Hahn v. GEICO Choice Insurance Company
420 P.3d 1160 (2018)
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Rule of Law:
A person's brief, incidental, and involuntary contact with a vehicle after being struck by it does not constitute "occupying" the vehicle for insurance coverage purposes, even if the policy defines "occupying" to include being "upon" it. Insurance policy terms must be interpreted contextually and in accordance with the reasonable expectations of the insured, not by reading single words in isolation.
Facts:
- In April 2015, Franklin Townsend's car rear-ended Chad Hahn, who was stopped on his motorcycle at a red light.
- The impact threw Hahn from his motorcycle, causing him to land momentarily on the hood, windshield, and roof of Townsend's car before falling to the street.
- Hahn and Townsend had no relationship prior to the accident.
- Hahn incurred significant medical bills and claimed damages that exceeded the limits of Townsend's standard bodily injury liability insurance.
- Townsend's GEICO policy included Underinsured Motorist (UIM) coverage for an "insured," which was defined to include any person "while occupying an insured auto."
- The GEICO policy defined the term "occupying" to mean "in, upon, getting into or getting out of."
- During settlement negotiations for Hahn's tort suit against Townsend, Hahn's attorney indicated a willingness to settle if GEICO offered the UIM policy limits in addition to the standard liability limits.
Procedural Posture:
- Chad Hahn filed a personal injury lawsuit against Franklin Townsend for negligence and intentional torts.
- GEICO filed a separate action against Hahn in superior court (trial court), seeking a declaratory judgment that Hahn was not covered under the UIM portion of Townsend's policy.
- Hahn filed a counterclaim seeking a declaratory judgment that UIM coverage was available to him.
- GEICO moved for summary judgment, arguing Hahn was not 'occupying' the vehicle.
- The superior court granted summary judgment in favor of GEICO, ruling that Hahn was not occupying the vehicle and was not entitled to UIM coverage.
- Hahn, as appellant, appealed the superior court's summary judgment ruling to the Supreme Court of Alaska.
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Issue:
Does a person who is struck by an insured vehicle and momentarily lands on it qualify as "occupying" that vehicle under an insurance policy that defines "occupying" as being "in, upon, getting into or getting out of" the vehicle?
Opinions:
Majority - Stowers, Chief Justice
No. A person who is struck by a vehicle and momentarily lands on it does not "occupy" that vehicle for the purposes of an insurance policy. The court reasoned that insurance contracts must be interpreted according to the reasonable expectations of the insured, which requires reading policy terms in context rather than in isolation. Using the doctrine of noscitur a sociis, the court found that the word "upon" must be understood in relation to the other words defining "occupying"—"in," "getting in," and "getting out of." These associated terms imply some prior relationship or volitional act oriented toward using the vehicle. A layperson would not reasonably expect a UIM policy to cover someone whose only contact with the vehicle was brief, incidental, and involuntary as a result of a collision. The court concluded that Hahn's interpretation would lead to absurd results, where coverage would depend on the happenstance of where a person lands after an accident.
Analysis:
This decision solidifies the application of the 'reasonable expectations of the insured' doctrine in Alaska insurance law, emphasizing contextual over literal interpretation of policy language. It establishes a precedent that incidental, post-collision contact with a vehicle does not satisfy the 'occupying' requirement for UIM coverage. The ruling curtails creative arguments to expand coverage and directs lower courts to consider the overall purpose of a provision and avoid interpretations that lead to absurd or arbitrary outcomes.
