Kline v. Travelers Pers. Sec. Ins. Co.

223 A.3d 677

Bradley E. KLINE, Appellee

v.TRAVELERS PERSONAL SECURITY INSURANCE COMPANY, Appellant

Bradley E. Kline, Appellant

v.Travelers Personal Security Insurance Company, Appellee

No. 104 MDA 2019

No. 164 MDA 2019

Superior Court of Pennsylvania.

Argued August 14, 2019

Filed November 18, 2019

Reargument Denied January 22, 2020

Allison L. Krupp, Camp Hill, for Travelers.

Evan J. Kline III, York, for Kline.

BEFORE: GANTMAN, P.J.E., McLAUGHLIN, J., and FORD ELLIOTT, P.J.E.

OPINION BY GANTMAN, P.J.E.:

Appellant/Cross-Appellee, Bradley E. Kline, and Appellee/Cross-Appellant, Travelers Personal Security Insurance Company ("Travelers"), appeal from the order entered in the York County Court of Common Pleas, in this declaratory judgment action, that granted partial summary judgment in favor of Appellant/Cross-Appellee Kline, granted in part and denied in part Travelers' cross-motion for summary judgment, and entered final judgment against Travelers in the amount of $100,000.00, plus interests and costs. For the following reasons, we vacate and remand with instructions.

In its opinion, the trial court sets forth the relevant facts of this appeal as follows:

[Appellant/Cross-Appellee Kline] brought this action as a result of the injuries he sustained while operating his motor vehicle. This action concerns an issue related to an automobile insurance policy entered into between [Appellant/Cross-Appellee Kline] and [Travelers], and an issue related to an automobile insurance policy entered into between [Appellant/Cross-Appellee Kline]'s mother and [Travelers]. The first issue is before this [c]ourt on both [parties'] Cross Motions for Summary Judgment. It concerns a dispute as to whether [Appellant/Cross-Appellee Kline] is entitled to stack underinsured motorist benefits where [Travelers] did not issue new rejection of stacking waiver forms upon [Appellant/Cross-Appellee Kline] adding two vehicles to his insurance policy. The second issue is before this [c]ourt on [Travelers'] Motion for Summary Judgment. It concerns whether [Appellant/Cross-Appellee Kline] is entitled to stacked benefits under the insurance policy entered into between his mother and [Travelers]. The following facts were stipulated by the parties:

[Appellant/Cross-Appellee Kline] applied for an automobile insurance policy ("the Policy") with [Travelers] in August of 2002. At the time, [Appellant/Cross-Appellee Kline] selected uninsured motorist benefits ("UM") and underinsured motorist benefits ("UIM") in the amount of $50,000 each person/$100,000 each accident. [Appellant/Cross-Appellee Kline] rejected stacked UIM coverage by signing a rejection of stacking waiver form. [Appellant/Cross-Appellee Kline's] Policy covered one vehicle at its inception, a 1999 Pontiac Grand Prix. The 1999 Pontiac Grand Prix was later replaced by a 2002 Pontiac Firebird.

On or about June 6, 2007, [Appellant/Cross-Appellee Kline] added a 2001 Pontiac Montana to the Policy. By doing so, [Appellant/Cross-Appellee Kline] increased the number of covered vehicles from one to two. [Appellant/Cross-Appellee Kline] notified his insurance agent and an amended Automobile Policy Declaration sheet was issued reflecting the addition to the vehicle to the Policy. [Travelers] did not present [Appellant/Cross-Appellee Kline] with a new stacking rejection form when the 2001 Pontiac Montana was added to the Policy. The 2001 Pontiac Montana was later replaced by a 2008 Chevrolet Uplander.

On or about August 11, 2011, [Appellant/Cross-Appellee Kline] added a 2003 Pontiac Vibe to the Policy. By doing so, [Appellant/Cross-Appellee Kline] increased the number of covered vehicles from two to three. [Appellant/Cross-Appellee Kline] notified his insurance agent and an amended Automobile Policy Declarations sheet was issued reflecting the addition of the vehicle to the Policy. [Travelers] did not present [Appellant/Cross-Appellee Kline] with a new stacking rejection form when the 2003 Pontiac Vibe was added to the Policy.

The Automobile Policy Declarations sheets reflected non-stacked UM and UIM coverage benefits of $50,000 each person/$100,000 each accident from the date of [Appellant/Cross-Appellee Kline's] Policy's inception to the date of the subject motor vehicle accident.

Section J of the Policy ("Section J") states, in pertinent part:

"Your covered auto" means:

1. Any vehicle shown in the Declarations.

2. Any of the following types of vehicles on the date you become the owner:

a. a private passenger auto; or

b. a pickup or van.

This provision (J.2) applies only if:

a. you acquire the vehicle during the policy period;

b. you ask us to insure it within 30 days after you become the owner; and

c. with respect to a pickup or van, no other insurance policy provides coverage for that vehicle.

