On April 24, 2017, Ty Kirby (Kirby) was involved in an accident with Mary Miller (Miller). Kirby was driving a 2002 Dodge Ram (Dodge Ram) owned by his employer, Bear Creek Gravel, Inc. (Bear Creek).

On the date of the accident, Kirby had just dropped off lunch to a co-worker and left the worksite. He collided with Miller’s vehicle at a nearby intersection.

The accident resulted in Miller’s death. Miller’s family sued Kirby for wrongful death by negligent operation of the vehicle. Kirby’s personal insurance carrier was Pioneer State Mutual Insurance Company (Pioneer). The policy covered Kirby even if he was not driving an owned auto. However, the policy excluded any vehicle furnished or available for his regular use. Pioneer denied liability coverage stating the Dodge Ram was provided to Kirby for regular use.

Kirby filed suit. The district court found that the regular use exclusion did not apply to the accident because Bear Creek imposed restrictions on Kirby’s utilization of the vehicle. The court ordered Pioneer to provide coverage for the accident.

Pioneer disagreed with the district court and filed an appeal. It argued that the district court erred as a matter of law in defining the term regular use. The Supreme Court of North Dakota had not precisely defined regular use. However, it did recognize that reasonable time and place restrictions on using a vehicle could lead to finding that a vehicle was not furnished for a person’s regular use.

Pioneer relied on Kunze v. State Farm Mut. Auto. Ins. Co., 197 N.W.2d 685, 694 (N.D.1972) and found that the court was required to find the vehicle furnished for Kirby’s regular use per this case. Pioneer stated that the Dodge Ram was furnished for business only and used strictly for business when the accident occurred. However, the court disagreed.

The Supreme Court found that the Dodge Ram was not furnished for Kirby’s regular use because of the restrictions placed on its use. Kirby could not operate the vehicle at any time. He needed permission to drive it and could not drive it while off duty. Kirby did not have his own set of keys to the vehicle and did not use it on weekends or in the evenings. The Supreme Court affirmed the district court's decision. The regular use exclusion did not apply because of the many restrictions in place.

Editor’s Note: We are uncertain why personal insurance was pursued in this matter rather than the business insurance. It may be specific to North Dakota automobile laws.

Pioneer 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 – Supreme Court State Of North Dakota - March 24, 2021