                    United States Court of Appeals
                          FOR THE EIGHTH CIRCUIT
                                  ___________

                                  No. 00-1646
                                  ___________

Avemco Insurance Company,             *
                                      *
            Plaintiff/Appellee,       *
                                      *
      v.                              *
                                      *
Auburn Flying Service, Inc.; Ruth     *
Norvell, Personal Representative of   *
the Estate of Fred E. Farington,      *
Deceased;                             *
                                      *   Appeal from the United States
            Defendants/Appellants,    *   District Court for the District of
                                      *   Nebraska.
Brian L. Smith, Co-Personal           *
Representative of the Estate of       *
Vera Mae Smith, Deceased; Janelle     *
Briner, Co-Personal Representative    *
of the Estate of Vera Mae Smith,      *
Deceased; Laverne Norvell, Personal   *
Representative of the Estate of       *
Augusta Norvell, Deceased; Edward     *
Drillon; Cheryl Bevirt, Personal      *
Representative of the Estate of       *
Edward DeBourbon, Deceased,           *
                                      *
            Intervenors/Defendants/   *
            Appellants.               *
                                    ___________

                              Submitted: October 23, 2000

                                   Filed: March 13, 2001
                                    ___________

Before WOLLMAN, Chief Judge, LAY, and BEAM, Circuit Judges.
                             ___________

BEAM, Circuit Judge.

       Avemco Insurance Company (Avemco) filed a declaratory judgment action to
determine if coverage for an accident existed under a noncommercial aviation policy
it had issued to Auburn Flying Services, Inc. (AFS). The defendant/appellant is the
personal representative of the estate of the deceased pilot and the intervenors are the
personal representatives of the estates of the three passengers killed in the accident
(collectively appellants). The district court1 granted Avemco's motion for summary
judgment. We affirm.

I.    BACKGROUND

       The relevant facts of this case are as straightforward as they are tragic. On
October 5, 1997, several organizations conducted a "fly-in" at the Auburn airport, near
Auburn, Nebraska. As part of the event, attendees could pay $10 for a ten- to fifteen-
minute airplane ride around the Auburn area in a plane piloted by Fred Farington. The
money was collected at a table near the runway, which had a sign near it advertising
the plane rides.


      1
      The Honorable Joseph F. Bataillon, United States District Judge for the District
of Nebraska.

                                         -2-
       On the ninth trip of the day, while attempting to land, the plane struck a passing
semi tractor-trailer and crashed. The three airplane passengers died in the crash.
Farington died from his injuries four months later. The parties have stipulated that the
money collected by Farington was not sufficient to cover the operating expenses of the
flights.

      Appellee, Avemco, had issued a noncommercial liability insurance policy to
AFS, covering the plane in question. Farington was president of AFS, and was covered
by name under the policy when piloting the plane.

      The policy contained the following exclusion of coverage: "This policy does not
cover bodily injury, property damage, or loss . . . [w]hen your insured aircraft is . . .
used for a commercial purpose." The policy contained the following definition:

      "Commercial purpose" means any use of your insured aircraft for which
      an insured person receives, or intends to receive, money or other benefits.
      It does not include:

      a. the equal sharing among occupants of the operating costs of a flight.

     After receiving evidence the district court granted Avemco's motion for summary
judgment. Defendants and intervenors filed this appeal.

II.   ANALYSIS

       We review a grant of summary judgment de novo. Firemen's Fund Ins. Co. v.
Thien, 8 F.3d 1307, 1310 (8th Cir. 1993). We view the facts in a light most favorable
to the nonmoving party. Id. Summary judgment may only be granted if there are no
disputes concerning material facts and the moving party is entitled to judgment as a
matter of law. Id.


                                          -3-
       In interpreting this insurance policy, we apply the law of Nebraska. See Langley
v. Allstate Ins. Co., 995 F.2d 841, 844 (8th Cir. 1993). Nebraska law provides:

      An insurance policy is to be construed as any other contract to give effect
      to the parties' intentions at the time the contract was made. . . . The
      resolution of an ambiguity in a policy of insurance turns not on what the
      insurer intended the language to mean, but what a reasonable person in
      the position of the insured would have understood it to mean at the time
      the contract was made.

Malerbi v. Central Reserve Life, 407 N.W.2d 157, 162-63 (Neb. 1987) (internal
citations omitted).

