Mut. Benefit Ins. Co. v. Natale

546 F.Supp.3d 430

MUTUAL BENEFIT INSURANCE COMPANY, Plaintiff,

v.Thomas G. NATALE, Jr., Defendant.

Civil Action No. RDB-21-178

United States District Court, D. Maryland.

Signed July 1, 2021

Alexander S. Brown, Pro Hac Vice, Jacob C. Cohn, Pro Hac Vice, Gordon Rees Scully Mansukhani LLP, Philadelphia, PA, Kelly M. Lippincott, Gordon Rees Scully Mansukhani, Alexandria, VA, for Plaintiff.

Cary L. Joshi, Bailey & Glasser LLP, Washington, DC, Samuel A. Hrko, Pro Hac Vice, Bailey Glasser LLP, Charleston, WV, for Defendant.

MEMORANDUM OPINION

Richard D. Bennett, United States District Judge

On May 25, 2019, the Defendant Thomas G. Natale, Jr. ("Natale" or "Defendant") was operating his All-Terrain Vehicle ("ATV") on U.S. Route 52 in West Virginia. He was involved in a vehicular accident when an individual named Eric Perkins operating a Chevrolet Equinox failed to yield the right of way and collided with Natale's ATV. Perkins had a motor vehicle insurance policy with per-person liability limits of $25,000. This case arises out of Natale's claim for uninsured motorist benefits under two personal automobile policies issued by the Plaintiff Mutual Benefit Insurance Company ("Mutual Benefit") to Natale individually and to his parents, Thomas Natale and Dorothy Natale, with whom he resides. Pursuant to Natale's request, Mutual Benefit consented to Natale's acceptance of the $25,000 policy limits for personal insurance from Perkins’ insurance carrier. Mutual Benefit reserved its right to deny uninsured motorist benefits to Natale.

Accordingly, Mutual Benefit brought this Declaratory Judgment action against Defendant Natale pursuant to 28 U.S.C. § 2201 to determine its liability under the two policies issued to him and his parents.¹ (ECF No. 1.) The Complaint asks this Court to resolve an insurance coverage dispute, i.e. , whether Natale's claims for uninsured motorist coverage and personal-injury-protection coverage under the two relevant policies are precluded by identical exclusions applicable to "motor vehicles" owned by Natale but not insured by the policies. Currently pending are the parties’ cross-Motions for Summary Judgment. (ECF Nos. 18, 21.) The parties’ submissions have been reviewed and no hearing is necessary. See Local Rule 105.6 (D. Md. 2018). For the reasons that follow, Mutual Benefit's Motion for Summary Judgment (ECF No. 18) is GRANTED, and Defendant Natale's Cross Motion for Summary Judgment (ECF No. 21) is DENIED. As a matter of law, Natale's ATV was not insured under the Mutual Benefit policies in question. His claims are excluded by the "owned-but-not-insured" exclusion in both policies.

BACKGROUND

In ruling on a motion for summary judgment, this Court reviews the facts and all reasonable inferences in the light most favorable to the nonmoving party. Scott v. Harris , 550 U.S. 372, 378, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007) ; see also Hardwick ex rel. Hardwick v. Heyward , 711 F.3d 426, 433 (4th Cir. 2013). When both parties file motions for summary judgment, as here, the Court applies the same standard of review to both motions, with this Court considering "each motion separately on its own merits to determine whether either [side] deserves judgment as a matter of law." Rossignol v. Voorhaar , 316 F.3d 516, 523 (4th Cir. 2003), cert. denied , 540 U.S. 822, 124 S.Ct. 135, 157 L.Ed.2d 41 (2003) ; see also havePower, LLC v. Gen. Elec. Co. , 256 F. Supp. 2d 402, 406 (D. Md. 2003) (citing 10A Charles A. Wright & Arthur R. Miller, Federal Practice & Procedure § 2720 (3d ed. 1983) ).

Plaintiff Mutual Benefit is an insurance company incorporated under the laws of Pennsylvania with its principal place of business in Huntingdon, Pennsylvania. (ECF No. 1 ¶ 4.) Defendant Natale is a resident of Harford County, Maryland. (Id. ¶ 5.)

On May 25, 2019, Natale was driving down U.S. Route 52 in his 2015 CAN-AM All-Terrain Vehicle ("ATV"), returning from the Hatfield-McCoy off-road trails back to the Boar's Nest ATV Lodge in Matewan, West Virginia. (Natale Affidavit, ECF No. 22-1 ¶¶ 2, 4-5.) Natale obtained a permit from the lodge which authorized him to operate his ATV on the Hatfield-McCoy trails. (Id. ¶ 2.) West Virginia law also allows an individual to operate an ATV on or near the shoulder of any road, street, or highway "for a distance not to exceed ten miles to travel between a residence or lodging and off-road trails, fields and areas of operation, including stops for food ...." W. Va. Code. Code Ann. § 17F-1-1(b). The West Virginia Code provides that that operation of an ATV in that manner described "shall not constitute operation of a motor vehicle on a road or highway of [West Virginia] as contemplated by the provisions of section seven of this article." Id. § 17F-1-1(c). Section seven states that an ATV driver is not subject to the general rules of operation which govern the state's roads and is not required to obtain an operator's license. See id. § 17F-1-7; State ex rel. Sergent v. Nibert , 220 W.Va. 520, 648 S.E.2d 26, 30 (2007).

