Opperman v. Heritage Mutual Insurance Co.

GILBERTSON, Justice

(dissenting).

[¶ 15] I respectfully dissent from the majority and would hold that the front-end loader was being warehoused as defined by Heritage’s policy.

[¶ 16] The majority fails to explain away the exceptions listed under Paragraph o. of the policy. The two relevant exceptions are:

(1) Vehicles or self-propelled machines or autos you manufacture, process or warehouse; or
(2) Vehicles or self-propelled machines, other than autos, you hold for sale;

(emphasis added).

[¶ 17] From its own policy, it is clear that Heritage does not term warehousing as storing vehicles or self-propelled machines for sale/resale. If it did, there would be no need for two exceptions, which differentiate between “warehousing” and “holding for sale.” The policy language further supports this interpretation by 1) separating the exceptions with the word “or” between the two exceptions, indicating they are alternative; and 2) by including autos under the first exception, and removing it from the second, underscoring that the terms “warehouse” and “holding for sale” cannot mean the same thing.

[¶ 18] The majority cites no authority for the proposition that the contract is to be construed pursuant to a common “industry” meaning. Supra, p. 490. The definition cited by the majority in Webster’s Third New International Dictionary, Unabridged 2756, using “warehouse” as a verb, is “to put or hold in safekeeping .... ” supra, p. 490. This common dictionary definition, and the interpretation urged by Opperman, is the “plain and ordinary meaning” of warehousing.2 American Family Mut. Ins. Co. v. Elliot, 523 N.W.2d 100, 102 (S.D.1994), supra p. 489. It is not a “strained or unusual meaning.”' Rogers v. Allied Mut. Ins. Co., 520 N.W.2d 614, 616 (S.D.1994), supra p. 489. Applying our rule interpreting the contract most favorably to the insured, Olson v. United States Fid. & Guar. Co., 1996 SD 66, 549 N.W.2d 199, the ordinary definition of warehousing entitles Opperman to coverage.

[¶ 19] Further, the majority, in determining that warehousing means storing goods for commercial sale, uses what is in essence a Uniform Commercial Code (UCC) definition for warehousing. See SDCL 57A-2-102 (chapter refers to transactions in goods). Opperman is not engaged in the sale of goods; it is a provider of services, which do not fall under the UCC. It also is not a manufacturer/processor. Heritage had extensive knowledge of the type of business Opperman was conducting.3 If the common industry definition is to be used, it would render the provision meaningless as to Op-perman, who is not in the industry whose definition is urged upon it. As we have said before, “[a] construction which may render a portion of the policy illusory should not be indulged in.” Rogers, 520 N.W.2d at 617.

[¶ 20] Heritage also claims that the doctrine of ejusdem generis applies in this instance, and “warehouse” must be interpreted in light of the preceding terms, “manufacture” and “process.” This rule of construc*493tion does apply to insurance contracts, but it applies when “general words follow an enumeration of persons or things, by words of a particular and specific meaning.” Black’s Law Dictionary, 464 (5thed 1979). In this case, warehousing is not a general term following more specific terms. See, e.g., Sioux Falls Sch. Dist. v. Koupal, 526 N.W.2d 248 (S.D.1994) (applied specific terms to limit definition of general term “other supportive services”); State v. Galati, 365 N.W.2d 575 (S.D.1985) (“administered by or with the privity of the accused” relates back to all listed conditions rendering rape victim incapable of consent); In re O’Neill, 347 N.W.2d 887 (S.D.1984) (applied rule to general term “other just causes”); Aberdeen Educ. Ass’n v. Aberdeen Bd. of Educ., 88 S.D. 127, 215 N.W.2d 837 (1974) (applied rule to general term “other conditions of employment”). The rule simply does not apply here.

[¶21] The fact that Opperman signed a Statement of Values indicating the value of the property in the building is not disposi-tive. In fact, it has nothing to do with the issue before the Court, which is whether the language of the policy excludes' the torn-down front-end loader temporarily stored in the warehouse.4

[¶ 22] I would affirm the trial court.

. This Court has itself used the verb “warehouse” in contexts other than storage of goods in a warehouse. See State v. Gehrke, 491 N.W.2d 421, 427 (S.D.1992) (Henderson, J. dissenting) ("warehousing" of state prisoners by private facilities); Robinson v. Solem, 432 N.W.2d 246, 255 (S.D.1988) (Henderson, J. dissenting) ("warehousing" without treatment individuals who plead guilty but mentally ill); Snyder v. First Fed. Sav. & Loan Ass’n, 90 S.D. 440, 442, 241 N.W.2d 725, 726 (1976) (lending institution purchased real estate and "warehoused” it for the developer). These uses conform to the common, ordinary definition as cited above, "to put or hold in safekeeping”.

. The trial court’s findings of fact point out that a representative from Heritage, in anticipation of renewing the policy, inspected the warehouse six months before the fire and learned that Opper-man had employed a full-time mechanic and that the insured building was being used to store and overhaul machinery. The trial court specifically found that "Heritage possessed extensive knowledge concerning the operation of Opperman's business.” Heritage has made no allegation of fraud.

. The trial court made no finding that even mentions the Statement of Values, probably because such extrinsic evidence cannot be used to construe a contract when it is unambiguous, as the majority agrees this contract was. See Ford v. Moore, 1996 SD 112, 552 N.W.2d 850.