Nodak Mutual Ins. Co. v. Koller

In 2011, Chase Koller and his girlfriend Stephanie Nelson were killed when Koller allegedly lost control of an all-terrain vehicle. Nelson was the mother of G.K., a child from a previous relationship. Becky Anderson, Koller's mother, was the registered owner of the vehicle. The vehicle was insured under a policy issued by Nodak Mutual Insurance Company. Todd Anderson, Koller's stepfather, was the named insured. The policy provided coverage for any "family member" of the named insured, up to $100,000 per incident. The policy defined a "family member" as "a person related to you by blood, marriage or adoption, including a ward or foster child, who is a resident of your household." The policy included a "step-down" endorsement that reduced the policy limits to $25,000 per incident if the vehicle was being driven by an insured who was not a "family member" of the named insured. After the fatal accident, Nodak retained an attorney to represent Anderson to prepare probate documents. Nodak then sued Anderson in her capacity as Personal Representative to the Estate of Chase Koller, and Chris Kemp, as guardian of G.K., and the heirs of Stephanie Nelson, seeking a declaration that it was only liable to pay the reduced step-down policy limits because Koller was not a resident of Todd Anderson's household and, therefore, was not a "family member" under the policy. Kemp filed an answer, cross-claim, and third-party complaint asserting wrongful death against Anderson in her capacity as Personal Representative, and asserting negligent entrustment against Todd and Anderson individually, claiming the family car doctrine applied. The district court severed Kemp's wrongful death claim from Nodak's declaratory judgment action. In the declaratory judgment action, Kemp moved for summary judgment. Nodak responded to Kemp's motion for summary judgment arguing that the district court should deny Kemp's motion and grant summary judgment in its favor. After a hearing, the district court entered an order granting Kemp's motion for summary judgment determining that Koller was a resident of the Andersons' household under Nodak's policy. Before the district court entered judgment, the North Dakota Supreme Court decided "Nodak Mutual Ins. Co. v. Bahr-Renner," (842 N.W.2d 912), interpreting an identical "step-down" provision. After reviewing "Bahr-Renner," the district court vacated its order granting Kemp's motion for summary judgment applied the "Bahr-Renner" factors, and found that Koller was not a resident of Todd Anderson's household and, Nodak was only required to pay the "step-down" policy limits. Kemp appealed from the district court's declaratory judgment in favor of Nodak. Finding no error with the district court's judgment, the Supreme Court affirmed. View "Nodak Mutual Ins. Co. v. Koller" on Justia Law