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The straight story … with a twist

The straight story … with a twist

November 27
13:19 2017

The straight story … with a twist

Robert Bunker was driving a tractor on a county road when he collided with a truck driven by Neill Smith. The hay spears attached to the tractor pierced the truck and impaled Smith, leaving him seriously injured. Bunker later pleaded guilty to a charge of careless driving. Smith settled his claim against Bunker for the liability limits of Bunker’s policy. According to Smith, this amount did not fully compensate him for his injuries.

Smith filed a claim for underinsured motorist benefits with his insurer, State Farm Mutual Automobile Insurance Company. Taking the position that a farm tractor is not a motor vehicle, State Farm denied coverage.

Smith sued State Farm, asserting claims for breach of contract, bad faith breach of an insurance contract, and improper denial of an insurance claim. State Farm petitioned the court to determine as a matter of law that the tractor was not a motor vehicle under the policy’s UIM coverage provision. The court granted the motion, finding that the tractor was not a covered motor vehicle for purposes of the UIM coverage. It then dismissed the complaint. Smith appealed.

On appeal, Smith argued that (1) the policy’s definition of  “uninsured motor vehicle” applied to the tractor; (2) the ordinary meaning of  “motor vehicle” included the tractor; and (3) State Farm was statutorily required to provide UIM coverage for injuries caused by the tractor, and the public policy behind this statute supported coverage.

The court rejected Smith’s first argument, pointing out that the policy’s definition of  “underinsured motorist” clearly applied only to the property damage coverage. On his second contention, the court cited case law and a dictionary definition to conclude that Bunker’s tractor was a motor vehicle for the purposes of Smith’s policy. Because the policy did not contain a definition of  “motor vehicle” that comported with the plain meaning of the term, the court held that the term was ambiguous and, therefore, the tractor was covered under the policy’s UIM provision. In light of this finding, the court did not consider Smith’s contention that the public policy behind the UIM laws required that the tractor be covered under the UIM provision. The judgment was reversed and the case remanded to the trial court for further proceedings.

Smith vs. State Farm Mutual Automobile Insurance Company-Colorado Court of Appeals-January 12, 2017.

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