Injured Employee Seeks Coverage Under Employer's Policy

Commercial Auto	Who is An Insured
Uninsured Motorists Coverage (UM)	Not in the Scope of Work

Renee Reese (Reese) and her son, Austin (the Reese family), were injured in a car accident in June 1996 after an unidentified driver cut off Reese. She was driving to Sarcom, Inc., her workplace. The Reeses settled with their own uninsured motorist insurance and later sought coverage under Sarcom's business auto, umbrella, and commercial general liability policies from Fidelity & Guaranty Insurance Company (F&G). When F&G denied their claim, they filed a lawsuit for declaratory judgment. Both sides then filed motions for summary judgment.

The trial court found in favor of F&G. The Reeses appealed.

The F&G business auto policy issued to Sarcom identified the named insureds as "Sarcom, Inc., J.R. Wilcox & Associates DBA: Inacomp Computer Rentals, Sarcom Properties, Inc., J.J.S. Wilcox, Ltd." Three additional insureds, who were businesses identified as lessors, were added via endorsements for liability coverage. The policy identified "Sarcom, Inc." as the named insured, and the section "Who Is An Insured" question was answered in part as "You" and included "If you are an individual, any family member." Applying current Ohio law, the Reese family qualify as "You" according to the policy's definition.

On appeal, Fidelity contended that the definition of "You" was altered when James R. Wilcox was added as an additional insured in the F&G commercial umbrella policy. F&G argued that explicitly including an individual removed the ambiguity that previously allowed the court to interpret the contract as including the Reese family under the definition of "You."

The Ohio Eighth District Court of Appeals in Cuyahoga County disagreed, emphasizing that James Wilcox was not listed as an additional insured on the auto policy. The use of "You" in the uninsured motorist section was ambiguous, making it appropriate to include the Reese family within that definition.

The main issue was whether the Reese family was covered by the policy, which depended on if Reese was an employee acting within the scope of her employment with Sarcom at the time of the accident. Both parties agreed Reese was en route to work when the accident happened. According to Ohio law, an employee is not considered to be acting within the scope of employment when driving to a fixed workplace unless there is a "special benefit" to the employer beyond providing the employee's services at the needed location. There was no evidence that Reese provided such a "special benefit" to Sarcom. Since she was injured while commuting to work, she was not covered under the policy and was not entitled to coverage.

Sarcom also maintained a commercial general liability policy with Fidelity. This policy excluded coverage for bodily injuries caused by autos, but the exclusion did not apply to "Parking an 'auto' on, or on the ways next to, premises you own or rent, as long as the auto is not owned, rented, or loaned to them.” The Reese family contended that this parking provision effectively expanded the policy to include motor vehicle liability coverage.

The court disagreed, stating that one provision does not convert what is otherwise a non-motor vehicle insurance policy into a motor vehicle insurance policy. In addition, even if the policy were changed, Reese would not be eligible for coverage since she failed to demonstrate that she was acting within the scope of employment. This reasoning also applied to the commercial umbrella policy.

The court concluded that the trial court correctly granted summary judgment to F&G and upheld that decision.

Reese v. Fidelity & Guaranty Insurance Underwriter-No. 83606-Court of Appeals of Ohio, Eighth District, Cuyahoga County-October 7, 2004-821 North Eastern Reporter 2d 1052