If the vehicle you acquire replaces one shown in the Declarations, it will have the same coverage as the vehicle it replaced. You must ask us to insure a replacement vehicle within 30 days only if:

a. you wish to add or continue Damage to Your Auto Coverages; or

b. it is a pickup or van used in any "business" other than farming or ranching.

If the vehicle you acquire is in addition to any shown in the Declarations, it will have the broadest coverage we now provide for any vehicle shown in the Declarations.

( [Declaratory Judgment Complaint, Exhibit "B"; R.R. at 30a-31a] ). All three of the vehicles covered at the time of the motor vehicle accident constituted "covered autos" as defined by Section J.

On September 18, 2012, [Appellant/Cross-Appellee Kline] was involved in a motor vehicle accident while operating the 2003 Pontiac Vibe. [He] asserted a UIM claim under the Policy as a result of the injuries he sustained. [Travelers] tendered the non-stacked UIM coverage limits of $50,000.

Miriam Kline is the mother of [Appellant/Cross-Appellee Kline]. At all relevant times, Miriam Kline insured a Chevrolet Cruze with [Travelers] under a different policy. At the time of the motor vehicle accident, Miriam Kline had stacked UIM coverage on her policy in the amount of $100,000 each person/$300,000 each accident. [Appellant/Cross-Appellee Kline] resided with Miriam Kline at all relevant times.

(Trial Court Opinion, filed December 18, 2018, at 2-4) (internal citations to record, some internal quotations omitted, some emphasis added). Ms. Kline's policy contained a "household vehicle exclusion" that reads in pertinent part:

B. We do not provide [UM] or [UIM] Coverage for bodily injury sustained:

* * *

2. By a "family member":

a. Who owns an auto while "occupying", or when struck by, any motor vehicle owned by you or any "family member" which is not insured for this coverage under this policy....

(Declaratory Judgment Complaint, Exhibit "J"). Ms. Kline's policy defines "family member," in relevant part, as "a person related to you by blood...who is a resident of your household. This includes a ward or foster child." (Id. ).

Procedurally,

[Appellant/Cross-Appellee Kline] filed this [declaratory judgment] action in the York County Court of Common Pleas on November 23, 2015. On December 22, 2015, [Travelers] filed a timely Notice of Removal pursuant to 28 U.S.C. §§ 1141 and 1146(b). The case was removed to the United States District Court for the Middle District of Pennsylvania. [Appellant/Cross-Appellee Kline] subsequently filed a Motion to Remand the case. On May 1[0], 2016, the District Court granted [Appellant/Cross-Appellee Kline]'s motion and remanded the case to this [c]ourt.

The parties filed a Joint Stipulation of Facts on February 16, 2018. On October 1, 2018, [Appellant/Cross-Appellee Kline] and [Travelers] filed Cross Motions for Summary Judgment and Briefs in support thereof....

(Trial Court Opinion, at 4-5). In his motion, Appellant/Cross-Appellee Kline sought summary judgment on his claim for stacked UIM benefits under his Policy. Travelers sought summary judgment in its favor and against Appellant/Cross-Appellee Kline's claims for stacked UIM benefits under the "continuous, non-finite, after-acquired vehicle provision" in his Policy. (See Travelers' Motion for Summary Judgment, 10/1/18, at 7 ¶35; R.R. at 167b.) Travelers also requested a declaration from the court that Appellant/Cross-Appellee Kline was not entitled to UIM benefits under Ms. Kline's policy with Travelers, under the household exclusion provision in her policy, which operates to preclude coverage to Appellant/Cross-Appellee Kline.

On December 18, 2018, the court entered an order that: (1) granted partial summary judgment in favor of Appellant/Cross-Appellee Kline on his claim for stacked UIM benefits under his Policy; (2) denied in part summary judgment for Travelers, finding Travelers must provide Appellant/Cross-Appellee Kline stacked UIM benefits under his Policy but granted summary judgment in part finding Travelers did not have to provide Appellant/Cross-Appellee Kline stacked UIM under Ms. Kline's policy, due to the "household vehicle" exclusion provision in her policy; and (3) entered judgment in favor Appellant/Cross-Appellee Kline and against Travelers in the amount of $100,000.00, which represented the remainder of the maximum available stacked UIM coverage under Appellant/Cross-Appellee Kline's policy only, plus interest and costs.

Travelers timely filed a notice of appeal on January 16, 2019. The court ordered Travelers on January 17, 2019, to file a concise statement of errors complained of on appeal per Pa.R.A.P. 1925(b). On January 29, 2019, Appellant/Cross-Appellee Kline timely filed a notice of cross-appeal. The court ordered Appellant/Cross-Appellee Kline on January 31, 2019, to file a Rule 1925(b) statement. Travelers and Appellant/Cross-Appellee Kline timely filed their Rule 1925(b) statements on February 6, 2019, and February 15, 2019, respectively. This Court consolidated the parties' appeals sua sponte on February 13, 2019. On March 5, 2019, the parties filed in this Court a joint application to amend the briefing schedule, which this Court granted on March 19,...