Lead Opinion
South Carolina Farm Bureau Mutual Insurance Co. (Farm Bureau) brought this declaratory judgment action to determine whether Henry Kennedy (Kennedy) was entitled to underinsured motorist (UIM) coverage for an accident. The trial court found Kennedy was entitled to UIM coverage under the terms of the policy because Kennedy was “upon” and thus “occupying” the insured vehicle at the time of the accident. The Court of Appeals reversed. S.C. Farm Bureau Mut. Ins. Co. v. Kennedy,
Kennedy was sent by his employer, Irons Poultry Farms, Inc. (Irons), in his employer’s truck, to Wise Barbeque, to tell Johnny Wise that Irons had some feed for him to pick up. Upon arrival, Kennedy left the keys in his employer’s truck and went into the restaurant to deliver the message.
After delivering the message, Kennedy saw his brother, Teddie Robinson, and they engaged in a conversation while walking towards the Irons truck. Part of the conversation occurred at the rear of the Irons truck. Kennedy and Robinson finished their conversation and Robinson prepared to leave. At that moment, an accident occurred on a nearby highway between two pickup trucks. The impact of the collision knocked one of the pickup trucks driven by George Counts into the restaurant’s parking lot. Counts’s truck struck both Robinson and Kennedy as they attempted to escape the careening vehicle.
Kennedy sustained a broken right femur and multiple abrasions, as well as head, neck, and back injuries. His combined medical expenses and lost wages exceeded the liability coverage on Counts’s truck. Irons had a Commercial Auto Policy with Farm Bureau that covered its truck. The policy provided UIM coverage of $50,000 per individual and $100,000 per occurrence. Kennedy sought UIM coverage under his employer’s insurance policy, but Farm Bureau denied coverage.
Farm Bureau filed this declaratory judgment action seeking a determination whether Kennedy was entitled to UIM benefits under the policy. Farm Bureau (1) disputed whether Kennedy was ever pinned to his employer’s vehicle; and (2) asserted Kennedy was standing by his employer’s vehicle and not in actual physical contact with it when the accident occurred and, thus, did not meet the policy’s definition of “occupying” the vehicle.
Kennedy was initially granted summary judgment. The Court of Appeals reversed, holding there was a genuine factual dispute regarding whether Kennedy was ever pinned against his employer’s truck, which precluded summary judgment. S.C. Farm Bureau Mut. Ins. Co. v. Kennedy, Op. No. 2006-UP-423 (S.C. Ct.App. filed Dec. 19, 2006).
Judge Hayes stated he was reaching this result in light of this Court’s mandate that “upon” and “occupying” should be construed in favor of the insured, citing McAbee v. Nationwide Mutual Insurance Co.,
In McAbee, this Court considered a Nationwide insurance policy that provided benefits in case of bodily injury or death “while in or upon, entering or alighting from” a motor vehicle. Id. at 99,
The Court observed that this provision had not previously been construed by this Court, and while cases in other jurisdictions are not in complete agreement, “the rule seems to be generally recognized that the words ‘in or upon’ as used in such policy provisions require a broad and liberal construction in favor of the insured and that by the weight of authority actual physical contact with the insured’s automobile is sufficient to establish that the insured was Upon the vehicle as contemplated by such policies.” Id.
The Court held that the insured was in actual physical contact when he had his back against the insured vehicle trying to protect himself and thus was “upon” it within the meaning of the policy provision, triggering his entitlement to UIM benefits. Id. at 100,
In the current matter before us on appeal, Judge Hayes found Kennedy was entitled to UIM coverage because he (1) “was in physical contact with the insured vehicle at the exact moment of the accident, by virtue of being knocked against it or pinned to it,” and (2) “that the evidence established that [Kennedy] was in physical contact [with the insured vehicle] prior to the accident but had removed his hand from the insured vehicle in his efforts to avoid being injured when the other vehicle was about to strike him.”
