Volunteer Firefighter Injured While Directing Traffic Away from Accident Scene Found Not Entitled to SUM Coverage Under His Fire Company's Business Auto Policy

SUM – BUSINESS AUTO – MEANING OF "YOU" – "OCCUPYING"
Gallaher v. Republic Franklin Ins. Co.
(4th Dept., decided 2/11/2010)

An insurance actuary of one of your readers' companies could probably tell me what the chances are of seeing two reported decisions on the issue of supplementary uninsured motorists (SUM) or underinsured motorists coverage for volunteer firefighters in the span of two weeks.  Matter of American Alternative Ins. Corp. v. Pelszynski out of Suffolk County Supreme was the first; here's the second.

Volunteer firefighter James Gallagher had ridden to the scene of a motor vehicle accident on his fire company's truck.  Upon arrival, he exited the truck and, at the time of the accident that led to his injuries, was directing traffic away from the original accident scene.  The relevant SUM endorsement defined an insured as "[y]ou, as the named insured" and "[a]ny other person while occupying . . . [a] motor vehicle insured for SUM under this policy." The SUM endorsement also defined "occupying" as "in, upon, entering into, or exiting from a motor vehicle."

Republic Franklin, the volunteer fire company's business auto insurer, denied SUM coverage to Gallagher, and he sued for that coverage, arguing alternatively that he qualified as an "insured" under the policy's SUM endorsement or that he was "occupying" the SUM-covered fire truck at the time of his accident.  Wayne County Supreme Court denied both parties' motions for summary judgment, and both parties appealed.

In REVERSING the order appealed from insofar as it had denied Republic Franklin's motion for summary judgment, the Appellate Division, Fourth Department, held that: (1) Gallagher was not a named insured under the policy because the "[y]ou" in the SUM endorsement referred only to the fire company and did not also refer to an employee of the company; and (2) Gallagher was not "occupying" the fire truck at the time of his accident because his conduct in directing traffic was unrelated to the truck and was not incidental to his exiting it:

Addressing first plaintiff's cross appeal, we conclude that the court properly determined that plaintiff is not a named insured under the policy. The named insured was the fire company, and thus "[y]ou" in the SUM endorsement referred only to the fire company and did not, as plaintiff contends, also refer to an employee of the company (see Buckner v Motor Veh. Acc. Indem. Corp., 66 NY2d 211, 214; Matter of Coregis Ins. Co. v Miceli, 295 AD2d 511). Addressing next defendant's appeal, we agree with defendant that the court erred in determining that there is an issue of fact whether plaintiff was covered under the policy as a person occupying the truck. At the time of the accident, plaintiff had exited the fire company's truck and was directing traffic away from the scene of a motor vehicle accident.  Plaintiff's conduct in directing traffic was "unrelated to the [truck]" and was not incidental to his exiting it (Matter of Travelers Ins. Co. [Youdas], 13 AD3d 1044, 1045). Thus, under the facts of this case, plaintiff was not "occupying" the truck within the meaning of that term in the policy (see Matter of Martinez, 295 AD2d 277, 278; Coregis Ins. Co., 295 AD2d at 511). 

Does this decision conflict with and, as it's from the Appellate Division, override the Pelszynski decision?  One could argue either way.  The holding in Pelszynski turned not on the meaning of "you" as used in the first part of the SUM endorsement's definition of "insured", but on subpart 2.(b) of that definition.  Moreover, "occupying" was not at issue in Pelczynski.  Read literally, however, the Fourth Department's statement that "'[y]ou' in the SUM endorsement referred only to the fire company and did not, as plaintiff contends, also refer to an employee of the company" could be construed to conflict with the holding in Pelszynski.