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Ball v. Allstate Insurance Co.

Supreme Court of Alaska

August 17, 2018

NATHAN BALL, Appellant,
v.
ALLSTATE INSURANCE COMPANY, an Illinois company, Appellee.

          Appeal from the Superior Court No. 4FA-15-02904 CI of the State of Alaska, Fourth Judicial District, Fairbanks, Michael A. MacDonald, Judge.

          Ward Merdes, Merdes Law Office, P.C., Fairbanks, for Appellant.

          Alfred Clayton, Jr. and Ryan Thomas Bravo, Clayton & Diemer, LLC, Anchorage, for Appellee.

          Before: Stowers, Chief Justice, Winfree, Maassen, Bolger, and Carney, Justices.

          OPINION

          WINFREE, JUSTICE.

         I. INTRODUCTION

         Allstate Insurance Company denied underinsured motorist (UIM) coverage to Nathan Ball for an accident involving his own vehicle after determining he was not an insured person under his then-fiancee's parents' Allstate automobile insurance policy. Ball contended that his fiancee was a "policyholder" for purposes ofher parents' policy, a necessary predicate to his argument for UIM coverage under the policy. But the policy declarations page did not list "policyholders," it listed only "named insureds" and "drivers." The superior court ruled on summary judgment that the policy language was not ambiguous because "policyholder" referred only to the parents, the "named insureds," that the fiancee - only a listed driver - had no objectively reasonable expectation that she was a policyholder, and, therefore, that Allstate did not have a duty to provide Ball UIM coverage. We agree that "policyholder" encompasses only the named insureds, not listed drivers, and we therefore affirm the superior court's decision.

         II. FACTS AND PROCEEDINGS

         In September 2012 Allstate delivered an automobile insurance policy renewal to Richard and Kathryn Davis at their address in Tok, incorporating changes they had requested to the policy. The policy listed "Richard & Kathryn Davis" as the "NAMED INSURED(S)" and "Richard" and "Kathryn," as well as "Vivian," the couple's adult daughter, as "DRIVER(S)." (Emphases omitted.)

         One day in December Vivian and her then-fiance, Nathan Ball, were driving two of Ball's vehicles; the vehicle Ball was driving stalled. Vivian backed the vehicle she was driving to the front of the stalled vehicle so that Ball could attach a tow chain. While Ball was positioned between the two vehicles, a third party drove into the back of the stalled vehicle; Ball was seriously injured.

         Ball made successful claims under the third party's liability insurance coverage, under his own liability insurance coverage protecting Vivian, and under his own UIM insurance coverage. Ball also made a claim under the UIM provision of the Davises' Allstate policy.

         The Allstate UIM provision states Allstate "will pay all damages, other than punitive or exemplary damages, that an insured person is legally entitled to recover from the owner or operator of an uninsured or underinsured auto because of... bodily injury sustained by an insured person." (Emphasis omitted.) The policy defines "[i]nsured [p]ersons" as "[y]ou and any resident relative" or "[a]ny person while in, on, getting into or out of your insured auto with your permission," (emphases omitted) and defines "insured auto" to include a motor vehicle "not owned by you or a resident relative if being operated by you with the owner's permission." (Emphases omitted.) The policy defines "[y]ou" or "[y]our" as "the policyholder named on the Policy Declarations and that policyholder's resident spouse." (Emphases omitted.)

         Allstate denied coverage for Ball's claim. Allstate contended that Ball did not qualify as an insured person under the Davises' policy because "[n]one of the definitions of' [i]nsured [p]ersons' appli[ed] to [Ball's] status at the time of the accident." Allstate explained that Ball was "neither a policyholder of the Davis policy, nor a resident relative in the Davis household," that "[t]he two people defined as 'you' [and thus policyholders] are Richard and Kathryn Davis," and that the car Vivian was driving at the time of the incident was owned by Ball and thus a non-owned auto under the Davises' policy.

         Allstate subsequently filed a complaint for a declaratory judgment that it had no duty under the terms of the policy to make any payment to Ball for his UIM claim, and it then moved for partial summary judgment. Allstate argued Ball was not an insured under the policy because the policy language and cases considering similar language established that Vivian-a listed permissive driver-did not meet the policy definition of "you" and Ball's vehicle did not meet the definition of "your insured auto." Ball's opposition and cross-motion for summary judgment argued that the policy was ambiguous because it defined "you" as "the policyholder named on the Policy Declarations" but failed to name a policyholder on that page, instead listing "named insureds" and "drivers." Ball contended there was a reasonable expectation that the policy should be construed in favor of coverage because Vivian submitted an affidavit stating she believed she was a policyholder.

         The superior court granted Allstate's motion and denied Ball's cross-motion. The court determined the policy language was not ambiguous because "policyholder" referred only to the named insureds - Richard and Kathryn - not to listed drivers, and Vivian did not have an objectively reasonable expectation that she was a policyholder.

         Ball filed a motion for reconsideration, arguing that the court unnecessarily based its decision on "whether Vivian can be reasonably identified as a 'Policyholder'" because the policy did not define the term and Vivian had a reasonable expectation that she was a policyholder. The court denied Ball's motion, holding Ball's interpretation of "policyholder" was not reasonable and finding Ball failed to "raise any material facts or propositions of law that change the [court's] analysis."

         Ball appeals, arguing the superior court erred in granting summary judgment because "policyholder" is ambiguous and Vivian had an objectively reasonable ...


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