Opinion
No. 107,438.
2012-10-5
Thomas LEMEN, Appellant, v. 21ST CENTURY NATIONAL INSURANCE COMPANY, Appellee.
Appeal from Shawnee District Court; Charles E. Andrews, Jr., Judge. John J. Bryan, of Bryan, Lykins, Hejtmanek & Fincher, P.A., of Topeka, for appellant. Jeffrey S. Southard, of Abbott, Davidson & Southard, of Kansas City, Missouri, for appellee.
Appeal from Shawnee District Court; Charles E. Andrews, Jr., Judge.
John J. Bryan, of Bryan, Lykins, Hejtmanek & Fincher, P.A., of Topeka, for appellant. Jeffrey S. Southard, of Abbott, Davidson & Southard, of Kansas City, Missouri, for appellee.
Before PIERRON, P.J., BUSER and LEBEN, JJ.
MEMORANDUM OPINION
PER CURIAM.
The district court granted summary judgment to 21st Century National Insurance Company (21st Century) on Thomas Lemen's claim that he was entitled to person injury protection (PIP) benefits after he was injured in a motorcycle accident while riding on the Milford School Creek Off–Road Vehicle (School Creek Trail) area. We reverse and remand for further proceedings, concluding that neither party is entitled to summary judgment on the current record.
On November 7, 2009, Lemen suffered severe bodily injury in an accident while riding a motorcycle at School Creek Trail. Lemen sued 21st Century after it refused to pay personal injury protection benefits under Lemen's automobile insurance policy. The parties filed competing motions for summary judgment.
The following facts were found to be uncontroverted by the district court:
“1. [Lemen], was injured as a result of an accident on November 7, 2009.
“2. The accident occurred while [Lemen] was riding a 1995 Yamaha YZ250 motorcycle (the motorcycle) on a public off road vehicle trail—[School Creek Trail]—near Milford Lake in Geary County.
“3. [Lemen] had an automotive insurance policy with [21st Century], but not for the motorcycle, which he did not own.
“4. The automotive policy included personal injury protection (PIP) coverage.
“5. The PIP coverage extends to other vehicles being operated by the policy holder under certain conditions.
“6. [Lemen's] PIP coverage provides for payment of ‘covered expenses as required by the Kansas Automobile Injury Act, incurred because of bodily injury: (1) Caused by an accident arising out of the ownership, maintenance, or use of a motor vehicle; and (2) Sustained by the insured.’
“7. The insurance agreement defines ‘motor vehicle’ as ‘a self-propelled vehicle of a kind required to be registered in the State of Kansas, including any trailer, semi-trailer, or pole trailer designed for use with such a vehicle. However, the term motor vehicle does not include a motorized bicycle.’ This definition is nearly verbatim with K.S.A. 40–3103(m).
“8. The policy was in effect on the day of the accident.
“9. [21st Century] notified [Lemen] that the motorcycle was not covered in the meaning of ‘motor vehicle’ under the policy.
“10. The insurance policy is intended to comply with the Kansas Automobile Injury Reparations Act, K.S.A. 40–3101 et seq.
“11. The trail where the accident occurred is maintained by the Corps of Engineers, and it is open to the public for purposes of vehicular travel.
“12. At the time of the accident, the motorcycle had no title; was not registered; and had no license tag, headlights, tail lights, brake lights, side-view mirrors, rear-view mirrors, turn signal or windshield.”
