883 N.W.2d 506
S.D.2016Background
- On May 1, 2013, Dusty Groom accidentally shot Brody Heitmann while Groom and Heitmann were at a residence on premises insured under a farm/ranch policy issued to Bonnie Buhl.
- Heitmann sued Groom; Groom and Heitmann later stipulated to a $1,100,000 judgment against Groom and Groom assigned to Heitmann any claims Groom had against American Family under Buhl’s policy.
- American Family denied coverage, asserting Groom was not an insured because he did not reside in Buhl’s household.
- Policy’s definitions: “You/Your” = named insured (Buhl); “Insured” includes spouse and relatives if residents of your household, and any person under 21 in your care or in the care of your resident relatives.
- Parties agreed Tammy (Buhl’s daughter) and Dusty lived on the insured premises but did not reside in Buhl’s home; cross-motions for summary judgment presented no material factual disputes.
- The circuit court granted American Family’s summary-judgment motion; Heitmann appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a “resident relative” under the Policy includes a relative who lives on the insured premises but not in the named insured’s household | Heitmann: coverage is premises-based; residing on insured premises makes Tammy a resident relative, so Dusty (under 21 in her care) is insured | American Family: definition requires relatives be residents of the named insured’s household (Buhl’s home); Tammy does not live in Buhl’s household, so no coverage | Court: The Policy unambiguously requires relatives be residents of Buhl’s household; Tammy and Dusty are not insureds; affirm summary judgment in favor of American Family |
Key Cases Cited
- W. Nat’l Mut. Ins. Co. v. Decker, 791 N.W.2d 799 (S.D. 2010) (insurance contract interpretation is a question of law reviewed de novo)
- Roden v. Gen. Cas. Co. of Wis., 671 N.W.2d 622 (S.D. 2003) (party disagreement over meaning does not itself create ambiguity)
- Gloe v. Union Ins. Co., 694 N.W.2d 252 (S.D. 2005) (court gives words their plain and ordinary meaning when interpreting policies)