AUTO DEALER + COVERAGE BUZZ

By Greg Johnson, Esq. Whether a person is “occupying” (or is an “occupant” of) a motor vehicle is often a significant issue in motor vehicle insurance coverage litigation. Under the Minnesota No-Fault Automobile Insurance Act, the determination of whether an injured person is entitled to recover first-party benefits (no-fault, uninsured and underinsured motorist coverage) at all, whether the injured person is disqualified from recovering benefits and which insurer has the primary obligation to pay benefits, often hinge on occupancy status.

For example, with respect to no-fault benefits, Minn. Stat. § 65B.43, subd. 3, the No-Fault Act’s definition of “maintenance or use” states: “’Maintenance or use of a motor vehicle’ means maintenance or use of a motor vehicle as a vehicle, including, incident to its maintenance or use as a vehicle, occupying, entering into, and alighting from it.” The same statute authorizes insurers to incorporate a no-fault benefits exclusion for “conduct in the course of loading and unloading the vehicle unless the conduct occurs while occupying, entering into or alighting from it.“

Minn. Stat. § 65B.46, subd. 2, the extra-territorial provision of the No-Fault Act, requires Minnesota insurers to provide no-fault benefits to insureds and “the driver and other occupants” of the insured vehicle if the accident occurs outside Minnesota in the United States, United States possessions, or Canada.

Under Minn. Stat. § 65B.47, the priority statute for payment of no-fault benefits, the obligation to pay benefits is sometimes based on whether the injured person was a “driver or occupant” of a particular type of vehicle.

With respect to uninsured and underinsured motorist coverages, Minn. Stat. § 65B.49, subd. 3a(5), the UM/UIM priority statute,  imposes primary coverage on the insurer of the vehicle the injured person was “occupying” at the time of injury. Subdivision 3a(7) of the same statute provides that UM/UIM coverages “do not apply to bodily injury of the insured while occupying a motor vehicle owned by the insured, unless the occupied vehicle is an insured motor vehicle.” Minn. Stat. § 65B.49.

So, when is an injured person “occupying” a motor vehicle?  The No-Fault Act has never defined the terms “occupying” or “occupant” or “occupied.” In Allied Mutual Insurance Co. v. Western National Mutual Insurance Co., 552 N.W.2d 561 (Minn.1996), the Minnesota Supreme Court rejected prior decisions from the Court of Appeals which had defined “occupying” in terms of a “reasonable geographic perimeter around a vehicle or a continuing relationship between a vehicle and the claimant.” 552 N.W.2d at 563. Instead, the Supreme Court observed that the “ordinary and commonly accepted meaning” of the term “occupy” means “to take possession of a place or to be resident or established in a place,” and held the term could not be altered by “creative definition.” Id. See also Ostendorf v. Arrow Insurance Co., 288 Minn. 491, 182 N.W.2d 190 (1970) (suggesting that the ordinary meaning of the word “occupying” contemplates that a person is physically inside the motor vehicle). Under the ordinary definition, at least some portion of a person’s body must physically be “in” a motor vehicle in order to be “occupying” it. See e.g., Campeau v. State Farm Ins. Co., 1997 WL 292146 (Minn. Ct. App. 1997) (noting that under Allied Mutual, “a person who is not actually in a vehicle, or at least in the act of getting in or out of a vehicle, is not ‘occupying’ the vehicle” and holding that a claimant who was outside his car and walking toward an oncoming vehicle was not occupying his vehicle).

Does Allied end the occupancy discussion? Not necessarily. While “occupying” means “in,” most motor vehicle insurance policies define the term “occupying” more expansively than its “ordinary and commonly accepted meaning” to also include any person who is “in, upon, entering into or “alighting from” the vehicle at the time of injury. See Allied Mutual, 552 N.W.2d at 564 (policies which defined “occupying” to include “in, upon, getting in, on, out or off,” is “broader than the commonly accepted meaning” of “occupying.”); Ostendorf, 182 N.W.2d at 191 (policy which defined “occupying” to mean “in or upon, entering or alighting from the insured automobile” reflects the insurer’s intent to provide coverage when the insured vehicle is parked and a person is outside the vehicle.)

