceedings against Lowe).

3 In their statement of material facts, the Estates asserted that Larson testified during a

deposition that Lowe gave him rides using only her car until her car broke down. Amica did not properly contradict that statement. See M.R. Civ. P. 56(h)(4). The Estates also asserted that Lowe 3

for several days. He gave Lowe the only set of keys to his car, and Lowe used

his car for her own purposes while he was gone. When he returned, and until

the accident on January 7, 2012, Lowe continued to use Larson’s car to give

him rides and for her own purposes.

[¶4] Lowe required transportation for her full-time job and, while her

car was unavailable, she did not have access to any vehicle other than

Larson’s. She used Larson’s car to drive to and from work, to visit relatives, to

pick up friends, to go tanning, and to go to the gym. She kept Larson’s car at

her family’s home, and she paid for gas most of the time.

[¶5] When the accident occurred, Lowe was a resident at the home of

her mother, Melissa J. Stanley. Stanley had a personal auto insurance policy

issued by Amica that provided for $300,000 in liability coverage. The policy

excluded from coverage liability arising out of the use of a vehicle “furnished

for the regular use of any family member.” The policy defined “family

member” as “a person related to you by blood, marriage, or adoption, who is a

resident of your household.”

testified that until her car broke down, she gave Larson rides using both her car and Larson’s car, depending on which was more convenient. Amica admitted that statement. 4

[¶6] After the accident, the Estates brought wrongful death actions

against Lowe, and the parties stipulated to the entry of judgments against

Lowe in favor of each of the Estates in the amount of one million dollars.

[¶7] The action at issue in this appeal began when, in July 2014, the

Estates filed separate reach-and-apply actions against Amica in the Superior

Court (Oxford County) seeking to apply insurance money from Stanley’s policy

to the judgments against Lowe. See 24-A M.R.S. § 2904. On Amica’s

unopposed motion, the court (Clifford, J.) consolidated the cases. The Estates

jointly moved for summary judgment and Amica filed a cross-motion for

summary judgment. In a written order dated January 18, 2016, the court

concluded as matter of law that the “regular use” exclusion in Stanley’s policy

applied to preclude coverage for Lowe’s negligent use of Larson’s car and that,

therefore, the Estates could not reach and apply insurance money from

Stanley’s policy toward satisfaction of the judgments against Lowe. The court

therefore determined that Amica was entitled to judgments as a matter of law

on the Estates’ complaints, see M.R. Civ. P. 56(c), granted Amica’s motion for

summary judgment, and denied the Estates’ motion for summary judgment.

The Estates timely appealed. 5

II. DISCUSSION

[¶8] The Estates contend that based on the undisputed material facts,

the “regular use” exclusion in Stanley’s policy does not apply to preclude

coverage for Lowe’s negligent use of Larson’s vehicle, and that the court

therefore erred by entering summary judgments in Amica’s favor.

We review a ruling on cross-motions for summary judgment de novo, considering the properly presented evidence and any reasonable inferences that may be drawn therefrom in the light most favorable to the nonprevailing party, in order to determine whether there is a genuine issue of material fact and whether any party is entitled to a judgment as a matter of law.

Frost, 2016 ME 132, ¶ 15, 146 A.3d 118; see M.R. Civ. P. 56(c). “Cross motions

for summary judgment neither alter the basic Rule 56 standard, nor warrant

the grant of summary judgment per se.” Remmes v. Mark Travel Corp.,

2015 ME 63, ¶ 19, 116 A.3d 466 (quotation marks omitted). “When the

material facts are not in dispute, we review de novo the trial court’s

interpretation and application of the relevant statutes and legal concepts.” Id.

[¶9] “The interpretation of an insurance contract exclusion and its

applicability is a matter of law reviewed de novo.” Pease v. State Farm Mut.

Auto. Ins. Co., 2007 ME 134, ¶ 7, 931 A.2d 1072; see Allstate Ins. Co. v. Gov’t

Emps. Ins. Co., 263 A.2d 78, 80 (Me. 1970) (“[W]hether the underlying facts

bring the claim within the [‘regular use’] policy exclusion is . . . a matter of 6

law.”). “Exclusions and exceptions in insurance policies are disfavored and

are construed strictly against the insurer.” Pease, 2007 ME 134, ¶ 7, 931 A.2d

1072 (quotation marks omitted).

[¶10] Stanley’s policy excludes from coverage liability arising out of the

use of a vehicle “furnished for the regular use of any family member.” Because

it is undisputed that Lowe is Stanley’s “family member,” the sole issue in this

appeal is whether the vehicle Lowe was driving when the accident occurred

was “furnished for [her] regular use.”

