Auto Owners Insurance Co. v. Perry

OPINION

ANDERSON, G. BARRY, Justice.

Appellant Chong Suk Perry applied to respondent Auto Owners Insurance Company for survivors’ economic loss benefits after her boyfriend, Daniel Savage, with whom she resided, died in a motor vehicle accident. Auto Owners denied Perry’s claim, and Perry petitioned for arbitration. After staying arbitration, the district court granted Auto Owners’ motion for summary judgment. The court of appeals held that the district court did not err in concluding that the definition of “dependent” in Minn.Stat. § 65B.44, subd. 6 (2006), is limited to a decedent’s surviving spouse and children and that Perry is thus not entitled to survivors’ economic loss benefits under the Minnesota No-Fault Automobile Insurance Act, Minn.Stat. §§ 65B.41-65B.71 (2006). We affirm.

Respondent Auto Owners Insurance Company issued a garage liability insurance policy to Kincaids Cars, Inc., an automobile sales company owned by Daniel Savage. Savage was fatally injured in a motor vehicle accident while driving a vehicle owned by the company. Auto Owners paid out $20,000 in medical benefits and $2,000 in non-medical benefits under the policy.

For approximately 7 years preceding his death, Savage had lived in Savage, Minnesota, with his girlfriend, appellant Chong Suk Perry. According to Perry, she and Savage owned their home together, had a joint checking account, and pooled their financial resources. Perry applied for survivors’ economic loss benefits in June 2005, and Auto Owners denied her claim on the ground that the policy provides for the payment of survivors’ economic loss benefits only to the decedent’s surviving spouse and children. After Perry sought arbitration of her claim, Auto Owners commenced an action for declaratory judgment and brought a summary judgment motion. Auto Owners contended that Perry failed to qualify as a “dependent” under the insurance policy and that the policy comported with the requirements of the No-Fault Act. The No-Fault Act requires insurers to offer survivors’ economic loss benefits to a decedent’s “surviving dependents.” Minn.Stat. § 65B.44, subd. 6. The Act sets forth the following definition of “dependent”:

For the purposes of definition under section 65B.41 to 65B.71, the following described persons shall be presumed to be dependents of a deceased person: (a) a wife is dependent on a husband with whom she lives at the time of his death; (b) a husband is dependent on a wife with whom he lives at the time of her death; (c) any child while under the age of 18 years, or while over that age but physically or mentally incapacitated from earning, is dependent on the parent with whom the child is living or from whom the child is receiving support reg*326ularly at the time of the death of such parent. Questions of the existence and the extent of dependency shall be questions of fact, considering the support regularly received from the deceased.

Id. The district court granted Auto Owners’ summary judgment motion.

The court of appeals affirmed the district court’s grant of summary judgment, concluding that section 65B.44, subd. 6, “defines a ‘dependent’ * * * as a “wife’ or ‘husband’ of the deceased, or ‘any child’ of a deceased parent.” Auto Owners Ins. Co. v. Perry, 730 N.W.2d 282, 285 (Minn.App.2007) (quoting Minn.Stat. § 65B.44, subd. 6). The court of appeals rejected Perry’s contention “that the last sentence of the [Ajct’s definition of ‘dependent’ creates a broader class of dependents” than is provided for in Auto Owners’ insurance policy. Id.

Perry concedes that she does not qualify as a dependent under the terms of the insurance policy; she argues, rather, that by providing for the payment of survivors’ economic loss benefits only to a decedent’s surviving spouse and children, the policy does not comply with the minimum coverage requirements prescribed in section 65B.44, subd. 6.1 The paramount goal of statutory interpretation “is to ascertain and effectuate the intention of the legislature.” Minn.Stat. § 645.16 (2006). If the language of a statute is unambiguous, “the letter of the law shall not be disregarded under the pretext of pursuing the spirit.” Id. But if the statutory language is ambiguous, we may look to other sources to ascertain legislative intent. See id. Statutory interpretation is a question of law, which we review de novo. State v. Al-Naseer, 734 N.W.2d 679, 683 (Minn.2007).

The key to this dispute is an argument about the interpretation of the final sentence of the second paragraph of section 65B.44, subd. 6, which reads, “Questions of the existence and the extent of dependency shall be questions of fact, considering the support regularly received from the deceased.” Perry argues that this language creates a class of provable dependents consisting of persons other than the surviving spouse and children of a decedent. Auto Owners, on the other hand, contends that section 65B.44, subd. 6, defines a “dependent” as the decedent’s surviving spouse or child and that the final sentence of the subdivision’s second paragraph merely permits the presumed dependency of a surviving spouse or child to be rebutted.