      The parties to an insurance contract may contract for any lawful coverage,
      and an insurer may limit its liability and impose restrictions and conditions
      upon its obligation under the contract not inconsistent with public policy
      or statute. . . . Where the terms of [an insurance] contract are clear, they
      are to be accorded their plain and ordinary meaning. The language of an
      insurance policy should be read to avoid ambiguities, if possible, and the
      language should not be tortured to create them. When an insurance
      contract can fairly be interpreted in more than one way, there is ambiguity
      to be resolved by the court as a matter of law. An ambiguous insurance
      contract will be construed in favor of the insured, but ambiguity will not
      be read into insuring language which is plain and unambiguous in order
      to construe it against the preparer of the contract. In interpreting a
      contract, a court must first determine, as a matter of law, whether the
      contract is ambiguous.

 American Family Ins. Group v. Hemenway, 575 N.W.2d 143, 148 (Neb. 1998)
(internal citations omitted).




                                          -4-
      We have found no case from the Nebraska Supreme Court interpreting similar
language from an insurance contract.2 Therefore, in predicting how that court would
decide this case, we follow its lead and examine precedent from other jurisdictions.
See, e.g., id. at 149 (surveying how other courts have interpreted a "regular use"
exclusion in auto insurance policies); Mendenhall v. Grantzinger, 546 N.W.2d 775, 778
(Neb. 1996) (analyzing cases from other jurisdictions to determine whether an
automatic coverage clause in an automobile insurance policy was ambiguous).

       Appellants argue that the "commercial purpose" exclusion in the policy is
ambiguous and in support cite several cases from other jurisdictions which have held
that "for a charge" and "for a fee" exclusions in similar non-commercial airplane
policies were ambiguous.3 We find this argument unpersuasive and find the contract
to be unambiguous.4

       The cases cited by appellants do not govern this policy because those cases
interpreted "for charge" exclusions, which did not contain any type of "shared




      2
        In fact, the parties agree that they can find no case from any jurisdiction
interpreting the precise contractual language involved in this dispute.
      3
        The precise language in the various policies varies in form, but not in substance.
We will refer to them collectively as "for charge" exclusions. "Exclusion" refers to a
clause in the policy that would eliminate coverage. "Exception" refers to an exception
to the exclusion that would restore coverage.
      4
       Appellants also seem to assert that we must consider the reasonable
expectations of the insured in deciding whether a policy is ambiguous. Under Nebraska
law, we would only consider reasonable expectations if the contract language was first
found to be ambiguous. See Safeco Ins. Co. v. Husker Aviation, Inc., 317 N.W.2d
745, 748 (Neb. 1982).

                                           -5-
expense" exception to that exclusion.5 The commercial purpose exclusion in the
present policy contains an explicit exception for shared expense flights. "'In construing
an insurance contract, the court must give effect to the instrument as a whole and, if
possible, to every part thereof.'" Polenz v. Farm Bureau Ins. Co., 419 N.W.2d 677,
680 (Neb. 1988) (quoting Cordes v. Prudential Ins. Co., 150 N.W.2d 905, 908 (Neb.
1967). Thus, even if the exclusion in this policy was ambiguous concerning shared
expense flights when read in isolation, any such ambiguity is removed by the exception
for "the equal sharing among occupants of the operating costs of a flight."6

        Finding the policy unambiguous because of the "shared expense" exception is
further supported by the outcomes of the cases cited by appellants. When faced with
an ambiguous "for charge" exclusion, the courts remedied the ambiguity by holding
that if the money exchanged only covered the expenses of a flight then the exclusion
did not apply. For example, in Flagstaff Mortuary, Inc. v. Gamble, the court held that
as a matter of law, if the money paid for use of an airplane exceeded the direct
operating costs of the flight, the "for charge" exclusionary clause applied precluding
coverage. 662 P.2d 149, 151 (Ariz. Ct. App. 1983); see also Monarch Ins. Co. v.



      5
        Only two cases mention a shared expense exception in the insurance contract.
See Pacific Indem. Co. v. Acel Delivery Serv., Inc., 485 F.2d 1169, 1172 (5th Cir.
1973); Thompson v. Ezzell, 379 P.2d 983, 987 (Wash. 1963). Appellants cite
Thompson as the best statement of the interpretation/ambiguity problem inherent in the
"for charge" policies. A closer examination of that case reveals that the court was
interpreting a policy similar to the one at hand, which contained a "for charge"
exclusion and an exception to the exclusion for a "shared expense" flight. See
Thompson, 379 P.2d at 987.
      6
        We express no opinion as to whether this exclusion, standing alone, may be
ambiguous according to the reasoning of the "for charge" cases. We merely note that
under Nebraska law each case must be determined "upon the wording of the
exclusionary clause in the policy and the special facts therein." Pimper v. National
American Fire Ins. Co., 296 N.W. 465, 467 (Neb. 1941).