A Minnesota insurer may always afford broader coverage than required by the No-Fault Act.  Accordingly, when presented with an “occupancy” issue, one must analyze the accident facts in light of the policy’s definition of “occupancy.”  As a matter of contract interpretation, the terms “upon” or “entering into” or “alighting from” are distinct from “in” and each term is intended to have a separate meaning.  See Wagenman v. State Farm Ins., 726 F. Supp. 1239, 1245 (D. Utah 1989) (“Courts logically find that the terms ‘in,’ ‘on,’ or ‘upon’ should mean something different than ‘entering into’ or ‘alighting from.’”); Pope v. Stolts, 712 S.W.2d 434, 437–38 (Mo. Ct. App. 1986) (“use of the disjunctive ‘or’ indicates that the words ‘in or upon or entering in or alighting from’ are to be viewed as alternative conditions, any one of which standing alone would constitute occupying the insured automobile.”); Christoffer v. Hartford Acc. & Indem. Co., 123 Cal. App. 2d Supp. 979, 267 P.2d 887, 890 (Cal. App. Dep’t Super. Ct. 1954) (“We must assume that it was the intention of the parties to the contract to include a class of persons within the meaning of the word ‘upon’ not necessarily included in the words ‘in’, ‘entering’, or ‘alighting from.’”); Wolf v. American Casualty Co., 2 Ill.App.2d 124, 118 N.E.2d 777 (Ill. Ct. App. 1954) (the word “upon” enlarges the area defined by the words “in” and “entering or alighting.”)

As most policies define occupancy to include “entering into” or “alighting from” or “upon” a motor vehicle (in addition to being “in” the vehicle), those terms are discussed below.

The Minnesota Two-Part “Occupancy” Test

The Minnesota Supreme Court has developed a two-part test for determining whether a claimant is “occupying” a motor vehicle when not physically “in” the insured vehicle. First, the injured claimant must be in close proximity to the vehicle. See Haagenson v. National Farmers Union Property & Casualty, 277 N.W.2d 648 (Minn.1979); State Farm Mut. Auto. Ins. Co. v. Levinson, 438 N.W.2d 110 (Minn. Ct. App. 1989). Second, there must be “some causal connection between the occupancy of the vehicle and the injury.” Allied Mutual Insurance Co. v. Western National Mutual Insurance Co., 552 N.W.2d 561, 564 (Minn.1996).

Proximity: “Entering in” or “Alighting From” a Motor Vehicle

The process of “entering into” or “alighting from” a motor vehicle is invariably covered by motor vehicle policies because the threshold of a vehicle creates an increased risk of injury.  Generally, one’s footing is not secure when engaged in the physical act of entering into or alighting from a motor vehicle and is consequently an insured risk.  See e.g., Putkamer v. Transamerica Ins. Corp. of Am., 454 Mich. 626, 563 N.W.2d 683, 686 (1997) (finding coverage when the insured fell on ice as she placed her foot on the floor board of her car); Padron v. Long Island Ins. Co., 356 So.2d 1337, 1338–39 (Fla.Dist.Ct.App.1978) (finding coverage where insured’s foot slipped as he was exiting the vehicle “causing his right leg to hit the bottom part of the car door and break his leg. The plaintiff did not slide out of the car, but injured himself on the car door threshold as he was alighting therefrom.”)

In Minnesota and elsewhere the intent to enter into a motor vehicle is not sufficient to constitute “entering into” a vehicle.  See e.g., Allied Mutual Insurance Co. v. Western National Mutual Insurance Co., 552 N.W.2d 561, 564 (Minn.1996) (“Decker was not occupying—i.e., in or getting in—McMillan’s automobile; and, in fact, she had no immediate expectation of occupying the car, which McMillan could not unlock.”) To enter or alight requires “an intent coupled with an overt act necessary to enter or exit the vehicle.” United Farm Bureau Mut. Ins. Co. v. Pierce, 152 Ind. App. 387, 283 N.E.2d 788, 791 (1972).

Approaching a motor vehicle is generally not sufficient either.  It is not the equivalent of the physical act of “entering into” a vehicle. See Ostendorf v. Arrow Insurance Co., 288 Minn. 491, 182 N.W.2d 190 (1970) (child who intended to get into her father’s vehicle but was struck by another vehicle while 10 feet away from her father’s vehicle was not “entering into” the vehicle — approaching a motor vehicle is not a part of the process of entering the vehicle); Testone v. Allstate Ins. Co., 165 Conn. 126, 328 A.2d 686 (1973) (although evidence showed that plaintiff was approaching the driver’s door of the car, the act of approaching is not the same as the act of entering). Cf Galle v. Excalibur Insurance Co., 317 N.W.2d 368, 370 (Minn.1982) (truck driver opening trailer door was “entering into” the truck); Haagenson, 277 N.W.2d at 652 (upholding jury’s finding that Haagenson had started to enter into vehicle by opening the door before he slipped and was electrocuted by a downed power line); Jorgensen v. Auto-Owners Insurance Co., 360 N.W.2d 397, 400 (Minn. Ct. App. 1985), rev. denied (Minn. Apr. 12, 1985) (plaintiff was “entering into” his father’s motor vehicle when he turned the trunk key in order to retrieve jumper cables from the trunk, heard a “pop,” and a gasoline exploded and burned him).

