Knight et al v. LM General Insurance Company, No. 3:2017cv00125 - Document 23 (D. Nev. 2018)

Court Description: ORDER granting ECF No. 16 Plaintiffs' Motion for Summary Judgment; denying ECF No. 18 Countermotion Motion for Summary Judgment; Clerk directed to enter judgment in favor of the Plaintiffs and against the Defendant. Signed by Judge Howard D. McKibben on 1/2/2018. (Copies have been distributed pursuant to the NEF - KW)
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Knight et al v. LM General Insurance Company Doc. 23 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 DISTRICT OF NEVADA 10 11 12 13 14 15 16 17 CLARA ANN KNIGHT, individually ) and as heir at law to LOGAN ) LORAINE KNIGHT, deceased; RACHEL ) WILSON, heir at law to LOGAN ) LORAINE KNIGHT, deceased; and THE ) ESTATE OF LOGAN LORAINE KNIGHT ) ) Plaintiffs, ) ) vs. ) ) LM GENERAL INSURANCE COMPANY, an Illinois corporation, ORDER Defendant. 18 19 3:17-cv-00125-HDM-VPC _________________________________ Before the court are plaintiffs Clara Ann Knight, Loraine 20 21 Knight, Rachel Wilson, and the estate of Logan Loraine Knight 22 (collectively “plaintiffs”) motion for summary judgment (ECF No. 23 16) and defendant LM General Insurance Company’s (“LM General”) 24 countermotion for summary judgment (ECF No. 18). 25 responded to the respective motions (ECF No. 20; ECF No. 19) and 26 the parties have replied to those responses (ECF No. 22; ECF No. 27 21). 28 Each party has The parties seek resolution of a single insurance coverage 1 1 issue under a policy of automobile insurance issued by LM General. 2 The issue is whether an exclusion to the liability coverage of the 3 LM General policy precludes coverage for wrongful death/bodily 4 injury claims arising from a February 23, 2015 motor vehicle 5 collision involving LM General’s insured, Paul S. Williams 6 (“Williams”). 7 fact in dispute and this action should be decided on the cross 8 motions for summary judgment. 9 I. Background Both parties agree there are no material issues of LM General issued an insurance policy to Williams with 10 11 effective dates of April 15, 2014 to April 15, 2015. The policy 12 provides liability coverage of $250,000 for each person and 13 $500,000 for each accident. 14 ‘bodily injury’ or ‘property damage’ for which any ‘insured’ 15 becomes legally responsible because of an auto accident.” 16 18 (Def. Countermotion Summ. J. Ex. 2 (Williams’ LM General 17 insurance policy)). 18 which provides: The policy provides coverage “for (ECF No. However, the policy includes an exclusion 19 B. We do not provide Liability Coverage for the 20 ownership, maintenance or use of: . . . 2. Any vehicle, other than “your covered 21 auto,” which is: a. owned by you; or b. furnished or available for your 22 23 regular use. 24 Id. 25 The subject vehicle is a Kia Sportage assigned to Williams by 26 his employer PGM Safety Services, LLC (“PGM”). PGM employed 27 Williams as a safety specialist and his duties included providing 28 2 1 safety services to PGM clients in northern Nevada. 2 employment, PGM provided Williams with the Kia to drive to and from 3 work and to use for work purposes throughout the business day. 4 As part of his Williams had driven his assigned Kia for several years prior 5 to the collision. He was given a set of keys and was expected to 6 drive the Kia to and from work and to take it to job sites during 7 the workday. 8 periods. 9 regular maintenance and was reimbursed for the costs through PGM. Williams kept the Kia at his home in between work Williams was also expected to keep up with the Kia’s 10 PGM prohibited any personal use of the company vehicles, including 11 even inconsequential errands. 12 the employee was required to reimburse PGM at a rate of $.40/mile. 13 There is no evidence in the record that Williams violated PGM’s 14 policies with regard to personal use of the company vehicle. 15 If an employee violated that policy, On the morning of February 23, 2015, Williams was driving to 16 work southbound on South McCarran Boulevard in his assigned Kia. 17 For unknown reasons, Williams allowed the Kia to cross into 18 northbound traffic where it collided head-on with the vehicle 19 plaintiff Clara Knight was driving. 20 husband, Logan Knight, sustained fatal injuries. 21 survived, but was seriously injured. 22 Williams and Clara Knight’s Clara Knight Following the accident, plaintiffs collectively made claims to 23 LM General for the full $500,000 limit of bodily injury liability 24 coverage available under Williams’ policy. 25 of the injuries is not in dispute and the parties agree that those 26 injuries are sufficient to implicate the limits of the subject 27 insurance policy. 28 solely on the basis of the “regular use” exception in Williams’ The nature and extent However, LM General denied plaintiffs’ claims 3 1 policy. 