                               UNPUBLISHED

                   UNITED STATES COURT OF APPEALS
                       FOR THE FOURTH CIRCUIT


                               No. 08-1132


HARLEYSVILLE MUTUAL INSURANCE COMPANY,

                 Plaintiff - Appellant,

           v.

JENNIE BRIDGETT DAVIS; MARYLAND AUTOMOBILE INSURANCE FUND;
VITTO PHILLIP LOMBARDO; SHAWNICE COTTON; PRESTON MAURICE
HAWKINS; JOHANNES MARIE WILSON; ESTATE OF LARRY SETH
GRIFFIN; JAMIE ANNA REEDER,

                 Defendants – Appellees,

           and

JAY DOUGHERTY; ERIC EUGENE BALLARD; ANTHONY PANZO; EDWIN J.
DOUGHERTY; GEORGE PERDUE USED CARS, INCORPORATED,

                 Defendants.


Appeal from the United States District Court for the District of
Maryland, at Baltimore.   William M. Nickerson, Senior District
Judge. (1:05-cv-01107-WMN)


Argued:   December 4, 2008                   Decided:   April 10, 2009


Before KING and DUNCAN, Circuit Judges, and Rebecca Beach SMITH,
United States District Judge for the Eastern District of
Virginia, sitting by designation.


Affirmed by unpublished opinion. Judge Smith wrote the majority
opinion, in which Judge King concurred.   Judge Duncan wrote a
separate concurring opinion.
ARGUED: William C. Parler, Jr., PARLER & WOBBER, Towson,
Maryland, for Appellant.       Donald S. Saiontz, James Kevin
MacAlister, SAIONTZ, KIRK & MILES, P.A., Baltimore, Maryland,
for Appellees.   ON BRIEF: Phillip S. Anthony, PARLER & WOBBER,
Towson, Maryland, for Appellant.          Arthur M. Rubenstein,
Baltimore, Maryland; Gerald F. Gay, ARNOLD, BACOT, GAY & DARBY,
P.A., Baltimore, Maryland, for Appellees.


Unpublished opinions are not binding precedent in this circuit.




                                2
SMITH, District Judge:

     In July 2004, Larry Griffin (“Griffin”) was killed in a car

accident while driving a Monte Carlo, on loan to his girlfriend,

Jennie     Davis    (“Davis”),     from        a    used-car       dealership.          The

dealership’s insurer claimed that its policy did not cover the

accident because Griffin did not have permission to drive the

loaner car.        After a two-day bench trial, the district judge

concluded    that     Griffin    had   implied            permission     to     drive   the

loaner car.        The district judge also found that the insurer had

not presented conclusive evidence to rebut the presumption under

Maryland    law     of   permissive    use.              Thus,    the   district    court

concluded that the insurance policy covered this accident.

     Harleysville does not contest the district court’s findings

of fact, but challenges its conclusions of law based on the

factual findings.        We review legal issues de novo.                  Fed. R. Civ.

P. 52(a); see, e.g., Roanoke Cement Co., LLC v. Falk Corp., 413

F.3d 431, 433 (4th Cir. 2005).                     For the following reasons, we

affirm.

                                          I.

     This    dispute      arises   out     of        a    July    1,    2004,    accident

involving a car loaned by Perdue’s Used Cars to Davis while her

car was being repaired.            Perdue’s Used Cars had an automobile

insurance    policy      with   Harleysville             Mutual    Insurance      Company

(“Harleysville”).        The omnibus clause of the policy defined an

                                          3
“insured” as “anyone else while using with your permission a

covered ‘auto’ you own[.]”            (J.A. 802.)             No party disputes that

the    policy       covers     the   loaner          car   given    to   Davis,      but

Harleysville claims that Griffin, the driver at the time of the

accident, is not an “insured” because he lacked permission from

either Perdue’s Used Cars or Davis to drive the loaner car.

