O'Neal v. Argonaut Midwest Insurance Co.
2013 Mo. App. LEXIS 1385
| Mo. Ct. App. | 2013Background
- Levi O’Neal, a passenger in a Nissan leased from Auto by Rent, seeks MVFRL coverage under Argonaut for Kristen’s negligence; the trial court granted Argonaut summary judgment and Levi’s cross-motion was denied.
- The Nissan is owned by Auto by Rent and leased to Theresa O’Neal, with Argonaut providing coverage when the lease-required insurance is not in effect or collectible.
- Theresa obtained a Haulers policy that covered the lease’s required liability but excluded Kristen as an insured; Haulers provided $25,000 MVFRL coverage for Levi only if Kristen was not driving.
- On November 29, 2006, Kristen drove the Nissan with Levi as a passenger; Levi was injured and a judgment against Kristen totaled $273,169, with $25,000 paid by Haulers and $5,000 by State Farm reducing the balance to $243,169.
- Argonaut contends no coverage because Haulers was in effect and collectible; Argonaut also asserts a contingent liability and an escape clause in its policy.
- The trial court held Argonaut’s policy is contingent and provided no coverage, and it declined Levi’s cross-motion; the court ordered Argonaut not to defend or indemnify Kristen.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Argonaut policy provides MVFRL coverage to Kristen as a permissive driver | O’Neal argues Argonaut must cover Kristen up to MVFRL minimums. | Argonaut contends coverage is conditioned on non-collectibility of lease insurance and falls away if Haulers is in effect. | Yes; Argonaut provides minimum MVFRL coverage to Kristen. |
| Whether the contingent liability and escape clause defeat MVFRL minimums | Levi asserts the contingent liability clause triggers coverage despite Haulers. | Argonaut argues the clause shifts primary liability away and defeats MVFRL requirements. | Contingent liability did occur; escape clause cannot defeat MVFRL minimums. |
| Whether an owner’s policy must provide MVFRL minimums to a permissive user when another policy provides coverage | Levi contends MVFRL requires minimum coverage for permissive drivers, regardless of other policies. | Argonaut relies on other-insurance or primary-excess allocation to avoid MVFRL duties. | Owner’s policy must provide MVFRL minimums to permissive users; Argonaut must cover Levi up to $25,000. |
Key Cases Cited
- Am. Standard Ins. Co. v. Hargrave, 34 S.W.3d 88 (Mo. banc 2000) (minimum MVFRL coverage required for owner policies; household exclusions invalid)
- Karscig v. McConville, 303 S.W.3d 499 (Mo. banc 2010) (owner vs. operator policy; MVFRL minimums apply to permissive users)
- Halpin v. Am. Family Mut. Ins. Co., 823 S.W.2d 479 (Mo. banc 1992) (household exclusion invalid under MVFRL minimums)
- Rutledge v. Bough, 399 S.W.3d 884 (Mo.App.2013) (interpretation of insurance contracts; MVFRL applications in Missouri)
- Irvin v. Rhodes, 929 S.W.2d 829 (Mo.App.1996) (avoidance of non-technical meanings in policy terms)
- Budget Rent A Car of St. Louis v. Guaranty Nat'l Ins. Co., 939 S.W.2d 412 (Mo.App. E.D.1996) (allocation of primary vs. excess insurance without defeating MVFRL)