[¶11] We interpret “regular use” exclusions consistent with their

“obvious contractual purpose,” which “is to cover occasional or incidental use

of other cars without the payment of an additional premium, but to exclude

the habitual use of other cars, which would increase the risk on the insurance

company without a corresponding increase in the premium.” Acadia Ins. Co. v.

Mascis, 2001 ME 101, ¶ 11, 776 A.2d 617 (emphasis omitted) (quotation

marks omitted). Stated another way,

The general purpose and effect of [a “regular use” exclusion] is to give coverage to the insured while engaged in the only infrequent or merely casual use of an automobile other than the one described in the policy, but not to cover him against personal liability with respect to his use of another automobile which he frequently uses or has the opportunity to do so.

Allstate, 263 A.2d at 82 (first emphasis added) (quotation marks omitted). 7

[¶12] In Allstate, a Navy servicemember “place[d] his car in the care of

[a] friend[]” while he was away on duty for two and a half months, id. at 79, in

order to protect the vehicle “from vandalism and the like,” id. at 82. The

servicemember told the friend that he could use the car “as his own,” but not if

he had been drinking alcohol. Id. at 79. The friend’s father also imposed

restrictions on the use of the car. Id. at 80. The friend had access to the car for

“two or three days” before he was involved in an accident while driving it. Id.

[¶13] We concluded that although the friend was an insured under his

father’s policy, a “regular use” exclusion in that policy precluded coverage for

liability arising out of the friend’s use of the servicemember’s car. Id. at 80, 83.

We explained that “regular use” exclusions are meant to prevent an insured

from receiving coverage for use of a vehicle without paying a premium for

that coverage, and that “[a] use may be a ‘regular use’ even though some

restrictions or limitations are imposed on the use.” Id. at 81; see id. at 83

(“Without violating the limitations imposed . . . there was opportunity for

substantial [enhancement] of the risk under [the] policy, a risk for which [the

insurer] had not been compensated.”).4

4 The United States Court of Appeals for the First Circuit has noted:

[A] policy which would give to an insured who simply took out a policy on a single owned car, coverage on any number of cars not owned by him, but furnished for his 8

[¶14] We also discussed and rejected the “benefit-motive theory,” the

notion that a vehicle cannot be considered “furnished for regular use” if the

arrangement primarily benefits the owner of the vehicle. Id. at 82-83. We

held instead that although the parties’ motivations in making the arrangement

can be relevant to the analysis, the fact that the arrangement benefits the

owner does not preclude application of a “regular use” exclusion where the

use otherwise qualifies as “regular.” Id. Although the friend’s use was

restricted and benefited the servicemember, the exclusion applied because

the friend had “both the right and the opportunity” to use the car as his own,

and “[s]uch frequent use could scarcely be deemed so casual, occasional or

incidental as to satisfy the purpose of coverage.” Id. at 83 (quotation marks

omitted).

[¶15] In Mascis, under a different set of circumstances, we concluded

that a “regular use” exclusion did not apply to preclude coverage. 2001 ME

101, ¶¶ 2-4, 10-11, 776 A.2d 617. In that case, the insured, who had only a

learner’s permit, drove her boyfriend’s car frequently in order to gain driving

regular use, just as if he owned them, would be ruinous to an insurance company. Where more than one owned automobile is included, as a rule the insurance premium is larger. The exclusion therefore protects the insurer from multiple exposure to liability for which the insured pays only one premium.

Volpe v. Prudential Prop. & Cas. Ins. Co., 802 F.2d 1, 3 (1st Cir. 1986) (alterations omitted) (citation omitted) (quotation marks omitted), superseded by statute on other grounds as stated in Town of Allenstown v. Nat. Cas. Co., 36 F.3d 229, 231-32 (1st Cir. 1994). 9

experience. Id. ¶ 3. Although the boyfriend let the insured “drive when she

wanted to,” and she drove the car three to five times per week, she never

drove the car without him, did not have the keys, and did not keep the vehicle

in her possession. Id.

[¶16] We reiterated the legal concepts expressed in Allstate,

id. ¶¶ 10-11, and referred favorably to a list of non-exhaustive factors that the

United States Court of Appeals for the Second Circuit considers in making

“regular use” determinations, id. ¶¶ 8 n.3, 11.5 We noted that the insured “had

neither an unrestricted right nor an unfettered opportunity to drive [the

boyfriend’s] vehicle,” that her ability to drive the vehicle “was strictly limited

by his permission and the time she spent with him,” that “[t]he vehicle was

not left in her possession[, and that] she did not own a set of keys.” Id. ¶ 11.

We concluded that the policyholder, the insured’s mother, “could not have

reasonably expected that she would have to pay additional premiums for [her

daughter’s] use of [the boyfriend’s] vehicle.” Id.

