469_C312
NO
COVERAGE FOR ATV ACCIDENT OFF INSURED PREMISES
|
Homeowners |
Insured Location |
|
All-Terrain Vehicle |
Reservation of Rights |
Peyton Power and her
father, James Power, owned a house at
At the time of the
accident, Peyton Power held a homeowners insurance policy issued by
Massachusetts Property Insurance Underwriting Association. Under a reservation
of rights, Massachusetts Property agreed to defend Spina
and the Powers. It then filed an action seeking a declaration as to its
obligations. The lower court found the homeowners
policy did not obligate Massachusetts Property to defend or indemnify Spina and the Powers. Wynn appealed.
Under the homeowners policy, accidents arising out of the use of motor
vehicles or motorized land conveyances were excluded from coverage. However,
ATVs were excepted from this exclusion if they were
not owned by the "insured," or if they were owned by the
"insured" and on an "insured location." The parties agreed
that Spina owned the ATV and that he was an
"insured" within the meaning of the policy. The issue, then, was
whether the ATV was on an "insured location" within the meaning of
the policy.
Wynn argued that the
language of the policy was ambiguous, and that the policy must therefore be
construed in his favor. He then contended that the language could be reasonably
interpreted to mean the ATV need only be garaged on the insured location. The
court disagreed. In reaching its decision it emphasized the intent of the
exception. The policy was written to require an insured to obtain specific
liability insurance for all motor vehicles and for all owned recreational
vehicles except for the limited circumstance when an ATV owned by the insured
was involved in an accident on the insured location, a confined area of risk.
Because the accident must have occurred on the insured location, it wasn't
enough that the involved vehicle was merely garaged there.
As an alternative argument,
Wynn proposed that the beach where the accident occurred fell within the
meaning of "insured location" because it was used regularly in
connection with the residence. Again, the court disagreed. The court reasoned
that to adopt this approach would render the definition meaningless and provide
no geographical limit to coverage.
The decision of the lower
court was affirmed.