On the other hand, a person need not be physically touching the vehicle to satisfy this policy language (the words “in” and “upon” (or “on”) cover actual physical contact). See e.g., Ostendorf, 182 N.W.2d at 191; Levinson, at 113. The phrase “alighting from” extends to situations where the claimant’s body is no longer “in,” or “upon” the insured vehicle. Whitmire v. Nationwide Mutual Ins. Co., 254 S.C. 184, 174 S.E.2d 391 (1970) (“[a]lighting from” must … extend to a situation where the body has reached a point when there is no contact with the vehicle.”) How close a person must be to a vehicle in order to be “entering into” or “alighting from” it presents “a question of degree” to be based on all of the evidence. Haagenson, 277 N.W.2d at 652; Levinson, 438 N.W.2d at 114; Safeco Ins. Co. v. Goldenberg, 435 N.W.2d 616, 621, n. 2 (Minn. Ct. App. 1989), rev. denied (Minn. Apr. 19, 1989).

Generally, courts recognize that a person remains an “occupant” of a motor vehicle until the person has completed all acts reasonably incident to the disembarking (“alighting from”) process and thereafter commences a course of conduct which is unrelated to the continued operation or use of the vehicle. See Christensen v. General Accident Ins., 482 N.W.2d 510, 512 (Minn. Ct. App.1992), rev. denied (Minn. May 15, 1992) (a person completes the “alighting from” process when the person intends to undertake a new direction or activity and overtly acts based on that intention); Fidelity & Casualty Company of New York v. Garcia, 368 So.2d 1313 (Fla.Dist.Ct.App.1979), rev. denied, 378 So.2d 344 (Fla.1979) (“alighting from” ceases at “the time and place at which the insured shows an intention, evidenced by an overt act based on that intention, to undertake a new direction or activity.”) Typically, the claimant loses occupancy status “[w]hen the time and distance factors are no longer proximate to the risk to which a person exposes himself while alighting from a vehicle.”  Day v. Coca-Cola Bottling Co., Inc., 420 So.2d 518, 520 (La. Ct. App. 1982). See also Levinson, 438 N.W.2d at 114 (upholding trial court’s finding that 3-year-old girl struck by a passing vehicle was “alighting from” her parent’s truck where the passenger door was still ajar and she was found within a few feet of the truck).

Proximity: “Upon” or “On” a Motor Vehicle

The insurance policy terms “upon” (or “on”) are intended to have meanings separate and distinct from “in” or “entering into” or “alighting from” a motor vehicle. See e.g., Wagenman v. State Farm Ins., 726 F. Supp. 1239, 1245 (D. Utah 1989) (“Courts logically find that the terms ‘in,’ ‘on,’ or ‘upon’ should mean something different than ‘entering into’ or ‘alighting from.’”); Christoffer v. Hartford Acc. & Indem. Co., 123 Cal. App. 2d Supp. 979, 267 P.2d 887, 890 (Cal. App. Dep’t Super. Ct. 1954) (“We must assume that it was the intention of the parties to the contract to include a class of persons within the meaning of the word ‘upon’ not necessarily included in the words ‘in’, ‘entering’, or ‘alighting from’.”); Wolf v. American Casualty Co., 2 Ill.App.2d 124, 118 N.E.2d 777, 779 (Ill.Ct.App1954) (the word “upon” enlarges the area defined by the words “in” and “entering or alighting.”) Rather, the terms “connote some physical relationship between himself and the car that enlarged the area defined by the words “entering or alighting” and the word ‘in.’ United Farm Bureau Mut. Ins. Co. v. Pierce, 152 Ind. App. 387, 283 N.E.2d 788, 791 (1972).

The common and ordinary meanings of the words “upon” and “on” are essentially the same. Beasley v. State Farm Mut. Auto. Ins. Co., 9 Kan. App. 2d 561, 682 P.2d 689, 692 (1984) (citing Webster’s Third New International Dictionary pp. 1575 and 2517 (3d ed. 1976) (defining “upon” by reference to the word “on” and defining the term “on” to mean “a position of contact with or against a supporting surface, or a motion into or toward such position.”)). The term “upon” does not mean that one must be couched on the top roof of the car or sitting on the hood. See Lambert v. Coregis Ins. Co., 950 So. 2d 1156, 1162 (Ala. 2006) (“the only plain and common meaning of those terms [“on” or “upon”] in relation to the term “occupying” is for “upon” or “on” to mean in contact with and supported by the top surface of or in contact with an outer surface.”) The terms “upon” and “on” in a motor vehicle policy are not restricted to “on top,” because “there [are] many positions, not normally taken while using an automobile … which could still be termed ‘upon’ the vehicle.” R.P. Davis, Annotation, Scope of Clause of Insurance Policy Covering Injuries Sustained While “in or on” or “upon” Motor Vehicle, 39 A.L.R.2d 1958 § 4 (1955 & Later Case Service 2005) (citing cases). See also Goodwin v. Lumbermen’s Mut. Cas. Co., 199 Md. 121, 85 A.2d 759, 763 (Md. 1952) (“One would not expect to find a person wholly above the top, the fenders, the hood, or the bumpers if the car were being lawfully used.”); Christoffer v. Hartford Acc. & Indem. Co., 123 Cal. App. 2d Supp. 979, 267 P.2d 887, 890 (Cal. App. Dep’t Super. Ct. 1954) (as the policy does not describe “how or in what manner the assured was to be upon the automobile (such as standing upon, sitting upon, kneeling upon, pushing upon, pulling upon, riding upon, resting upon, etc.), we conclude that respondent was ‘upon the automobile’ as the term is employed in the policy.”)

