Hong Lu v. Automobile Club Inter-Insurance Exchange and Crystal Gunckel
2016 Mo. App. LEXIS 1218
| Mo. Ct. App. | 2016Background
- ACIIE issued an auto policy to Thomas Sanders ("Father") covering a 2003 Ford Focus from June 3 to December 3, 2014.
- Father sold the Ford to his son Jonathan ("Son") and permanently relinquished possession on November 20, 2014; title assignment and related documents in the record reflect that date.
- On November 26, 2014, Son’s girlfriend Crystal Gunckel (not a member of Father’s household) was driving the Ford with Son’s permission and collided with Hong Lu’s vehicle; Lu obtained a judgment against Gunckel for property damage.
- Lu then sued ACIIE in an equitable garnishment action, arguing Father’s policy covered Gunckel’s use of the Ford; ACIIE removed the Ford from the declarations effective November 20, 2014.
- Lu alternatively argued the Motor Vehicle Financial Responsibility Law (MVFRL), §303.210, required ten days’ notice to the Director before termination of a certified policy, so coverage remained at the time of the accident.
- The trial court granted summary judgment for ACIIE; the appeals court affirmed, finding (1) Gunckel was not an insured under Father’s policy and (2) §303.210 did not apply because the policy was not shown to be a certified (SR-22) policy.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Gunckel was an "insured" under Father’s policy at time of accident | Lu: Gunckel was covered under the policy (either as household member or as permissive user of an insured auto) | ACIIE: Gunckel was not an insured because Father no longer owned the Ford when the accident occurred | Held: Gunckel was not an insured; Father sold the Ford on Nov 20 and thus it was not an "insured auto" at accident |
| Whether ownership/title transfer occurred before the accident | Lu: Title/ownership did not transfer until later (registry/certificate issuance), so Father still owned the Ford | ACIIE: Ownership transferred upon delivery and assignment of the certificate of title on Nov 20, 2014 | Held: Transfer of ownership occurred on Nov 20 upon delivery/assignment of title; later registration is irrelevant |
| Whether §303.210 MVFRL required 10 days’ notice to Director so coverage continued | Lu: §303.210 applies to all policies, so without 10 days’ notice coverage continued and ACIIE remained liable | ACIIE: §303.210 applies only to certified policies (e.g., SR-22); there is no evidence this was a certified policy | Held: §303.210 did not apply because the policy was not shown to be a certified policy; no evidence of SR-22/certification |
| Whether summary judgment was proper on equitable garnishment claim | Lu: Genuine issues exist regarding insured status and MVFRL notice | ACIIE: Undisputed facts negate insured status and no MVFRL certification exists, entitling it to judgment as a matter of law | Held: Summary judgment for ACIIE affirmed — no genuine dispute of material fact and ACIIE entitled to judgment as a matter of law |
Key Cases Cited
- ITT Commercial Fin. Corp. v. Mid-Am. Marine Supply Corp., 854 S.W.2d 371 (Mo. banc 1993) (summary judgment standard and burden-shifting)
- Allstate Ins. Co. v. Nw. Nat. Ins. Co., 581 S.W.2d 596 (Mo. App. 1979) (ownership transfers on assignment of title)
- Schultz v. Murphy, 596 S.W.2d 51 (Mo. App. 1980) (operative fact in used vehicle sale is assignment of title, not registration)
- Wilson v. Traders Ins. Co., 98 S.W.3d 608 (Mo. App. 2003) (distinguishing certified insurance policies and SR-22 requirements)
- Dutton v. Am. Family Mut. Ins. Co., 454 S.W.3d 319 (Mo. banc 2015) (interpretation of insurance policy is a question of law)