Allstate Insurance v. Geiwitz

ALPERT, Judge. Allstate Insurance Company, appellant, filed a declaratory judgment action seeking a declaration that property damage tortiously caused by Jeffrey Lee Geiwitz, appellee, was not covered by a homeowner’s insurance policy under which Geiwitz was an insured. Allstate now appeals to us ⁷⁰⁶ from an order of the Circuit Court for Carroll County in which the court entered judgment against Allstate. Facts and Proceedings In 1984, Jeffrey Lee Geiwitz bought a “skeleton” car — a 1970 Chevrolet Nova — for restoration.

The seller delivered the car to Geiwitz, after which time Geiwitz never drove the car but proceeded to restore it for show purposes. For six months, Geiwitz kept the car at his parents’ residence while he disassembled it. He subsequently loaded the car onto a trailer and took it to a Hampstead Amoco station to have body work and painting done. When the work was completed in late December 1985 or early 1986, the station owner transported the car via trailer to David and Patricia Cecil’s (appellees) residence.

Geiwitz completed his restoration work on the car in January 1986. Geiwitz then improperly obtained Maryland license tags for the car by giving the Motor Vehicle Administration the tag number and body number of his 1973 Datsun, which he regularly drove and which was validly insured. Geiwitz purportedly obtained the tags for show purposes, i.e., to enter the Nova into a street car class competition. In February 1986, Geiwitz showed the car at the “World of Wheels” in the Baltimore Convention Center.

Geiwitz transported the car to the Convention Center via a truck-pulled trailer. In his deposition, Geiwitz testified that he did not drive the car to the Convention Center “[bjecause it’s not, the car is not that, it’s just for show. It wasn’t made for driving.” Geiwitz continued to store the car in the Cecils’ driveway where he worked on it from time to time. Geiwitz did general maintenance and “little things that needed to be fixed,” including tuning and cleaning the engine, changing the clutch, changing the oil and the oil filter.

He worked on the car in the Cecils’ garage three'’or four times prior to the incident at issue in this case. On the evening of March 8, 1986, Geiwitz drove the car into the Cecils’ garage to fix the gas gauge. He brought a kerosene heater from the Cecils’ basement into the garage, ⁷⁰⁷ lit the heater, and positioned it in the middle of the floor— about ten feet away from the car. Geiwitz drained the gasoline from the car’s gas tank into a bucket, which overflowed.

When he noticed the gas flowing toward the kerosene heater, Geiwitz went to move the heater, at which point the gas ignited. The fire destroyed Geiwitz’s car and extensively damaged the Cecils’ property. State Farm Fire and Casualty Company, appellee, paid the Cecils, its insureds, $124,841.85 for their property damage from the fire. State Farm then filed a tort action against Geiwitz in the Circuit Court for Carroll County, seeking subrogation.

Because Geiwitz resided in his parents’ household, he was an insured person under their homeowner’s policy. Specifically, Geiwitz was covered under a Deluxe Homeowner’s Insurance Policy, No. 018413396, issued by Allstate Insurance Company. The policy, however, provides that: 5. We do not cover bodily injury or property damage arising out of the ownership, maintenance, use, occupancy, renting, loaning, entrusting, loading or unloading of any motorized land vehicle or trailer.

However, this exclusion does not apply to: a) a motorized land vehicle in dead storage or used exclusively on an insured premises.... Consequently, Allstate filed a declaratory judgment action on the grounds that the homeowner’s policy did not cover the subject loss due to the “automobile exclusion” provision. Both State Farm and Allstate filed cross-motions for summary judgment. After oral argument on the motions, the court granted summary judgment in favor of appellees.

Allstate appeals to us from that ruling and asks whether: I. The trial court erred when it held that the subject vehicle was in “dead storage.” II. The trial court erred when it ruled that the homeowner’s policy provided coverage because the subject vehicle was not used on public highways. ⁷⁰⁸ I. Allstate contends that the trial court erred when it held that the subject vehicle was in “dead storage.” 1 It submits that in interpreting an insurance contract, a court must give words their “customary and normal meaning.” On this basis, Allstate argues that “dead” in this context means “totally inoperable, incapable of any function whatever,” while “storage” means that which is put “beyond use, beyond any handling or dealing with them in the ordinary course of things.” Thus, reasons Allstate, Geiwitz’s car was not “in dead storage” within the meaning of the policy because the car “was fully operable, was in fact driven from place to place, was being used as an automobile and was regularly repaired and maintained.” In Pacific Indemnity Co. v. Interstate Fire & Casualty Co., 802 Md. 383 , 388-89, 488 A.2d 486 (1985), the Court of Appeals set forth the principles of insurance contract construction in Maryland: An insurance contract, like any other contract, is measured by its terms unless a statute, a regulation or public policy is violated thereby. To determine the intention of the parties to the insurance contract, which is the point of the whole analysis, we construe the instrument as a whole. Maryland courts should examine the character of the contract, its purpose, and the facts and circumstances of the parties at the time of execution.

Id. In so doing, “we accord a word its usual, ordinary and accepted meaning unless there is evidence that the parties intended to employ it in a special or technical sense.” Cheney v. Bell National Life Ins. Co., 315 Md. 761, 766 , 556 A.2d 1135 (1989) (emphasis added). “Courts may construe unambiguous contracts as a matter of law.” Pacific Indemnity, 302 Md. at 389 , 488 A.2d 486 . “That a term cannot be precisely defined so as to make ⁷⁰⁹ clear its application in all varying factual situations does not mean that it is ambiguous.” Allstate Ins. Co. v. Humphrey, 246 Md. 492, 496 , 229 A.2d 70 (1967).

The parties concede that the term “dead storage” is not ambiguous as used in the homeowner’s policy. We agree. Further, even if we concluded that the term was ambiguous, we still could determine the proper construction of the policy because there is no factual dispute in the evidence. Pacific Indemnity, 302 Md. at 389 , 488 A.2d 486 .

Lay dictionaries, such as Webster’s Third New International Dictionary, do not define the term “dead storage.” Black’s Law Dictionary, however, defines the term as follows: “The storage, especially of automobiles in public garages, where automobiles not in use are to remain uninterruptedly for a time, sometimes for the season.” Black’s Law Dictionary 359 (5th ed. 1979). The definition originated in Hogan v. O’Brien, 123 Misc. 865 , 206 N.Y.S. 831, 832 , aff'd, 212 A.D. 193 , 208 N.Y.S. 477 (1924), in which the court addressed the extent of a garage keeper’s responsibility for cars placed in his garage for storage. The court in that case also distinguished “dead” from “live” storage, defining the latter as “the storage of cars in active daily use.” Id. Although not directly on point, the Hogan court’s definitions of dead and live storage indicate that the term “dead storage” cannot be defined by simply separating the two words and then combining the common meaning of each.

Instead, we think that the term “dead storage,” as it appears in insurance policies, is employed in a technical sense or as a term of art and should be interpreted accordingly. Maryland courts have not yet addressed the issue of when a car is in dead storage for purposes of coverage under a homeowner’s insurance policy. Other courts that have addressed the issue have resolved it based on the facts of each individual case. See Annotation, Liability Insurance: When is Vehicle in “Dead Storage,” 48 A.L.R.4th 591 (1986). ⁷¹⁰ Usually, the issue of whether a vehicle is in dead storage arises from similar fact patterns.

An insured owns a vehicle for transportation purposes. For some reason, usually because the vehicle is inoperable, the insured has not used the vehicle, i.e., driven the vehicle on the public roads or elsewhere, for a period of time. Whether the vehicle is registered or insured varies. Often, an incident that