Associated Dermatology & Skin Cancer Clinic of Helena, P.C. v. Mountain West Farm Bureau Mutual Insurance Co.
2017 MT 30
Mont.2017Background
- In June 2012, landowner Robert Fitte cut down two beetle-killed pine trees near where he parked work vehicles; he then burned the trimmed branches under a burn permit.
- The burn escaped two days later and became the Corral Fire, which damaged multiple properties including Behlmer’s 224-acre parcel.
- Fitte carried Mountain West insurance: $300,000 homeowners, $1,000,000 CGL, and $500,000 commercial automobile coverage; the homeowners and CGL coverages were resolved elsewhere.
- Fitte admitted negligence and a $500,000 judgment was entered in favor of Behlmer; Fitte assigned his insurance rights to Behlmer in exchange for no personal execution.
- Behlmer sued Mountain West seeking a declaration that the commercial automobile policy covered the Corral Fire damages; Mountain West counterclaimed that the automobile policy did not provide coverage.
- The District Court granted summary judgment for Behlmer, reasoning the fire damage “resulted from” Fitte maintaining his insured vehicle; the Supreme Court of Montana reversed that coverage ruling.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the commercial automobile policy covers property damage that "resulted from the ownership, maintenance or use" of a covered auto | Behlmer: disposing of trees (by burning) was part of maintaining/protecting the vehicles, so the damage resulted from vehicle maintenance and is covered | Mountain West: "maintenance" means work on the vehicle itself; cutting/burning trees was not vehicle maintenance and the burn was a separate disposal decision | Reversed: Court holds the automobile policy does not cover the Corral Fire — the burning occurred after risk from standing trees was eliminated and was not an inherent part of vehicle maintenance |
Key Cases Cited
- Link v. State, 180 Mont. 469, 591 P.2d 214 (Mont. 1979) (defining "maintain" as preserve or keep in existing condition and discussing maintenance as acts performed on the object itself)
- State Farm Mut. Auto. Ins. Co. v. Pan Am. Ins. Co., 437 S.W.2d 542 (Tex. 1969) (quoted definition of "maintain" as preserving or preventing decline)
- Guishard v. Gen. Sec. Ins. Co., 875 N.E.2d 881 (N.Y. 2007) ("maintenance" in automobile policy interpreted as work on intrinsic parts and function of the car)
- Ply v. Nat’l Union Fire Ins. Co., 81 P.3d 643 (Okla. 2003) ("maintenance" includes acts relating to the external and mechanical condition of a vehicle)