The Court of Appeals reversed. The Court of Appeals concluded that Kennedy was not occupying his employer’s truck at the time of the accident because “[h]e had departed the truck, gone inside the restaurant, and returned to the parking lot to talk with his half-brother near the vehicle when he was hit by the pickup truck. As a result, there was no causal connection between Kennedy’s use of the [employer’s] truck and his being struck by Counts’[s] pickup truck.” S.C. Farm Bureau Mut. Ins. Co. v. Kennedy,
“A suit for declaratory judgment is neither legal nor equitable, but'is determined by the nature of the underlying issue.” Felts v. Richland County,
“In an action at law tried without a jury, the appellate court will not disturb the trial court’s findings of fact unless there is no evidence to reasonably support them.” Id. at 46-47,
III. LAW/ANALYSIS
Initially, it is noted that the Court of Appeals ignored the trial court’s findings of fact and substituted its own. Significantly, the Court of Appeals ignored the trial court’s findings that Kennedy had physical contact with the insured truck until he attempted to escape the impending danger and that Kennedy also had actual physical contact as a result of being pinned between the insured vehicle and Counts’s truck. These findings of fact are supported by evidence in the record. Additionally, it appears the Court of Appeals based its decision on a question not raised by the parties, that being whether or not Kennedy was using the insured vehicle at the time he was injured. It is undisputed that Kennedy was performing an errand for his employer and was preparing to return to the work site when he was struck by Counts.
The proper question before the court was whether or not Kennedy had actual physical contact with the insured truck when he was injured. This was a question of fact for the trial court, which it answered in the affirmative. The evidence in the record supports the trial court’s finding. Farm Bureau attempts to convert this question of fact to one of law by arguing a finding of coverage would contravene the policy’s provisions. Notwithstanding our dispositive “any evi
Part II of Farm Bureau’s policy, concerning UIM coverage, provides it will pay UIM benefits to a “covered person” as follows:
We will pay damages for bodily injury or property damage a covered person is legally entitled to collect from the owner or operator of an underinsured motor vehicle. The bodily injury or property damage must be caused by an accident arising out of the operation or ownership of the underinsured motor vehicle.
A “covered person” is defined in Part II as including a “person occupying your [the insured’s] covered auto.” “Occupying” appears in the General Definitions portion of the policy and “means having actual physical contact with an auto while in, upon, entering, or alighting from it.” Kennedy contended he was entitled to UIM coverage because he was “upon” the insured vehicle when he was injured and thus was “occupying” it.
On appeal, Kennedy argues that in considering whether he was “upon” his employer’s truck, it should not matter when the physical contact occurs, i.e., whether he was touching the insured vehicle at the time he was crushed by another vehicle, or whether he was touching it, then ran away for his safety before being pinned back upon it, as in the current appeal. In either circumstance, the insured was in physical contact with the insured vehicle and injured.
Farm Bureau contends this interpretation would contravene the policy, which provides the physical contact must occur while the individual is “occupying” the vehicle. Farm Bureau argues Kennedy was not in physical contact with his employer’s truck when Counts’s truck initially hit him, and the fact that he was pushed into the vehicle as a result of the accident does not change his status.
Like the Court of Appeals, Farm Bureau erroneously assumes that this accident begins and ends at the exact
In McAbee, although the policy did not require physical contact, there was, in fact, physical contact between McAbee and his employer’s truck when McAbee was pinned between his employer’s truck and a tractor.
As noted in American Jurisprudence, Second Edition, whether a person is deemed to have been “occupying” a vehicle depends on the facts of each case, although the general trend appears to be in favor of a liberal construction of the
In this case, Kennedy drove his employer’s truck to the restaurant, where he left the keys in the truck with the engine running and a dog inside while he went inside the building. Shortly thereafter he returned to the parking lot, where he was standing with his hand on the vehicle when he saw the approaching danger and attempted to flee before immediately being struck and injured by Counts’s truck. Thus, Kennedy was in physical contact with his employer’s vehicle immediately prior to being struck by Counts’s vehicle. The fact that Kennedy had engaged in a conversation at the rear of the truck is not important. Holding a conversation outside of an automobile is commonplace and is to be expected in the ordinary use of a vehicle.