                                          -6-
Siegel, 625 F. Supp. 693, 699 (N.D. Ind. 1986) (holding that a "for charge" exclusion
applies whenever the money received exceeds the direct operating costs of a flight);
Cammack v. Avemco Ins. Co., 505 P.2d 348, 350 (Or. 1973) (holding that a "for
charge" exclusion did not apply where the money paid was just a reimbursement of
expenses in a noncommercial context). In effect these cases have created an implicit
exception to "for charge" exclusions, which restores coverage where the charge only
covered expenses. In the present case, the policy's plain language already achieves the
same result.

      Since the exclusionary clause is not ambiguous, its interpretation is a question
of law for this court. See American Family, 575 N.W.2d at 148. Our task is to
determine the difference between a receipt of money for use of the aircraft and an equal
sharing of operating costs. Thompson, 379 P.2d at 987 (stating "the issue only revolves
about a differentiation between 'a charge' and 'share expense'").7

       In interpreting an exclusionary clause, one important consideration is the general
purpose of the clause. Id.; cf. American Family, 575 N.W.2d at 147-48 (referring to
the general purpose behind "regular use" exclusions in automobile liability policies
while interpreting such an exclusion). We agree with the Washington Supreme Court
that the difference in risk between these two types of flights ("for charge" or "shared
expense") lies in the frequency of flights. The purpose of the exclusionary clause is to
reduce that risk by limiting the total number of flights. Thompson, 379 P.2d at 987.
The receipt of money, or some other benefit, for the use of an airplane provides
additional impetus or motivation for making the flight, and is thus likely to increase the


      7
        Although the policies in the cases interpreting "for charge" exclusions contained
no explicit "shared expense" exception, they are helpful in this inquiry. Once the courts
held that a "for charge" exclusion was ambiguous and carved out an implicit "shared
expense" exception that restored coverage, the courts still had to determine the
difference between the two.

                                           -7-
number of flights an insured will make.8 Id. See also American Cas. Co. v. Eagle Star
Ins. Co., 568 P.2d 731 (Utah 1977). On the other hand, a "shared expense" flight
suggests a common interest in the flight, other than the interest in making the particular
flight. Thompson, 319 P.2d at 987.

        Several court have found dispositive the relationship of the money paid to the
direct operating expenses of the flight. See Flagstaff, 662 P.2d at 151 (holding that
where evidence showed payment far in excess of direct fuel expenses and close to the
standard commercial charter rate, the insurer was entitled to summary judgment);
Monarch Ins., 625 F. Supp. at 699-700 (holding that an hourly charge in addition to
paying for gas and oil was clearly a flight "for charge"). Other courts have noted that
if there is some quid pro quo (if the motivating factor for the flight was the fee) then the
flight is "for charge" rather than "shared expense." See Pacific Indem. Co. v. Acel
Delivery Serv., Inc., 485 F.2d 1169, 1172 (5th Cir. 1973). If the payment is completely
voluntary, then no quid pro quo exists, and a payment that just covers a portion of the
fuel expense is not excluded by the "for charge" clause. See Houston Fire and Cas. Ins.
Co. v. Ivens, 338 F.2d 452, 455 (5th Cir. 1964). The factors relied upon in these cases
are relevant to our inquiry, but no single factor is dispositive.

       We hold that in interpreting an insurance exclusion clause, like the one in this
case, the relevant inquiry is whether a reasonable person, viewing the totality of the
circumstances surrounding the arrangement, would conclude that the arrangement was
one of "shared expenses" or a flight made for the receipt of money. See Meridian Mut.
Ins. Co. v. Auto-Owners Ins. Co., 698 N.E.2d 770, 775-76 (Ind. 1998) (relying on a


       8
        We do not go so far as to say that there must be a profit motive for the flight as
the Thompson court seems to indicate, and for which the appellants argue. See also
Pacific Indem., 485 F.2d at 1172 (holding that for charge language implies some quid
pro quo, but quid pro quo does not necessarily mean that the insured must have a profit
motive).