The district court granted summary judgment to 21st Century. The court agreed with 21st Century's analysis that Lemen would lose in all scenarios. The court stated that if it held that School Creek Trail amounted to a public highway, then Lemen failed to properly insure the motorcycle in accordance with state law. Had Lemen properly insured the motorcycle he would have had the insurance coverage he desired. On the other hand, if the court found the School Creek Trail was not a public highway, then the motorcycle was not the kind for which Kansas required registration. Consequently, the motorcycle was not intended to be operated on a public highway, no registration was required, and the policy only applied to motor vehicles that were required to be registered under Kansas law. The court held as follows:
“In this case, the motorcycle is a motor vehicle under Kansas law. If being operated on a public highway, it was required to be registered—an obligation for which an operator may be held responsible for. K.S.A. 8–142. This carries with it the obligation to have insurance. Failing to be registered, and therefore to have the required insurance, [Lemen] cannot turn to PIP coverage under a different policy to fill in the gap. But, if not being operated on a public highway, it is the sort of vehicle disclaimed from the insurance policy in this case. With undisputed facts, there is but one conclusion: Summary Judgment should be granted to [21st Century] as a matter of law, and so it is. This Memorandum Decision and Order shall constitute the Court's entry of judgment in this matter, and no further journal entry is required.”
Lemen filed a motion to alter or amend the judgment based on the fact that he was not the owner of the motorcycle and would have no duty to insure it. The district court denied Lemen's motion. Lemen appeals.
Lemen argues the district court erred in granting summary judgment to 21st Century and denying him PIP benefits under his insurance policy. He asserts the motorcycle he was driving was a motor vehicle under his policy and Kansas law. He also argues that School Creek Trail is a highway under Kansas statutes because it is open to the public and is publicly maintained by the Corps of Engineers for the purpose of vehicular travel within its boundaries. Since the motor vehicle was being driven on a highway, Kansas law required the motor vehicle to be insured and registered. Lemen argues that he was the named insured who was injured while borrowing an uninsured motor vehicle and 21st Century is obligated to pay PIP benefits resulting from an accident arising out of the use of the motor vehicle.
The parties agree that our standard of review is unlimited as we are asked to consider the interpretation and legal effect of a written insurance policy and applicable statutes. Further, because there is no factual dispute, review of the order granting summary judgment is de novo. Estate of Draper v. Bank of America, 288 Kan. 510, 205 P.3d 698 (2009). Regardless of the district court's conclusion, an appellate court may construe the written contract and determine its legal effect. City of Arkansas City v. Bruton, 284 Kan. 815, 828–29, 166 P.3d 992 (2007).
We will first turn to the question of whether School Creek Trail is a highway under Kansas statute.
The Kansas Legislature has provided a very general statutory definition of highway. In the Kansas Automobile Injury Reparations Act [KAIRA], highway is defined as, “the entire width between the boundary lines of every way publicly maintained, when any part thereof is open to the use of the public for purposes of vehicular travel.” K.S.A. 40–3103(e). In the Kansas statutes regarding automobiles, highway is defined as, “every way or place of whatever, nature open to the use of the public as a matter of right for the purpose of vehicular travel. The term ‘highway’ shall not be deemed to include a roadway or driveway upon grounds owned by private owners, colleges, universities or other institutions.” K.S .A.2011 Supp. 8–126(s)
The School Creek Trail is a 287–acre area containing many trails for vehicular travel. The trails are open to the public for use by vehicles that are less than 50 inches in width. The trail where the accident occurred is maintained by the Corps of Engineers. Along with the width restrictions, parts of the area are speed controlled.
21st Century cites to the generally accepted rule of construction that courts should construe statutes to avoid unreasonable or absurd results. See Southwestern Bell Tel Co. v. Beachner Constr. Co., 289 Kan. 1262, 1269, 221 P.3d 588 (2009).
21st Century argues that a dirt trail which is specifically closed to most motorized vehicles and which leads to nowhere cannot under any common-sense interpretation be termed a highway. Coincidentally, K.S.A.2011 Supp. 8–126(bb) defines “All-terrain vehicle” as “any motorized nonhighway vehicle 50 inches or less in width, having a dry weight of 1,500 pounds or less, traveling on three or more nonhighway tires, having a seat designed to be straddled by the operator.” It appears 21st Century is arguing that the School Creek Trail is limited to all-terrain vehicles (or smaller vehicles) and should not be considered a highway.