As one Supreme Court summarized:

In the context of the present situation, “upon” and “on” are used in defining the term “occupying,” and the definitions of the words “upon” and “on” must be interpreted in relation to the term they are used to define. *** As noted earlier, “upon” in modern usage is the equivalent of “on.” The applicable definitions of “on” found in Merriam–Webster’s Collegiate Dictionary 865 (11th ed. 2003) are as follows: “1 a—used as a function word to indicate position in contact with and supported by the top surface of … b—used as a function word to indicate position in or in contact with an outer surface … c—used as a function word to indicate position in close proximity with….” Although it may be possible to give multiple meanings to the terms “on” or “upon” when those terms are standing alone, the only plain and common meaning of those terms in relation to the term “occupying” is for “upon” or “on” to mean in contact with and supported by the top surface of or in contact with an outer surface. *** As written, in order to provide UM coverage under the policy Lambert must have been “upon” or “on” the covered vehicle, because those terms are used in defining “occupying.”

Lambert v. Coregis Ins. Co., 950 So. 2d 1156, 1162 (Ala. 2006).

In Minnesota, being “near” or “in proximity” to the insured vehicle is not sufficient to be “upon” a vehicle. Short v. Midwest Family Mutual Insurance Co., 602 N.W.2d 914, 916 (Minn. Ct. App. 1999) (rejecting suggestion that words “upon” and “on” should be broadly construed to mean “near to” and “in proximity to.”)  See also Testone v. Allstate Ins. Co., 165 Conn. 126, 328 A.2d 686, 691 (1973) (holding the term “upon” requires “the injured party’s actual physical contact with the insured vehicle at the time of the injuries” and finding that while the plaintiff was adjacent to the insured vehicle, he was not in physical contact with it and, therefore, was not “upon” the vehicle within meaning of policy language).

Numerous courts across the country have interpreted the terms “upon” or “on” in motor vehicle occupancy clauses.  An injured claimant is “upon” (or “on”) a motor vehicle when she is in physical contact with the vehicle at the time of injury. “By the clear weight of authority actual physical contact with the insured’s automobile, when shown, is sufficient to sustain a recovery under a policy requiring the injured claimant to be injured “while in or upon” the insured vehicle. Henderson v. Hawkeye-Sec. Ins. Co., 252 Iowa 97, 106 N.W.2d 86, 89 (1960). See also S.C. Farm Bureau Mut. Ins. Co. v. Kennedy, 398 S.C. 604, 609, 730 S.E.2d 862, 864, 868 (2012) (noting that “by the weight of authority actual physical contact with the insured’s automobile is sufficient to establish that the insured was Upon the vehicle as contemplated by such policies” and finding that claimant was “upon” his employer’s vehicle where he had his hand on the truck when another vehicle careened towards him, forcing him to relinquish his contact in an unsuccessful attempt to avoid being injured); DeStefano v. Oregon Mutual Insurance Co., 762 P.2d 1123, 1126 (Utah Ct.App.1988) (driver who was pouring gasoline into the tank of his vehicle on the side of a highway was “in, upon, or entering into the vehicle” when struck by another motorist); Pope v. Stolts, 712 S.W.2d 434, 438 (Mo. Ct. App. 1986) (plaintiff was “upon” automobile as he was standing over it with his stomach resting against the grill and his legs against the bumper preparing to connect jumper cables to its battery); Beasley v. State Farm Mut. Auto. Ins. Co., 9 Kan. App. 2d 561, 682 P.2d 689, 693 (Kan. Ct. App. 1984) (claimant whose arm was caught inside a trash compactor attached to a truck while completing the packing process was “in and on” the insured vehicle within meaning of the policy insuring the truck); Hart v. Traders and General Ins. Co., 487 S.W.2d 415 (Tex.Ct.App.1972) (individual leaning into vehicle’s engine to install a new fuel pump was “upon” vehicle when struck by another motorist); United Farm Bureau Mutual Insurance Co. v. Pierce, 152 Ind. App. 387 283 N.E.2d 788, 791 (1972) (driver was “upon” car when he was injured while attempting to free tires from an accumulation of snow and cut his hand while pushing on front fender; an injured party need not be on top of or physically supported by an insured vehicle in order to have been “upon” it at the moment of injury.); McAbee v. Nationwide Mutual Ins. Co., 249 S.C. 96, 152 S.E.2d 731, 732 (1967) (claimant who was crushed between his employer’s truck and another vehicle while pushing his employer’s truck was “upon” the truck – the policy term “upon” cannot be construed to mean only “on top of.”); Cont’l Cas. Co. v. U. S. Fid. & Guar. Co., 303 F.2d 821, 822–23 (5th Cir. 1962) (claimant was either “upon” the truck with one of his knees and holding onto the truck with one hand or was “entering into” the truck); Henderson v. Hawkeye-Security Ins. Co., 252 Iowa 97, 106 N.W.2d 86, 90 (1960) (claimant who was struck by a vehicle while leaning against her stalled car attempting to put down the hood was “in or upon” her vehicle); Christoffer v. Hartford Acc. & Indem. Co., 123 Cal. App. 2d Supp. 979, 267 P.2d 887, 891 (Cal. App. Dep’t Super. Ct. 1954) (person injured when struck by motorist while leaning over vehicle changing a flat tire was ‘upon’ it within contemplation of the policy); Goodwin v. Lumbermen’s Mut. Cas. Co., 199 Md. 121, 85 A.2d 759, 763 (Md. 1952) (Blum was “upon” and entering into the insured car when struck by another car as she was standing near the right front door of the insured car and, after opening the right front door with a key, leaned in the car to release the tab so that the rear right-hand door could be opened); Sherman v. New York Casualty Co., 78 R.I. 393, 82 A.2d 839 (RI 1951) (claimant who had placed his hands and knees upon the insured car in an effort to prevent it from rolling into a wall was “upon” the car within meaning of policy; Lokos v. New Amsterdam Cas. Co., 197 Misc. 40, 93 N.Y.S.2d 825 (1949), aff’d 96 N.Y.S.2d 153 (1950) (plaintiff who was struck by another motorist was “upon” his parked car because he was leaning over its bumper in preparation for tying the bumper up after one end of the bumper had fallen off).