                                            -8-
similar standard in interpreting an automobile policy with a "for charge" exclusion and
a "shared car pool expense" exception); cf. Mendenhall, 546 N.W.2d at 775 (holding
that in order to determine if a newly purchased vehicle was covered under a policy's
automatic coverage clause, the inquiry is whether a reasonable person would have
thought the vehicles already owned by the insured were in such a condition of
inoperability that the insured would not have included them in a policy of liability
insurance) (emphasis added).9

        The factors a reasonable person would examine would include those mentioned
in the previous aviation policy cases: relationship of the amount paid to the expenses
of a flight, existence of a community interest in taking the flight other than the flight
itself, voluntariness of the payment and any indication of a quid pro quo. In automobile
cases interpreting similar insurance contracts, courts have clearly followed a totality of
the circumstances standard and taken a more comprehensive approach than the cited
aviation insurance cases in considering all of the factors relevant to distinguishing "for




      9
        We look to cases interpreting automobile liability policies with "for charge"
exclusions and "shared car pool expense" exceptions because noncommercial aviation
policies are often similar in structure and follow the same general pattern. See Lee R.
Russ & Thomas F. Segalla, Couch on Insurance § 1:49 (3d ed. 1997). We
acknowledge that these cases are not perfectly analogous, particularly since 'car pool'
bears a meaning specific to the auto policies. However, the similar issues in construing
the two types of policies allow us to take direction from the standards and approaches
courts have developed in interpreting these automobile policies. The totality of the
circumstances approach has a long pedigree in automobile insurance cases. See, e.g.,
State Farm Mut. Auto. Ins. Co. v. Self, 93 F.2d 139, 140 (5th Cir. 1937) ("[C]ourts, in
determining whether or not such payment amounts to a 'consideration' for the carrying,
take into account not only the payment of the money, but all the attending
circumstances"); Beer v. Beer, 16 N.E.2d 413, 417 (Ohio 1938) (holding that where
parties made trip for mutual interest, pleasure or benefit, coverage is not excluded as
being carrying of passengers for compensation).

                                           -9-
charge" from "shared expense" arrangements. See, e.g., Meridian Mut., 698 N.E.2d
at 775.

        For example, in Meridian Mutual the court considered whether the driver held
herself out as providing transportation to the general public or just to a small group of
people whose participation in the car pool generally did not change; whether there was
significant formality in the arrangement between the driver and the passengers; whether
the driver had some purpose in making the trip other than carrying the passengers (such
as going to work herself); and whether the driver used the vehicle for her own personal
use at other times.10 Id. at 776; see also Johnson v. Allstate Ins. Co., 505 So.2d 362,
367 (Ala. 1987) (stating that the significant factors are whether the insured charged a
definite amount, whether the amount was proportionate to actual expenses of the trip,
whether payment was voluntary (or paid as consideration for the trip) and whether the
driver and passengers were engaged in some common enterprise).11


      10
         The Indiana Supreme Court mentions these factors as being indicative of the
driver's primary motivation for making the trip. We believe their relevance goes
beyond inferences of the driver's intent. We believe they are the factors a reasonable
person would examine when deciding whether an arrangement is "for charge" or
"shared expense" aside from what they may indicate about the driver's intent.
      11
        We recognize that the Seventh Circuit has indicated some factors, such as
voluntariness of the payment or existence of a quid pro quo, are not helpful or relevant
in determining if an arrangement was for a charge or shared expenses. General
Accident Ins. Co. v. Gonzales, 86 F.3d 673, 676 n.4 (7th Cir. 1996). For example, the
court noted that even in shared expense arrangements there is a sense in which the
payment is not voluntary because payment of one's share of the expenses may be a
condition for participating in the flight. We agree that an involuntary payment does not
automatically mean that the arrangement was "for charge." However, if a payment
were entirely voluntary, as it was in Houston Fire, 338 F.2d at 455, we think that would
almost certainly mean that the arrangement was a sharing of expenses. Therefore, a
reasonable person could consider such factors while keeping in mind that they do not
afford conclusive (or even necessarily strong) evidence in many cases.

                                          -10-
        In examining these factors under a totality of the circumstances standard, courts
have generally found that where the arrangement is among persons with a common
purpose, where participation in the arrangement is limited to a small group of people,
and where the driver would have made the trip in question anyway, the arrangement is
a covered "shared car pool expense." Meridian Mut., 698 N.E.2d at 775 (stating that
a woman who used her van to transport from five to eight co-workers to and from work
for a set weekly fee, who testified she was not in the arrangement to make a profit (and
there was no indication to the contrary), who did not extend the opportunity to ride in
the van pool beyond people she personally knew and who would otherwise have made
the trips anyway to get to and from work, was covered by the insurance policy);
General Accident Ins. Co. v. Gonzales, 86 F.3d 673 (7th Cir. 1996) (same); Aetna
Cas. and Sur. Co. v. Mevorah, 566 N.Y.S.2d 842, 845 (N.Y. Sup. Ct. 1991) (same);
see also Thompson, 379 P.2d at 987.

