Integon Nat'l Ins. Co. v. Billy Reece ( 2020 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS DEC 11 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
INTEGON NATIONAL INSURANCE No. 19-17567
COMPANY,
D.C. No.
Plaintiff-Appellee, 1:18-cv-01192-LJO-JLT
v.
MEMORANDUM*
BILLY REECE; AMBER REECE,
Defendants-Appellants,
and
C. N., a minor, by and through his Guardian
Ad Litem Callie Nielsen,
Defendant.
INTEGON NATIONAL INSURANCE No. 19-17568
COMPANY,
Plaintiff-Appellee, D.C. No.
1:18-cv-01192-LJO-JLT
v.
C. N., a minor, by and through his Guardian
Ad Litem Callie Nielsen,
Defendant-Appellant,
and
BILLY REECE; AMBER REECE,
Defendants.
Appeal from the United States District Court
for the Eastern District of California
Lawernce J. O’Neill, District Judge, Presiding
Submitted December 8, 2020**
San Francisco, California
Before: MURGUIA and CHRISTEN, Circuit Judges, and SESSIONS,*** District
Judge.
Appellants Billy and Amber Reece and C.N., a minor, bring this
consolidated appeal of the district court’s entry of summary judgment in favor of
Integon National Insurance Company (“Integon”). We have jurisdiction under 28
U.S.C. § 1291, and reviewing de novo, United States v. Swisher, 811 F.3d 299, 306
(9th Cir. 2016) (en banc), we affirm.
C.N. filed suit in state court against the Reeces for negligent supervision and
entrustment, claiming injuries suffered while riding on the Reeces’ electric golf
cart. The Reeces sought coverage from Integon under their homeowners’ policy.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
***
The Honorable William K. Sessions III, United States District Judge
for the District of Vermont, sitting by designation.
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The policy excluded coverage for motor vehicle accidents, including accidents
resulting from negligent supervision or entrustment. The exclusion had an
exception, however, for vehicles designed for recreational use off public roads, so
long as the “occurrence” took place at the “insured location.”. The “insured
location” in this case was the Reeces’ home. C.N. was allegedly injured while on a
public roadway.
Because the public roadway was not an “insured location,” the Integon
homeowners’ policy does not encompass C.N.’s claims. An insurance policy is a
contract, and under California law, “[t]he fundamental rules of contract
interpretation are based on the premise that the interpretation of a contract must
give effect to the ‘mutual intention’ of the parties.” Waller v. Truck Ins. Exch.,
Inc., 900 P.2d 619, 627 (Cal. 1995), as modified on denial of reh’g (Oct. 26, 1995).
California law also endorses a “common sense” reading of an insurance policy.
See, e.g., Foremost Ins. Co. v. Eanes, 184 Cal. Rptr. 635, 637 (Cal. Ct. App. 1982).
Here, a common sense reading of the Integon policy reveals the parties’ intent to
cover only those “occurrences” that happened on the Reeces’ property. C.N.’s
alleged injuries were suffered outside that policy limitation.
Appellants urge us to find coverage on the basis of the Reeces’ location at
the time of the accident, arguing that the relevant “occurrence” was their allegedly-
negligent supervision while at their home. Such coverage would be inconsistent
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with the language of the homeowners’ policy, as the parties clearly intended to
exclude motor vehicle accidents, and any resulting injuries, suffered away from the
insured location.
Appellants’ reliance on Liberty Surplus Ins. Corp. v. Ledesma & Meyer
Construction Co., 418 P.3d 400 (Cal. 2018), as modified (July 25, 2018) (“Liberty
Surplus”), is misplaced. Liberty Surplus considered whether an employer’s
negligent hiring and supervision of an employee was an “occurrence,” and whether
the alleged injury, though inflicted intentionally, could be considered an
“accident.” 418 P.3d at 402. Those issues are not presented here. Moreover,
Liberty Surplus was “not concerned with where the accident occurred but with
whether there was an ‘accident’ within the scope of the policy language.” Id. at
406. In this case, the location of the accident is fundamental. Because the
“occurrence” in this case did not take place at an insured location, there is no
coverage.
AFFIRMED.
Appellants to bear costs.
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