2 exception and the parties agreed to seek a resolution of their 3 dispute through a declaratory relief action filed with this court 4 (ECF No. 1 (Plaintiffs’ complaint)). 5 II. 6 Plaintiffs disputed the applicability of the “regular use” Legal standard Summary judgment shall be granted “if the movant shows that 7 there is no genuine issue as to any material fact and the movant is 8 entitled to judgment as a matter of law.” 9 The burden of demonstrating the absence of a genuine issue of Fed. R. Civ. P. 56(a). 10 material fact lies with the moving party, and for this purpose, the 11 material lodged by the moving party must be viewed in the light 12 most favorable to the nonmoving party. 13 Co., 398 U.S. 144, 157 (1970); Martinez v. City of Los Angeles, 141 14 F.3d 1373, 1378 (9th Cir. 1998). 15 that affects the outcome of the litigation and requires a trial to 16 resolve the differing versions of the truth. 17 Workers Int’l Ass’n, 804 F.2d 1472, 1483 (9th Cir. 1986); S.E.C. v. 18 Seaboard Corp., 677 F.2d 1301, 1306 (9th Cir. 1982). 19 Adickes v. S.H. Kress & A material issue of fact is one Lynn v. Sheet Metal Here, “[t]he parties agree on the applicable legal standard 20 and appear to agree that the interpretation and application of the 21 regular use exclusion to the facts of this case is a matter of law 22 for the [c]ourt.” (ECF No.20 (Def. Opposition to plaintiffs’ Mot. 23 Summ. J. at 2)). 24 III. Analysis 25 A. 26 In general, Nevada courts apply the principles of contract law Interpretation of insurance policies under Nevada law 27 when interpreting insurance policies. 28 Summerfield, 87 Nev. 127, 131, 482 P.2d 308, 310 (1971). 4 Continental Cas. Co. v. However, 1 “[w]hile clauses providing coverage are interpreted broadly so as 2 to afford the greatest possible coverage to the insured, clauses 3 excluding coverage are interpreted narrowly against the insurer.” 4 National Union Fire Ins. v. Reno’s Exec. Air, 100 Nev. 360, 365, 5 682 P.2d 1380, 1383 (1984). 6 B. 7 Although the Williams’ policy does not provide a definition of The regular use exclusion 8 the term “regular use” the Supreme Court of Nevada has done so. 9 Nevada, “regular use” “means constant, systematic In . . . 10 continuous use; uninterrupted normal use for all purposes; without 11 limitation as to use; and customary use as opposed to occasional 12 use or special use.” 13 138, 508 P.2d 8, 13 (1973); see also Allstate Ins. Co. v. Larimer, 14 433 F.Supp.2d 1195, 1198 (D. Nev. 2005) (citing with approval the 15 Supreme Court of Nevada’s definition of “regular use”). 16 Hartford Ins. Group v. Winkler, 89 Nev. 131, Here, LM General argues that the regular use exclusion applies 17 because Williams used the Kia continuously during work hours, had 18 keys to the Kia, kept the Kia at his home overnight, kept up with 19 the Kia’s maintenance schedule, and had continuous access to the 20 Kia at all hours (ECF No. 18 (Def. Countermotion Summ. J.)). 21 While Williams was, under the terms of his employment, 22 expected to use the Kia throughout the work day, store the Kia at 23 his home, drive the Kia to and from work, and keep the Kia in good 24 repair, Williams’ personal use of the Kia was expressly prohibited 25 under company policy. 26 at a rate of $.40/mile. This policy prohibiting personal use was 27 clearly understood and adhered to by both PGM and Williams and 28 there is no evidence before the court that Williams ever violated Any violation of the policy was sanctioned 5 1 2 the policy. LM General cites to several cases outside of Nevada including 3 Farmers Ins. Co. of Ariz. v. Zumstein, 675 P.2d 729 (Ariz. App. 4 1983) for the proposition that “a finding of regular use is not 5 predicated on completely unrestricted use of the vehicle at issue.” 6 (ECF No. 18 (Def. Countermotion Summ. J.)). 7 seeks a broad interpretation of the regular use exclusion in 8 Williams’ policy. 9 exclusions narrowly to afford the greatest coverage to the insured. Therefore, LM General However, under Nevada law, courts interpret 10 Powell v. Liberty Mut. Fire Ins. Co., 127 Nev. 156, 162, 252 P.3d 11 668, 672 (2011). 12 definition of “regular use” but did not do so in drafting the 13 policy in question. 14 LM General could have provided a more expansive Because PGM placed express limitations on Williams’ use of his 15 company vehicle, and there is no evidence Williams exceeded those 16 limitations, the regular use exclusion in Williams’ LM General auto 17 insurance policy does not bar coverage here. 18 plaintiffs’ motion for summary judgment (ECF No. 16) is GRANTED and 19 LM General’s countermotion for summary judgment (ECF No. 18) is 20 DENIED. 21 the plaintiffs and against the defendant. Therefore, The clerk of the court shall enter judgment in favor of 22 IT IS SO ORDERED. 23 DATED: This 2nd day of January, 2018. 24 25 26 ____________________________ UNITED STATES DISTRICT JUDGE 27 28 6