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Steve Norton, Appellant, vs. Tri-State Insurance Company of Minnesota, Respondent. C1-98-1614, Court of Appeals Published, March 30, 1999.

STATE OF MINNESOTA IN COURT OF APPEALS C1-98-1614 Steve Norton, Appellant, vs. Tri-State Insurance Company of Minnesota, Respondent. Filed March 30, 1999 Reversed and remanded Crippen, Judge McLeod County District Court File No. C397443 L. Michael Hall, L. Michael Hall, P.A., 27 Courthouse Square, St. Cloud, MN 56303-4769 (for appellant) Theodore J. Smetak, Arthur, Chapman, Kettering, Smetak & Pikala, P.A., 500 Young Quinlan Building, 81 South Ninth Street, Minneapolis, MN 55402-3214 (for respondent) Considered and decided by Halbrooks, Presiding Judge, Crippen, Judge, and Mulally, Judge. SYLLABUS Legal restrictions on stacking first-party insurance benefits govern claims that coverage on more than one owned vehicle multiplies the coverage for an incident involving any one of them, but stacking limits have no bearing on the question of multiple coverage by two policies written on the same vehicle. OPINION CRIPPEN, Judge In this declaratory judgment proceeding, appellant Steve Norton contends that he has first-party coverage with two companies for injuries sustained in a December 1994 collision of an uninsured motorist with appellant's Chevrolet automobile. Payment of Norton's claims has been tendered by Austin Mutual Insurance Company, whose policy Norton purchased after he bought the Chevrolet in August 1994. Respondent Tri-State Insurance Company of Minnesota provided uncommon coverage on the same vehicle, its policy having been purchased by the prior owner of the Chevrolet and left in force by the owner because part of the purchase price remained unpaid. [1] Appellant disputes the trial court's judgment that it would constitute unlawful judicial stacking to enforce Tri-State's coverage. We reverse, determining that the doctrine of stacking does not deal with two policies written on the same vehicle. We also reverse alternative trial court holdings upholding arguments of Tri-State that its policy contains language whereby (a) coverage is barred for an insured occupant, other than the named insured, who owns the insured vehicle, and (b) it is absolved from the coverage claim because Austin Mutual's policy was closest to the risk; contrary to Tri-State's representations to the trial court, its policy contains no language (a) limiting coverage for an insured occupant who is owner of the insured vehicle or (b) permitting the determination that Austin Mutual's coverage might be considered either exclusive (as respondent represented to the trial court) or primary (as has prompted other applications of the closest-to-the-risk doctrine).

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Steve Norton, Appellant, vs. Tri-State Insurance Company of Minnesota, Respondent. C1-98-1614, Court of Appeals Published, March 30, 1999.

Because the policies of both Austin Mutual and Tri-State include an other-insurance clause that limits their coverage to a proportionate share of the maximum recovery, based on the limits of coverage in each policy, we remand for a determination of the proportion of appellant's claims that must be paid by respondent Tri-State. FACTS In August 1994, appellant Norton purchased an automobile, a 1977 Chevrolet Caprice, from Reuben Sanken. Appellant possessed and used the automobile while completing payments to Sanken. Both appellant and Sanken carried insurance on the vehicle. Appellant's Austin Mutual policy had uninsured motorist benefits of $50,000 per person and $100,000 per occurrence. Sanken's Tri-State policy had uninsured motorist benefits of $100,000 per person and $300,000 per occurrence. On December 3, 1994, an uninsured motorist collided with the Caprice, severely injuring appellant and others in his family. Appellant made a claim on behalf of himself and his family and Austin Mutual tendered benefits. Appellant also made a claim for uninsured motorist benefits under Sanken's Tri-State policy. Tri-State initially advised appellant that it would provide UM coverage pursuant to the policy but subsequently reversed its position and denied the claim. Appellant sought a declaratory judgment stating that he was entitled to UM benefits from Tri-State. The trial court held that appellant was not entitled to benefits from Tri-State, first because of judicial stacking laws and second because of contentions that the policy contained language prohibiting coverage. ISSUES 1. Do rules of law on stacking, the claim that first-party coverage on multiple owned vehicles enlarges the exposure for an incident involving any one of them, govern the question of coverage of two policies written on the same vehicle? 2. Has Tri-State identified policy language that eliminates appellant's coverage or demands either exclusive or primary coverage under the policy purchased by appellant? ANALYSIS 1. Standard of review The trial court's application of a statute to undisputed facts is a conclusion of law; therefore, this court need not defer to the district court's decision. A.J. Chromy Constr. Co. v. Commercial Mech. Servs., Inc., 260 N.W.2d 579, 582 (Minn. 1977). When the parties agree to the underlying facts and only dispute the interpretation of an insurance policy, we review de novo whether the trial court properly interpreted and applied the law to the facts. Magnetic Data, Inc. v. St. Paul Fire & Marine Ins. Co., 442 N.W.2d 153, 155 (Minn. 1989). "Interpretation of an insurance policy is a question of law subject to de novo review." National Family Ins. v. Bunton, 509 N.W.2d 565, 567 (Minn. App. 1993). 2. Stacking The trial court denied appellant recovery under Tri-State's policy because "[t]he absolute prohibition against judicial stacking applies to the adding of UM coverages for the same vehicle." But the cases and statutory provisions cited by the trial court only prohibit stacking of the coverage limits for two or more vehicles. See Austin Mut. Ins. Co. v. Templin, 435 N.W.2d 584, 586 (Minn. App. 1989) (defining judicial stacking as "pyramiding of separate first party coverages attributable to two or more vehicles despite policy language prohibiting stacking") (quoting Rusthoven v. Commercial Standard Ins. Co., 387 N.W.2d 642, 644 n.1 (Minn. 1986)); Minn. Stat.

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