Unpublished Disposition, 852 F.2d 1289 (9th Cir. 1988)

MEMORANDUM^* 

LaPlante appeals the district court's grant of summary judgment in favor of Allstate Insurance Company. Allstate had brought a declaratory judgment action in district court, seeking a ruling that it was not obligated under a renter's policy to indemnify or defend its insureds in an automobile personal injury action. We find that an "automobile use" exclusion contained in the renter's policy is applicable to this case; thus, we affirm the district court's grant of Allstate's motion for summary judgment.

FACTS

LaPlante was injured when the Volkswagen he was traveling in as a passenger struck another car, causing the seat he occupied to break free from its mounting. LaPlante filed suit against the owners of the Volkswagen, Danny Jay Sterns and Daniel E. Sterns, alleging, among other things, that the Sterns were liable because they negligently installed plastic molded bucket seats in the Volkswagen.

At the time of the accident, the Sterns were covered by an Allstate automobile insurance policy and by an Allstate renter's policy. Allstate paid LaPlante $100,000, the policy limit, under the automobile policy and subsequently sought a declaration from the district court that it was not obligated under the renter's policy.

DISCUSSION

We review the district court's grant of summary judgment de novo. Darring v. Kincheloe, 783 F.2d 874, 876 (9th Cir. 1986). If underlying facts are not in dispute, the construction of an insurance policy is a matter of law. Allstate Ins. Co. v. Jones, 139 Cal. App. 3d 271, 274, 188 Cal. Rptr. 557, 559 (1983). California law applies to this declaratory action based on diversity jurisdiction. St. Paul Fire & Marine Ins. Co. v. Weiner, 606 F.2d 864, 867 (9th Cir. 1979).

The Allstate renter's policy at issue in this case provides that "Allstate will pay all sums arising from an accident and loss which an insured person becomes legally obligated to pay because of bodily injury or property damage covered by this part of the policy." An exclusion to the policy, however, states that coverage does not apply to "bodily injury or property damage arising out of the ownership, maintenance, use, occupancy, renting, loaning, entrusting, loading or unloading of any motorized land vehicle or trailer." We are of the view that under California law, the installation of bucket seats in the Volkswagen constituted a "use" of the car by its owners, fitting squarely within the exclusion to the renter's policy.

The term "use" is not limited to the actual motion of an automobile; rather, it "extends to any activity in utilizing the insured vehicle in the manner intended or contemplated by the insured." State Farm Fire & Cas. Co. v. Camara, 63 Cal. App. 3d 48, 54, 133 Cal. Rptr. 600, 603 (1976) (citations omitted). In Camara, the court held that an owner's reconstruction of a Volkswagen, converting it into a dune buggy, constituted a clear use of the vehicle. Id. at 603 n. 3. Thus, the court denied coverage because the reconstruction activity fell within an exclusionary clause in the defendant's homeowners policy similar to the one found in the Sterns' renters policy. Id. at 603. See also Allstate Ins. Co. v. Jones, 188 Cal. Rptr. at 561 (equipping and transporting rebar is an intended and accustomed "use" of a truck; thus, coverage is not available under a general liability policy).

The instant case is controlled by Camara. The Sterns' installation of bucket seats in their Volkswagen, like the reconstruction of a car into a dune buggy, constitutes a clear "use" of the automobile by its owners. Thus, this situation falls squarely within the exclusionary provision of the Sterns' renters policy. The district court was therefore correct in holding that coverage under the policy is not available as a matter of law.¹ 

CONCLUSION

For the above reasons, the district court's grant of summary judgment in favor of Allstate is AFFIRMED.