134 A.3d 178
R.I.2016Background
- In July 2012 Mark Van Hoesen fell from a deck and sued the contractor, Brian Leonard, for negligent construction. His wife asserted loss of consortium.
- Process on Leonard was returned non est inventus; plaintiffs moved to substitute Leonard’s insurer, Lloyd’s (pursuant to § 27-7-2), and the Superior Court allowed substitution and plaintiffs amended to name Lloyd’s.
- Lloyd’s admitted issuing a policy to Leonard running March 8, 2007–March 8, 2008, but asserted the policy was canceled August 29, 2007 for nonpayment of premium and that coverage applies only if the bodily injury occurs during the policy period.
- Lloyd’s moved for summary judgment arguing there was no coverage for the 2012 injury because the injury occurred well after the policy period; alternatively it argued substitution was improper because plaintiffs made insufficient efforts to serve Leonard.
- The Superior Court granted Lloyd’s motion on the ground that the policy unambiguously required the bodily injury to occur during the policy period; it denied summary judgment on the service/substitution issue as factual.
- Plaintiffs appealed arguing enforcement of the policy defeats the public-policy purpose of R.I. Gen. Laws § 5-65-7(a) (contractor insurance mandate); Lloyd’s cross-appealed the denial of summary judgment on the substitution/service ground.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the insurer owe coverage for 2012 injuries where the alleged negligent workmanship occurred during the 2007 policy period but bodily injury manifested after policy expiration/cancellation? | Van Hoesen: Policy should be interpreted to effectuate § 5-65-7(a) (contractor must maintain insurance) so that insurer covers injuries caused by work performed during the policy even if injury occurred later. | Lloyd’s: Policy unambiguously limits coverage to bodily injury that occurs during the policy period; no duty to cover injuries after expiration/cancellation. | Court held for Lloyd’s: enforce plain policy language — bodily injury must occur during policy period; no public-policy exception. |
| Does § 5-65-7(a) impose a continuing duty on insurers to provide coverage after policy termination or cancellation? | Van Hoesen: Statute’s purpose would be frustrated if insurers could cancel coverage immediately after work, leaving the public unprotected. | Lloyd’s: Statute requires contractors to maintain insurance but imposes no continuing duty on insurers; enforcement and penalties apply to contractors, not insurers. | Court held insurers are not required to provide post-policy coverage; statute does not impose ongoing insurer liability. |
| Can plaintiffs proceed directly against Lloyd’s after a single unsuccessful constable attempt to serve Leonard (i.e., was substitution proper under § 27-7-2)? | Van Hoesen: Substitution was proper after non est inventus return. | Lloyd’s: Plaintiffs failed to make reasonable/good faith efforts to locate and serve Leonard, so substitution was improper. | Court did not decide—because summary judgment on coverage was dispositive, it affirmed without reaching or reversing the service/substitution ruling. |
| Should the court reinterpret an unambiguous insurance contract based on public-policy concerns? | Van Hoesen: Yes—public policy and statutory purpose require broader coverage. | Lloyd’s: No—courts must give effect to plain contractual terms and not rewrite contracts for policy reasons. | Court held that plain, unambiguous contractual language governs; it will not read in coverage absent ambiguity. |
Key Cases Cited
- Sullo v. Greenberg, 68 A.3d 404 (standard of review for summary judgment)
- Allstate Ins. Co. v. Ahlquist, 59 A.3d 95 (insurance-policy construction rules; no departure from plain language absent ambiguity)
- Beacon Mut. Ins. Co. v. Spino Brothers, Inc., 11 A.3d 645 (same: refrain from reading ambiguity into policy)
- Casco Indem. Co. v. Gonsalves, 839 A.2d 546 (view policy in entirety and apply ordinary meaning)
- Mullins v. Federal Dairy Co., 568 A.2d 759 (give effect to plain language of insurance contract)
- VanMarter v. Royal Indem. Co., 556 A.2d 41 (explaining uninsured-motorist coverage rationale — distinguished here)
- Allstate Ins. Co. v. Fusco, 110 R.I. 350 (discussing legislative purpose behind uninsured-motorist requirement)