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Progressive Northwestern Insurance Co. v. Jensen

United States District Court, D. Montana, Missoula Division

February 23, 2017



          Dana L. Christensen, Chief Judge

         Before the Court are the parties' cross-motions for summary judgment in this declaratory judgment action. On August 17, 2016, Petitioner Progressive Northwestern Insurance Company ("Progressive") filed its motion for summary judgment, arguing that it has discharged its duties to Respondents. On September 27, 2016, Respondents Shawna Jensen, Megan Collins, Leonard Piedalue, and Warren James responded to Progressive's motion and filed their cross-motion for summary judgment, seeking entry of judgment in their favor. For the reasons explained below, the Court denies each party's motion.


         On the evening of August 27, 2015, Respondent Shawna Jensen was traveling west on Montana Highway 200 in her 2002 GMC Yukon when she crossed the center line. On the other side of the dividing line was a dump truck driven by Respondent Leonard Piedalue. As Piedalue moved toward the shoulder, he felt the impact of Jensen's Yukon, "and then [he] was in the air." (Doc. 31 at 2.) Within a matter of moments, the Yukon struck a second vehicle, Respondent Warren James's Ford F-150 Extended Cab, which was following Piedalue's dump truck in the eastbound lane. Both Piedalue and James suffered extensive damages.

         Petitioner Progressive insured Jensen's Yukon at the time of the collisions. The policy in play provided liability coverage with limits of "$300, 000 combined single limit each accident" subject to the other terms and conditions of the Progressive policy. The policy does not define "accident." Both Piedalue and James have demanded a separate $300, 000 limit. Following receipt of Respondents' claims, Progressive accepted liability and paid a single limit of $300, 000 to be divided between Piedalue and James.

         The parties dispute whether the collisions between Jensen's vehicle and those driven by Piedalue and James constitute one accident or two. In addition to the legal question of policy interpretation, some facts remain in dispute, particularly: the time between the collisions, the location of the second collision, and Jensen's actions and control of the Yukon between the collisions. The relevance of these disputes is discussed below.


         Summary judgment is appropriate when the moving party demonstrates that "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). To determine whether a factual dispute is material, the Court looks to substantive law; "[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251 (1986). In diversity cases, the Court applies the substantive law of the forum state. Kabatoff v. Safeco Ins. Co. of Am., 627 F.2d 207, 209 (9th Cir. 1980).


         Petitioners argue that, under the unambiguous terms of the policy, only one accident occurred, regardless of the specific facts in dispute. Respondents argue both: (1) that the policy is ambiguous and should be construed in favor of coverage; and (2) that under Montana insurance law, two accidents occurred. The Court disagrees that the policy is ambiguous, but it determines that the question of how many accidents occurred cannot be resolved without an adjudication of relevant factual disputes.

         I. Interpretation of the Term "Accident"

         The parties dispute whether the term "accident" is ambiguous such that it should be construed in favor of coverage. The Court agrees with Petitioner that even if the term could be construed as ambiguous in other circumstances, that ambiguity would be irrelevant to this Order.

         "An ambiguity exists where the contract, when taken as a whole, is reasonably subject to two different interpretations. Whether an ambiguity exists is determined through the eyes of 'a consumer with intelligence but not trained in the law or insurance business.' " Hardy v. Progressive Specialty Ins. Co., 67 P.3d 892, 896 (Mont. 2003) (internal citations omitted). Where an ambiguity exists, it "must be construed in favor of the insured and in favor of extending coverage." Id.

         Here, the policy's insuring agreement states, "[Progressive] will pay damages for bodily injury and properly damage for which an insured person becomes legally responsible because of an accident." (Doc. 1-1 at 2.) The policy does not define the term "accident, " but the use of the singular indefinite article "an" clearly demonstrates that whatever an ...

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