United Services Automobile Ass'n. v. Swann
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United Services Automobile Assn. v. Swann (98-568); 170 Vt. 302; 749 A.2d 23
[Filed 28-Jan-2000]
NOTICE: This opinion is subject to motions for reargument under
V.R.A.P. 40 as well as formal revision before publication in the Vermont
Reports. Readers are requested to notify the Reporter of Decisions,
Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
any errors in order that corrections may be made before this opinion goes
to press.
No. 98-568
United Services Automobile Supreme Court
Association, Inc.
On Appeal from
v. Windham Superior Court
Kevin and Roscoe A. Swann September Term, 1999
Gary Dolderer
John P. Wesley, J.
Douglas Richards and Tracy Kelly Shriver of Douglas Richards, P.C.,
Springfield, for Plaintiff-Appellee.
Robert B. Luce of Downs Rachlin & Martin PLLC, Burlington, for
Defendant-Appellant, Gary Dolderer.
PRESENT: Amestoy, C.J., Johnson and Skoglund, JJ., and VanBenthuysen,
Supr. J., and Gibson, J. (Ret.), Specially Assigned
AMESTOY, C.J. Insurer United Services Automobile Association (USAA)
sought a declaratory judgment from the Windham Superior Court to determine
whether it is obligated to either defend or indemnify Kevin Swann, an
adult child, under the terms of his parents' homeowner's policy, against a
claim that Swann allegedly committed a tort. According to USAA, it has no
duty to defend or indemnify Swann because the alleged tort occurred when
Swann was working a seasonal job and living away from his parents'
household. The court granted summary judgment to USAA, concluding that,
under the circumstances, insurer had no duty to either defend
or indemnify Swann. Defendant Gary Dolderer argues that the court erred in
concluding that Swann was not entitled to coverage under the terms of his
parents' homeowner's policy. We affirm.
I. Facts
On April 9, 1996, defendant was seriously injured when he was struck
in the head by Kevin Swann while photographing Swann performing an aerial
ski jump maneuver in Vermont. Swann, an unmarried, only child, was in his
early forties when the accident occurred. His parents, Col. Roscoe and
Raynina Swann, are named insureds under a USAA homeowner's policy which
covers them and "residents of [Col. Swann's] household" in Temple Hills,
Maryland. At the time of the accident, and for several years preceding
it, Kevin Swann had come and gone from his parents' home to pursue
seasonal employment. During the cold weather months, he lived in Vermont
or New York ski lodges while working as a ski instructor. During the warm
weather months (approximately Memorial Day through October), he lived in
tent, or occasionally in a duplex apartment, in West Virginia while
working as white water rafting guide. He received mail at these locales.
In transition between his seasonal employment, Swann would spend
approximately two to two-and-a-half months at his parents' home each year.
He kept many of his possessions in his parents' basement. He always
considered his parents' home his own and used their phone number and
address for his vehicle and voter registrations, and driver's license.
Swann's bank accounts were in Temple Hills, and he swore residence at his
parents' home in a bankruptcy petition he filed months before the
accident. His doctors were in Maryland. He participated in household
activities while staying at his parents' home and paid a modest amount for
room and board during the time he was there.
Defendant filed suit against Swann in November 1997, and USAA was
promptly notified because Swann claimed that he was covered by his
father's USAA homeowner's policy. USAA
denied coverage to Swann, and in April 1998, filed a petition for
declaratory judgment, arguing that it had no duty to defend or indemnify
Swann under his father's policy because Swann was not a resident of his
parents' household. (FN1) Defendant and Swann answered the petition.
Subsequently, USAA moved for summary judgment. The court granted USAA's
motion, concluding that, under Maryland law, Swann was not a resident of
his parents' Temple Hills, Maryland, household at the time of the
accident. This appeal followed.
II. Discussion
The issue before us is whether the trial court was correct in
determining that, under Maryland law, Swann was not a resident of his
parents' Temple Hills, Maryland, home at the time of the accident, and
thus, whether the court appropriately granted USAA summary judgment.
