This is a review of a published decision of the court of appeals
There are four issues in this case. First, whether Paul Wilson's insurance policy insured Paul Wilson's vehicles and therefore Julia Post under the policy's permissive
On March 30, 1986, Karen Cardinal (Cardinal) was involved in an automobile accident and sustained serious injuries. The automobile she was driving was struck by a van driven by Julia Post (Post) who allegedly drove through a stop sign. Paul Wilson (Wilson), the owner of the van, gave Post permission to drive the van. Prior to the accident, in February, 1985, Leader National Insurance Company issued a "non-owner" automobile insurance policy to Paul Wilson. Such policy was in effect at the time of the accident.
Cardinal filed personal injury claims against Milwaukee Mutual Insurance Company (Milwaukee Mutual), Post's insurer; American & Foreign Insurance Company a/k/a Royal Insurance Company (Royal), Cardinal's uninsured-underinsured insurer; and Leader National Insurance Company (Leader), Wilson's insurer. Cardinal's claim against Milwaukee Mutual was severed from her other claims and tried separately. Cardinal's claim against Royal was settled and Cardinal was dismissed from the lawsuit. By subrogation and assignment, Royal replaces Cardinal and pursues the claim
In Wisconsin, drivers whose licenses have been revoked because of their poor driving records are required to show proof of financial responsibility to have their operators licenses reinstated under sec. 344.24, et seq., Stats., 1989-90, the financial responsibility statutes. This requirement can be fulfilled by obtaining liability insurance with the coverage specified in sec. 344.33, Stats., 1989-90,
To comply with the financial responsibility statutes, Wilson applied for and purchased automobile liability insurance from Leader. Leader certified that Wilson was
The first issue is, did Paul Wilson's insurance policy insure the vehicles Wilson owned and therefore Julia Post under the policy's permissive user section? Royal argues the policy is ambiguous and should be construed to cover Julia Post. The construction of an insurance contract is a question of law which we review de novo. Kaun v. Industrial Fire & Cas. 148 Wis.2d 662, 667, 436 N.W.2d 321 (1989). Ambiguities in an insurance contract should be construed in favor of coverage. Smith v. Atlantic Mut. Ins. Co., 155 Wis.2d 808, 811, 456 N.W.2d 597 (1990); D' Angelo v. Cornell Paperboard Products Co., 59 Wis.2d 46, 49, 207 N.W.2d 846 (1973); Kopp v. Home Mut. Ins. Co., 6 Wis.2d 53, 57, 94 N.W.2d 224 (1959). Exclusions are to be narrowly construed against the insurer, especially if they are uncertain as to effect. Smith, 155 Wis. 2d at 811; Meiser v. Aetna Casualty & Surety Co., 8 Wis.2d 233, 238, 98 N.W.2d 919 (1959).
The financial responsibility statutes provide what constitutes the insurance policy:
Section 344.33(2)(d), Stats., 1989-90.
On the application form used by Leader, spaces were provided for the description of owned vehicles. No vehicles were described, rather, lines were drawn through the spaces. The Leader policy also contained a declarations page which provided spaces for the description of vehicles. Again, no vehicles were described.
The Leader insurance policy is not ambiguous. "An ambiguity exists when the policy is reasonably susceptible to more than one construction from the viewpoint of a reasonable person of ordinary intelligence in the position of the insured." Schroeder v. Blue Cross & Blue Shield, 153 Wis.2d 165, 174, 450 N.W.2d 470 (Ct. App. 1989); Cieslewicz v. Mut. Service Cas. Ins. Co., 84 Wis.2d 91, 97-98, 267 N.W.2d 595 (1978). Given the clear language of the policy, a reasonable person could only interpret the policy in one way, as insuring only those vehicles described on the declarations page. Since no vehicles were described on either the application or the declarations page, a reasonable person would believe that no vehicles were insured.
This conclusion is bolstered by the equally unambiguous policy endorsement. The endorsement is a one page attachment to the policy clearly stating the policy is a "non-owner" policy insuring "you and your spouse"
Taken together, the lack of vehicles described on the application or the declarations page and the unambiguous language of the endorsement clearly reveal that the policy does not insure vehicles. Therefore, Julia Post is not covered as a permissive user since that section applies only where the permissive user operates a vehicle described within the policy.