5 Those factors are

(1) blanket permission to use the car rather than having to ask permission for each use; (2) availability of a set of keys to the car; (3) continuous, steady, methodical use as opposed to occasional or special use; (4) the nature of the use (e.g. use for all purposes rather than solely business use); and (5) that the insured would reasonably have expected to pay an extra premium to cover the use of the car.

Amica Mut. Ins. Co. v. Franklin, 147 F.3d 238, 242 (2d Cir. 1998). 10

[¶17] Here, the facts are more similar to those in Allstate, where the

exclusion applied, than to those in Mascis, where the exclusion did not apply.

From at least when Lowe’s car broke down in December until when the

accident occurred in January, Lowe used Larson’s car as though it was her

own, including by giving Larson rides. Lowe was given the only set of keys,

she kept the vehicle at her house, and she paid for the gas most of the time.

There is no evidence that she had to ask permission to use Larson’s car, and

she used it to accomplish her daily transportation needs—for instance, to

travel to and from work, to visit friends and family, to go tanning, and to go to

the gym.

[¶18] Considering together all of the facts relevant to Lowe’s use of

Larson’s vehicle, we cannot conclude that the record on summary judgment

generates a triable contention that Lowe’s use was “occasional or incidental,”

id. (quotation marks omitted), or “infrequent or merely casual,” Allstate,

263 A.2d at 82 (quotation marks omitted).6 This is so even to the extent that

Lowe’s freedom of use was encumbered by her agreement to give Larson

6 Although the Estates assert that the “principal purpose of the arrangement” was to benefit

Larson, the undisputed facts reveal that the arrangement was mutually beneficial because it provided for both (1) rides for Larson while his license was suspended and (2) Lowe’s sole means of transportation while her car was not working. There is no evidence indicating that either purpose was primary. Moreover, given the nature of Lowe’s use in this case, the fact that the arrangement benefited Larson is not the “controlling factor in determining ‘regular use,’” Allstate Ins. Co. v. Gov’t Emps. Ins. Co., 263 A.2d 78, 82 (Me. 1970) (quotation marks omitted). 11

rides. See id. at 81 (“A use may be a ‘regular use’ even though some

restrictions or limitations are imposed on the use.”). Here, as in Allstate, id. at

81, 83, Stanley could reasonably have expected to pay an increased premium

for Lowe’s use of Larson’s car as her only means of daily transportation.

Requiring Amica to cover such use would alter the allocation of risk

contemplated in the insurance contract between Amica and Stanley. See id.

[¶19] Contrary to the Estates’ urging, we do not consider the duration

of Lowe’s use to be determinative in this case. Although the duration of use

may be a factor in determining whether a “regular use” exclusion applies to

the facts of a given case, id., we decline to hold that “temporary” use cannot

also be “regular,” see, e.g., Amica Mut. Ins. Co. v. Franklin, 147 F.3d 238, 242

(2d Cir. 1998) (holding that the exclusion applied where the insured “had

unrestricted use of the car . . . [for] approximately two weeks,” and rejecting

the trial court’s reasoning that the exclusion could not apply “where a car was

available for a short and predetermined amount of time, even if the use during

that period is unrestricted” (quotation marks omitted)). Here, Lowe used

Larson’s car as if it was her own for at least the two weeks between when her

car broke down and when the accident occurred. Although Larson and Lowe

considered their arrangement to be “temporary,” there is no evidence 12

suggesting whether or when Larson’s driver’s license would be reinstated or

Lowe’s own vehicle would be fixed. See id. at 243 (holding that the exclusion

applied where “[t]here was no indication that [the insured’s] use of the car

would end within weeks or even months”). Given the other undisputed facts

characterizing Lowe’s use of Larson’s vehicle in this case, the fact that the

accident occurred only two weeks after Lowe’s car broke down does not alter

our conclusion that the regular use exclusion in Stanley’s policy applies to

preclude coverage for Lowe’s use of Larson’s car. See 8A Lee R. Russ &

Thomas F. Segalla, Couch on Insurance § 121:71 at 121-95 (3d ed. 2005) (“It is

the nature of the use for which the vehicle is intended and to which it is put,

rather than the actual duration of use, which is significant.”). We therefore

conclude that the trial court did not err when it entered summary judgments

in Amica’s favor on the Estates’ reach-and-apply complaints.

The entry is:

Judgments affirmed.

Steven D. Silin, Esq., and Robert H. Furbish, Esq. (orally), Berman & Simmons, P.A., Lewiston, for appellant Estate of Rebecca L. Mason

Sheldon J. Tepler, Esq., Hardy Wolf & Downing, Lewiston, for appellant Estate of Logan Dam

Martica S. Douglas, Esq. (orally), Douglas, Denham, Buccina & Ernst, Portland, for appellee Amica Mutual Insurance Company

Oxford Superior Court docket numbers CV-2014-31 and -32 FOR CLERK REFERENCE ONLY