Neither party disputes that Maryland law controls this case.
"We review a motion for summary judgment under the same standard as
the trial court: summary judgment is appropriate only when the record
clearly shows that there is no genuine issue of material fact and that the
movant is entitled to judgment as a matter of law." Bacon v. Lascelles,
165 Vt. 214, 218, 678 A.2d 902, 905 (1996). In making this determination,
we regard as true all allegations of the nonmoving party that are
supported by admissible evidence, and we also give the nonmoving party the
benefit of all reasonable doubts and inferences. See Messier v.
Metropolitan Life Ins. Co., 154 Vt. 406, 409, 578 A.2d 98, 99-100 (1990).
Additionally, Maryland law has held that where - as here - the underlying
facts are not in dispute, "the ultimate conclusion as to residency becomes
a question of law, i.e., whether such facts disclose residency of a
particular place as a matter of law and within the meaning of the policy
of insurance in question." Willis v. Allstate Ins. Co.,
591 A.2d 896, 899 (Md. Ct. Spec. App. 1991) (quoting Hamilton v. State Farm
Mut. Auto. Ins. Co., 364 So. 2d 215, 218 (La. Ct. App. 1979)).
In reaching its decision, the court primarily relied on three Maryland
cases and one Virginia case interpreting residency clauses in insurance
policies, though it correctly recognized that none involved facts directly
analogous to those of this case. In Peninsula Ins. Co. v. Knight, 255 A.2d 55 (Md. 1969), the Court of Appeals considered a policy that excluded
claims against the insurer arising out of injury to persons related to the
insured and residents of the insured's household. Knight involved a son -
the policyholder - who had temporarily moved his family into his parents'
home to be closer to his employment. His parents were injured in an
accident and sued the son, who contended that the insurer should indemnify
or defend him against his parents' claim. The court's residency
determination turned on several factors: the son's family had moved all of
its belongings into the attic; they lived in a bedroom in the house; they
used the family kitchen and bathroom; and they did not buy their own
groceries. The court held that because the son and his parents were
residents of the same household, the exclusion provision applied and the
insurer was not obligated to indemnify or defend him against his parents'
claim. See id. at 63-64.
The court also relied on Willis, which dealt with a homeowner's
liability policy that similarly excluded resident relatives from coverage.
A granddaughter, who had moved with her mother into her insured
grandparents' home, drowned in the grandparents' swimming pool. The
girl's mother sued the grandparents, who in turn contended that their
insurer was obligated to provide liability and medical coverage under
their policy. In determining residency, the court considered the salient
facts to include that the mother had abandoned her previous home, brought
all her personal possessions with her, and had no intention to return to
her prior residence. The court held that the granddaughter was a resident
relative of her grandparents' home. See Willis, 591 A.2d. at 901. Thus,
the insurance
policy's exclusion clause applied and the insurer had no duty to provide
liability and medical coverage to the grandparents.
In Forbes v. Harleysville Mut. Ins. Co., 589 A.2d 944 (Md. 1991), an
automobile insurance policy that limited coverage to residents of
insured's household was at issue. A wife, who had recently left her
husband and moved out of the family home with their two children, was
killed in a car accident. The husband sued his insurer for wrongful death
benefits, but the insurer contended that the wife was not covered under
the policy because she was not a resident of her husband's household at
the time of the accident. The court concluded that the wife was a resident
of her insured husband's household at the time of the accident because:
the separation between the couple was not permanent, as no divorce
discussions or proceedings had begun; the parties had only been separated
for approximately one-and-a-half months prior to the accident; the wife had
not changed her driver's license or voter registration to reflect her new
address; and the lease on the dwelling she lived in after moving out of
the family home was only on a month-to-month basis rather than for a
longer term. Therefore, the court held that, under the policy, the insurer
was liable for wrongful death benefits. See id. at 953.