       Harleysville       brought    suit       in   the   United   States     District

Court for the District of Maryland to establish that it had no

duty       to   defend   or   indemnify     for      claims    arising   out   of   this

accident. 1       On November 10, 2007, the district court found that

Harleysville had a duty to indemnify and defend Davis for all

claims arising against her from this accident, because she was

indisputably a permissive user of the loaner car.                        The district

court found genuine issues of material fact relating to whether

Griffin had implied permission from Davis to drive the loaner

car on the night of the accident.

       Following the two-day bench trial, the district judge found

the following facts, which have not been challenged on appeal.

Davis regularly drove a 1996 Ford Taurus purchased from Perdue’s

Used Cars.          On June 30, 2004, Davis took the Taurus to the

dealership for a repair under warranty.                       When told that the car

       1
       On March 3, 2006, the district court entered a consent
final judgment limited to claims between Perdue’s Used Cars and
Harleysville, which claims are not at issue on appeal.



                                            4
would not be ready that day, Davis asked for a loaner car to

drive to work and take her children to daycare.                 George Perdue

(“Perdue”), the owner of Perdue’s Used Cars, testified that he

authorized the loan of a 2000 Monte Carlo, and that he gave

Davis no instructions about how she could use the car or about

who was allowed to drive it.      Since he was loaning a replacement

car, Perdue testified that he expected that Davis would use the

Monte Carlo just like the Taurus.            According to Perdue, Davis

did not receive any paperwork or oral instructions when the car

was loaned.      At trial, Perdue’s son, David Perdue, testified

that he--not his father--loaned Davis the Monte Carlo, and that

he instructed Davis to use the car only for driving to work and

daycare.       Characterizing   the   testimony       of   Perdue’s     son   as

incredible, the district court found that Perdue’s Used Cars

gave Davis express permission to drive the car and that “no

restrictions were placed on its use.”              (J.A. 1470.)       Thus, the

district court found that Davis was free to use the Monte Carlo

as she would have used her Taurus, which included permitting

another person to drive the car.

     Griffin    had   been   living   with    Davis    for   several     months

before   the   accident.      Based   on     the    testimony    of    numerous

witnesses, the district judge found that Griffin had Davis’s

permission routinely to use her Taurus, without having to ask

specifically to use the car on any given occasion.               On the night

                                      5
of the accident, Davis had picked up her children from daycare

and returned home.          Griffin was not home, although his Crown

Victoria automobile was parked in the driveway.                  Davis left the

keys to the Monte Carlo on the kitchen table, where she usually

placed her car keys to the Taurus.             After going to sleep early,

Davis awoke when Griffin returned home and asked if she would

like   to   go   out   to   a   club   with   him   and   some   friends.    She

declined, saying that she had to get up early for work.                     While

Davis later testified that she would not have let Griffin take

the car out with friends if he had asked, the district court did

not find that Griffin asked for permission to drive the loaner

car, nor did the court find that Davis had placed any express

restrictions on Griffin’s use of this car.                 The district court

found that Griffin picked up the keys to the Monte Carlo, from

the same place he usually found the keys to the Taurus, and that

he took the loaner car out with friends, “assuming he was free

to use the loaner car in the same manner that he freely and

frequently borrowed Davis’s Taurus.”            (J.A. 1472.)

       In the early hours of July 1, 2004, Griffin was killed in a

car accident.          Several witnesses from the hospital testified

that Davis showed remorse for letting Griffin drive the Monte

Carlo, but the district court did not assume from this testimony

that Davis had earlier expressly told Griffin that he could take

the loaner car.        The district court concluded: (1) Davis had the

                                         6
authority to permit Griffin to use the Monte Carlo; (2) Griffin

had implied permission to drive the Monte Carlo based on his

unrestricted      use    of    the     Taurus;       (3)        Harleysville        had    not

rebutted the presumption under Maryland law that Griffin was a

permissive    user      of   the    car;    and,    thus,       (4)   the    Harleysville

policy covered the liability and damages for the July 1, 2004,

accident.

                                            II.

     Under Maryland law, 2 words in an insurance policy receive

their    “customary,         ordinary,       and     accepted         meaning,”       as     a

“reasonably    prudent        layperson”        would     understand        them.         State

Farm Mut. Auto. Ins. Co. v. DeHann, 900 A.2d 208, 226 (Md.