21st Century frames its second issue as: “The trial court was correct in finding that the off-road trail where the accident occurred was not a ‘highway’ under Kansas law.” There is no support provided for this statement. The court did not render a conclusion on whether the School Creek Trail was or was not a highway. Instead, the district court held that it didn't matter because Lemen lost whether it was a highway or not.
Under our statutory interpretation of the above very generally worded statutes and applying those definitions to this case, the School Creek Trail meets the plain, unambiguous statutory definition of a highway. It is a “way,” “open to the use of the public as a matter of right” and is used for “vehicular travel.” K.S.A.2011 Supp. 8–126(s). Much like the county road in Kresyman, the trails in this case are public highways. See Kresyman v. State Farm Mut. Auto. Ins. Co., 5 Kan.App.2d 666, 623 P.2d 524 (1981) (a Cherokee County road was a highway under K.S.A. 8–126[s] ). It is within this context that we look at the applicable caselaw.
Kansas courts have consistently held that a vehicle being operated on public roads, whether designed for such use or not, is a motor vehicle at that time for uninsured motorist coverage. This argument is centered on the analysis and holding of Kresyman. Steven Kresyman, a minor, sued his father Raymond's auto insurance carrier, State Farm Mutual Automobile Insurance Company. Steven attempted to obtain personal injury protection (PIP) benefits under his father's policy for injuries which Steven suffered when he was struck by a car on a public highway while he was driving his own 1974 Honda, two-wheeled mini-bike. The mini-bike was not a registered motor vehicle under K.S.A. 8–126 et seq. , nor could it have been registered because it was not equipped as required by K .S.A. 8–1801 et seq. The mini-bike was not covered by any motor vehicle liability insurance policy.
Under Raymond's PIP endorsement, State Farm was obligated to pay PIP benefits for bodily injury arising out of the use of a motor vehicle (K.S.A.1980 Supp. 40–3103[i] ) sustained by a relative of Raymond residing in the same household while occupying a motor vehicle “ ‘if the relative at the time of the accident is not himself the owner of a motor vehicle with respect to which a motor vehicle liability insurance policy is required by [the] act.’ K.S.A.1980 Supp. 40–3109(a)(3).” 5 Kan.App.2d at 667.
Because Kresyman was decided under the KAIRA, K.S.A. 40–3101 et seq. , the phrase “motor vehicle” means every self-propelled vehicle of a kind required to be registered in this state. K.S.A.1980 Supp. 40–3103(m). 5 Kan.App.2d at 667. Thus, the ultimate dispositive issue in Kresyman was reached: “Was the mini-bike a vehicle ‘of a kind required to be registered in this state?’ “ 5 Kan.App.2d at 668. This court answered the question in the affirmative based on the following definitions and analysis:
‘ “(a) “Vehicle.” Every device in, upon or by which any person ... is or may be transported ... upon a public highway....
‘ “(b) “Motor vehicle.” Every vehicle, as herein defined, which is self-propelled.’ K.S.A. 8–126.
The mini-bike is a motor vehicle under K.S.A. 8–126(b) definition; it is a self-propelled device upon which a person may be and was transported upon a public highway.
“Regarding registration, the following appears in K.S.A. 8–127(a):
‘Every owner of a motor vehicle ... intended to be operated upon any highway in this state ... shall, before any such vehicle is operated in this state, apply for and obtain registration....’
“It is with respect to this statutory direction that plaintiff makes his material argument. He argues the mini-bike was not ‘of a kind required to be registered in this state’ because the mini-bike was not intended to be operated upon any highway in this state.
“In our view, plaintiff mistakenly fails to take into account the K.S.A. 8–142 provision that ‘[i]t [is] unlawful for any person ... [t]o operate, or for the owner thereof knowingly to permit the operation, upon a highway of any vehicle, as defined in K.S.A. 8–126, which is not registered....’
