Cookson v. Liberty Mutual Fire Insurance

SILVER, J.,

with whom JABAR, J., joins, dissenting.

[¶20] I respectfully dissent. The insurance policy covers motor vehicles and motorized land conveyances that are (1) not subject to motor vehicle registration and (2) used to service a residence. The phrase “subject to motor vehicle registration” is not ambiguous, and Cookson’s Case 590M is not the type of vehicle that is subject to motor vehicle registration. The phrase “service an insured’s residence,” however, is ambiguous and should be construed in favor of Cookson. Taken together, these provisions indicate that the Case 590M falls within the exception to the motor vehicle exclusion. The insurance policy should cover the loss.

[¶ 21] Whether the Case 590M is subject to motor vehicle registration depends on whether vehicles of the same type are generally required to be registered. Certain types of vehicles are subject to registration whether or not an owner actually intends to register his particular vehicle. Kimball v. New England Guar. Ins. Co., 642 A.2d 1347, 1348-49 (Me.1994). Although Kimball suggests that vehicle type is distinct from and paramount to vehicle use, it was unnecessary to distinguish type from use in that case because pickup trucks are tantamount to passenger cars; both are presumed to be driven on public ways and both are subjected to the same registration requirements pursuant to the motor vehicle statute. See id.; 29-A M.R.S. § 501(1) (2011). Whether a particular driver chooses not to drive a pickup truck on a public way is irrelevant because pickup trucks are clearly the type of motor vehicles for which the statute contemplates registration. See 29-A M.R.S. § 501(1).

[¶ 22] The classification of the type of vehicle at issue here is much less clear than in Kimball. A Case 590M is a large tractor with backhoe and bucket attachments that is commonly used for commercial construction projects. The parties alternately refer to it as a loader, tractor, backhoe, and special mobile equipment. The majority refers to it as “heavy construction machinery.” A vehicle of this sort is clearly not akin to an automobile used primarily to transport persons or property. See 29-A M.R.S. § 101(7) (2011). Determining whether a motor vehicle that is used less like a car and more like farm or construction equipment is the type of vehicle that is usually subject to registration requires a closer examination of the motor vehicle statute than was necessary in Kimball.

[¶ 23] Pursuant to the motor vehicle statute, whether a certain type of vehicle must be registered depends on how it is used. The statute explicitly qualifies the registration requirements for all vehicles by providing that only a “vehicle that is operated or remains on a public way” must be registered. 29-A M.R.S. § 351 (2011). When the classification of the type of vehicle at issue is less clear than it was in Kimball, the use to which the vehicle is put becomes more relevant to determining whether it is a type of vehicle that must be registered. See N.A. Burkitt, Inc. v. Champion Rd. Mach., 2000 ME 209, ¶ 12, 763 A.2d 106 (noting that one reason graders are not considered “motor vehicles” pursuant to the Motor Vehicles Dealers Act is that they are usually used off-road at construction sites).

[¶ 24] Cookson did not use the Case 590M as an on-road vehicle or to transport himself or his property. Cookson’s deposition testimony indicates that he only drove the vehicle between his current home, a plot of land on which he was building a new home, and his father’s house for repairs. These properties were within three or four miles of each other. Cookson drove the vehicle with one set of wheels in the ditch along the side of the road and *1162one set of wheels on the shoulder, and he avoided the road when possible by traveling on wooded snowmobile trails. The vehicle has a maximum speed of twenty-five miles per hour. He used the vehicle to perform general site work on his Acton property, including building a driveway, well, and drainage ditch. He also used it for snow removal and yard work at his current home in West Newfield. This use of a Case 590M is more akin to a farm or logging vehicle used on-road only incidentally to its primary off-road use and only to move to and from premises where it is kept, work sites, and repair sites. See 29-A M.R.S. § 510 (2011). It does not render the vehicle the type that must be registered.

[¶ 25] For the insurance policy to cover the tractor it also must have been used to “service [his] residence.” This phrase is not defined in the insurance policy. Servicing in common usage can be limited to maintenance work, or broadly defined to include assistance with any kind of work done on the property. See Webster’s II New College Dictionary 1010 (2001). Because the policy does not make clear which type of servicing it intends to cover, I conclude that this language is ambiguous. Jipson v. Liberty Mut. Fire Ins. Co., 2008 ME 57, ¶¶ 6, 10, 942 A.2d 1213 (stating that interpretation of an insurance contract is reviewed de novo and that “[c]ontractual language is ambiguous if it is reasonably susceptible of different interpretations” (quotation marks omitted)). Cookson’s deposition testimony established that he bought the vehicle to remove snow and perform yard work at his home in West Newfield, and he actually used it for these tasks. He also regularly used the vehicle to perform general site work on his property in Acton. Whether these actions constitute servicing, regardless of whether the average homeowner would have bought the same machinery for this purpose, is not clear from the policy or from the summary judgment record. Accordingly, the policy should be construed in Cookson’s favor to include the type of work he performed with the Case 590M. See id. ¶ 10 (“Ambiguities in insurance contracts are to be construed in favor of the insured.”).

[¶ 26] Because the Case 590M as Cook-son used it is not the type of vehicle that is subject to motor vehicle registration and because the tasks for which Cookson used it can be considered servicing a residence, I interpret the insurance policy to provide coverage for the loss. I do not, however, agree with Cookson that he is entitled to a replacement value equal to the purchase price of a brand new Case 590M. Liberty Mutual argues that the tractor should be considered “outdoor equipment,” such that Cookson would be entitled to “actual cash value at the time of loss.” The insurance adjuster determined that the actual cash value of Cookson’s tractor is $27,825 based on the retail price, transportation costs, and sales tax required to purchase a comparable used tractor. Cookson believes that the tractor is “personal property,” such that he would be entitled to the “replacement cost with a similar item of like kind and quality at the time of loss.” Cookson suggests that this entitles him to the purchase price of a brand new Case 590M, which is $106,050.

[¶ 27] Pursuant to either provision, Cookson is not entitled to recover the full cost of a brand new Case 590M. Cookson’s Case 590M was used when he bought it in 2005 for approximately $27,000. The average person would not conclude that the language of the insurance policy entitles an insured to a brand new tractor to replace a tractor that he purchased used more than six years ago and that he has used extensively since then. See Peerless Ins. Co. v. Wood, 685 A.2d 1173, 1174 (Me.1996) (“[W]e view the contract language from the perspective of an average person, un*1163trained in either the law or the insurance field, in light of what a more than casual reading of the policy would reveal to an ordinarily intelligent insured.”). The policy clearly attempts to limit payment by entitling the insured to the lesser amount of the replacement cost or the cost of repair. In light of this language, it would be unreasonable for Cookson to expect that the policy entitles him to a payment of nearly four times the amount he paid for the tractor or the amount he would have to pay to purchase a similar tractor today. Therefore, I would find that Cookson is entitled to coverage for his loss, but the amount to which he is entitled should not exceed the amount it would cost for him to purchase a used tractor comparable to the one he purchased in 2005.