2009 WI App 11
court of appeals of
published opinion
Case No.: |
2008AP464 |
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Complete Title of Case: |
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Opinion Filed: |
December 23, 2008 |
Submitted on Briefs: |
November 18, 2008 |
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JUDGES: |
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Appellant |
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ATTORNEYS: |
On behalf of the defendant-third-party plaintiff-appellant-cross-respondent,
the cause was submitted on the briefs of Rolf E. Sonnesyn and Matthew R. Smith of Tomsche,
Sonnesyn & Tomsche, P.A. of |
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Respondent |
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ATTORNEYS: |
On behalf of the plaintiffs-respondents-cross-appellants,
the cause was submitted on the briefs of Patrick T. Tierney, Esq. of Collins, Buckley, Sauntry &
Haugh, P.L.L.P., of On behalf of the defendant-respondent-cross-respondent,
the cause was submitted on the brief of Susan
D. Thurmer and Tamara L. Novotny
of Cousineau McGuire Chartered, of |
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2009 WI App 11
COURT OF APPEALS DECISION DATED AND FILED December 23, 2008 David
R. Schanker Clerk of Court of Appeals |
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NOTICE |
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This opinion is subject to further editing. If published, the official version will appear in the bound volume of the Official Reports. A party may file with the Supreme Court a petition to review an adverse decision by the Court of Appeals. See Wis. Stat. § 808.10 and Rule 809.62. |
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Appeal No. |
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STATE OF |
IN COURT OF APPEALS |
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Wayne Brown and Dianna Brown, d/b/a Sky High Crane Rental, Inc.,
Plaintiffs-Respondents-Cross-Appellants, v. Sandeen Agency, Inc.,
Defendant-Third-Party
Plaintiff-Appellant-Cross-Respondent, Tri-State Insurance Company of Risk Administrators Company, LLC,
Defendant-Respondent-Cross-Respondent, State Auto Insurance Company of Intervening
Defendant, v. Bill Brown, Third-Party
Defendant. |
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APPEAL
and CROSS-APPEAL from an order of the circuit court for
Before
¶1
Background
¶2 Sky High is a business based in
¶3 To obtain coverage from the Pool, an employer submits an application to the Pool, which then assigns a participating insurance company to write the policy. Thus, when Sky High submitted its application in 2003, the Pool assigned Tri-State as the insurer.
¶4 In January 2005, Sky High employee Mathew Olson, who lives in
¶5 Olson returned to work with a different company but experienced
continuing physical difficulty. In
December 2005, Olson requested temporary total disability benefits in
¶6 Tri-State moved for summary judgment, arguing it had not breached the contract and Sandeen was not its agent. Sky High filed a cross-motion for partial summary judgment, arguing Tri-State’s policy covered worker’s compensation claims brought in Minnesota and if the policy did not provide such coverage, then Sandeen was negligent as a matter of law. The circuit court concluded Tri-State was entitled to summary judgment on the contract and agency questions. It denied Sky High’s motion for summary judgment on Sandeen’s negligence, concluding genuine issues of material fact existed regarding Sandeen’s duty.[2]
Discussion
¶7 We review summary judgments de novo, using the same
methodology as the circuit court. Green
Spring Farms v. Kersten, 136
I. Whether the Tri-State Policy Covers
Olson’s Minnesota Claim
¶8 Interpretation of an insurance contract is a question of law
we review de novo. Liebovich v. Minnesota Ins. Co.,
2008 WI 75, ¶17, 310
¶9 A claimant bears the initial burden of proving his or her
loss falls within a policy’s broad grant of coverage. Kozlik v. Gulf Ins. Co., 2003 WI App
251, ¶8, 268 Wis. 2d 491, 673 N.W.2d 343.
If a claimant fulfills this burden, then the burden shifts to the
insurer to prove an exclusion precludes coverage.
¶10 Sandeen and Sky High assert the insurance policy obligates
Tri-State to pay Wisconsin worker’s compensation benefits to an employee of a
Wisconsin employer regardless of where an injury occurs or where the claim is
filed. Tri-State asserts it pays
benefits only for claims filed in accordance with Wisconsin law, and Olson’s
claim was denied not because of where the injury occurred but because he sought
benefits payable under
¶11 Part One of the policy states the policy “applies to bodily injury by accident…. We will pay promptly when due the benefits required of you by the workers’ compensation law.” “Workers’ Compensation Law” is defined as the law “of each state or territory named in Item 3.A. of the Information Page.” The information page states: “Workers’ Compensation Insurance: Part One of the policy applies to the Workers’ Compensation Law of the states listed here: WI.”[3]
¶12 Tri-State asserts it denied Olson’s claim based on this
language because he was seeking benefits under
¶13 The policy language is clear.[4] Tri-State will pay benefits due under
¶14 Sandeen and Sky High’s interpretation of the policy is
unreasonable. In fact, if we followed
their interpretation, we would turn the insurance Pool on its head. Sandeen and Sky High’s interpretations amount
to coverage for an employee’s injury occurring in any state and a claim filed
in any state. It is unreasonable to
conclude this is a nationwide policy because it is meant to fulfill obligations
under
¶15 Further, all evidence about the Pool structure suggests
Tri-State’s interpretation is correct.
