Encompass Ins. Co. v. Coast Nat'l Ins. Co., No. 12-55784 (9th Cir. 2014)Annotate this Case
Encompass filed suit against Mid-Century and Coast National seeking contribution or subrogation for the expenses Encompass incurred in its defense and indemnification of its insured, Lisa Torti, in an underlying lawsuit. Alexandra Van Horn was a passenger in a wrecked car and, Torti, fearing that Van Horn might be in danger, grabbed Van Horn and physically removed her from the car. Van Horn suffered severe spinal injuries after the accident and became a paraplegic. Van Horn sued Torti, alleging that Torti caused her injuries when she removed her from the wrecked car. At issue on appeal was whether unloading an injured passenger from a motor vehicle constitutes "use" of that motor vehicle under California law. The court concluded that it does. As used in Mid-Century's and Coast National's insurance policies, the term "use" is defined by California Insurance Code 11580.06(g). As defined by California Insurance Code 11580.06(g), "use" of an automobile includes unloading that automobile. In this case, Torti "used" the vehicle when she unloaded Van Horn from that car. Accordingly, the court reversed the judgment of the district court in favor of Mid-Century and Coast National and remanded for further proceedings.
Court Description: California Insurance Law. The panel reversed the district court’s judgment in a diversity insurance coverage action concerning coverage for injuries sustained as part of an automobile accident. The panel held that unloading an injured passenger from a motor vehicle constituted “use” of that motor vehicle under California law. Specifically, the panel held that as used in the insurance policies at issue, the term “use” was defined by California Insurance Code § 11580.06(g). The panel further held that as defined by California Insurance Code § 11580.06(g), “use” of an automobile included unloading that automobile, and therefore, the car in this case was “used” when the injured passenger was removed. Tenth Circuit Judge Murphy dissented, and he would hold that unloading the passenger did not constitute use of the vehicle because the person unloading the passenger did not avail herself of the vehicle simply by unloading it.