DAVIS, Justice:
American States Insurance Company ("American States"), defendant below, appeals from an adverse jury verdict in an insurance coverage declaratory judgment action brought by Barbara Surbaugh ("Ms. Surbaugh"),
This case began on or about June 6, 1997, when Gerald Kirchner was accidentally shot and killed by Robbie Bragg. At the time of the shooting, Mr. Kirchner and Mr. Bragg were both employees of Grimmett Enterprises, a sporting goods store located in Rainelle, West Virginia. Grimmett Enterprises was owned by David Grimmett ("Mr. Grimmett"). Mr. Kirchner was shot accidentally while Mr. Bragg was showing a customer how to load a handgun that was for sale in the store.
On or about December 19, 1997, the mother of Mr. Kirchner, Ms. Surbaugh, filed a wrongful death action against Mr. Bragg and a workers' compensation deliberate intent cause of action against Grimmett Enterprises. In 2002, Mr. Bragg and Grimmett Enterprises entered into a settlement with Ms. Surbaugh. Under the terms of the settlement, Mr. Bragg and Grimmett Enterprises agreed to a judgment against them for $1.5 million. Ms. Surbaugh agreed to not execute the judgment against the defendants in exchange for the defendants assigning all claims they might have against their respective insurers for refusing to provide a defense and coverage.
In 2005, Ms. Surbaugh filed an amended complaint to assert a declaratory judgment action against Grimmett Enterprises' insurer, American States.
Ms. Surbaugh filed a renewed motion for summary judgment on May 4, 2011. In response, American States filed a renewed cross motion for summary judgment. American States argued that it was entitled to summary judgment because of the court's earlier ruling that the exclusion was unambiguous. By order entered June 17, 2011, the circuit court denied both summary judgment motions.
On June 23, 2011, a jury trial was held to determine coverage under the policy. The only witness called during the trial was Mr. Grimmett. At the conclusion of the evidence, the case was submitted to the jury with a special verdict form that had only one question: "Was the exclusionary language at issue in this case brought to the attention of the insured, Grimmett Enterprises, Inc."
This is an appeal from a jury verdict in a declaratory judgment action. In addition to appealing the jury verdict, American States also has assigned error to the trial court's denial of its motions for summary judgment. With respect to a jury verdict in a declaratory judgment proceeding, we have held,
Joslin v. Mitchell, 213 W.Va. 771, 775, 584 S.E.2d 913, 917 (2003).
This Court's standard of review concerning summary judgment is well-settled. Upon appeal, "[a] circuit court's entry of summary judgment is reviewed de novo." Syl. pt. 1, Painter v. Peavy, 192 W.Va. 189, 451 S.E.2d 755 (1994). In conducting our de novo review, we are mindful that "[a] motion for summary judgment should be granted only when it is clear that there is no genuine issue of fact to be tried and inquiry concerning the facts is not desirable to clarify the application of the law." Syl. pt. 3, Aetna Cas. & Sur. Co. v. Federal Ins. Co. of New York, 148 W.Va. 160, 133 S.E.2d 770 (1963). In other words, "[t]he circuit court's function at the summary judgment stage is not to weigh the evidence and determine the truth of the matter, but is to determine whether there is a genuine issue for trial." Syl. pt. 3, Painter, 192 W.Va. 189, 451 S.E.2d 755.
With these standards of review in mind, we address the dispositive issues presented.
In this case, we are presented with two dispositive issues. First, we must determine whether the trial court was correct in finding, as a matter of law, that a jury had to decide if an insurance policy's exclusionary language was adequately brought to the attention
The trial court determined that it was for the jury to decide whether the exclusionary language at issue in this case was brought to the attention of Mr. Grimmett. American States argued below, and in this appeal, that this issue was for the trial court and not a jury.
We previously have held that "when a declaratory judgment proceeding involves the determination of an issue of fact, that issue may be tried and determined by a judge or jury in the same manner as issues of fact are tried and determined in other civil actions." Erie Ins. Prop. & Cas. Co. v. Stage Show Pizza, 210 W.Va. 63, 66, 553 S.E.2d 257, 260 (2001). Our declaratory judgment act provides that, "`[w]hen a proceeding under this article involves the determination of an issue of fact, such issue may be tried and determined in the same manner as issues of fact are tried and determined in other civil actions in the court in which the proceeding is pending.' W. Va.Code § 55-13-9 (1941)." Syl. pt 15, Mountain Lodge Ass'n v. Crum & Forster Indem. Co., 210 W.Va. 536, 558 S.E.2d 336 (2001). Moreover, in Syllabus point 16 of Mountain Lodge we held that
Id.