The common denominator in the foregoing cases is the fact that in each case the claimant either was, or intended to be, an operator or passenger of the insured vehicle and was injured while in physical contact with the vehicle. In many cases, the reason for leaving the vehicle, and the claimant’s activities after leaving the vehicle, were directly related to the continued operation or use of the vehicle because it had malfunctioned or sustained damage and the claimant was either trying to repair the damage or prevent further damage. Where the injuries relate to the continued operation or use of the vehicle, the injured claimant is typically afforded insured status. (Note that had the case of Klein v. United States Fidelity & Guar. Co., 451 N.W.2d 901 (Minn. Ct. App.1990) rev. denied (Minn. Mar. 27, 1991) involved the issue of whether Klein was “upon” or “on” the insured pick-up truck, Klein would have qualified for coverage as he was struck by another highway motorist while in the process of changing a flat tire on the pick-up truck).

By contrast, claimants who were neither actual nor intended operators or passengers of an insured vehicle at the time of injury have been denied insurance coverage because, although there was evidence of physical contact, the claimant had no “connection” to the insured vehicle other than the injury-causing impact. See e.g., Hollingworth v. American Guarantee and Liability Insurance Co., 105 R.I. 693, 254 A.2d 438, 439 (1969) (“In all the recited cases, the injured plaintiff had some connection with the injuring automobile other than the ultimate impact which caused the injuries for which recovery was sought. In the case at bar, however, plaintiff had no connection with the injuring automobile prior to the time when it lurched forward and pinned him against the building.”)

Some courts have held that an operator of an insured vehicle who alights from the vehicle and sustains injuries almost immediately thereafter when another vehicle strikes the insured vehicle and the insured vehicle is, in turn, pushed into the operator, is “upon” the insured vehicle. See e.g., Motor Vehicle Accident Indemnification Corp. v. Oppedisano, 41 Misc.2d 1029, 246 N.Y.S.2d 879 (1964) (injured claimant was “upon” vehicle within meaning of auto policy where a hit and run vehicle struck the claimant’s parked vehicle which, in turn, struck the claimant); Wolf v. American Casualty Co., 2 Ill.App.2d 124, 118 N.E.2d 777 (Ill. Ct. App. 1954) (claimant was “upon” his parked vehicle when it was pushed into him after being struck by another car from the rear). The Minnesota Court of Appeals appears to have implicitly adopted this analysis in Horace Mann Ins. Co. v. Neuville, 465 N.W.2d 432 (Minn. Ct. App.1991), rev. denied (Minn. Mar. 27, 1991).  There, Neuville had been driving a 1978 Mazda GLC which he owned and failed to insure. The Mazda broke down, and his mother, with her car, pushed the Mazda along a county road. His mother’s car started to overheat, and she left to get help. Neuville stayed with his car. Another car, owned and operated by Perona, struck the rear of the Mazda. The collision pushed the Mazda forward striking Neuville, who was standing somewhere in front of his car. At the time of the accident, Neuville’s mother was insured under a policy issued by Horace Mann. Neuville qualified as a resident relative under the policy. Neuville sought underinsured motorist (“UIM”) benefits under the policy. Consistent with Minn. Stat. § 65B.49, subd. 3a(7), the Horace Mann policy excluded coverage if the insured was “occupying” an owned, uninsured motor vehicle. Although Neuville was not engaged in the physical act of exiting the vehicle when injured, the trial court and Court of Appeals determined that Neuville was “occupying” the uninsured Mazda at the time of the accident and was therefore precluded from recovering UIM benefits from Horace Mann.