Kennedy argues Farm Bureau’s interpretation of the policy, which would deny coverage here while allowing it in a case like McAbee, where the individual was bracing himself against his employer’s truck when he was crushed by a tractor, would be an “unreasonable” distinction that would unfairly deny him UIM benefits. We agree that requiring Kennedy to keep his hand upon the vehicle, remain in the path of Counts’s oncoming vehicle, and risk being crushed is unreasonable, unconscionable, and not in accordance with the legislative purpose behind enactment of the UIM statute. See S.C.Code Ann. § 38-77-160 (2002) (stating automobile insurance “carriers shall ... offer ... underinsured motorist coverage up to the limits of the insured liability coverage to provide coverage in the event that damages are sustained in excess of the liability limits carried by an at-fault insured or underinsured motorist
To interpret the physical contact requirement in a manner that would require Kennedy to succumb to the approaching danger rather than relinquish physical contact would be unreasonable and unconscionable. Kennedy’s conduct was reasonably to be expected from one acting under similar circumstances when faced with a hazard encountered in the ordinary use of a vehicle. See Whitmire v. Nationwide Mut. Ins. Co.,
Although Farm Bureau contends this dispute can be resolved by a literal interpretation of the plain language of “physical contact,” we disagree, as the Supreme Court of Rhode Island recently observed the literal interpretation of policy language will be rejected where its application would lead to unreasonable results and the definitions as written would be so narrow as to make coverage merely “illusory.” Empire Fire & Marine Ins. Cos. v. Citizens Ins. Co.,
Moreover, in Chavez v. Arizona School Risk Retention Trust, Inc.,
In another case involving a physical contact requirement, the Appellate Court of Illinois questioned the validity of the
Although we are likewise concerned about the ultimate validity of such definitional provisions
IV. CONCLUSION
Initially, we conclude that the trial court’s finding of actual physical contact is supported by the evidence. Under the sequence of events that unfolded here, where the trial court found Kennedy had left the engine running on his employer’s vehicle, and that he was in physical contact with the covered vehicle (with his hand on the truck) when Counts’s vehicle careened towards him, forcing him to relinquish his contact in order to attempt to avoid injury, that Kennedy was “upon” and “occupying” the vehicle at the time of the accident and he is entitled to UIM coverage under the Farm Bureau policy. Moreover, a second, resultant physical contact was established when Kennedy was pinned against the insured vehicle. We
REVERSED.
Notes
. The McAbee court ostensibly believed that it made no difference when the physical contact occurred because it did not address whether McAbee first came in physical contact with the tractor or with the insured truck.
. See Jonathan M. Purver, Annotation, Automobile Insurance: When is a Person "Occupying” an Automobile Within Meaning of Medical Payments Provision,
. Requiring physical contact for all methods of "occupying” a vehicle could render some terms of coverage meaningless, arguably creating illusory coverage. For example, in Whitmire,
. S.C.Code Ann. § 38-77-30(7) (2002) defines an insured as follows: " ‘Insured’ means the named insured and, while resident of the same household, the spouse of any named insured and relatives of either, while in a motor vehicle or otherwise, and any person who uses with the consent, expressed or implied, of the named insured the motor vehicle to which the policy applies and a guest in the motor vehicle to which the policy applies or the personal representative of any of the above.” (Emphasis added.) There is no requirement of actual physical contact with the insured vehicle at the time of injury to qualify as an insured under the statute. If "actual physical contact” is required, then the phrase "in a vehicle or otherwise ” appears meaningless. The only statutory limitation is that a non-resident relative and others must have the consent of the named insured to use the vehicle. Consent to use the vehicle bestows the same level of coverage upon others as that enjoyed by the named insured. The statutory definition cannot be limited by a contractual provision. Cf. Boyd v. State Farm Mut. Auto. Ins. Co.,
Dissenting Opinion
I respectfully dissent. The policy defines “occupying” as “having actual physical contact with an auto while in, upon, entering, or alighting from it.” In my opinion, there is no dispute that petitioner was not “in actual physical contact” with the truck when the accident occurred. Unlike the majority, I am unable to agree that an accident continues until the last injury is inflicted. Under this theory, in virtually every case where the victim eventually makes contact with an insured vehicle, whether he was thrown, dragged or carried across the parking lot by another vehicle, there would be coverage. Such an expansive reading renders meaningless the policy language defining “occupying” as “in, upon, entering, or alighting from” the insured vehicle. “[Pjarties have the right to make their own contract and it is not the function of this Court to rewrite it or torture the meaning of a policy or extend coverage never intended by the parties.” Torrington Co. v. Aetna Cas. & Sur. Co.,
I would affirm the decision of the Court of Appeals.