2006).     While Maryland courts do not strongly construe insurance

policies     against     the       insurer,       they     do     resolve     ambiguities

against the insurer as the drafter of the policy.                              Truck Ins.

Exch. v. Marks Rentals, Inc., 418 A.2d 1187, 1191 (Md. 1980).

Moreover,    an   “omnibus         clause   must     be    liberally        construed       in

favor of the insured.”             DeJarnette v. Fed. Kember Ins. Co., 475

A.2d 454, 457 (Md. 1984).




     2
       The parties agree that “[t]he substantive law of the State
of Maryland governs the construction of the subject insurance
contract in this case.” (J.A. 105 n.2) (citing Erie R.R. Co. v.
Tompkins, 304 U.S. 64 (1938)).



                                            7
       In an automobile insurance policy, an “omnibus clause” is a

provision that extends coverage to individuals who use a car

with the owner’s permission.                     See Blue Bird Cab Co., Inc. v.

Amalgamated Cas. Ins. Co., 675 A.2d 122, 128 n.9 (Md. Ct. Spec.

App. 1996). Under an omnibus clause, permission can be express

or implied.            See Bond v. Pa. Nat’l Mut. Cas. Ins. Co., 424 A.2d

765,       768    (Md.    1981)       (reading       the   term   “permission”       in    an

automobile            insurance   policy     “as       though     the   word   ‘implied’

precedes it”).            The “existence of permission, whether express or

implied,         is    largely    a    factual       determination,     and    one    which

varies in response to the circumstances present in each case.”

Id.        Implied permission may arise from the “course of conduct

among those involved[.]”                See State Farm Mut. Auto. Ins. Co. v.

Martin Marietta Corp., 657 A.2d 1183, 1188 (Md. Ct. Spec. App.

1995). 3

       The use of a car must “fall within the scope of permission

given      by    the     insured[.]”       Nationwide        Mut.   Auto   Ins.      Co.   v.

       3
        Citing   Maryland’s   anti-theft   statute,  Harleysville
contends that permission to use a vehicle cannot be presumed or
implied based on prior permission.       Md. Code Ann., Transp.,
§ 14-102(c) (for crimes of unauthorized use, owner’s consent may
not “be presumed or implied because of the owner’s consent on a
previous occasion”). As Maryland’s anti-theft statute has never
been applied in any civil case, we do not find that it abrogates
Maryland’s presumption of permission or examination of conduct--
which may include the driver’s prior use of a vehicle--to
support a finding of implied permission.      See Martin Marietta
Corp., 657 A.2d at 1187-88; see also Bond, 424 A.2d at 768.



                                                 8
Cont’l Cas. Co., 589 A.2d 556, 561.                To determine if a specific

use falls “within the purview of the omnibus clause, one must

examine the total facts” presented by the case.                      Fed. Ins. Co.

v.   Allstate   Ins.   Co.,    341   A.2d     399,      407   (Md.   1975)(internal

quotation omitted).      Express restrictions may limit the scope of

permission.     See Md. Indem. Ins. Co. v. Kornke, 319 A.2d 603,

611 (Md. Ct. Spec. App. 1974).           But “comprehensive permission is

more readily to be assumed where the use of the car is for

social or non-business purposes,” rather than business purposes.

Fed. Ins. Co., 275 A.2d at 408.

      Finally, Maryland courts presume that the driver of a car

has the permission of the car’s owner.                        See Martin Marietta

Corp., 657 A.2d at 1187.             The party arguing that the driver

lacked permission has the burden of rebutting the presumption by

conclusive evidence.       Id. at 1188.



                                      III.

      The   unrestricted      language       of   the    omnibus     clause   in   the

Harleysville policy with Perdue’s Used Cars covers any use of an

insured car, if permitted by Perdue’s Used Cars or its permitted

drivers.     The omnibus clause extends coverage to “anyone else

while using with your permission a covered ‘auto’ you own[.]”