It is important to note that while the vast majority of courts have held that physical contact is required to be “upon” (or “on”) a motor vehicle, the Minnesota Court of Appeals has also held that physical contact need not occur simultaneously with the injury; it is sufficient if the contact occurred immediately prior to the moment of injury. See Illinois Farmers Insurance Co. v. Marvin, 707 N.W.2d 747 (Minn. Ct. App. 2006) (claimant was “in, on, [or] getting into or out of” vehicle where “the upper half of her body had been in the [cargo area of the] vehicle mere moments before the accident” and her legs were then crushed between the bumper of that vehicle and another vehicle).

Some courts reject the plain meaning of the term “upon” (or “on”) and its physical contact requirement if there was a sufficient relationship between the claimant and the vehicle so that it can reasonably be said that the claimant was an “occupant”. In such jurisdictions, the person claiming insurance benefits must typically: (1) be in close geographic proximity to the insured vehicle; (2) be vehicle oriented; and (3) engaged in an activity essential to the vehicle’s use. See e.g., D’Amour v. Amica Mut. Ins. Co., 153 N.H. 170, 891 A.2d 534, 537 (2005) (recognizing the “vehicle orientation standard,” under which a claimant “engaged in a transaction essential to the use of the insured vehicle at the time of the accident” may be “occupying” the vehicle”); Simpson v. United States Fid. & Guar. Co., 562 N.W.2d 627, 630–31 (Iowa 1997) (holding that uninsured motorist coverage extended to anyone “in close proximity to the [covered auto]” and “engaged in an activity relating to the use of the [covered auto]”); Cocking v. State Farm Mut. Auto. Ins. Co., 6 Cal. App. 3d 965, 968–71, 86 Cal. Rptr. 193, 198 (Ct. App. 1970) (claimant injured by motorist while standing one to four feet away from the insured vehicle in preparation for putting snow chains on the vehicle was “upon” the vehicle; affixing snow chains placed the claimant in the requisite physical relationship to the car so as to bring him within the protection of the policy.) In light of the Minnesota Supreme Court’s holding in  Allied Mutual, 552 N.W.2d 561, 563 (Minn.1996) (rejecting decisions which had defined “occupying” in terms of a “reasonable geographic perimeter around a vehicle or a continuing relationship between a vehicle and the claimant”) and the Court of Appeals’ holding in Short v. Midwest Family, 602 N.W.2d 914 (Minn. Ct. App. 1999) (rejecting argument that words “upon” and “on” could be construed to mean “near to” and “in proximity to”), Minnesota courts would no doubt reject reliance on any foreign case law which has interpreted the policy term “upon” (or “on”) in light of a close geographic proximity.  

Causal Connection Requirement:  Nexus between Injury and Occupancy

In addition to the “proximity” requirement, the Minnesota two-part occupancy test also requires a causal connection “between the occupancy of the vehicle and the injury.” Allied Mutual Insurance Co. v. Western National Mutual Insurance Co., 552 N.W.2d 561, 564 (Minn.1996). This is somewhat similar to the causal connection required to demonstrate that an injury arises out of the use of a vehicle, which looks at the connection “between the injury and the use of a motor vehicle” (see e.g., Dougherty v. State Farm Mut. Ins. Co., 699 N.W.2d 741, 743 (Minn. 2005)), but addresses different issues.

For there to be a connection “between the occupancy of the vehicle and the injury” the claimant must have either been “in” the insured vehicle or, although outside it, engaged in conduct normally associated with the operation or “use” of the insured vehicle.

