State Farm Mutual Automobile Insurance Co. v. Moore

Brian Stuck (plaintiff) got into an accident while driving a car owned by Charles Royer (whose daughter paid for and regularly used the car) and insured by Ohio Casualty Insurance Company (Ohio Casualty) (defendant). Stuck drove the car at Royer’s daughter’s request. The Ohio Casualty policy included 12 coverage exclusions, including one for any accident in which someone used the car “without a reasonable belief that the person is entitled to do so.” The policy defined certain terms but did not define the term “entitled.” The accident resulted in several personal-injury actions against Stuck. Ohio Casualty denied coverage for the accident because, among other things, Stuck did not have a driver’s license, which in Ohio Casualty’s view meant that Stuck could not have had a reasonable belief that he was entitled to use the car. That is, Ohio Casualty asserted that the policy exclusion for “entitled” drivers meant both that the driver had the owner’s permission to use the car and that the driver was legally allowed to drive in the first place. State Farm Mutual Automobile Insurance Company (State Farm) (plaintiff), which was Stuck’s parents’ homeowner’s insurer, stepped in to defend against the claims against Stuck. State Farm also brought an action against Moore (defendant) seeking a declaratory judgment that Stuck was entitled to coverage under the Ohio Casualty policy. Per State Farm, the “entitled” exclusion meant only that Stuck must have had Royer’s daughter’s permission to drive the car at the time of the accident. The trial court concluded that the “entitled” exclusion was ambiguous because it was susceptible to the competing interpretations offered by State Farm and Ohio Casualty. The trial court then determined that the parties intended the exclusion to apply only if the driver did not have the owner’s permission to use the car, and the trial court charged the jury accordingly. The jury found that Stuck did have Royer’s daughter’s permission to drive the car, leading the trial court to rule that the exclusion was inapplicable and Stuck was entitled to coverage. Ohio Casualty appealed, arguing that the “entitled” exclusion unambiguously meant that Stuck was not covered because he had no legal authority to drive.