(J.A. 802.)      From the perspective of a reasonable layperson,

this language does not limit the authority of Perdue’s Used Cars

                                         9
to give others permission to use loaner cars insured by the

Harleysville       policy.     Nor    does           this    language      restrict      the

authority    of    permitted   drivers          to    allow    others      to   use    these

loaner cars.        Given Maryland’s liberal construction of omnibus

clauses    in     favor   of   policyholders,            the    Harleysville          policy

allows both Perdue’s Used Cars and their permitted drivers to

let others use an insured loaner car.

      The district court found that Perdue’s Used Cars gave Davis

express permission to drive the Monte Carlo--a car insured                                by

the Harleysville policy--and that Perdue’s Used Cars did not

restrict the use of the Monte Carlo by Davis.                              The district

court     further     found    that    after           this     grant      of    express,

unrestricted permission from Perdue’s Used Cars to Davis, she

had full authority to use the Monte Carlo as she would have used

the   Taurus,     including    to    let    others          drive    the   Monte      Carlo.

These factual findings are not contested.

      Importantly, further undisputed facts establish a course of

conduct supporting the district court’s conclusion that Griffin

had implied permission from Davis to drive the Monte Carlo.                               On

the night of the accident, Davis parked the Monte Carlo in her

driveway where she parked the Taurus, and she left the keys on

kitchen counter, just as she normally did.                          Griffin then found

the keys in their usual place, and he saw the Monte Carlo where

the Taurus was typically parked.                      Moreover, Griffin routinely

                                           10
drove Davis’s Taurus, without her being present in the car.                    The

district    judge   found    that    Griffin     had   Davis’s   permission     to

“freely and frequently” drive the Taurus--a finding of fact that

Harleysville does not contest.             Further, Davis never forbade or

restricted Griffin’s use of the Monte Carlo. 4

      As a regular driver of the Taurus, who saw the Monte Carlo

located in the same place as he would have seen the Taurus,

Griffin had the same freedom to take the Monte Carlo loaner car

as the car it replaced.             The ongoing implied permission that

Davis gave Griffin to drive her personal car did not vanish when

she received a substitute car.             Perdue loaned the Monte Carlo to

Davis to replace the Taurus while finishing repairs on it, and

to use as a substitute for her regular car.                  Thus, the Monte

Carlo was meant to serve the same purposes, and to be for the

same uses, as the Taurus.           Davis clearly viewed the Monte Carlo

as a replacement for the Taurus, as shown by where she drove the

car, where she parked it, and where she put the keys.                    Griffin

was   a   regular   permissive      user   of   Davis’s   Taurus.       On   these

uncontested     facts,      we   conclude       that   Griffin    had    implied




      4
       Although Davis may have had uncommunicated restrictive
thoughts and intentions on the night of the accident, she did
not express them to Griffin. (J.A. 1471.)



                                       11
permission      to   drive    the   Monte      Carlo     on    the    night     of   the

accident. 5

        Finally, even if Davis had not submitted ample evidence of

Griffin’s       implied      permission        to     drive    the      loaner       car,

Harleysville has not presented conclusive evidence to rebut the

presumption that Griffin had permission to use the Monte Carlo.

See Martin Marietta, 657 A.2d at 1187-88.                     Indeed, Harleysville

has   not   presented     any    evidence      that    Griffin       actually    lacked

permission to drive the Monte Carlo.                Harleysville has failed to

rebut Maryland’s strong presumption of permissive use.



                                        IV.

      The uncontested facts of this case show that Griffin had

implied permission to drive the Monte Carlo and that he did not

exceed the scope of this implied permission.                   Moreover, no facts

rebut     the   presumption     under   Maryland       law    that    Griffin    was   a

permissive user of the loaner car.                  As a result, the district

      5
       Harleysville contends that Griffin could not have driven
the car within the scope of permission, unless Davis had
expressly permitted Griffin to take the Monte Carlo the night of
the accident.   This position contravenes Maryland’s settled law
that permission may be express or implied and shown through a
course of conduct. See Bond, 424 A.2d at 768; Martin Marietta,
657 A.2d at 1188.    Moreover, Griffin’s use of the car for the
social purpose of going out with friends, rather than for a
business reason, also supports the conclusion that he drove
within the scope of his permission. See Fed. Ins. Co., 275 A.2d
at 408.



