Pioneer State Mutual Insurance Co. v. Bear Creek Gravel , 2021 ND 53 ( 2021 )

FILED
IN THE OFFICE OF THE
CLERK OF SUPREME COURT
MARCH 24, 2021
STATE OF NORTH DAKOTA
IN THE SUPREME COURT
STATE OF NORTH DAKOTA
2021 ND 53Pioneer State Mutual Insurance Company, Plaintiff and Appellant
v.
Bear Creek Gravel Inc.; Pat and Delores Anderson;
and Mary L. Miller, deceased, through her
known Heirs Richard Miller, Sarah
Miller Wohl, Jay Miller, and Betsey
Seter a/k/a/ Betsy Seter, Defendants and Appellees
and
Auto-Owners Insurance Company; Ty Kirby,
AAA Insurance; Defendants
No. 20200170
Appeal from the District Court of Ransom County, Southeast Judicial District,
the Honorable Mark T. Blumer, Judge.
AFFIRMED.
Opinion of the Court by Crothers, Justice.
Jonathon F. Yunker, Devils Lake, ND, for plaintiff and appellant.
Michael J. Morley (argued) and Victoria A. Thoreson (appeared), Grand Forks,
ND, for defendents and appellees Bear Creek Gravel Inc.; and Pat and Delores
Anderson.
Kellen B. Bubach (argued) and Daniel J. Dunn (appeared), Fargo, ND, for
defendants and appellees Mary L. Miller, deceased, through her known Heirs
Richard Miller, Sarah Miller Wohl, Jay Miller, and Betsey Seter a/k/a/ Betsy
Seter.
Pioneer State Mutual Insurance Co. v. Bear Creek Gravel
No. 20200170
Crothers, Justice.
[¶1] Pioneer State Mutual Insurance Company appeals from a declaratory
judgment finding the automobile policy issued by Pioneer to Ty Kirby provided
insurance coverage. We affirm.
I
[¶2] On April 24, 2017, Kirby was involved in a motor vehicle accident with
Mary Miller. Kirby was driving a 2002 Dodge Ram owned by his employer,
Bear Creek Gravel, Inc. One of Kirby’s co-workers had forgotten his lunch and
Kirby instructed him to meet him at the intersection of two nearby highways
where Kirby would bring him a sandwich. After purchasing the sandwich,
filling the 2002 Dodge Ram with fuel, and delivering the sandwich to his co-
worker, Kirby began crossing the intersection. Kirby proceeded through the
intersection and collided with Miller, who died as a result of the collision.
[¶3] Miller’s heirs sued Kirby, alleging he was negligent in the operation of
the company owned 2002 Dodge Ram. Kirby’s personal automobile insurer,
Pioneer, initiated a declaratory judgment action seeking to deny liability
coverage to Kirby for the Miller’s wrongful death claim.
[¶4] Kirby purchased an automobile insurance policy from Pioneer effective
from April 1, 2017 to October 1, 2017. The policy covered Kirby even if he was
driving a vehicle he did not own. However, the policy excluded coverage for any
vehicle “furnished or available for [Kirby’s] regular use.” The regular use
exclusion is the basis for Pioneer’s denial of liability coverage for the accident.
[¶5] A bench trial was held on March 12, 2020. The district court found the
“regular use” exclusion did not apply to the accident because Bear Creek
Gravel imposed restrictions on Kirby’s use of the 2002 Dodge Ram. The court
ordered Pioneer to provide Kirby coverage for the April 24, 2017 accident.
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II
[¶6] Pioneer appears to argue the district court erred as a matter of law in
defining the term “regular use.” However, Pioneer ultimately acknowledges
that whether a vehicle has been provided for regular use is a question of fact.