It is clear from the above authorities that issues of fact, that are normally tried by a jury, may be submitted to a jury in a declaratory judgment action. However, in the context of a declaratory judgment action to determine insurance coverage, generally the issues presented are for the trial court to decide. This Court has held that "[d]etermination of the proper coverage of an insurance contract when the facts are not in dispute is a question of law." Syl. pt. 1, Tennant v. Smallwood, 211 W.Va. 703, 568 S.E.2d 10 (2002). See also Syl. pt. 2, in part, Riffe v. Home Finders Assocs., Inc., 205 W.Va. 216, 517 S.E.2d 313 (1999) ("The interpretation of an insurance contract, including the question of whether the contract is ambiguous, is a legal determination[.]."). In Payne v. Weston, 195 W.Va. 502, 466 S.E.2d 161 (1995). Justice Cleckley addressed the parameters for invoking a jury trial on an insurance coverage issue:
In the instant case, the trial court determined that, based upon the per curiam opinion in Luikart v. Valley Brook Concrete & Supply, Inc., 216 W.Va. 748, 613 S.E.2d 896 (2005), a jury was required to determine whether the exclusionary language at issue in the case was brought to the attention of Mr. Grimmett. Simply put, Luikart does not support the trial court's ruling as to the necessity of a jury trial.
The plaintiff in Luikart was the father and administrator of the estate of Paul Travis Luikart, who was killed during the course of his employment. The plaintiff sued the employer for wrongful death under the workers' compensation statute. While the action was pending, the employer's insurer denied coverage and filed a declaratory judgment action to obtain a judicial ruling on the issue. After the two actions were consolidated, the employer entered into a settlement and an agreed judgment against it for $3 million. The plaintiff agreed to not execute the judgment against the employer in exchange for the employer assigning all claims it might have against its insurer for refusing to provide a defense and coverage. Eventually, the insurer moved for summary judgment on the declaratory judgment claim. The trial court granted summary judgment in favor of the insurer. The plaintiff appealed.
One of the issues presented in Luikart involved the application of language found in Syllabus point 10 of National Mutual Insurance Co. v. McMahon & Sons, Inc., 177 W.Va. 734, 356 S.E.2d 488 (1987), overruled on other grounds by Potesta v. United States Fidelity & Guaranty Co., 202 W.Va. 308, 504 S.E.2d 135 (1998). In McMahon, we held:
Syl. pt. 10, McMahon, 177 W.Va. 734, 356 S.E.2d 488 (emphasis added.)
After we determined in Luikart that the language of the insurance contract was unambiguous and conspicuous, we addressed the plaintiff's contention that the exclusionary language was not brought to the attention of the employer. In addressing this issue, we examined the deposition testimony of the employer's president, who testified that he read some of the policy but not
Luikart, 216 W.Va. at 754, 613 S.E.2d at 902. In view of this evidence, we held that the insurer "sufficiently disclosed the exclusions to Valley Brook." Luikart, 216 W.Va. at 754, 613 S.E.2d at 902.
It is clear to this Court that Luikart's application of Syllabus point 10 of McMahon, that an insurer bring exclusionary language to the attention of an insured, did not remotely suggest that this was a mandatory jury question. In fact, we wish to make clear, and so hold, that, as a general rule, the issue of whether an insurer has brought a policy exclusion to the attention of an insured is to be resolved by the trial court.
Our holding is consistent with the procedural way in which a federal district court in Canal Insurance Co. v. Sherman, 430 F.Supp.2d 478 (E.D.Pa.2006), addressed the issue. Sherman was a diversity jurisdiction case that applied West Virginia insurance law to a policy coverage issue. One of the issues addressed by Sherman was the parties' cross motions for summary judgment on the issue of whether the insurer brought policy exclusions to the attention of the insured. After rejecting the insurer's evidence that the exclusions were brought to the attention of the insured, the court held that the insurer's "motion for summary judgment that the exclusions bar coverage will be denied." Sherman, 430 F.Supp.2d at 488. In turning to the insured's cross motion for summary judgment, the court held that the insured
Sherman, 430 F.Supp.2d at 489. Although we may not agree with the district court's substantive resolution of the disclosure issue in Sherman, we find that the district court correctly concluded that the resolution of the issue was for the court and not a jury.