       The appellants argue that evidence of Farington's intent to use the money to
defray costs creates a question of fact unsuitable for disposition at summary judgment.
While we think that this is relevant to our inquiry, it does not create a question of fact
because we assume, favorably to appellants, that he did have such an intent. However,
aside from Farington's intent and the stipulation that the money collected did not exceed
expenses, all of the other undisputed facts weigh in favor of finding this flight was for
receipt of money rather than equally shared expenses.

     The depositions of Farington's other passengers reveal that none thought there
was any agreement to share expenses, nor that the set $10 amount was only for
expenses. Farington and his passengers possessed no community of interest other than
just taking the flight itself. By providing these flights in conjunction with the Fly-In's
general activities and posting a sign offering anyone a flight in exchange for $10,
Farington was holding himself out to provide flights to the general public.




                                          -11-
      These last two factors (no community of interest and holding himself out to the
general public) are the most significant in this case. For example, even if Farington and
his passengers did not arrive at a specific agreement that the $10 was to cover
expenses, but the passengers were family or friends whom he often took for joy rides
(and he only did this with family or friends) then he likely would satisfy the share
expense exception. Cf. Cammack, 505 P.2d at 349 (stating that where the insured
allowed his uncle and cousin to fly insured's plane in exchange for an hourly fee to
cover expenses and also extended this privilege to the uncle's friend, the payment just
covered expenses in a noncommercial context). Or, if Farington was going on a
vacation with friends and decided to fly them in exchange for a fee that only covered
expenses, he would also be covered. See Thompson, 379 P.2d at 987.12


III.   CONCLUSION

      By offering flights to anyone willing to pay the fee, Farington increased the
number of flights he would make with the plane, and increased the risk to the insurer
beyond that contemplated in the insurance contract. Consequently, the flight in
question was for receipt of money and was not an equal sharing of expenses.

       Accordingly, we affirm the decision of the district court.

LAY, Circuit Judge, dissenting.

I respectfully dissent.


       12
         We decline to address whether payment of a set fee by different numbers of
passengers on different flights, or Farington's failure to pay $10 towards expenses on
each flight means that the arrangement was not equal under the terms of the contract.
Such inquiry is unnecessary to our decision since on the facts of this case the
arrangement was not "shared expense" much less "equally shared expense."

                                          -12-
       Under the circumstances, I respectfully submit that the result reached by the
majority constitutes a gross miscarriage of justice for the families of those passengers
who were killed and for the decedent owner and operator of the small plane involved.
Under the doctrine of reasonable expectation, it is absurd to think that the owner of the
plane did not contemplate full insurance coverage for his non-commercial flights.13 The
owner lost money on the flights in question each time he flew and the facts stipulated
clearly show that he did not have a commercial purpose in having passengers share in
a token expense for the flight.

       The majority has now construed the insurance policy in such a wooden way as
to find forfeiture of a non-commercial policy of insurance which the owner purchased
to cover his injury or death and that of his passengers. This unreasonable interpretation
defies every principle of construction governing insurance policies long given
adherence by the Nebraska Supreme Court.

       First of all, it is well-settled under Nebraska law that exclusionary clauses will
be liberally construed in favor of the insured. Modern Sound & Systems, Inc. v.
Federated Mutual Ins. Co., 262 N.W.2d 183, 187 (Neb. 1978). Second, it is clear
under Nebraska law that forfeitures are not favored. See Rathbun v. Globe Indem. Co.,
184 N.W. 903, 904-05 (Neb. 1921). For over a century, Nebraska law has recognized
that forfeitures which are against equity and good conscience or are absurd from the
standpoint of the contract to give protection will not be enforced. See Connecticut Fire
Ins. Co. v. Jeary, 83 N.W. 78, 79 (Neb. 1900). Couch has expressed this holding by
stating “that in cases where it is doubtful that a forfeiture provision was intended, the

      13
        See Decker v. Combined Insurance Co. of America, 505 N.W.2d 719, 722
(Neb. 1993) (“An insurance policy should be interpreted in accordance with reasonable
expectations of the insured at the time of the contract. A contract of insurance should
be given a reasonable construction so as to effectuate the purpose for which it was
made. In cases of doubt, it is to be liberally construed in favor of the insured.”)
(quoting Neal v. St. Paul Fire & Marine Ins. Co., 250 N.W.2d 648 (Neb. 1977)).