We engaged in our most extensive assessment of section 65B.44, subd. 6, in Peevy v. Mutual Services Casualty Insurance Co., in which a decedent’s ex-wife sought survivors’ economic loss benefits under the decedent’s no-fault automobile insurance policy. 346 N.W.2d 120, 121 (Minn.1984). After discussing the arguments in favor of the parties’ respective interpretations of section 65B.44, subd. 6, we concluded that the subdivision is ambiguous and held that the ex-wife was entitled to survivors’ economic loss benefits under the terms of the policy itself. Id. at 121-23. Contrary to the dissent’s characterization of Peevy, we did not intimate which interpretation of section 65B.44, subd. 6, we found more compelling. Our assessment of section 65B.44, subd. 6, in Peevy was dicta, and it is not self-evident *327that the subdivision is, in fact, ambiguous. Indeed, because section 65B.44, subd. 6, is devoid of any explicit reference to a class of dependents consisting of persons other than the decedent’s surviving spouse and children, we conclude that the better argument is that it is not ambiguous.2

Lending further support to Auto Owners’ plain language interpretation of section 65B.44, subd. 6, is the subdivision’s third paragraph, which provides as follows:

Payments shall be made to the dependent, except that benefits to a dependent who is a child or an incapacitated person may be paid to the dependent’s surviving parent or guardian. Payments shall be terminated whenever the recipient ceases to maintain a status which if the decedent were alive would be that of dependency.

“Status” is defined as “[a] person’s legal condition,” examples of which include “the status of a father” and “the status of a wife.” Black’s Law Dictionary 1447 (8th ed.2004). Given that a live-in girlfriend does not have a “status” under the law akin to that of a spouse or child and that a decedent’s surviving spouse and children are identified as presumed dependents in the preceding paragraph of section 65B.44, subd. 6, the word “status” logically refers to a person’s status as a surviving spouse or child of the decedent.3

Because Perry is not Savage’s surviving spouse or child, she does not have a “status” that she must “maintain” in order to continue receiving benefits pursuant to section 65B.44, subd. 6. Therefore, under Perry’s reading of section 65B.44, subd. 6, she would be entitled to benefits until her death or until she receives the maximum amount of survivors’ economic loss benefits payable. See Minn.Stat. § 65B.44, subd. 1(a) (2006) (setting forth the minimum basic economic loss benefits that insurers must provide). It would be anomalous for the legislature to create a broad class of provable dependents and then fail to delineate a standard by which payments to members of that class terminate.4 See Minn.Stat. § 645.17(1) (2006) (“[T]he legislature does not intend a result that is absurd, impossible of execution, or unreasonable”).

*328Although we conclude that the statutory-language at issue is not ambiguous, given our contrary statement in dicta in Peevy, it is useful to consider the legislative history and legislative purposes behind the statute. Perry’s interpretation lacks merit even if we conclude that ambiguity exists and therefore look to legislative history and legislative purposes to determine the statute’s meaning.

Evolution and Legislative History of Minn.Stat. § 65B.kk, subd. 6

We resort to the former law and legislative history to ascertain the legislative intent behind an ambiguous statute. Minn. Stat. § 645.16(5), (7). As originally proposed in the Senate in 1973, the No-Fault Act mandated payment of survivors’ economic loss benefits to “survivors,” which it defined by reference to Minn.Stat. § 573.02, subd. 1 (1971), as “the surviving spouse and next of kin.” 1 Journal of the Senate 1503-04 (68th Minn.Leg., Apr. 25, 1973). But when enacted in 1974, the second paragraph of section 65B.44, subd. 6, identified a decedent’s surviving spouse and children as presumed dependents and provided, “In all other cases, questions of the existence and extent of dependency shall be determined in accordance with the facts at the time of the death.” Act of Apr. 11, 1974, ch. 408, § 4, 1974 Minn. Laws 762, 766-67 (codified at Minn.Stat. § 65B.44, subd. 6 (1974)) (emphasis added).

The legislature deleted the phrase “[i]n all other cases” as part of its amendment of the No-Fault Act in 1975. Act of Mar. 28, 1975, ch. 18, § 5, 1975 Minn. Laws 208, 210. Senator Jack Davies explained to the Senate Committee on Labor and Commerce that the 1975 legislation was necessary because “in preparing legislation for a law with the magnitude, scope and complexities of the No-fault law it is not unusual that drafting errors, omissions, ambiguities and misleading provisions get into the law.” Hearing on S.F. 28, S. Comm. Labor and Commerce, 69th Minn. Leg., Jan. 14, 1975 (minutes). Senator Davies noted that “in some instances the present language is awkward and in others unintended language will be removed from the law, but that the bill does not make any substantive changes in the law.” Id.