The Pool was created so that employers with Wisconsin operations could
obtain worker’s compensation insurance to satisfy
The Pool policy provides coverage only to employers
having operations in
¶16 Coverage for all risks is not automatic; coverage for risks in
other states must be applied for with a separate application form.
¶17 Because participation in the Pool is mandatory for companies
writing worker’s compensation policies in
II. Whether Sandeen was Tri-State’s Agent
¶18 Sandeen argues it was Tri-State’s agent as a matter of law, or
that agency should at least be a question for the jury, and the court erred in
concluding otherwise.[8] An agency relationship requires the
“manifestation of one party that the other party shall act for him.” Boehck Constr. Equip. Corp. v. Voigt,
17
¶19 A person who “[s]olicits, negotiates or places insurance or
annuities on behalf of an insurer or a person seeking insurance or annuities”
or who “[a]dvises other persons about insurance needs and coverages” is an
insurance marketing “intermediary.” Wis. Stat. § 628.02(1)(a). An insurance broker is an intermediary who
“acts in the procuring of insurance on behalf of an applicant for insurance or
an insured, and does not act on behalf of the insurer except by collecting
premiums or performing other ministerial acts” while an insurance agent is an
intermediary who “acts as an intermediary other than as a broker.” Wis.
Stat. § 628.02(3)-(4). In
short, a broker acts as a middleman while an agent represents an insurer for
whom the agent works. Production
Credit Ass’n v. Gorton Farms, 216
¶20 We are confident that Sandeen was not Tri-State’s agent as a matter of law. Despite the characterization to the contrary, Fehr did not prepare an application to submit to Tri-State. She prepared an application to submit to the Pool. The Pool then assigned an insurance company from its list of participating companies. Fehr did not apply directly to Tri-State; she did not know which company would be the insurer when she submitted the application to the Pool. Further, there is no indication that Fehr or Sandeen are employed by Tri-State.
¶21 Moreover, the Pool handbook advises “producers,” who “assist[]
the employer in making application to the Pool[,]” are not agents for the
insurance companies. Insurance Pool [Handbook], supra, at 4. Indeed, the handbook specifically advises that
a producer “ha[s] no authority from the servicing carrier or the [Pool] to bind
or cancel coverage or to otherwise act within such an agency relationship.”
¶22 Under the Pool structure, it appears an insurance professional
has no way to know which company will be asked to write a given policy. Conversely, an insurer does not know from
what producer a policy will originate until the Pool assigns the client. Thus, it would be impossible for one party to
manifest “that the other party shall act for him,” Boehck Construction Equipment,
17
III. Whether Sandeen was Negligent
as a Matter of Law
¶23 Sky High argues that if we determine there is no coverage for
Olson’s injury,[9]
we should conclude Sandeen was negligent as a matter of law. But negligence is almost always inappropriate
for summary judgment. See State Bank of
¶24 Sandeen asserts it quoted premiums for
By the Court.—Order affirmed.
[1] All references to the Wisconsin Statutes are to the 2005-06 version unless otherwise noted.
[2] Further proceedings were stayed pending appeal.
[3] An endorsement then specifies the “Law” referred to as Wis. Stat. ch. 102.
[4] In fact, Sky High does everything but address the language directly.
[5] The current version of the handbook, which was effective September 1, 2008, is available at https://www.wcrb.org/WCRB/Manuals/PoolHandbook/POOL_HANDBOOK.pdf. Any changes between versions are inconsequential to our analysis.
[6]
[7] Sky
High thinks it significant that the premium Tri-State charged was based on Sky
High’s entire payroll, which included payments for jobs completed in
[8] This is evidently because Sky High raised a theory of vicarious liability. Before Tri-State can be liable for Sandeen’s negligence, if there is any, there must be some relationship giving rise to vicarious liability.
[9] That is, no coverage beyond the $90,000 Tri-State already paid.