In addition, the "Financial Responsibility Laws" section of the policy does not create coverage for Julia Post. The relevant portion states: "When we certify this policy as proof [of financial responsibility], all the terms and conditions of this insurance will be amended to comply
Thus, under the terms of the policy, Paul Wilson was insured while operating any vehicle, regardless of whether he owns the vehicle. The vehicle itself is not insured. While Julia Post was a permissive driver of Paul Wilson's van, such van was not an insured vehicle, and therefore Julia Post was not insured.
The second issue is, do the financial responsibility statutes mandate that insurance provided thereunder insure the vehicles owned by the named insured? Royal argues that the financial responsibility statutes require an insured, who owns vehicles, to have vehicle insurance before operating privileges will be reinstated. Statutory interpretation is a question of law which this court reviews de novo. This court does not defer to the determination of either the court of appeals or the circuit court. City of Madison v. Donohoo, 118 Wis.2d 646, 651, 348 N.W.2d 170 (1984).
Prior to its amendment in 1973, the financial responsibility statutes distinguished between "owner's" and "operator's" policies when defining "motor vehicle policy."
The intent of the pre-1973 financial responsibility statutes clearly was to require a person subject to the financial responsibility statutes to insure the vehicles he or she owned. See Van Erem v. Dairyland Mut. Ins. Co., 5 Wis.2d 450, 556-57, 93 N.W.2d 511 (1958).
However, the amended statutes abandon the distinction between an "owner's policy" and an "operator's policy," and delete the language requiring vehicle insurance for owned vehicles. In so doing, the amended statute creates an ambiguity. "Ambiguity can be created by the interaction of two separate, but related statutes." Van Cleve v. Hemminger, 141 Wis.2d 543, 547-48, 415 N.W.2d 571 (Ct. App. 1987).
The amended certification statute suggests it is the vehicle, not the person, which must be covered:
Section 344.31, Stats., 1989-90 (emphasis added).
Section 344.33(2), Stats., 1989-90 (emphasis added).
For the reasons set forth below, we hold the financial responsibility statutes to mandate insurance on the person, not on the vehicles such person may own.
First, the nature and language of the amendments to the statutes are significant. The omission of a word or words in the revision of a statute indicates an intent to alter its meaning. Pittman v. Lieffring, 59 Wis.2d 52, 64, 207 N.W.2d 610 (1973). If a statute is ambiguous, it is permissible to look to the legislative intent. Ellingson v. ILHR Department, 95 Wis.2d 710, 713-14, 291 N.W.2d 649 (Ct. App. 1980). We look to the language, scope, history, context, subject matter and object intended to be accomplished by the statute to determine the legislative intent. State v. Pham, 137 Wis.2d 31, 34, 403 N.W.2d 35 (1987).
Unlike its predecessor statute, the amended certification statute, sec. 344.31, Stats., 1989-90 makes no reference
Additionally, unlike its predecessor statute, the amended definition statute, sec. 344.33, Stats., 1989-90 does not distinguish between owner's and operator's policies. The amendments abandon that distinction and now specifically require the person to be insured: "A motor vehicle policy of liability insurance shall insure the person named therein using any motor vehicle with the express or implied permission of the owner...." Section 344.33(2), Stats., 1989-90.
The changes in the penalties for failing to maintain proof of financial responsibility are also significant. Prior to the 1973 amendment, the penalty for failing to maintain proof of financial responsibility was revocation of the person's operating privileges and registration.
Second, to read the amended certification statute as mandating vehicle insurance would yield an absurd result. We cannot interpret a statute in such a way as to lead to an absurd or unreasonable result. Pham, 137 Wis. 2d at 34. We agree with the court of appeals, "[i]t would be unreasonable to believe that the legislature intends insurance to operate like a contagious disease, attaching itself to any vehicle operated by a driver who has non-owner's insurance." Cardinal, 158 Wis. 2d at 155.
