This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.
Facts
The case involves a claim for stacked uninsured motorist (UM) coverage under a corporate commercial auto policy issued to a corporation owned by the parents of the injured party. The injured party, the son, was severely injured in an accident involving an uninsured motorist while he was a passenger in a vehicle not insured by the corporation. The son was not an officer, stockholder, employee, or agent of the corporation, nor was he in a vehicle insured by the corporation at the time of the accident (paras 1-3).
Procedural History
- District Court of Santa Fe County: Granted summary judgment in favor of the plaintiffs, allowing the son to stack UM coverage for seven vehicles insured under the corporate commercial auto policy (paras 10-11).
Parties' Submissions
- Appellant (Allstate Insurance Company): Argued that the son was not an insured under the corporate commercial auto policy and, therefore, not entitled to any UM benefits. Allstate contended that being an insured is a precondition to receiving stacked coverage and that the policy's language was unambiguous in excluding the son (paras 1, 5, 11, 13).
- Appellees (Parents and Son): Claimed that the policy was ambiguous and that the son should be entitled to stacked UM coverage based on the reasonable expectations of the insured. They argued that the policy's exclusion of stacking violated public policy, especially since separate premiums were paid for each vehicle (paras 4, 8, 11, 25-26).
Legal Issues
- Whether the son qualifies as an insured under the corporate commercial auto policy.
- Whether the policy's prohibition of stacked UM coverage violates public policy when separate premiums are charged for each vehicle.
Disposition
- The Court of Appeals reversed the district court's decision and remanded the case with instructions to enter judgment in favor of Allstate (para 39).
Reasons
The court held that the son was not an insured under the corporate commercial auto policy based on the clear and unambiguous language of the policy. The policy defined insureds differently depending on whether the named insured was an individual or a corporation. Since the named insured was a corporation, the son did not qualify as a Class 1 or Class 2 insured under the policy (paras 13-24).
The court rejected the plaintiffs' argument that the policy was ambiguous or violated public policy. It emphasized that the change in the business structure from a sole proprietorship to a corporation was made at the parents' direction, and the policy clearly reflected this change. The court also noted that public policy does not require stacked UM coverage for corporations, as corporations do not suffer personal injuries, and the policy's terms were consistent with New Mexico law (paras 25-38).