Unpublished Disposition, 902 F.2d 38 (9th Cir. 1990)

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US Court of Appeals for the Ninth Circuit - 902 F.2d 38 (9th Cir. 1990)

ALLSTATE INSURANCE COMPANY, Plaintiff-Appellee,v.Dwayne K. KEOMAKA, Defendant,andThomas S. Merrill and Kathleen M. Merrill, Defendants-Appellants.

No. 88-15053.

United States Court of Appeals, Ninth Circuit.

Submitted April 9, 1990* .Decided April 25, 1990.

Before FARRIS, PREGERSON, and RYMER, Circuit Judges.


The parties stipulated the facts leaving purely a legal question to be decided on summary judgment.

Appellants correctly identify the issue as "whether the incident herein was an accident arising out of the use of an automobile under Hawaii law." However, the policy coverage pursued is Keomaka's compulsory liability insurance rather than the no-fault or uninsured motorist coverage carried by Merrill, the injured party.

While Merrill may be correct that "accident" and "arising out of" should have the same meaning in both liability and uninsured or no-fault insurance, that is not dispositive of whether Keomaka's liability insurance will apply to this circumstance. In determining whether an insurance coverage applies, the analysis must be of the contractual agreement between the insured (attempting to recover) and the insurer and of the contract's relationship to the conduct for which the coverage is sought. This was the court's focus in both Ganiron v. Hawaii Insurance Guaranty Assoc., 744 P.2d 1210 (Haw.1987), and State Farm Fire & Casualty Co. v. Tringali, 686 F.2d 821 (9th Cir. 1982), upon which Merrill relies, and is the proper focus in this case.

The injury Keomaka inflicted did not arise from his use or operation or maintenance of his vehicle. The intervening conduct precludes a finding that the injury arose from Keomaka's use of his vehicle. The use of the vehicle was only incidental. See State Farm Mutual Auto Ins. Co. v. Fernandez, 767 F.2d 1299 (9th Cir. 1985) (stabbing of one driver by another after a driving incident, without collision, was not covered by the attacking driver's liability insurance).


PREGERSON, Circuit Judge, dissenting.

I do not agree with the majority's focus in this case and therefore dissent.

The majority's memorandum errs in identifying the dispositive question as "whether the incident ... was an accident arising out of the use of an automobile." I believe that our analysis should focus on whether the "arising out of" phrase is ambiguous, i.e., whether more than one reasonable construction of the phrase is possible. Such an inquiry is necessary, because, " [u]nder Hawaiian law, insurance policies must be construed as liberally as possible in favor of the insured and all ambiguities are to be resolved against the insurer." Crawford v. Ranger Ins. Co., 653 F.2d 1248, 1250 (9th Cir. 1981).

The "arising out of" language at issue is ambiguous. Such language does not preclude recovery for damages resulting from auto-related altercations. Indeed, Hawaii courts have broadly construed policy terms covering harms produced by auto-related altercations. See, e.g., Ganiron v. Hawaii Ins. Guarantee Ass'n., 744 P.2d 1210, 1212 (Haw.1987) (occupant of motor vehicle injured by gunshot from unidentified assailant in unidentified motor vehicle held covered by auto liability policy providing uninsured motorist coverage). If the insurance company did not want to contract for coverage of auto-related altercations, it should have made that unmistakably clear.

The majority's reliance on State Farm Mutual Auto Ins. Co. v. Fernandez, 767 F.2d 1299 (9th Cir. 1985), is misplaced. The court there used a causation analysis, not a contract analysis, to deny relief to insureds who sought coverage for damages resulting from auto-related violence. The pertinent inquiry here, however, is not whether damages were caused by covered activity, but whether it would have been reasonable for the insured to expect coverage, given the policy language and the posture of Hawaii law. "The reasonable expectations principle is a rule of construction to be applied when policy provisions which would deny coverage are unclear or inconspicuous." Crawford, 653 F.2d at 1251 (acknowledging the rule of Gray v. Zurich Ins. Co., 65 Cal. 2d 263, 419 P.2d 168, 54 Cal. Rptr. 104 (1966), in Hawaii law).

I believe that the insured could reasonably have expected coverage. Because Hawaii law requires resolving ambiguity in insurance contracts against the insurer, I would find in favor of appellants.


The Panel unanimously finds this case suitable for decision without oral argument. Fed.R.App. 34(a) and Ninth Circuit rule 34-4


This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Circuit Rule 36-3