Am. Hardware Mut. Ins. Co. v. Nat’l Farmers Union Prop. & Cas., 422 N.W.2d
402, 404 (N.D. 1988). Because the district court made factual findings whether
the 2002 Dodge Ram was provided for Kirby’s regular use, this Court
determines whether the findings were clearly erroneous. See id. A finding of
fact is clearly erroneous if it is induced by an erroneous view of the law, if no
evidence supports it, or if the reviewing court, on the entire evidence, is left
with a definite and firm conviction a mistake has been made. Stoddard v.
Singer, 2021 ND 23, ¶ 6, 954 N.W.2d 696.
[¶7] This Court has not precisely defined “regular use.” But we have
recognized reasonable time and place restrictions on the use of a vehicle could
lead to finding a vehicle was not furnished for a person’s regular use. See Am.
Hardware, 422 N.W.2d at 404; Kunze v. State Farm Mut. Auto. Ins. Co., 197
N.W.2d 685, 694 (N.D. 1972).
[¶8] In American Hardware, this Court addressed the phrase “furnished for
regular use” as it related to a customer’s trial use of an automobile dealership’s
pickup. Am. Hardware, at 403. The district court found the customer-
dealership agreement for use of the pickup had implicit restrictions on time
and use. Id. at 404. The court determined the pickup was not furnished for the
customer’s regular use. Id. This Court concluded the decision was not clearly
erroneous, explaining that evidentiary inferences about time and place
restrictions reasonably provided a basis for the district court to find the pickup
was not furnished for the customer’s regular use. Id.
[¶9] Pioneer relies on Kunze to argue the district court was required to find
the 2002 Dodge Ram was provided for Kirby’s regular use. Specifically, Pioneer
cites the following from Kunze:
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“Whether an automobile is furnished by another to an insured for
his regular use may reasonably depend upon the time, place and
purpose for which it is to be used. One furnished for all purposes
and at all times would clearly be for his regular use. One furnished
at all times but strictly for business purposes alone could hardly
be said to have been furnished for his regular use at a time and
place when it was being used for personal purposes.”
Kunze, 197 N.W.2d at 693. According to Pioneer, because the 2002 Dodge Ram
was furnished for business purposes and was being used strictly for business
purposes at the time of the accident, the court was required to find the vehicle
was furnished for Kirby’s regular use. We disagree. In Kunze this Court quoted
several cases with conflicting definitions and tests for regular use. Id. at 689-
94. Because of the conflicting nature of those cases, at best Kunze serves to
affirm that a finding of regular use is factual. See id. at 694 (explaining it was
well within jury’s province to decide whether vehicle was furnished for regular
use).
[¶10] Here, the district court concluded the 2002 Dodge Ram was not furnished
for Kirby’s regular use because several restrictions existed for Kirby’s use of
the vehicle. The testimony from Kirby and the owners of Bear Creek Gravel,
Pat and Delores Anderson, was that the 2002 Dodge Ram was not furnished
for Kirby’s use at all times. Kirby also testified that he needed permission from
the Andersons to drive the 2002 Dodge Ram, and that he was not allowed to
drive the vehicle while off duty. Kirby did not have his own set of keys to the
vehicle. Pat Anderson testified Kirby could not use the vehicle without
permission and Kirby did not use the vehicle on weekends or during the
evening. The testimony was not disputed. It is well-settled that a trial court
may draw inferences from facts presented and make a finding based on an
inference supported by the evidence. Am. Hardware, 422 N.W.2d at 404. Here,
evidence and inferences about restrictions on Kirby’s utilization of the vehicle
support the district court’s decision the regular use exclusion did not apply.
Therefore, the district court’s decision on Kirby’s use was not clearly erroneous.
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III
[¶11] We affirm the declaratory judgment.
[¶12] Jon J. Jensen, C.J.
Daniel J. Crothers
Lisa Fair McEvers
Jerod E. Tufte
Allan L. Schmalenberger, S.J.
[¶13] The Honorable Allan L. Schmalenberger, S.J., sitting in place of
VandeWalle, J., disqualified.
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