Here, the court concluded, based on these three cases, that Maryland
uses a "totality of the circumstances" test to measure residency status,
considering such factors as: the abandonment of previous residence with no
intent to return; the storage of belongings in the alleged residence; and
the shared usage of common areas of the house. See, e.g., Forbes, 589 A.2d
at 952 ("It is generally stated that residence under "'[a] common roof is
not the controlling element.' It is rather a conclusion based on the
aggregate details of the living arrangements of the parties.") (quoting
State Farm Mut. Auto. Ins. Co. v. Snyder, 178 S.E.2d 215, 217 (Ga. Ct.
App. 1970)). The court identified the shared characteristics of
residency, as used in the Maryland cases, to be "physical presence
within a common abode on reasonably regular basis at a reasonably recent
time, regardless of whether the individual uses the address for various
legal and practical purposes or subjectively considers it his home."
It then predicted that Maryland courts would approve the rationale
adopted by the Supreme Court of Virginia in Allstate Ins. Co. v.
Patterson, 344 S.E.2d 890 (Va. 1986). Patterson involved a
twenty-six-year-old who was injured in a motorcycle accident. Prior to the
accident, he had been living off-and-on for a few years at his motorcycle
gang's clubhouses and with friends, all the while maintaining his bedroom
at his parents' home, keeping the bulk of possessions there, using his
parents' address on his official papers, subjectively considering it as his
home, and, in fact living there approximately ten percent of the time
before the accident. The court held that the son was not a resident of
his parents' home. See id. at 893. According to the court, "while a
person's intention to become a member of a particular household need not
be coupled with continuous residence, the intention must be accompanied by
a reasonable degree of regularity in the person's residential contacts
with the household; casual, erratic contacts are not sufficient." Id.
(FN2)
Based on these cases, the court concluded that Swann's attachment to
his parents' household, given his transitional seasonal employment
pattern, had been "very attenuated" by the time of the accident, and that
he had not actually lived at his parents' home on a reasonably regular
basis at a reasonably recent time before the accident. Moreover, it found
none of the policy concerns evident
in the other cases that would justify finding Maryland residency for Swann.
See, e.g., Forbes, 589 A.2d at 951 (to avoid coverage exclusion of
temporarily separated married couple); Larimore v. American Ins. Co., 552 A.2d 889, 892 (Md. 1989) (to prevent creating large class of uninsured
motorists through coverage exclusion interpretation).
Defendant contends that, by reading Knight, Willis, and Forbes
together, the court ignored Knight's observation that the phrase "resident
of the household" is interpreted more expansively when it is used to
define a policy's scope of coverage, as in Forbes, than when used in a
provision excluding coverage, as in Knight and Willis. Defendant asserts
that, absent a more informative definition, the phrase "resident of your
household," as used in USAA's policy, must be inclusively construed
consistent with an extension of liability coverage.
It is true that a conclusion of residency may benefit the insurer
where coverage can be denied because of a provision that excludes
residents of households. See, e.g., Knight, 255 A.2d at 64; Willis, 591 A.2d at 901. Conversely, a conclusion of residency may benefit an insured
where coverage is provided to residents of households. See, e.g., Forbes,
589 A.2d at 953. However, the court's task is to construe a residency
clause "in the context of [the] facts" before it. Knight, 255 A.2d at 56.
USAA accurately notes that Maryland has not adopted a rule that the
provisions of an insurance policy are to be construed against the insurer.
See Willis, 591 A.2d at 901. But even accepting defendant's contention
that homeowner's policies extending coverage should be broadly
interpreted, we are unable to conclude that a Maryland court making a
fact-specific inquiry of the "aggregate details of the living
arrangements[,]" see Forbes, 589 A.2d at 952 (quoting Davenport v. Aetna &
Surety Co., 241 S.E.2d 593, 594 (Ga. Ct. App. 1978)), would conclude that
Swann was a resident of his parents' household.