                                          12
court properly held that Harleysville’s insurance policy covers

this accident.

     For the above reasons, the judgment of the district court

is

                                                      AFFIRMED.




                              13
DUNCAN, Circuit Judge, concurring:

       Although        I    ultimately         agree    with        the   majority’s       fine

opinion, I do so on slightly different grounds and with somewhat

greater reservations, which I write separately to express.

       My concern flows from the majority’s conclusion that under

the facts of this case, Maryland’s implied permission transfers

between two vehicles.               It is clear, as the majority states, that

Griffin     had   permission         to     use     Davis’s    Taurus       and    that    Davis

herself was a permissive user of the Monte Carlo.                                  It is also

clear under Maryland law a course of conduct between parties may

be    sufficient       to    give    rise      to    implied    permission         to   use   an

automobile.        However,          in   this       case   there     was    absolutely       no

evidence that Griffin had permission--implied or express--to use

the    Monte    Carlo.         There      is   no     evidence       in   the     record    that

Griffin and Davis discussed the provenance of the Monte Carlo or

that Griffin even knew that it was a loaner car to replace her

Taurus.     Leaving one’s keys in the same place each night seems

too small a quantum of evidence from which to imply permitted

use.

       Were we deciding the issue of whether to imply permissive

use,    I      would        prefer     to      certify        the     question       of     such

transferability to the Maryland courts to resolve in the first

instance.       I am persuaded, however, that the issue before us is



                                                14
slightly different.       This appeal presents the narrower question

of whether Harleysville has carried its burden of proof.

     As   the   majority    notes,   under    Maryland     law   there   is   a

presumption that a driver operating a vehicle has either express

or implied permission to do so.           State Farm Mut. Auto. Ins. Co.

v. Martin Marietta Corp., 657 A.2d 1183, 1186 (Md. Ct. Spec.

App. 1995).     The existence of this presumption shifts the burden

to   Harleysville    to    establish      that   Griffin    did    not   have

permission to use the vehicle when the accident occurred. *                   A

party must show “conclusive evidence” to rebut the presumption

as a matter of law.       In the absence of such conclusive evidence,

the presumption is a question for the finder of fact.                    State

Farm, 657 A.2d at 1188; see also Empire Fire & Marine Ins. Co.

     *
       The case law reveals that the presumption of permission
functions as a burden-shifting device. In State Farm, the case
cited by both parties to support the presumption, the court
employed the presumption in this way:
     There is, however, a presumption that Mansel did have
     permission to be driving at that time. As soon as the
     stipulation was read to the jury, appellant had the
     benefit   of  this   presumption,  which  shifted  to
     appellees the burden of persuading the jury that
     Mansel did not have permission to be driving when the
     accident occurred.
657 A.2d at 1186 (internal citations omitted).   The court went
on to say:
     The owner who asserts that the driver did not have
     permission should be held to the same burdens of
     production and persuasion as the owner who asserts
     that the driver was not an agent. . . . .[of showing]
     by a preponderance of the evidence that . . . [the
     driver] did not have permission.
Id. at 1187.


                                     15
v. Liberty Mut. Ins. Co., 699 A.2d 482, 500 (Md. Ct. Spec. App.

1996).

     As I noted earlier, in this case the record reflects an

absence of evidence on the question of whether or not Griffin

had permission to drive the Monte Carlo.      I am not unsympathetic

to   Harleysville’s   plight.   Proving   a   negative--   here,   the

absence of implied permission-- is a difficult burden.        It is,

however, the burden imposed by Maryland law, and Harleysville

has failed to meet it.

     For the narrow reason that Harleysville has failed to carry

its burden of rebutting the presumption of permission, I concur

in the majority’s opinion.




                                16