                                          -13-
interpretation will be against a forfeiture.” Couch on Insurance 3d § 22:35 (1995)
(citing Hilmer v. Western Travelers’ Accident Ass’n., 125 N.W. 535 (Neb. 1910)).
Couch further states “[s]ince forfeitures are not favored, the courts are usually inclined
to take hold of any extrinsic circumstance which indicates an election to waive a
forfeiture or which precludes the insurer under principles of estoppel from enforcing
the forfeiture.” Id. at § 22:36. Third, contrary to the law in Nebraska and all other
jurisdictions, the majority here ignores the fundamental principle that an ambiguous
insurance policy is to be construed against the insurer. See American Family Ins.
Group v. Hemenway, 575 N.W.2d 143, 148 (Neb. 1998); Safeco Ins. Co. of Am. v.
Husker Aviation, Inc., 317 N.W.2d 745, 748 (Neb. 1982). The majority avoids this
principle by use of an indefensible construction, ignoring an obvious ambiguity in the
insurance policy.

      The premise underlying the majority’s analysis is that the commercial purpose
clause is not ambiguous because it is expressly defined within the policy. In all due
respect, the majority’s opinion fits the old adage “saying so don’t make it so.” A
Dictionary of American Proverbs 526 (Wolfgang Mieder et al. eds., 1992). The
majority’s declaration that the policy terms are not ambiguous does not cure the latent
ambiguity in those terms, which arises when applied to the facts of this case.

       The policy at issue excludes coverage when the insured aircraft is used for a
“commercial purpose.” Commercial purpose is defined as any use of the aircraft for
which an insured person “receives, or intends to receive, money or other benefits.”
According to the policy, this exclusion does not operate where the aircraft’s occupants
equally share the operating expenses of the flight. The obvious interpretation of
“commercial” purpose relates to the owner making a profit from the flight. It is
stipulated by the parties that no profit was made here.

      To predict whether the Nebraska Supreme Court would find the commercial
purpose clause ambiguous, the majority looks to other jurisdictions that have examined

                                          -14-
“for charge” exclusions. However, the reasoning the majority employs to reach its
desired result is tenuous, at best.14 The majority cites cases that hold where money
paid by passengers exceeds operating costs, a “for charge” exclusion clause applies and
precludes coverage. It also cites cases that hold where money paid by passengers
equals expenses, a “for charge” exclusion does not apply and coverage is proper.
Based on these authorities, the majority concludes that the commercial purpose clause
is not ambiguous and must be enforced according to the plain meaning of its terms.
However, none of the cases cited by the majority incorporate the facts of this case,
where the passengers paid less than the operating expenses of the flight. Herein lies
the latent ambiguity which the majority overlooks. See Plambeck v. Union Pacific R.R.
Co., 509 N.W.2d 17, 20 (Neb. 1993) (“Although the language of a document may be
clear and unambiguous, a latent ambiguity exists when collateral facts make the
meaning of the contract uncertain.”); Couch on Insurance 3d § 21.12 (“A latent
ambiguity exists where uncertainty appears in the application of the contract to the
object thereof, although the policy read by itself would otherwise be clear.”).


      14
          In addition to the primary difference I have with the majority’s opinion, I also
find it internally inconsistent. For instance, the majority suggests that only cases with
both a “for charge” exclusion and a “shared expense” exception to that exclusion are
apposite to the case at hand. See Slip Op. at 5-6 (“The cases cited by appellants do not
govern this policy because those cases interpreted ‘for charge’ exclusions, which did
not contain any type of ‘shared expense’ exception to that exclusion.”). It then goes
on to rely on the conclusions set forth in cases that do not contain an explicit “shared
expense” exception to a “for charge” exclusion. See Monarch Ins. Co. of Ohio v.
Siegel, 625 F. Supp. 693 (N.D. Ind. 1986); Cammack v. Avemco Ins. Co., 505 P.2d
348 (Or. 1973); Flagstaff Mortuary, Inc. v. Gamble, 662 P.2d 149 (Ariz. Ct. App.
1983). The majority also explains how courts have remedied ambiguity in “for charge”
exclusion cases. See Slip Op. at 6-7. Based on the outcomes of those cases, the
majority concludes that the terms in the instant policy are not ambiguous. This is
circular reasoning that lacks congruence. To adopt the interpretations in the cases that
are faced with “an ambiguous ‘for charge’ exclusion,” id. at 6, it seems we first would
have to embrace the central premise of those cases: the terms and phrases at issue are
ambiguous.

