Coverage question certified to West Virginia court

Where West Virginia law is unclear on the amount of coverage that must be provided when an exclusion in an automobile liability insurance policy violates West Virginia Code § 33-6-31(a) because it would deny coverage to a permissive user of an insured automobile, the question was certified to the Supreme Court of Appeals of West Virginia.

Background

On Oct. 25, 2016, employees of Milton Hardware LLC, were performing construction work at the home of Rodney Perry in Milton, West Virginia. At one point during the work, Milton Hardware’s owner authorized Perry to move one of Milton Hardware’s trucks, which was blocking the driveway. As Perry was moving the truck in reverse, however, he accidentally struck Greg Ball, a Milton Hardware employee, temporarily pinning him between the truck Perry was driving and another Milton Hardware truck. As a result, Ball sustained serious injuries that required hospitalization.

Milton Hardware’s policy with United Financial Casualty Company provided for $1 million of liability coverage to Milton Hardware and to any person using Milton Hardware’s vehicles with its permission. Concededly, at the time of the accident, Perry was a permissive user of Milton Hardware’s vehicle.

But the policy also contained an exclusion which provided that liability coverage did not extend to “[b]odily injury to . . . [a]n employee of any insured arising out of or within the course of: (i) [t]hat employee’s employment by any insured; or (ii) [p]erforming duties related to the conduct of any insured’s business.” It provided further that “[t]his exclusion applies . . . [w]hether the insured may be liable as an employer or in any other capacity.”

Given that Ball was an employee of the named insured and was injured in the course of his employment, this exclusion would, on its face, bar any coverage to Perry for his liability to Ball. But West Virginia Code § 33-6-31(a) provides that, subject to limited exceptions, automobile liability insurance policies must contain “a provision insuring the named insured and any other person . . . using the motor vehicle with the consent, expressed or implied, of the named insured.”

United Financial contends that it is obligated to provide only the $25,000 minimum amount of coverage required by the Motor Vehicle Safety Responsibility Law § 17D-4-2(b). Ball contends that United Financial is obligated to provide Perry with coverage in an amount of up to $1 million, as provided in the policy.

Analysis

The United States Court of Appeals for the Fourth Circuit requests that the Supreme Court of Appeals of West Virginia exercise its discretion to accept the following question: “When an exclusion in an automobile liability insurance policy violates West Virginia Code § 33-6-31(a) because it would deny coverage to a permissive user of an insured automobile, must the insurance company provide the permissive user with the full liability coverage available under the policy or the minimum liability coverage required by the Motor Vehicle Safety Responsibility Law, W. Va. Code § 17D-1-1 et seq.?”

Question certified.

United Financial Casualty Company v. Ball, Case No. 20-1452, Feb. 23, 2022. 4th Cir. (Niemeyer), from SDWVA at Huntington (Chambers). Stephen Brooks Farmer for Appellant. Susan Renee Snowden for Appellee.VLW 022-2-048. 12 pp.