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American Economy Insurance Compay v. Bogdahn2/10/2004
__ P.3d __
FEDERAL CERTIFIED QUESTION OF LAW.
Pursuant to the Uniform Certification of Questions of Law Act, 20 O.S.2001, ยงยง 1601-1611, the United States Court of Appeals for the Tenth Circuit on its own motion certified the following question of Oklahoma law:
Whether Blake Bogdahn was a person insured under the uninsured motorist provisions of the American Economy policy issued to Hillcrest Pharmacy, Inc. as the named insured?
We rephrase the certified question into the following two questions:
1. Is the definition of an insured in the UM endorsement of the American Economy policy issued to Hillcrest Pharmacy, Inc. ambiguous, such that the doctrine of reasonable expectations can be applied to define Blake Bogdahn as an insured?
2. If so, does the statutorily mandated UM selection/rejection form create a reasonable expectation of coverage for Blake Bogdahn, such that the policy must be reformed to provide such coverage?
Our answer to the first question is that the definition of an insured is not ambiguous and therefore the doctrine of reasonable expectations cannot be applied to define Blake Bogdahn as an insured. Because of our answer to the first question, it is unnecessary for us to answer the second question.
I. BACKGROUND
To place the questions in perspective, we recite the facts and procedural history provided to us by the certifying court. Hillcrest Pharmacy, Inc. (Hillcrest Pharmacy) is a corporation with its principal place of business in Woodward, Oklahoma. Since at least the late 1960s, Hillcrest Pharmacy has purchased commercial liability insurance through Figley Salz & Co., Inc., a local insurance agency. In 1990, the insurance agency began procuring insurance for Hillcrest Pharmacy from American Economy Insurance Company (American Economy). Shortly thereafter, the sole owner of Hillcrest Pharmacy, Lanny Ducket, sold his interest in Hillcrest Pharmacy to the Bogdahns, who chose to continue insurance coverage through American Economy.
On August 19, 2000, the Bogdahns' minor son, Blake, was seriously injured when he fell off the back of an all-terrain vehicle (ATV) driven by a friend, who was also a minor. The ATV was owned by the friend's parents and was apparently uninsured. The Bogdahns, through their attorney, requested coverage for Blake's injuries under the uninsured motorist (UM) endorsement of the American Economy policy issued to Hillcrest Pharmacy. American Economy denied coverage, concluding the ATV was not a covered vehicle under the policy and that Blake was not an insured under the UM endorsement.
American Economy brought a diversity action in the United States District Court for the Western District of Oklahoma, seeking a declaration that it was not required to provide coverage under the UM endorsement for Blake's injuries. The Bogdahns filed a counterclaim seeking reformation of the policy in order "to comply with the intentions and reasonable expectations of the parties." Alternatively, the Bogdahns asked that American Economy be required "to answer in negligence for all damages resulting from its failure to obtain coverage as requested and reasonably expected by" the Bogdahns and Hillcrest Pharmacy.
American Economy moved for summary judgment, arguing that the policy did not provide UM coverage for Blake's injuries and that no ground for reformation or evidence of constructive fraud or negligence existed which would require that UM coverage be provided. In granting summary judgment in favor of American Economy, the federal district court concluded that Blake was not an insured under the UM endorsement. Furth
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