                                          -15-
       The majority also reasons that any ambiguity in the commercial purpose clause
is cured when it is read together with the equal sharing provision. The equal sharing
provision defines what is not a commercial purpose. In other words, the majority
defines a positive (commercial purpose) with a negative (not equal sharing). That
syllogism does not preclude the possibility that the commercial purpose clause is
ambiguous.

       Obviously there can be more than one meaning given to “commercial purpose.”
Under the terms of the policy, although the commercial purpose exclusionary clause is
inoperable where there exists equal sharing of operating expenses, it makes no sense
to argue that where there is less than equal sharing in expenses by the occupants, this
constitutes a commercial purpose simply because it is not specifically expressed in the
policy. If sharing of expenses makes the exclusion inoperable, the only reasonable
construction is that anything less than sharing of operative expenses would also make
the exclusionary clause inoperable. The majority’s reasoning rests upon a false premise
that every flight is deemed commercial unless there is an equal sharing of operating
expenses. It makes little sense to urge that unless there exists equal sharing of
expenses all other flights are deemed to be commercial. Under Nebraska law, the
terms of coverage must rely upon the ordinary meaning of the words uses. See
Preferred Risk Mut. Ins. Co. v. Continental Ins. Co., 109 N.W.2d 126, 127-28 (Neb.
1961). Webster’s Dictionary defines “commercial” as “from the point of view of
profit: having profit as the primary aim.” Webster’s Third New International
Dictionary 456 (1981).

      In the instant case, “[t]he parties have stipulated that the money collected by
Farington was not sufficient to cover the operating expenses of the flights.” Slip Op.
at 3. The policy’s equal sharing provision does not apply to this case because




                                         -16-
Farington expended more for the flights than he collected from his passengers.15 That
does not mean that Farington had a commercial purpose by default. The question
remains whether, in collecting less money for the flight than he expended, Farington
received, or intended to receive, money or other benefits. The majority’s construction
of the exclusionary terms places particular emphasis on the physical act of receiving
money. In other words, the simple fact that Farington (or his wife, in this case)
physically took money from passengers (that did not amount to a pro rata share of
operating costs) brought this case under the commercial purpose clause of the contract.
Taking this interpretation to its logical conclusion, Farington could have collected as
little as one cent from each passenger and thus be precluded coverage by that act. Such
an interpretation is far beyond the purpose of the exclusionary clause. A second, but
equally reasonable reading of this policy, is that the commercial purpose clause only
is triggered where the insured receives in fact, or intends to receive, more money or
other benefits than he expends for the flights.16 The logical conclusion of this



      15
         The equal sharing provision applies where the aircraft’s “occupants” equally
share operating costs of the flight. An occupant is defined as “a person while in, on,
or getting into or out of” the aircraft. In other words, the pilot is an occupant.
Farington’s passengers equally shared expenses in that they paid $10 each for the ride,
but their contributions did not cover the operating expense of the flight. This means
that Farington, an occupant, assumed more than his equal share of operating costs.
      16
         The majority’s opinion concedes the reasonability of this interpretation by
virtue of the cases it cites that analyze similar “for charge” exclusions. See Monarch,
625 F. Supp. at 699 (holding that a “for charge” exclusion applies whenever the money
received exceeds the direct operating costs of a flight); Cammack, 505 P.2d at 350
(holding that a “for charge” exclusion does not apply where money paid reimbursed
expenses in a noncommercial context); Flagstaff, 662 P.2d at 151 (holding that as a
matter of law, if the money paid for use of an airplane exceeds the direct operating
costs of the flight, the flight was made “for a charge;” the court expressed doubt that
if the money constituted a mere reimbursement of expenses that the flight would be “for
a charge.”).

                                         -17-
interpretation is that because he recovered less than he expended for the flights,
Farington clearly did not have a commercial purpose.