At approximately 4:00 p.m. on May 25, 2019, Natale neared the intersection of U.S. 52 and Route 49 in Williamson, West Virginia when he was struck by a car driven by Eric Perkins. (Id. ¶¶ 4-6.) According to Natale, Perkins failed to yield the right of way when attempting to turn from U.S. 52 onto Route 49. (Id. ) Natale was thrown from his ATV and suffered serious and permanent injury. (Id. ¶ 7.)

At the time of the crash, Natale was insured under two personal automobile insurance policies. The first was a Personal Automobile Policy No. PP2005910 issued to Natale as the "named insured" (the "Natale Policy"). (See ECF No. 1-2.) The Natale Policy provided coverage for the policy period from January 28, 2019 to January 28, 2020. (Id. ) The second policy was a Personal Automobile Policy No. PP01029789, issued to Natale's parents, Thomas and Dorothy Natale, which provided coverage to Natale as a resident of the named insureds’ household (the "Family Policy"). (See ECF No. 17-1.) The Family Policy provided coverage for the policy period from October 25, 2018 to October 25, 2019. (Id. ) Both policies were issued to Natale and his parents in Maryland and through a Maryland-based insurance broker. (ECF No. 1-2 at 3-6; ECF No. 17 at 2-6.)

The Natale Policy provided liability, medical payments/personal injury protection, and uninsured motorist coverage for two vehicles: a 2012 Dodge Ram and a 2006 Chevrolet Cobalt. (ECF No. 1-2 at 5.) The Family Policy provided the same types of coverage for five vehicles: a 2001 Honda Accord, a 2000 Chevrolet Silverado, a 2014 Chevrolet Silverado, a 2018 Hyundai Tucson, and a 2018 Ford Transit. (ECF No. 17-1 at 5-6.) Natale's ATV was not included as an insured motor vehicle in either Policy.

Both the Natale Policy and the Family Policy were endorsed with identical Uninsured Motorist Coverage – Maryland forms ("UM Endorsement") and Personal Injury Protection Coverage – Maryland forms ("PIP Endorsement"). (ECF Nos. 1-2 at 7; 17-1 at 7.) The UM Endorsement provides coverage for "compensatory damages" the insured is entitled to recover from the owner or operator of an "uninsured motor vehicle." (ECF No. 1-2 at 50.) "Uninsured" is defined to include underinsured motorists. (Id. at 24.) The PIP Endorsement provides $2,500 in coverage for bodily injuries an insured might sustain from a "motor vehicle," regardless of who was at-fault, or whether the other driver was insured. (Id. at 54.) Both of these endorsements contain an exclusion for injuries sustained by an insured while occupying or operating a motor vehicle owned by the insured but not insured under the applicable policy. The UM Endorsement states:

Exclusions

A. We do not provide Uninsured Motorist Coverage for "bodily injury" sustained:

1. By an "insured" while "occupying", or when struck by any motor vehicle owned by that "insured" which is not insured for this coverage under the policy. This includes a trailer of any type used with that vehicle.

(Id. at 51.) The PIP Endorsement similarly provides:

Exclusions

We will not provide Personal Injury Protection Coverage for "bodily injury" sustained by any "insured":

...

5. Who is a named insured or "family member" while "occupying" any "motor vehicle" which is owned by that "insured" and for which personal injury protection benefits required by the Maryland Insurance Code are not provided.

(Id. at 55.) The UM endorsement does not specifically define "motor vehicle." However, the PIP Endorsement does define the term, stating that a motor vehicle is "an automobile and any other vehicle, including a trailer, operated or designed for operation upon a public road by any power other than animal or muscular power." (Id. at 54.) The Maryland Insurance Code similarly defines "motor vehicle" as "a vehicle, including a trailer, that is operated or designed for operation on a public road by any power other than animal or muscular power." Md. Code Ann., Ins. § 19-501(b)(1).

On August 21, 2019, Natale submitted a claim to Mutual Benefit for uninsured motorist and personal-injury-protection coverage under the Natale Policy. (ECF No. 1 ¶ 23; ECF No. 11 ¶ 23.) He claimed that the individual responsible for the accident, Perkins, was underinsured.² (Id. ) Mutual Benefit disclaimed coverage stating that the ATV involved in the accident was a "motor vehicle" owned by Natale, but not insured under the Policy. (ECF No. 1 ¶¶ 24-25; ECF No. 11 ¶¶ 24-25.) Mutual Benefit asserted that the claims related to the ATV accident fell within the Uninsured Motorist ("UM") and Personal Injury Protection ("PIP") Endorsements’ "owned-but-not insured" exclusions. (Id. ) On April 2, 2021, Natale submitted a claim under the Family Policy related to the same accident with his ATV. (ECF No. 17 ¶¶ 8(b), (d).) Mutual Benefit denied coverage on the same grounds as the Natale Policy. (Id. )

On September 10, 2020, Natale filed a complaint in Mingo County, West Virginia, seeking damages against Perkins and judgment...