This second element of the Minnesota test serves to restrict “occupancy” status to persons who were (1) “in” the vehicle, (2) had an expectation of “entering into” the vehicle or (3) were engaged in conduct associated with the operation or use of the vehicle, as opposed to persons who are mere pedestrians or bystanders. See e.g., Balderrama v. Milbank Mut. Ins. Co., 324 N.W.2d 355, 358 (Minn. 1982) (“This is not a case where plaintiff has attained bystander or pedestrian status. His automobile was only temporarily stopped in a hazardous area, Interstate Highway No. 94.”) Thus, a person who was outside the insured vehicle, but in physical contact with it while filling it with gas, would be covered by the policy on the insured vehicle as he was “upon” (or “on”) the vehicle and his conduct was associated with the continued operation of the vehicle (see e.g., Balderrama, 324 N.W.2d 355), while one who is simply standing in the vicinity of an insured vehicle would not be covered. See Allied Mutual, 552 N.W.2d at 564 (“When Ms. Decker was struck by the Larson vehicle she was a pedestrian. That she was standing in the vicinity of the McMillan automobile was mere happenstance. Decker was not occupying—i.e., in or getting in—McMillan’s automobile; and, in fact, she had no immediate expectation of occupying the car, which McMillan could not unlock. *** [T]here was no conceivable causal connection between the McMillan automobile and Decker’s injuries.”)

Other courts have reached the same result as the Minnesota two-part test by giving each of the words (“in,” “upon,” “entering into,” and “alighting from,”) its own distinct meaning and at the same time construing each term with reference to the word it defines (“occupying”). For example, in Pennsylvania Nat. Mut. Cas. Ins. Co. v. Bristow, 207 Va. 381, 150 S.E.2d 125 (1966), Zahn’s vehicle stalled on a highway, so he pulled over. Bristow was a passenger in a panel truck that pulled over to assist Zahn.  Bristow, opened the hood and leaned over the motor and reached in to check some of the wiring. His legs were touching the bumper with his stomach touching the car. At that moment, the Zahn’s car was struck in the rear by an uninsured motorist. The impact threw Bristow into the ditch and injured him.  Bristow made claim for uninsured motorist benefits from Allstate Insurance Company, which insured Zahn’s vehicle.  The policy extended coverage to persons “occupying” the insured vehicle and defined the term to mean “in or upon or entering into or alighting from.”

The crucial question was whether Bristow was “upon” the Zahn vehicle at the time of the accident, within the meaning of Allstate’s policy. In holding that Bristow’s physical contact with the vehicle was insufficient to be “upon” Zahn’s motor vehicle, the Virginia Supreme Court stated:

“[T]he word cannot be viewed as if in a vacuum nor can it be read out of context with the place and manner in which it is employed in the policy. The word “upon” must be viewed with relation to the word in the policy which it defines, that is, the word “occupying.” The word “upon” must be read together with the other words in the phrase in which it is found, that is, the words “in … or entering into or alighting from.” When the disputed word is so viewed and read, it is clear that to be “upon” an insured vehicle is to have some connection with “occupying” it. To give the word such a meaning is to fit it snugly into the context of the phrase in which it appears, all the other words of which are directly connected with “occupying.” Within the purposes contemplated here, a person may be said to be “upon” a vehicle when he is in a status where he is not actually “in,” or is not in the act of “entering into or alighting from,” the vehicle, but whose connection therewith immediately relates to his “occupying” it. Bristow’s situation, at the time of his injury, does not fall within the meaning which we conclude must be given to the word “upon.” He had not occupied the Zahn vehicle, to which Allstate’s policy applied, nor did he intend to occupy it. His touching of the vehicle was merely incidental to his kindly act as a Good Samaritan. Commendable though his actions might have been, it cannot be said that he was “upon” the vehicle in the sense of “occupying” it, within the meaning of the language of Allstate’s policy.

See also, Maryland Auto. Ins. Fund v. Baxter, 186 Md. App. 147, 973 A.2d 243, 247–49 (2009) (“MAIF cites no case (nor have we found one) from any jurisdiction supporting its contention that a pedestrian, who had no prior connection with the insured vehicle, was nevertheless ‘occupying’ that vehicle simply because he or she was struck by it. We hold that a pedestrian who has had no connection with the insured vehicle, except for the fact that he or she was struck by it, was not “upon” the vehicle and thus was not ‘occupying’ it….”); Rednour v. Hastings Mutual Insurance Co., 468 Mich. 241, 661 N.W.2d 562, 566–67 (2003) (rejecting an interpretation of the word “upon” that would “provide (and require payment for) supplemental coverage in the form of uninsured motorists benefits for anyone who happened to be near the covered automobile and injured when the auto is struck by an uninsured motorist even though the person has no connection with the owner, named insured, or covered vehicle.”)

The Minnesota Court of Appeals has addressed several “occupancy” cases, both before and after the Minnesota Supreme Court’s decision in Allied Mutual, 552 N.W.2d 561, 564 (Minn.1996).  In some cases the result would have been the same; in others, the result would have been different. 

Assuming the policy at issue in Klein v. United States Fidelity & Guar. Co., 451 N.W.2d 901 (Minn. Ct. App.1990) rev. denied (Minn. Mar. 27, 1991) had extended coverage to persons “upon” (or “on”) the insured vehicle, the injured claimant in Klein, who was struck by another motorist while changing a flat tire on a pick-up truck alongside a highway, would have qualified for coverage.