        According to the majority’s reasoning, if the occupants did not equally share in
the expenses, but did pay less than the expenses (as stipulated), then it is still a
commercial purpose because payment of less than the expenses did not strictly conform
to the coverage provided when equal expenses are paid. This constitutes a totally
unreasonable interpretation. It means if the occupants share expenses, there is
coverage because there is no charge and thus, commercial usage is not involved. But
if the occupants pay less than expenses, a commercial use takes place. This makes
little sense and defies every rule of reasonable construction. The majority ignores the
obvious ambiguity and by implication borrows from the old maxim of construction,
expressio unius est exclusio alterius. The Supreme Court, however, has long
abandoned the use of such maxim in a comparable situation, saying “the maxim cannot
properly be applied to a situation where the remedies redress different misconduct and
where the remedial purposes of the Acts would be undermined by a presumption of
exclusivity.” Herman & MacLean v. Huddleston, 459 U.S. 375, 387 n.23 (1983)
(emphasis added).

       The majority’s opinion appears to resolve this case on grounds that there is no
patent ambiguity in the exclusionary clause. See Couch on Insurance 3d § 21:12 (“A
patent ambiguity is one which appears on the face of the written contract of
insurance.”). A closer look reveals that things are not always what they seem. “The
mere fact that a particular contract is found to be unambiguous in connection with one
type of loss does not preclude a court from finding that it is ambiguous in the context
of a totally different type of loss.” Id. § 21:11. Thus, the mere fact that the policy is
not ambiguous when applied to situations where passengers pay equal to or more than
their share of operating expenses does not save it from ambiguity in this case, where
the passengers paid less than their share of operating expenses. This ambiguity cannot
be ignored.

                                          -18-
       Language should not be tortured to find ambiguities in a contract. See Swedberg
v. Battle Creek Mut. Ins. Co., 356 N.W.2d 456, 458-59 (Neb. 1984). It is equally
important that language not be tortured to avoid ambiguity. I respectfully submit that
to avoid ambiguity in this case the majority has tortured the terms of this contract by
confining the language in a way that a reasonable person might not. A fair reading of
this contract from the standpoint of a reasonable person purchasing insurance reveals
more than one interpretation. One reading precludes coverage and the other reading
mandates coverage. Given this ambiguity, under Nebraska law we must construe the
policy against the insurer. See Safeco, 317 N.W.2d at 748.

       There is another reason which causes me to disagree with the majority’s opinion.
In affirming the district court’s order for summary judgment, the majority allegedly
gives cognizance to well-accepted principles of contract interpretation espoused by the
Nebraska Supreme Court. However, for over a century the Nebraska Supreme Court
also has recognized that “words are to be taken in their ordinary grammatical sense
unless such a construction would be obviously repugnant to the framers of the
instrument, or would lead to some other inconvenience or absurdity.” Curten v.
Atkinson, 54 N.W. 131, 133 (Neb. 1893) (emphasis added); see also Murphy v.
Travelers Ins. Co., 2 N.W.2d 576, 581 (1942) (“This court is committed to the rule
that, when the strict enforcement of a provision of an insurance policy will result in
unreasonable and unjust forfeitures, or an absurd result, the courts will refuse to enforce
the strict meaning of the language of the policy.”); Couch on Insurance 3d § 22:35
(noting the general rule that forfeitures of insurance coverage are not favored in the law
and that those which “are absurd from the standpoint of the purpose of the contract to
give protection are not to be enforced.”). The Supreme Court agrees. See Stipcich v.
Metropolitan Life Ins. Co., 277 U.S. 311, 322 (1928) (“[N]arrow and unreasonable
interpretations of clauses in an insurance policy are not favored.”). Thus, while terms
in a contract ordinarily should be given their plain, natural and ordinary meaning, that
rule does not operate if it leads to an unreasonable or absurd result or if it defeats the


                                           -19-
parties intention and purpose in entering into the contract. See Rathbun, 184 N.W. at
905 (Neb. 1921).

        Rules of contract construction, though useful guidelines, do not operate in a
vacuum and must not trump logic and common sense in a court of law. Despite the
academic framework set forth in the majority’s opinion, it not only seems absurd, but
it also defies common sense to conclude that Farington received, or intended to receive,
money or other benefits when the bottom line says he received nothing at all.
According to the majority’s reading of the policy’s plain terms, Farington would have
had to calculate each passenger’s share of operating costs to a mathematical certainty
in order for coverage to exist. This would be nearly impossible and would defeat
coverage in almost every instance where Farington’s passengers contributed to the
operating expenses of the flight, no matter how small the amount.

       Whether the policy is analyzed in terms of ambiguity or in terms of the
unreasonable result it imposes, I come to the inescapable conclusion that summary
judgment was inappropriate in this case. Accordingly, I would reverse and remand for
further proceedings.

      A true copy.

             Attest:

                CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.




                                         -20-
