Hawkeye-Security Insurance v. Bunch
2011 U.S. App. LEXIS 13843
8th Cir.2011Background
- Hawkeye-Security and Midwestern insured Total Lock and Installers for multiple company vehicles used by employees.
- Donald and Patricia Bunch were employees of Installers; Patricia was allowed limited vehicle use and Donald’s driving authority had been revoked earlier.
- Patricia drove the company car for a Thanksgiving weekend and requested Brandt, an intoxicated non-employee, to drive for a personal errand.
- Brandt, not authorized by the employer and intoxicated, crashed the car injuring Donald Bunch, who suffered severe injuries.
- Policies included an omnibus liability clause; there was no written scope-of-permission clause, and company rules prohibited personal use and driving after drinking.
- District court ruled in favor of insurers, holding no liability coverage for Brandt and no UM/UIM coverage for Donald; Bunches appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Brandt is covered under the omnibus clause. | Bunches contend Patricia had authority to permit Brandt as a second permittee. | Insurers argue Patricia lacked authority to grant permission; no express/implied permission from named insured. | Brandt not covered; no permission from named insured or second permittee authority. |
| Whether Donald Bunch qualifies for UM/UIM coverage. | Donald as a passenger should be covered under the “anyone occupying” language. | Policy excludes anyone using a vehicle without a reasonable belief of entitlement; Donald lacked reasonable belief. | Donald not covered; exclusion unambiguous and he lacked a reasonable belief to use the vehicle. |
Key Cases Cited
- Shelter Mut. Ins. Co. v. See, 46 S.W.3d 65 (Mo.Ct.App.2001) (express vs. implied permission for omnibus clause)
- State Farm Fire & Cas. Co. v. Ricks, 902 S.W.2d 323 (Mo.Ct.App.1995) (second permittee permission from named insured required)
- U.S. Fidelity & Guar. Co. v. Safeco Ins. Co. of Am., 522 S.W.2d 809 (Mo.1975) (second permittee may extend coverage when first permittee has unfettered control)
- St. Paul Ins. Co. v. Carlyle, 428 S.W.2d 753 (Mo.Ct.App.1968) (first permittee may limit or prevent second permittee usage)
- Bituminous Cas. Corp. v. McDowell, 107 S.W.3d 327 (Mo.Ct.App.2003) (policy interpretation of coverage and permissions as facts-based inquiry)
- Marchand v. Safeco Ins. Co. of Am., 2 S.W.3d 826 (Mo.Ct.App.1999) (factors for reasonable belief of entitlement to use a vehicle)