Swann is a forty-two-year-old man with a transitory, seasonal employment
pattern who made infrequent visits to his parents' home for short periods
of time during the several years preceding the accident. This
distinguishes the instant case from Knight, Willis, and Forbes,
irrespective of whether this is construed as an inclusion or exclusion
case. In Knight and Willis, the parties in question were physically
living in the homes at issue when the respective incidents occurred. In
Forbes, the claimant's wife - the mother of his two children - had lived
in the family home for a number of years prior to the accident. Although
she did not physically live at the claimant's home at the time of the
accident, the couple had only recently separated, and no change in the
legal status of their marriage had occurred.
In contrast to each of these cases, Swann neither lived at his
parents' home at the time of the accident nor for a substantial period of
time prior to the accident. We conclude that a reasonable construction of
USAA's policy cannot lead to residency coverage because there was no
"reasonable degree of regularity in [Swann's] residential contacts with
the household . . . ." Patterson, 344 S.E.2d at 893.
Defendant also points out that USAA's policy expressly provides for
coverage when a resident of the household is "temporarily residing" at
another location, thus distinguishing between a "resident" of the
household and a "regular resident" of the household. Defendant argues that
these clauses would be surplusage if it is determined that Swann is not a
resident of his parents' home. We find defendant's argument unpersuasive
because it ignores the fact that, to be insured under his father's policy,
Swann had to be "a resident of [Col. Swann's] household." (FN3) Swann was
not, in the
first instance, a resident of his parents' home in Maryland. Thus, any
possible distinction between a "resident" and a "regular resident" is
immaterial.
Finally, we agree with the court's determination that no policy
concerns exist here that would justify a conclusion that Swann was a
resident of his parents' home. Maryland has no mandatory homeowner's
coverage statute intended to protect third parties who are injured, as it
does for uninsured motorists who injure others. Thus, despite defendant's
argument that Maryland rejects the notion of a "floating resident,"
Knight, 255 A.2d at 64, there are no analogous policy concerns evident
here requiring a liberal construction "'to assure financial compensation to
the innocent victims[,]'" Forbes, 589 A.2d at 948 (quoting Pennsylvania
Nat'l Mut. v. Gartleman, 416 A.2d 734, 737 (Md. Ct. App. 1980)), of
ski-related accidents by tortfeasors who have no homeowner's insurance.
Nor do the facts of this case involve a marital separation where absence of
a spouse from the insured household may require consideration of additional
factors. See id. at 951.
We express no opinion on whether a similar holding would be
appropriate in other situations, such as a college student who returns to
his parents' home during holidays and summers or an emancipated adult
living with his parents. We conclude that, under the facts of this case,
the trial court was correct in determining that Swann's attachment to his
parents' household was so attenuated that, under Maryland law, he was not
a resident of his parents' household entitled to coverage under their
homeowner's policy.
Affirmed.
FOR THE COURT:
_______________________________________
Chief Justice
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Notes
FN1. USAA also argued that Swann was not covered because the policy's
intentional acts and business pursuits exclusions precluded coverage. The
trial court did not reach these arguments in granting USAA's motion, nor do
we in our decision.
FN2. Here, the court also noted Auto-Owners Ins. Co. v. Harris, 374 N.W.2d 795 (Minn. Ct. App. 1985), where a forty-five-year-old man used his
parents' home as his mailing address and for his driver's license, vehicle
registration, traffic tickets, and hunting license, and had moved into his
parents' home, along with most of belongings. However, he did not sleep
there. The Harris court upheld the trial court's conclusion that the man
was not a resident of his parents' household and thus not covered under
their homeowner's policy, stating that he "was not maintaining a
continuous, significant presence at his parents' home before the date of
the dog bite[,]" the incident at issue. Id. at 797.
FN3. Although USAA's policy does not define the terms "resident" or
"regular resident" in its policy, it does define "insured location" to
mean "[a]ny part of a premises: (1) not owned by an insured; and (2) where
an insured is temporarily residing." (Emphasis added.)
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