Selective Way Insurance Company v. Roseanne Apple
661 F. App'x 794
| 4th Cir. | 2016Background
- Selective Way issued a commercial liability and business automobile policy to Building Industries, Inc. (BI); the policy listed the vehicle Apple was driving as a covered automobile though the vehicle was titled to Roseanne Browning Apple and her husband.
- Apple struck Earl Eugene Hoar while driving her husband home from the hospital after surgery, injuring Hoar.
- Selective sued for a declaratory judgment seeking a ruling that it had no duty to indemnify Apple because she was not an insured under BI’s policy.
- The district court held a bench trial and ruled for the appellees, concluding that Virginia’s omnibus statute made Apple an insured because BI implicitly consented to her permissive use of the vehicle.
- The Fourth Circuit reviewed legal conclusions de novo and vacated the district court’s judgment, holding that Apple, as the titled owner, was not a permissive user under the omnibus clause and that BI therefore could not grant or withhold permission to use the vehicle.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Selective has a duty to indemnify Apple under Virginia’s omnibus clause | Apple is not an insured under the BI policy; no duty to indemnify | BI’s policy covers any person using the vehicle with BI’s consent; Apple was a permissive user | Vacated district court: Apple was the vehicle owner and not a permissive user under the omnibus clause, so BI could not grant permission |
| Whether BI had an interest sufficient to grant implied consent (despite not holding title) | BI’s payment of purchase, premiums, maintenance and exposure to loss entitles it to grant permission | Ownership/titling is decisive; only party with right to possession/control can grant or withhold permission | Held that BI lacked the possessory/control right; payments alone do not make BI able to grant permission |
Key Cases Cited
- Raleigh Wake Citizens Ass’n v. Wake Cty. Bd. of Elections, 827 F.3d 333 (4th Cir. 2016) (standard of review for bench trials)
- Gov’t Emp. Ins. Co. v. United Serv. Auto. Ass’n, 708 S.E.2d 877 (Va. 2011) (omnibus clause is remedial and construed broadly to protect injured persons)
- Stone v. Liberty Mut. Ins. Co., 478 S.E.2d 883 (Va. 1996) (named insured generally cannot give permission to use a vehicle it does not own)
- Nationwide Mut. Ins. Co. v. Cole, 124 S.E.2d 203 (Va. 1962) (permission requires right to possession and control)
- Va. Auto. Mut. Ins. Co. v. Brillhart, 46 S.E.2d 377 (Va. 1948) (permission connotes power to grant or withhold use; owner uses by virtue of ownership)
- Hall, Inc. v. Empire Fire & Marine Ins. Co., 448 S.E.2d 633 (Va. 1994) (owner identified by legal title)