2017 COA 6
Colo. Ct. App.2017Background
- Neill Smith was impaled and seriously injured when hay spears on a John Deere tractor driven by Robert Bunker collided with Smith’s truck on a county road; Bunker pled guilty to careless driving.
- Smith settled with Bunker for the liability policy limits but sought underinsured motorist (UIM) benefits from his State Farm policy to cover remaining damages.
- State Farm denied UIM coverage arguing the farm tractor is not a covered “motor vehicle” under the policy.
- Smith and his wife sued for breach of contract and bad faith; the district court granted State Farm’s motion and dismissed, holding the tractor was not a covered motor vehicle.
- The Colorado Court of Appeals reviewed de novo whether the policy’s UIM provision covers injury caused by a farm tractor and whether any policy or statutory definition excludes it.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the tractor is a covered “motor vehicle” under the UIM policy | Smith: the ordinary meaning of “motor vehicle” (or definitions elsewhere in policy) includes the tractor, so UIM applies | State Farm: the policy doesn’t define “motor vehicle”; if defined, it should be limited to vehicles primarily designed for highway use (statutory definition) | Held: The policy’s UIM provision did not define motor vehicle; applying the ordinary dictionary meaning, the tractor is a motor vehicle and thus covered |
| Whether a definition of “uninsured motor vehicle” in the property-damage section applies to UIM coverage | Smith: contract must be read as whole; import that definition into UIM section | State Farm: policy expressly limits coverage-specific definitions “only for use with that coverage,” and typeface differences confirm no cross-use | Held: Rejected importation; the property-damage definition does not apply to the UIM provision |
| Whether the statutory definition of “motor vehicle” (primarily for highway travel) controls policy meaning | Smith: (alternative) UIM statute/public policy requires coverage | State Farm: statutory definition should be read into the policy, excluding tractors primarily designed for off-road use | Held: Court declined to read statutory definition into the contract absent express incorporation; relied on plain dictionary meaning instead |
| If ambiguous, whether to construe in favor of insured | Smith: any ambiguity favors coverage | State Farm: narrower reasonable interpretation favors exclusion | Held: Even if State Farm’s narrower view were reasonable, that creates ambiguity to be construed for the insured; result favors coverage |
Key Cases Cited
- Allstate Ins. Co. v. Huizar, 52 P.3d 816 (Colo. 2002) (policy interpretation follows ordinary contract principles)
- State Farm Mut. Auto. Ins. Co. v. Nissen, 851 P.2d 165 (Colo. 1993) (undefined policy words given plain meaning)
- State Farm Mut. Auto. Ins. Co. v. Stein, 940 P.2d 384 (Colo. 1997) (ambiguities in insurance policies construed for insured)
- Am. Family Mut. Ins. Co. v. Hansen, 375 P.3d 115 (Colo. 2016) (term ambiguous if susceptible to more than one reasonable meaning)
- Bertrand v. Bd. of Cty. Comm’rs, 872 P.2d 223 (Colo. 1994) (use of dictionary to define “motor vehicle”)
- Miller v. Hartford Cas. Ins. Co., 160 P.3d 408 (Colo. App. 2007) (dictionaries may assist in ascertaining ordinary meaning in policy interpretation)
- Williams v. State Dep’t of Highways, 879 P.2d 490 (Colo. App. 1994) (applying dictionary definition to conclude a vehicle used on public roads is a motor vehicle)
- Keelan v. Van Waters & Rogers, Inc., 840 P.2d 1070 (Colo. 1992) (statutory provisions may be treated as part of a contract when the contract evidences intent to incorporate them)
- Pastrana v. Hudock, 140 P.3d 188 (Colo. App. 2006) (court may disregard non-record factual assertions)
Outcome: Court of Appeals reversed dismissal, holding the tractor qualifies as a “motor vehicle” under the UIM provision and remanded for further proceedings.