“Reading K.S.A. 8–127(a) and K.S.A. 8–142 together and giving them both effect, as must be done, it is clear to us that the essence of their direction is that a motor vehicle operated upon a highway is to be registered, with the registration to be obtained before such operation. Various other statutory provisions within the motor vehicle laws and the act provide exceptions and exemptions but they play no role in this case. The ‘intended to be’ wording of K.S.A. 8–127(a) is not an element in the definition of a motor vehicle ‘of a kind required to be registered in this state.’
“By operation of K.S.A. 8–127(a) and K.S.A. 8–142, the mini-bike, a self-propelled device transporting a person while being operated on a highway in this state, was a vehicle with respect to which a motor vehicle liability insurance policy was required by the act. This being so, plaintiff's injury was beyond the scope of defendant's obligation to pay PIP medical benefits.” 5 Kan.App.2d at 668–69.
In the Kresyman opinion, Judge Rees, in his usual careful approach to opinion writing, cautioned that the decision should not be read too broadly and said: “In this case, the accident occurred at a time when the mini-bike was operated on a public highway and the extent of our holding is that at that time it was a motor vehicle with respect to which a motor vehicle liability insurance policy was statutorily required.” 5 Kan.App.2d at 669.
Kresyman was distinguished, but its analysis and result was specifically approved in Farm Bur. Mut. Ins. Co. v. Kurtenbach, 265 Kan. 465, 961 P.2d 53 (1998). One issue in Kurtenbach was whether a motorcycle that was being used in farming operations was a motor vehicle subject to state registration when it collided with another vehicle. The collision in Kurtenbach occurred as the plaintiff was crossing a public highway which separated two tracts of land of the family farm. In finding coverage under the Farm Master policy, the court held this area was ultimately found to be on plaintiff's premises and not a public highway, and the motorcycle was held not to be a motor vehicle as defined by the statute. 265 Kan. at 476.
The court in Kurtenbach distinguished, but specifically approved, the analysis of Kresyman, stating:
“We agree with Kresyman and partially with the dissent's analysis of this issue. However, we must observe a crucial difference between Kresyman and the accident in this case. In Kresyman, the accident occurred on a county road, which is a public highway. See K.S.A. 8–126(s). The decision in Kresyman is dependent upon the fact that the mini-bike was, at the time of the accident, being operated upon a highway of this state.” 265 Kan. at 476.
The other important issue is that in order to distinguish Kurtenbach from Kresyman, the Supreme Court first determined that the highway on which the accident occurred was actually part of Kurtenbach's insured premises. 265 Kan. at 469. It was only after determining that the accident occurred on the plaintiff's insured premises that the Supreme Court was able to distinguish Kurtenbach, again stating:
“Unlike Kresyman, the accident in this case occurred on Kurtenbach's premises within the meaning of Farm Bureau's policy while Scott was crossing Highway 56. As we noted above, this type of crossing under the particular facts of this case would not subject the motorcycle to the provisions of K.SA. 8–127(a). Had this accident occurred at one of the 10 or 15 times since 1979 that Scott operated the motorcycle on the county road, no coverage would exist under the policy because the motorcycle at that time would be ‘subject to motor vehicle registration because of its use.’ “ 265 Kan. at 476.
The court in Shumaker v. Farm Bureau Mut. Ins. Co., 14 Kan.App.2d 155, 785 P.2d 180,rev. denied 246 Kan. 769 (1990), dealt with the “question left unanswered in Kresyman [citation omitted] where it was held that a ‘mini-bike,’ while being operated on a public highway, was a vehicle with respect to which insurance was required.” Shumaker addressed the question of whether an uninsured dune buggy was a motor vehicle for purposes of uninsured motorist PIP benefits when the plaintiff was injured while a passenger in a dune buggy that was being driven off road on private property.