Consequently, and in conjunction with the discussion that follows, we find that the trial court committed error in having a jury decide whether the insurance policy's exclusionary language adequately was brought to the attention of Mr. Grimmett.
The parties filed several summary judgment motions in this case. In our review of the issue on appeal, we will rely on the record submitted for all of the summary judgment motions, as well as the arguments set out in this appeal.
With respect to general principles involved with examining provisions of an insurance policy, this Court has indicated that "[w]hen an insurance company seeks to avoid its duty to defend, or its duty to provide coverage, through the operation of a policy exclusion, the insurance company bears the burden of proving the facts necessary to trigger the operation of that exclusion." State Auto. Mut. Ins. Co. v. Alpha Eng'g Servs., Inc., 208 W.Va. 713, 716, 542 S.E.2d 876, 879 (2000) (citation omitted). "Language in an insurance policy should be given its plain, ordinary meaning." Syl. pt 1, Soliva v. Shand, Morahan & Co., Inc., 176 W.Va. 430, 345 S.E.2d 33 (1986), overruled on other grounds by National Mut. Ins. Co. v. McMahon & Sons, 177 W.Va. 734, 356 S.E.2d 488 (1987). "Where the provisions of an insurance policy contract are clear and unambiguous they are not subject to judicial construction or interpretation, but full effect will be given to the plain meaning intended." Syl., Keffer v. Prudential Ins. Co., 153 W.Va. 813, 172 S.E.2d 714 (1970). As we previously indicated,
This exclusion applies:
In Ms. Surbaugh's motion for summary judgment on July 20, 2010, she argued that this exclusion was ambiguous. Ms. Surbaugh contended that the exclusion could be read to mean that the employer had to cause the injury. To support this assertion, Ms. Surbaugh submitted an affidavit by Mr. Grimmett, in which he stated that when he read the exclusion after the accident, he thought that it meant that he, as the employer, had to cause the injury. Ms. Surbaugh also presented deposition testimony of a linguistics expert, who opined that the exclusion was ambiguous.
The circuit court rejected Ms. Surbaugh's argument that the exclusion was ambiguous. The circuit court's order addressed the issue as follows:
Ms. Surbaugh contended below that the exclusion was not conspicuous because the policy did not contain a table of contents.
The exclusion in the policy is found in the "Businessowners Liability Coverage Form." The relevant exclusion in this case is found on page two of this policy Form. The policy
We already have made clear that, under Syllabus point 10 of McMahon, an insurer seeking to invoke exclusions "must bring such provisions to the attention of the insured." Webster Cnty. Solid Waste Auth. v. Brackenrich & Assocs., Inc., 217 W.Va. 304, 312, 617 S.E.2d 851, 859 (2005) (internal quotations and citations omitted). Although the issue of disclosure is part of the analysis in determining whether to enforce an exclusion, it is an element that is rarely invoked. In the vast majority of cases brought to this Court involving enforcement of exclusions under Syllabus point 10 of McMahon, the issue of disclosure was not raised by the insured. See West Virginia Emp'rs' Mut. Ins. Co. v. Summit Point Raceway Assocs., Inc., 228 W.Va. 360, 719 S.E.2d 830 (2011) (resolving issues under Syllabus point 10 of McMahon but no direct issue raised concerning disclosure of exclusion); Bender v. Glendenning, 219 W.Va. 174, 632 S.E.2d 330 (2006) (per curiam) (same); Webster Cnty. Solid Waste Auth. v. Brackenrich & Assocs., Inc., 217 W.Va. 304, 617 S.E.2d 851 (2005) (same); Satterfield v. Erie Ins. Prop. & Cas., 217 W.Va. 474, 618 S.E.2d 483 (2005) (same); Wehner v. Weinstein, 216 W.Va. 309, 607 S.E.2d 415 (2004) (same); Russell v. Bush & Burchett, Inc., 210 W.Va. 699, 559 S.E.2d 36 (2001) (same); Marcum Trucking Co., Inc. v. United States Fid. & Guar. Co., 190 W.Va. 267, 438 S.E.2d 59 (1993) (same). But see New Hampshire Ins. Co. v. RRK, Inc., 230 W.Va. 52, 736 S.E.2d 52 (2012) (per curiam) (raising disclosure issue); Luikart v. Valley Brook Concrete & Supply, Inc., 216 W.Va. 748, 613 S.E.2d 896 (2005)(same). The reason for the rarity of this issue is probably because it is an element that is difficult to sustain. The arguments made by Ms. Surbaugh illustrate the difficulty in establishing disclosure as a genuine issue in dispute.
