2019 Ohio 5077
Ohio Ct. App.2019Background
- Holloman was injured in a crash caused by Christopher Hay while he was driving a Chrysler Sebring owned by Bethany Mathis. Holloman obtained a $25,000 default judgment against Hay and sued the insurers under R.C. 3929.06 to satisfy that judgment.
- Mathis carried liability insurance with The General (policy with a "restricted policy endorsement" naming only Mathis as an insured driver). Hay had a separate Trustgard liability policy that listed a 1998 Cadillac Deville—which Hay had sold about four months before the crash—as the covered auto.
- Trustgard moved for summary judgment, arguing (1) Hay lacked an insurable interest because he had sold the covered vehicle (so the policy was void) and (2) the regular-use exclusion barred coverage for the Sebring.
- The General moved for summary judgment, arguing the restricted-endorsement limited "insured drivers" to those specifically listed (Mathis only), so Hay was not covered as a permissive driver.
- The trial court granted summary judgment for both insurers. On appeal, the court reversed as to Trustgard (finding genuine factual dispute on regular use) and affirmed as to The General (endorsement excluded Hay).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether sale of Hay's listed vehicle voided his Trustgard liability policy (insurable-interest defense) | Holloman: Trustgard's liability coverage remained in force and the policy does not become void upon sale of the covered auto | Trustgard: Hay lost insurable interest when he sold the Cadillac, so the policy is void and provides no coverage | Court: Rejected Trustgard's void-by-sale argument—policy language did not support automatic voiding; summary judgment on this ground improper for Trustgard |
| Whether the regular-use exclusion in Trustgard's policy bars coverage for the Sebring | Holloman: Mathis's testimony (deposition) shows limited/occasional use by Hay, not "regular" use | Trustgard: Hay and Mathis shared the Sebring and Hay used it regularly, so the vehicle was "furnished or available for [his] regular use" and exclusion applies | Court: Reversed summary judgment for Trustgard and remanded—conflicting evidence (recorded statements vs. deposition) creates genuine issue of material fact on regular use |
| Whether The General must cover Hay under Mathis's policy despite a restricted-driver endorsement | Holloman: Disputes over policy modifications and endorsements create doubt; Hay should be covered | The General: The restricted policy endorsement limits "insured drivers" to those listed on declarations (Mathis only), so Hay is excluded | Court: Affirmed summary judgment for The General—endorsement unambiguous, Hay not an insured under Mathis's policy |
Key Cases Cited
- World Harvest Church v. Grange Mut. Cas. Co., 148 Ohio St.3d 11 (2016) (apply ordinary meaning to insurance-policy language)
- Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216 (2003) (plain-language rule governs policy construction)
- Phillips v. Cincinnati Ins. Co., 60 Ohio St.2d 180 (1979) (insurable interest required or policy is void)
- Smith v. Nationwide Mut. Ins. Co., 37 Ohio St.3d 150 (1988) (sale/transfer of vehicle and insurable-interest analysis under applicable law)
- Sanderson v. Ohio Edison Co., 69 Ohio St.3d 582 (1994) ("regular use" means frequent, steady, constant, or systematic)
- Thompson v. Preferred Risk Mut. Ins. Co., 32 Ohio St.3d 340 (1987) (control, permission, and sole dominion weigh against finding "regular use")
- Ohio Cas. Ins. Co. v. Travelers Indemn. Co., 42 Ohio St.2d 94 (1975) (purpose of regular-use exclusion is to prevent one-policy protection for habitual operation of non-owned vehicles)
- Dresher v. Burt, 75 Ohio St.3d 280 (1996) (summary-judgment burden requires nonmoving party to point to evidence creating genuine factual dispute)