The plaintiff in Shumaker relied on Kresyman and the definition of vehicle in K.S.A. 8–126 which defined a vehicle “as any device in which a person is or may be transported on a public roadway.” 14 Kan.App.2d at 156. The key factual difference in Shumaker was that the dune buggy was an off-road vehicle and the injury occurred while the dune buggy was being driven off road. This court ruled the dune buggy was not a motor vehicle and Shumaker was not entitled to PIP coverage or to uninsured motorist coverage for an off-road accident. We said:
“We do not read our own no-fault law or uninsured motorist law to either require or prohibit coverage for off-road accidents caused by the off-road operation of a device designed primarily for use off road. Accordingly, the question becomes one of contract between the insurer and the insured. [Citation omitted.]
“Common sense also supports our conclusion. Devices designed primarily for use off road, while actually being used off road for recreational or sporting activities (rather than for transportation of people on a public highway), simply pose a greater risk of injury. Insurance companies should not be expected to insure such greater risks at the same rate associated with the ‘normal’ use of such devices for on-road transportation purposes.” 14 Kan.App.2d at 157.
Each one of the above cited cases— Kresyman, Kurtenbach, and Shumaker—are not on all fours with the facts in the present case. Each one of the cases has an important distinction that separates it from our case.
In Kresyman, the father had four other vehicles he insured, but he did not insure the motorcycle upon which the injuries to the minor son occurred. Here, Lemen fully insured his own vehicle and had permission to borrow and drive the motorcycle he was driving at the time of the accident.
In Kurtenbach, the accident did not occur on a highway and occurred on the insured premises under the farmer's Farm Master policy. Here, the accident occurred on what we have determined is a statutorily defined “highway.” In dicta, the Kurtenbach court stated that had the accident occurred on the county road instead of just while the driver was crossing the road between the farm properties, there would have been no coverage. But the motorcycle was being driven by the son of the uninsured motorcycle's owner, and Kurtenbach arose under a comprehensive general liability policy, not an automobile insurance policy with the definition of motor vehicle found in Lemen's policy
In Shumaker, the injuries occurred while the driver was on a dune buggy on a private off-road area. Here the off-road vehicle area was maintained by the Corps of Engineers, it was open to the public, and vehicular travel was allowed on it.
The Kansas statutory provisions for uninsured and underinsured motorist coverage, K.S.A. 40–287, are mandatory and are to be considered a part of any insurance policy written in this state. See Simpson v. KFB Insurance Co., Inc., 209 Kan. 620, 626, 498 P.2d 71 (1972). Insurers are not permitted to dilute the provisions of the statute. State Farm Mut. Auto. Ins. Co. v. Cummings, 13 Kan.App.2d 630, 778 P.2d 370,rev. denied 245 Kan. 786 (1989), abrogated on other grounds by Cashman v. Cherry, 270 Kan. 295, 300, 13 P.3d 1265 (2000). K.S.A. 40–3107(f) provides that every policy of motor vehicle liability insurance issued by an insurer to an owner residing in this state shall:
“include personal injury protection benefits to the named insured, relatives residing in the same household, persons operating the insured motor vehicle, passengers in such motor vehicle and other person struck by such motor vehicle and suffering bodily injury while not an occupant of a motor vehicle, not exceeding the limits prescribed for each of such benefits, for loss sustained by any such person as a result of injury.”
“The purpose of the [KAIRA] is to make personal injury protection insurance mandatory by requiring every owner of a motor vehicle obtain first party coverage for personal injury protection benefits payable by his own insurance company.” Dreiling v. State Farm Mut. Auto. Ins. Co., 227 Kan. 851, Syl. ¶ 1, 610 P.2d 611 (1980). In this regard, a person injured while occupying a motor vehicle owned and insured by someone else is not entitled to recover any PIP benefits if he or she owns a motor vehicle, with respect to which a liability insurance policy is required by the KAIRA. K.S.A. 40–3109(a)(3). See also Dreiling, 227 Kan. at 855–56 (denying PIP benefits to plaintiff because he owned a vehicle for which he was required, but had failed, to maintain an insurance policy).