As is argued by Auto Owners, the phrase “[i]n all other cases” may have been “unintended language” or one of the “misleading provisions” that the legislature intended to remove from the No-Fault Act. See id. The dissent agrees that “[t]he purpose of the change was to eliminate confusing and misleading language,” and we believe that the language is confusing and misleading because it did not accurately reflect the intention of the legislature to limit dependency qualification to a decedent’s surviving spouse and children. Auto Owners’ contention is supported by our presumption that the adoption of an amendment is indicative of legislative intent to effect “some change in the existing law.” Bhd. of Ry. & S.S. Clerks, Freight Handlers, Express & Station Employees, Lodge 364 v. State, 303 Minn. 178, 195, 229 N.W.2d 3, 13 (1975). By eliminating the phrase “[i]n all other cases” from section 65B.44, subd. 6, the legislature likely intended to limit the definition of “dependent” to a decedent’s surviving spouse and children.

Legislative Purposes Behind the No-Fault Act

In ascertaining the legislative intent behind an ambiguous statute, we also consider the mischief to be remedied and the object to be attained. Minn.Stat. § 645.16(3)-(4). The legislatures purposes in adopting the No-Fault Act included, inter alia, “to relieve the severe economic distress of uncompensated victims of auto*329mobile accidents within this state, to speed the administration of justice, and to ease the burden of litigation on the courts of this state.” Minn.Stat. § 65B.42 (2006).

Amici curiae OutFront Minnesota and Minnesota Association for Justice suggest that the adoption of Perry’s interpretation of section 65B.44, subd. 6, would further the legislative purpose of relieving the economic hardship of uncompensated victims of automobile accidents. But there is no evidence that the legislature actually intended to require insurers to provide survivors’ economic loss benefits to individuals other than the decedent’s surviving spouse and children. Limiting the definition of “dependent” to a decedent’s surviving spouse and children, in contrast, would further the legislative purposes of “speeding] the administration of justice” and eas[ing] the burden of litigation on the courts of this state. See Minn.Stat. § 65B.42. If we were to adopt Perrys interpretation of section 65B.44, subd. 6, any person financially dependent on an insured decedent could potentially be entitled to survivors economic loss benefits under the No-Fault Act. The flood of litigation that would likely ensue from such a ruling would actually hinder the administration of justice and increase the burden of litigation on Minnesota courts in contravention of the legislature’s purposes in enacting the No-Fault Act.5 See Minn.Stat. § 65B.42.

In light of the unambiguous language of Minn.Stat. § 65B.44, subd. 6, the district court did not err in concluding that the definition of “dependent” in section 65B.44, subd. 6, is limited to a decedent’s surviving spouse and children. Because Perry is not Daniel Savage’s surviving spouse or child, she is not entitled to survivors’ economic loss benefits under the No-Fault Act.

Affirmed.

DIETZEN, J., not having been a member of this court at the time of the argument and submission, took no part in the consideration or decision of this case.

. The No-Fault Act sets forth the statutorily prescribed minimum coverage for automobile insurance policies. Am. Family Ins. Group v. Schroedl, 616 N.W.2d 273, 278, 280 (Minn.2000). “[U]nless the policy provides greater protection for the insured than the No-Fault Act, the terms of the policy must be conformed to the provisions of the Act.” Ill. Farmers Ins. Co. v. Glass Serv. Co., 683 N.W.2d 792, 803 (Minn.2004).

. Although Dahle v. Aetna Casualty & Surety Insurance Co., 352 N.W.2d 397 (Minn.1984), offers some support for Perry’s reading of section 65B.44, subd. 6, the facts of that case are distinguishable from those before us. The issue we resolved in Dahle was whether a posthumous child qualifies as a “surviving dependent” under the statute, and we emphasized that posthumous children are afforded protection elsewhere under Minnesota law. Id. at 400-01. Dahle, which involved a claim brought on behalf of an actual "child” of the decedent, cannot be fairly read as authority for the proposition that others, such as friends, acquaintances, or a girlfriend or boyfriend residing with the decedent, are entitled to benefits. Dahle involved children, who are entitled to support from parents as a matter of law and are specifically mentioned in the No-Fault Act.

. We decline the dissent's invitation to speculate with respect to various hypotheticals, in dicta, as to particular circumstances that are not before us. That said, many of the dissent’s hypotheticals involve individuals specifically recognized in the statute and also in Dahle.

. The adoption of Perry’s reading of section 65B.44, subd. 6, would thus disfavor a decedent’s surviving spouse and children with regard to the termination of benefits. Payments to a decedent’s surviving spouse and children would terminate when the recipient ceases to maintain the "status * * * of dependency” (presumably upon the remarriage of a surviving spouse or upon the attainment of majority, marriage, or emancipation of a surviving child), but other individuals would be entitled to payments until death or receipt of the entire amount payable under the No-Fault Act. Such a result would be contrary to the legislature’s intention to favor a decedent’s surviving spouse and children via the dependency presumption.

. Of course, as we noted, and indeed emphasized, in Peevy, the definition of “dependent” is a matter subject to legislative determination. See Peevy, 346 N.W.2d at 123. The legislature has not acted to further define “dependent” since Peevy was decided in 1984.