Universal North America Insurance Company v. Bower, 2:16-cv-00693

Background

On Nov. 28, 2015, Danielle Bower drove a golf cart that tipped over, injuring passengers; the Bowers were insured under a homeowner’s policy covering Jan. 12, 2015–Jan. 12, 2016.
Universal North America (Plaintiff) seeks a declaratory judgment that it has no duty to defend or indemnify the Bowers because the golf cart was used on a public road and was not registered, invoking a motor-vehicle exclusion in the homeowners policy.
Defendants (Responding Defendants) contend the accident occurred off the public road—between two sidewalks or on the golf course—so the motor-vehicle exclusion does not apply and coverage may exist (including a golf-cart-specific coverage exception for use on golfing facilities or allowed recreational activity).
Evidence is disputed: a plat and Kijanka’s affidavit initially supported a non-road landing, but Kijanka’s deposition undermined that certainty; police videos and several witnesses place the cart where responders found it (after it had been moved); passenger Aimee Spencer, an eyewitness, testified the cart rested between the two sidewalks.
The policy’s Coverage E (personal liability) and Coverage F (medical payments) apply for injury caused by an “occurrence” unless excluded; Section II.A excludes “[m]otor vehicle liability” when registration is required but absent; Section II.A.2.e provides a possible coverage carve-out for insured-owned golf carts used within golfing facility bounds or for allowed recreational activity.
Magistrate Judge recommended denying Plaintiff’s second motion for summary judgment because genuine disputes of material fact remain about where the accident/ final resting place occurred and whether the golfing-facility exception applies.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the motor-vehicle exclusion bars coverage because the accident occurred on a public road/right-of-way	Accident began and ended on the roadway/right-of-way; cart was unregistered and thus excluded	The cart’s final resting place (and thus the occurrence) was off the public right-of-way (between sidewalks/on golf course), so exclusion doesn’t apply	Denied summary judgment — disputed fact whether occurrence was on public right-of-way; jury/trier must decide
Whether eyewitness and physical evidence conclusively place the accident on the road	Police videos, some witness testimony, and accident reconstruction show cart on road/right-of-way	Eyewitness passenger (Spencer) and plat (from spray outline) indicate cart between sidewalks/on golf course; other witness testimony is equivocal	Evidence is mixed and not definitive; credibility/resolution for factfinder — no summary judgment
Whether the golf-cart exception to the motor-vehicle exclusion applies	Exception inapplicable because defendants were not playing golf or accessing golf facilities; cart use was not authorized recreational activity	Use may qualify as “other recreational or leisure activity allowed by the facility,” so the carve-out could apply	Insurer bears burden to prove exclusion; ambiguity resolves against insurer — triable issue remains
Whether summary judgment is appropriate for insurer where exclusions are asserted	Plaintiff argues evidence now establishes exclusion applies as a matter of law	Defendants argue factual disputes preclude summary judgment	Court recommends denial of Plaintiff’s second summary judgment motion due to genuine disputes of material fact

Key Cases Cited

Jessco, Inc. v. Builders Mut. Ins. Co., 472 Fed. Appx. 225 (4th Cir.) (duty to defend exists where possibility of coverage; insurer must prove exclusions)
Muhammad v. Klotz, 36 F. Supp. 2d 240 (E.D. Pa. 1999) (summary judgment inquiry focuses on whether evidence presents a genuine disagreement for trial)
Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (summary judgment standard and weighing of inferences are for the trier of fact)
Diamond v. Colonial Life & Acc. Ins. Co., 416 F.3d 310 (4th Cir.) (district court need not de novo review R&R absent timely objections)
Thomas v. Arn, 474 U.S. 140 (1985) (failure to timely object to magistrate judge’s recommendation may waive appellate review)