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Recalde v. ITT Hartford10/31/1997
UPON A QUESTION OF LAW CERTIFIED BY THE DISTRICT OF COLUMBIA
COURT OF APPEALS
On April 18, 1997, we accepted for consideration a question of Virginia law that the District of Columbia Court of Appeals certified to us. That court stated in its certification order that the certified question is determinative of the appeal pending before it. The certified question is:
hether under Virginia law, for the purpose of deciding the scope of coverage of a commercial insurance policy for injury or property damage arising from the use of a motor vehicle, a sole proprietorship named as the insured is a legal entity separate and distinct from the individual owner doing business in that name.
I.
The underlying lawsuits arose out of an automobile accident that occurred in Virginia on September 22, 1989. An employee of A & R Sweeping and Cleaning (A & R), while in the course of his employment, left a Ford pickup truck, owned by Alfonso C. Recalde and his wife, Anita G. Mora, unattended without removing the keys. Another individual stole the truck, drove it away at a high rate of speed, and collided with an automobile driven by Donald E. Reynard. Alleging that he sustained injuries in the accident, Reynard filed a personal injury action in the Superior Court of the District of Columbia against Alfonso C. Recalde and A & R Sweeping and Cleaning. Judith A. Reynard, Donald E. Reynard's wife, sought recovery in a separate count of the same action for loss of consortium.
During the pendency of the Reynard action, a dispute ensued concerning available insurance coverage. Consequently, Recalde filed a complaint for declaratory judgment styled on behalf of "Alfonso C. Recalde, t/a A & R Sweeping and Cleaning" in the Superior Court of the District of Columbia against ITT Hartford (Hartford), A & R's insurance carrier. Recalde sought a declaration that, pursuant to the "Business Auto Coverage Part" of an insurance policy issued by Hartford to A & R, Hartford has a duty to defend A & R and to provide insurance coverage in the Reynard action. After staying the Reynard action pending resolution of the declaratory judgment proceeding, the superior court granted summary judgment for Hartford. Recalde appealed that ruling to the District of Columbia Court of Appeals, which in turn certified the question of law to us.
The disputed insurance policy is a "Special Multi-Flex Policy" consisting of two "Coverage Parts," the "Business Auto Coverage Part" and the "Commercial General Liability Coverage Part." The crucial provisions are the designation of the "named insured" in both "Coverage Parts" and the two classes of motor vehicles identified as "covered autos" in the "Business Auto Coverage Part." The named insured under the policy is "A & R Industrial Sweeping & Cleaning," and its mailing address is "5108 Ninian Ave., Alexandria, VA 22310." The parties agree that this address is Recalde's home and business address. The definition of "covered autos" in this policy includes only the following two categories of vehicles:
HIRED AUTOS ONLY.
Only those autos you lease, hire, rent or borrow. This does not include any auto you lease, hire, rent or borrow from any of your employees or members of their households.
NON-OWNED AUTOS ONLY.
Only those autos you do not own, lease, hire or borrow which are used in connection with your business. This includes autos owned by your employees or members of their households but only while used in your business or your personal affairs.
The superior court interpreted the designation of the "named insured" and the categor
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