Ultimately, however, this case must be decided based upon the terms of the insurance contract between the parties. The case turns on whether there's PIP coverage under Lemen's automobile insurance policy for the injuries he suffered while riding someone else's motorcycle. Under the policy language, Lemen is entitled to PIP coverage if he suffers injury “[c]aused by an accident arising out of the ... use of a motor vehicle.”
Everyone agrees Lemen suffered an accidental injury arising out of his use of a motorcycle. So the question is whether the 1995 Yamaha YZ250 motorcycle he was riding is a motor vehicle; if so, there should be PIP coverage under the policy.
The insurance policy contains its own definition of “motor vehicle.” It defines a motor vehicle as “a self-propelled vehicle of a kind required to be registered in the State of Kansas.” The insurance company's argument is that this is a “nonhighway vehicle” under Kansas law and that nonhighway vehicles do not have to be registered. See K.S.A. 8–198(a). Thus, this motorcycle was not “of a kind required to be registered” and not a motor vehicle under the policy.
Nonhighway vehicles are statutorily defined to include ones “not manufactured for the purpose of using the same on the highways of this state and ... not provided with the equipment required by state statute for vehicles of such type” when used on state highways. K.S.A. 8–197(b)(1)(A). So 21st Century essentially argues that because this motorcycle didn't have all of the required safety equipment, it was a nonhighway vehicle, was not required to be registered, and therefore was not “of a kind required to be registered in the State of Kansas.”
But, at least based on our record, there is a problem with this argument. The definition of “nonhighway vehicle” in K.S.A. 8–197(b)(1)(A) has two requirements-that the vehicle be “not manufactured for the purpose of using the same on the highways of this state” and “not provided with the equipment required,” There is nothing in our record that tells us whether this 1995 Yamaha YZ250 motorcycle was manufactured only for nonroadway use. Based on the picture of the vehicle found in our record, that certainly appears possible-perhaps even probable. But on 21st Century's summary-judgment motion, we must take all inferences from the evidence in favor of Lemen, the nonmoving party. Shamberg, Johnson & Bergman, Chtd. v. Oliver, 289 Kan. 891, 900, 220 P.3d 333 (2009). In doing so, we cannot simply assume that this motorcycle was manufactured for nonroadway use and thus met both parts of the definition of a nonhighway vehicle found in K.S.A. 8–197(b)(1)(A).
Of course, on the counter-motion for summary judgment filed by Lemen, we must take all of the reasonable inferences from the evidence in the light most favorable to the insurance company, which is the nonmoving party on that motion. From the photo, which appears to show a motorcycle intended for dirt-bike use, the inference most favorable to 21st Century would be that the motorcycle was manufactured for that purpose, not for highway use.
Although the parties have filed cross-motions for summary judgment and no doubt believed that there were no material factual issues still to be resolved, we conclude that we cannot decide the case without knowing whether this 1995 Yamaha YZ250 motorcycle was manufactured for nonhighway use. If it was, then the vehicle, which appears to be a dirt bike, was not a motor vehicle as that term is defined in the policy. If it was not, then it would be within the policy definition of motor vehicle, and there would be coverage.
Lemen has one last argument that we must consider. He contends that even if the motorcycle is generally a nonhighway vehicle, once it's used on a Kansas highway it must be registered. That much is true, and we have concluded that Lemen is right that this trail was technically a highway under Kansas law. But we must return to the policy language: the motorcycle must be “of a kind required to be registered in the State of Kansas.” (Emphasis added.) Lemen is suggesting that the use of the motorcycle can determine whether it is a motor vehicle under the policy definition, but that definition makes no reference to the vehicle's use. If this motorcycle was manufactured for off-road, dirt-bike use and was not provided with the equipment required by state statute for motorcycles, then it is “of a kind” of vehicle not required to be registered in Kansas, i.e., nonhighway vehicles.
We therefore reverse the district court's grant of summary judgment to the insurance company and remand the case for further proceedings consistent with this opinion.
Reversed and remanded with directions.