Third, holding that the financial responsibility statutes mandate insured persons, not insured vehicles, furthers the purpose of the statutes. The purpose of the financial responsibility statutes is to provide a method of compensating for damages that may result from future accidents caused by negligence of the operator with a poor driving record. Gross, 72 Wis. 2d at 589; Lang v. Kurtz, 100 Wis.2d 40, 44, 301 N.W.2d 262 (Ct. App. 1980).
Fourth, the language in the Department of Transportation's SR-22 certification form does not persuade us otherwise. The SR-22 form divides insurance into an "owner's policy" and an "operator's policy." We are cognizant that where the legislature charges an administrative
The third issue is, did the SR-22 form expand the coverage of Paul Wilson's policy to insure vehicles he owned? Royal argues that the SR-22 form, as filled out by Leader, creates coverage for Post. Leader completed an SR-22 financial responsibility form and filed it with the Department of Transportation to certify that Wilson complied with the financial responsibility statutes. The form divides insurance into an "owner's policy" and an "operator's policy." Leader checked off both types of insurance and, beneath the "owner's policy" section, typed in: "all owned and non-owned vehicles."
Coverage for Julia Post was not created by the manner in which Leader filled out the SR-22 form. First, the
Section 344.33(5)(d), Stats., 1989-90.
Second, even if we held that the SR-22 was incorporated into the policy by virtue of it being specifically referred to in the policy, because we hold the SR-22 does not create vehicle coverage, its reference in the policy would not create vehicle coverage.
Leader claimed it filled out the SR-22 form in the manner it thought was required by the Department of Transportation to certify coverage. The SR-22 form provided by the Department of Transportation seems to correspond to the pre-1973 statutes since it distinguishes an "owner's policy" from an "operator's policy." As concluded above, the financial responsibility statute requires poor drivers to be insured, not their vehicles. Since the use of the SR-22 form is to certify compliance with the financial responsibility statutes, its use cannot create coverage which is not intended by the current financial responsibility statutes.
The fourth issue is, do the omnibus statutes, which mandate that vehicle insurance cover permissive users of the insured vehicles, create liability coverage for Julia Post? Royal argues that the omnibus statutes, sec. 632.32 et seq. Stats., 1989-90, extend coverage to Julia Post. Citing Groth v. Farmer's Mut. Ins. Automobile Insurance Co., 21 Wis.2d 655, 659, 124 N.W.2d 606 (1963), Royal asserts that the policy behind the omnibus statute is to increase, not decrease coverage. Royal also
While we do not disagree with the principles for which these cases stand, they offer little guidance since the cases cited do not address the issue at hand. The Groth case was concerned with expanding coverage of a policy to insure the father of a minor under the statutory provision requiring that coverage extend to "any person legally responsible for" the operation of the vehicle. Groth, 21 Wis. 2d at 658. The Drewek case involved the issue of whether "permissive use" mandated permission for the specific use for which the vehicle was to be used. The Miller case dealt with the issue of coverage provided for a passenger as "additional insured." Royal's arguments are undermined by the fact that the omnibus statutes mandate permissive users to be covered when using a vehicle described in the policy.
Lastly, Royal relies on Germannota National Indemnity Co., 119 Wis.2d 293, 299, 349 N.W.2d 733 (1984), arguing that as a matter of public policy, insurance contracts should be interpreted to comply with the applicable statutes. Since we hold that the Leader policy does comply with the mandates of the financial responsibility statutes and since the permissive use provision of the omnibus statutes are inapplicable, our decision does not conflict with the policy of Germannota.
Therefore, we hold that the insurance policy itself, the financial responsibility statutes, the SR-22 form, and the omnibus statutes do not require the Leader National Insurance Company to insure Julia Post.
By the Court.—The decision of the court of appeals is affirmed.
Section 344.33(2) and (3), Stats., 1971-72.
Section 344.31, Stats., 1989-90 (emphasis added).
Section 344.33(2), Stats., 1989-90 (emphasis added).
Section 344.40(1), Stats., 1971-72.