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Country Mutual Insurance Co. v. Universal Underwriters Insurance Co.

September 01, 2000

COUNTRY MUTUAL INSURANCE COMPANY, AS SUBROGEE OF DAVID EVANS,
PLAINTIFF-APPELLEE,
V.
UNIVERSAL UNDERWRITERS INSURANCE COMPANY,
DEFENDANT-APPELLANT.



Appeal from the Circuit Court of the 10th Judicial Circuit Tazewell County, Illinois No. 98-LM-311 Honorable Brian Nemenoff Judge Presiding

The opinion of the court was delivered by: Justice Lytton

Country Mutual Insurance Company (Country Mutual) filed suit against Universal Underwriters Insurance Company (Universal), seeking reimbursement of funds expended defending David Evans, who was involved in a traffic accident while test driving a vehicle owned by Mike Murphy Ford (Ford) and insured by Universal. Country Mutual, as Evans' personal insurance carrier, alleged that Universal had primary liability because Evans was driving a third party vehicle at the time of the accident. Country Mutual filed a motion for summary judgment, which the trial court granted. Universal appeals, claiming that (1) Country Mutual's coverage of Evans is "co-primary;" (2) Country Mutual is liable for a pro rata share of the defense; and (3) its policy limits are $20,000 per person, $40,000 per occurrence and $15,000 for property damage. We affirm.

I. FACTS

Evans was involved in an automobile accident while test driving a vehicle owned by Ford. His liability insurance with Country Mutual contained an "other insurance" clause, which stated that "any insurance we provide with respect to a vehicle you do not own will be excess over any other collectible insurance." (Emphasis in original.) The vehicle driven by Evans at the time of the accident was insured by Universal through a garage liability insurance policy issued to Ford. Ford's policy provided that the most Universal "will pay" for a claim arising from a customer accident "is that portion of such limits needed to comply with the minimum limits provision law in the jurisdiction where the OCCURRENCE took place." (Emphasis in original.)

Evans attempted to tender his defense of the underlying personal injury and property damage claims to Universal, but Universal refused to defend him. Country Mutual subsequently defended Evans under a reservation of rights against Universal. Country Mutual settled the claims against Evans for $49,808.13, and then sued Universal for reimbursement.

The parties filed cross-motions for summary judgment. The trial court granted Country Mutual's motion and denied Universal's motion, holding that (1) Universal's coverage was primary; (2) Country Mutual's coverage was excess; and (3) Universal's policy provided Evans with coverage in the amount of $100,000 per person and $300,000 per occurrence. Universal appeals.

II. ANALYSIS

Summary judgment is proper when the pleadings, affidavits and other evidence establish, when viewed in a light most favorable to the non-movant, that there is no genuine issue of material fact, and the movant is entitled to judgment as a matter of law. Pennsylvania Life Insurance Co. v. Pavlick, 265 Ill. App.3d 526, 529, 637 N.E.2d 1160, 1162 (1994). When a trial court grants summary judgment, we review de novo. Courson v. Danville School District No. 118, 301 Ill. App.3d 752, 755, 704 N.E.2d 447, 449 (1998).

A.

Universal admits that it had primary liability for the accident involved here, but it claims that Country Mutual's policy also provided primary coverage. Citing Universal Underwriters Insurance Group v. Griffin, 287 Ill. App.3d 61, 677 N.E.2d 1321 (1997), Universal claims that coverage by the two insurance companies should be deemed "co-primary," and damages should be prorated between them based on policy limits. Country Mutual responds that its policy only allowed for excess coverage.

Primary liability is generally placed on the insurer of an automobile rather than on the insurer of a driver. State Farm Mutual Automobile Insurance Co. v. Universal Underwriters Group, 182 Ill.2d 240, 246, 695 N.E.2d 848, 851 (1998); Pekin Insurance Co. v. State Farm Mutual Automobile Insurance Co., 305 Ill. App.3d 417, 421, 711 N.E.2d 1227, 1230 (1999). Thus, a garage liability insurer has responsibility for providing primary coverage to customers test driving an automobile dealer's vehicles. State Farm Mutual Automobile Insurance Co., 182 Ill.2d at 245-246, 695 N.E.2d at 851; Pekin Insurance Co., 305 Ill. App.3d at 421, 711 N.E.2d at 1230.

Here, Universal must provide primary coverage to Evans as a customer test driving a vehicle owned by Ford. See State Farm Mutual Automobile Insurance Co., 182 Ill.2d at 245-246, 695 N.E.2d at 851; Pekin Insurance Co., 305 Ill. App.3d at 421, 711 N.E.2d at 1230. Nothing alleged to exist in Evans' personal automobile insurance policy can be construed as allowing co-primary coverage for an accident occurring under these circumstances. On the contrary, the policy that Country Mutual issued to Evans stated that "any insurance we provide with respect to a vehicle you do not own will be excess over any other collectible insurance." (Emphasis in original.) The language contained in Country Mutual's policy is consistent with the supreme court's analysis in State Farm Mutual Automobile Insurance Co., where the court noted "that pursuant to custom in the insurance industry, primary liability is generally" not placed on the insurer of the driver of a vehicle; rather, liability is placed upon the insurer of the automobile. 182 Ill.2d at 246, 695 N.E.2d at 851.

Universal's argument for co-primary coverage, premised on Griffin, does not persuade. In Griffin, the court addressed which insurance company, that of an automobile dealership or that of a test driver, provided primary coverage for an accident involving a test driver. 287 Ill. App.3d at 74-75, 677 N.E.2d at 1330-1331. Because neither policy in that case could be construed as providing primary liability, the court reasoned that the insurers should share liability. Griffin, 287 Ill. App.3d at 75, 677 N.E.2d at 1331. Griffin, however, was decided before our supreme court's decision in State Farm Mutual Automobile Insurance Co., finding that regardless of the language in a dealership policy, its insurer's liability is always primary (182 ...


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