The evidence shows that, at some point in 1995, Mr. Grimmett opened a sporting goods store. The owner of the building where the store was going to be located informed Mr. Grimmett that he would have to obtain insurance. Mr. Grimmett contacted a New York agent of American States and made arrangements by phone to purchase a policy. Mr. Grimmett received the first policy in October 1995. The policy subsequently was renewed for the period October 1996 to October 1997. The shooting accident occurred during the second year of the policy.
Ms. Surbaugh raised the issue of failure to disclose by arguing below that Mr. Grimmett was never verbally told about the exclusions, that the initial application for insurance did not contain any exclusions, and that the initial quote for coverage did not disclose any exclusions. In light of this evidence, Ms. Surbaugh contends American States failed to bring the exclusions to the attention of Mr. Grimmett.
American States argues that the cover letter of the first policy informed Mr. Grimmett of the following:
In addition, American States points out that at the top of the policy the following appears:
Finally, American States notes that Mr. Grimmett admitted to reading the cover letter, but not the policy. In the affidavit submitted by Mr. Grimmett, as an exhibit along with Ms. Surbaugh's first motion for summary judgment on the policy, he stated the following:
Ms. Surbaugh contends that the fact that Mr. Grimmett did not read the policy until after the accident is not dispositive. Ms. Surbaugh argues that our decision in Mitchell v. Broadnax, 208 W.Va. 36, 49, 537 S.E.2d 882, 895 (2000), superseded by statute as recognized by Findley v. State Farm Mutual Automobile Insurance Co., 213 W.Va. 80, 576 S.E.2d 807 (2002), outlines the requirements for bringing an exclusion to the attention of a policyholder. This Court noted in footnote 24 of Mitchell the following:
Mitchell, 208 W.Va. at 49 n. 24, 537 S.E.2d at 895 n. 24. The dicta in footnote 24 of Mitchell by its express terms did not provide exhaustive examples of how an insurer may bring policy exclusions to the attention of an insured.
Mitchell, 208 W.Va. at 48-49, 537 S.E.2d at 894-95. In the final analysis, the dicta of footnote 24 in Mitchell was merely pointing out examples of how "deceptive or misleading" exclusions could be brought to the attention of policyholders.
In the instant proceeding, there is nothing "deceptive or misleading" in the plain and unambiguous exclusions in the policy.
Mission Viejo Emergency Med. Assocs. v. Beta Healthcare Grp., 197 Cal.App.4th 1146, 128 Cal.Rptr.3d 330, 338 (2011). See also Blankenship v. City of Charleston, 223 W.Va. 822, 827, 679 S.E.2d 654, 659 (2009) ("[A]n equally important provision of the general policy is the cautionary introductory statement that `[v]arious provisions in this policy restrict coverage [and one has to] [r]ead the entire policy carefully to determine rights, duties and what is not covered.'"); Luikart, 216 W.Va. at 754, 613 S.E.2d at 902 ("The portion of the insurance policy titled `Commercial General Liability Coverage Form,' which contains the relevant exclusionary language, cautions in its first sentence that `[v]arious provisions in this policy restrict coverage. Read the entire policy carefully to determine rights, duties and what is and is not covered.' Accordingly, we conclude that Motorists sufficiently disclosed the exclusions to Valley Brook."); Moore v. United Benefit Life Ins. Co., 145 W.Va. 549, 564, 115 S.E.2d 311, 319 (1960) ("[T]he insured cannot escape the effect of the conditions of a policy on the ground of ignorance, due to failure to read his policy, it being his duty to examine it[.]").
In sum, American States established at the summary judgment stage that no material issue of fact was in dispute as to the exclusion being unambiguous, conspicuous, and
In view of the foregoing, the circuit court's order of June 30, 2011, which entered judgment in favor of Ms. Surbaugh based upon a jury verdict, is reversed. This case is remanded with instructions that the circuit court enter summary judgment in favor of American States in the bifurcated declaratory judgment part of the action.
Reversed and Remanded.
Chief Justice BENJAMIN and Justice KETCHUM concur and reserve the right to file concurring opinions.