In Dohman v. Housely, 478 N.W.2d 221 (Minn. Ct. App. 1991), rev. denied (Minn. Feb. 11, 1992), the court held that a police officer who had parked and left his squad car to investigate suspicious persons in another vehicle was not “occupying” the squad car when the other vehicle sped away and ran over the officer’s foot. This decision would have been the same under the Allied Mutual test even had the policy extended coverage to persons “upon” (or “on”) the insured vehicle — the officer was not in contact with the squad car and was not engaged in conduct associated with the continued operation or use of the squad car when injured.

In Conlin v. City of Eagan, 482 N.W.2d 519 (Minn. Ct. App. 1992), the policy covered any person “occupying” the insured vehicle and defined “occupying” as being “in, upon, getting in, on, out or off” the vehicle. A tow truck driver was struck by another motorist while crouching down to remove a car’s front license plate before towing it.  The Court of Appeals held that the tow truck driver was “occupying” the tow truck when he was injured. The appellate court applied an expansive meaning to the term “occupying,” construing it “to refer to a reasonable geographic perimeter around a vehicle or a continuing relationship between a vehicle and an injured person.” Id. at 520.  The result in Conlin would have been the same after Allied Mutual had the car had been physically attached to the tow truck. The tow truck driver would have been “upon” the insured vehicle and the tow truck driver would have been engaged in conduct associated with the continued use of the tow truck.

In Geiser v. Home Indem. Co., 484 N.W.2d 256 (Minn. Ct. App. 1992), the Court of Appeals held that a police officer who was injured while directing traffic 30 to 150 feet away from his patrol vehicle was not “occupying” his vehicle. The Home Indemnity policy’s underinsured coverage applied to “anyone occupying a covered auto.” “Occupied” was defined as “in, upon, getting in, on, out or off.” The appellate court, in reversing the trial court, held that the police officer did not satisfy the reasonable geographic perimeter of or maintain a continuous and uninterrupted relationship with the vehicle. Id. at 258. The court held that the police officer’s connection with his vehicle was too tenuous to satisfy the continuing and uninterrupted relationship test. Id. This decision would have been the same under the Allied Mutual test as the claimant did not satisfy either element of the two-part test.

In Short v. Midwest Family Mutual Insurance Co., 602 N.W.2d 914 (Minn. Ct. App. 1999), the policy covered any person “occupying” the insured vehicle and defined “occupying” as being “in, upon, getting in, on, out or off” the vehicle. A tow truck driver, Randall Short, was injured on as he prepared to tow a stalled automobile. He had just locked the car onto a lift device and was walking toward the lift controls at the rear of the tow truck when a pickup truck collided with the car and pushed it into Short. After recovering applicable liability insurance proceeds, he brought an action against his employer’s insurer, Midwest Family, to obtain underinsured motorist (“UIM”) benefits. Although the tow truck driver was engaged in conduct associated with the continued operation or use of the tow truck, the district court, applying the first factor of the Allied Mutual test (“proximity”) concluded that, because Short was walking toward the back of the tow truck when injured, he was not “in, upon, getting in, on, out of or off” the insured vehicle. The Court of Appeals agreed: “[T]he starting point is the policy definition, if there is one, or common usage, if there is no specific policy definition. In view of Allied Mutual, we hold that the district court did not err in applying the plain meaning of the policy definition of “occupying” here.”

In Illinois Farmers Ins. Co. v. Marvin, 707 N.W.2d 747 (Minn. Ct. App. 2006), a post-Allied Mutual case, Mariese Marvin was injured as a result of being pinned between two automobiles – a vehicle owned and driven by Betz and a parked Ford Explorer owned by Tonya Weigel. There was no question that Marvin’s injuries “arose out of” the use of Betz’s vehicle as Betz backed his vehicle into the Ford Explorer, crushing Marvin’s legs between the bumpers of the two automobiles. Marvin settled her liability claim against Betz, exhausting the liability coverage. She then sought underinsured motorists (“UIM”) coverage from the Illinois Farmers policy insuring Weigel’s Ford Explorer.  The UIM policy defined an “insured” to include any person “occupying [the] insured car” and defined occupying to mean “in, on, [or] getting into or out of” the insured car. As Marvin was clearly in physical contact with the Ford Explorer while engaged in an activity associated with the “use” of the vehicle at the time of the injury (i.e., she was unloading boxes from the rear cargo area of the vehicle and also in the process of alighting from it), Marvin was “occupying” the Ford Explorer and was, thus, entitled to UIM benefits from Illinois Farmers.

This article is for informational purposes only. By reading it, no attorney-client relationship is formed. The law is constantly changing and if you want legal advice, please consult an attorney. Gregory J. Johnson, Attorney ©All rights reserved 2017.