Automobile Exclusion Applied to Parade Float Injury
The insured owned and operated a parade float. During a parade, a passenger fell off the float and was injured. The passenger filed a negligence suit against the insured. The trial court held that the insurer owed a duty to defend. However, the court noted that the complaint did contain several allegations which did not in any way relate to an automobile because it involved a parade float and alleged fault in the construction of the float. Therefore, the court concluded that the auto exclusion in the policy did not apply.
The insurer argued that a parade float falls within the definition of “auto,” as defined in the policy, and that the complaint did not allege the negligent operation of the “auto”. The insured argued that a parade float should, at a minimum, be considered a trailer and therefore it would fall under the definition of an “auto”. The court examined the definition of “trailer” in the dictionary and held that the float falls within the definition of an “auto” as defined in the policy.
The established rule is that the court will enforce the intentions of the parties, as expressed in the agreement, by construing the policy as a whole, considering the type of insurance, the risks undertaken and purchased, the subject of the policy, and the purpose of the contract as a whole. Further, with regard to the words in the policy, the court will give them the ordinary meaning. However, if an ambiguity exists, the ambiguity will be construed in favor of the insured. In order to determine if a duty to defend exists, the court examines the allegations of the underlying complaint and whether it falls (or potentially falls) within the policy’s coverage.
The court also determined that the injuries claimed arose while the “auto” was being used, and therefore the defection condition claims by the passenger were not independent of the negligent operation of the float. Therefore, the court held that the auto exclusion applied, and the insurer had no duty to defend in the underlying suit.
Maxum Indem. Co. v. Gillette, 2010 Ill. App. LEXIS 1265, 405 Ill.App.3d 881, 940 N.E.2d 78 (Ill.App. 3 Dist., 2010).