Justice KETCHUM, concurring:
I agree with the majority opinion's conclusion: an insured cannot escape the effect of exclusions in an insurance policy due to failure to read the policy, when the exclusions are clear, unambiguous and conspicuous.
The majority opinion spent a great deal of time clearing up inconsistent, ambiguous dicta in many of our older cases. I believe we should have overruled these cases outright, and simply started over with a new bright-line syllabus reflecting the majority opinion's ultimate conclusion set forth above.
BENJAMIN, Chief Justice, concurring:
Although I agree that this case must be reversed and remanded, I believe the majority has applied the incorrect analysis for deciding the case.
Factually, this case is the fraternal twin sister of a case recently decided by this Court, New Hampshire Ins. Co. v. RRK, Inc., 230 W.Va. 52, 736 S.E.2d 52 (2012); the cases are remarkably similar, though not identical. In New Hampshire, the insured, RRK, Inc. ("RRK"), sought insurance to cover damage to a barge and two docks on the Ohio River. RRK ultimately purchased insurance from New Hampshire Insurance Company ("New Hampshire"), but RRK dealt solely with an agent of New Hampshire during the negotiations and the sale. Prior to agreeing to purchase insurance from New Hampshire, RRK requested a copy of coverage forms for the proposed policy. In reply, the agent faxed a 17-page document which stated, "Per our phone conversation of this morning, attached you will find the coverage forms you requested."
After purchasing the insurance, New Hampshire mailed a copy of the insurance policy to RRK. RRK representatives testified that they did not read this policy, nor the renewal policy sent one year later. Two years after purchasing the insurance, the barge sank. New Hampshire denied RRK's claim for damages, arguing that a wear-and-tear exclusion appearing at the top of the first substantive page of the policy excluded coverage of the barge. While the mailed policy did contain a wear-and-tear exclusion, the 17-page faxed document did not.
The pertinent facts of the case at bar are parallel to those of New Hampshire. Here, Mr. Grimmett sought insurance to cover his sporting goods store. He ultimately purchased insurance from American States Insurance Company ("American States"), but he dealt solely with an agent of American States during the negotiations and the sale. Prior to purchasing the insurance, Mr. Grimmett and the agent discussed the coverage to be provided by the policy in three separate phone conversations, each lasting approximately 10 minutes. Additionally, the agent sent to Mr. Grimmett a 1-page sales offer proposal.
After purchasing the insurance, American States mailed a copy of the insurance policy to Mr. Grimmett. Mr. Grimmett testified that he did not read this policy, nor the renewal policy sent one year later. Two years after purchasing the insurance, one of his employees accidently shot and killed another employee. When the estate of the deceased employee attempted to collect under the policy, American States refused, arguing that an exclusion appearing on the first substantive page of the policy excluded coverage for the accident. While the mailed policy did contain the exclusion, Mr. Grimmett
In this case, the majority hinged its analysis on whether the exclusion at issue was adequately disclosed to Mr. Grimmett. Undoubtedly, it was disclosed; the policy was mailed to Mr. Grimmett, and it was placed in the policy in such a way as to bring it to the attention of the insured. The majority completely overlooked the real issue, which was also the primary issue in New Hampshire: whether, based on the representations of the insurance company, the insured had a reasonable expectation that the exclusion at issue was part of the contract.
The doctrine of reasonable expectations
In New Hampshire, we found that "[t]o support summary judgment under the doctrine [of reasonable expectations], a court must find that the insured had an objectively reasonable expectation of coverage under the insurance contract." Because of the discrepancy between the pre-sale representations of coverage — the phone conversations and the "coverage forms" requested by RRK — and the post-sale representations of coverage, we decided that a substantial question of fact existed which warranted remanding the case to the circuit court so that the issue could be decided by a fact finder. The present case is different in that the circuit court should have found that the short series of 10-minute phone calls and the 1-page sales offer could not objectively have lead Mr. Grimmett to believe that the multi-page policy he received in the mail encapsulated only what was discussed in the phone calls and the sales offer.
In footnote 13 of the opinion in the case sub judice, the majority attempts to distinguish the two cases by stating that the case at bar "does not involve a conflict between a draft of the policy coverage forms and the policy itself." The phone calls and the 1-page sales offer in this case are parallel to the phone calls and 17-page faxed document in New Hampshire. The "conflict" described by the majority is identical to both scenarios; the pre-purchase documents and representations in both cases did not contain the disputed exclusions while the mailed policies did.
For the reasons stated above, I concur.