                                                                         FILED
                                                                    Jun 19 2019, 8:42 am

                                                                         CLERK
                                                                     Indiana Supreme Court
                                                                        Court of Appeals
                                                                          and Tax Court




ATTORNEY FOR APPELLANT                                     ATTORNEY FOR APPELLEE
Stephen C. Wheeler                                         P. Gregory Cross
Smith Fisher Maas Howard & Lloyd,                          The Cross Law Firm, P.C.
P.C.                                                       Muncie, Indiana
Indianapolis, Indiana



                                            IN THE
    COURT OF APPEALS OF INDIANA

Auto-Owners Insurance                                      June 19, 2019
Company,                                                   Court of Appeals Case No.
Appellant,                                                 18A-CT-1330
                                                           Appeal from the Henry Circuit
        v.                                                 Court
                                                           The Honorable Bob A. Witham,
Travis Shroyer,                                            Judge
Appellee.                                                  Trial Court Cause No.
                                                           33C01-1407-CT-22



Pyle, Judge.




Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019                             Page 1 of 11
                                        Statement of the Case
[1]   Brena Berardicelli (“Berardicelli”), on behalf of her three-year-old son (“J.B.”),

      filed a complaint for damages, alleging that Travis Shroyer (“Shroyer”) caused

      injuries to J.B. by negligently operating a skid loader on his premises. Shroyer’s

      homeowner’s insurance company, Auto-Owners Insurance Company (“Auto-

      Owners”), denied coverage for the accident as well as any duty to indemnify or

      defend Shroyer.


[2]   Shroyer brought an insurance coverage declaratory judgment action requesting

      Auto-Owners indemnify and defend him pursuant to the Personal Liability

      Protection Coverage under his homeowner’s insurance policy (the “Policy”).

      In response, Auto-Owners filed a motion for summary judgment alleging that it

      had no duty to indemnify or defend Shroyer’s liability claims because the

      undisputed evidence demonstrates that J.B. was an “insured” under the Policy

      and that, as a matter of law, the coverage for bodily injury to J.B. was excluded.

      The trial court denied Auto-Owners’ motion for summary judgment.


[3]   On appeal, Auto-Owners argues that the trial court erred in denying the motion

      and that it was entitled to summary judgment as a matter of law because J.B.

      qualifies as an “insured” under the Policy. Concluding that J.B. was an

      “insured” as defined in the Policy at the time of the accident, we reverse the

      denial of summary judgment and remand to the trial court to enter judgment in

      favor of Auto-Owners.


[4]   We reverse and remand.


      Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019         Page 2 of 11
                                                       Issue
              Whether the trial court erred in denying summary judgment to
              Auto-Owners.

                                                       Facts
[5]   Beginning in the summer of 2013 until April 2014, Berardicelli and her two

      sons resided with Shroyer at his residence. Berardicelli and Shroyer were

      “together” and shared a bedroom at the residence. (App. Vol. 2 at 194). On

      April 26, 2014, Shroyer moved a Caterpillar skid loader out of his barn.

      Shroyer planned to use the skid loader to move stone, put in a garden, and do

      some other landscaping. At some point, Shroyer “thought he had backed over

      the pile of dirt he had just left behind him, but got off the machine to check and

      noticed [J.B.’s] battery operated four-wheeler under the machine and [J.B.]

      laying on the ground injured.” (App. Vol. 2 at 183). As a result, J.B. suffered

      serious injuries.


[6]   Property-Owners Insurance Company, which is an affiliate of Auto-Owners,

      insured Shroyer. The Policy identifies the insured premises as Shroyer’s

      residence, which was the location of the accident. The Policy provides personal

      liability coverage with limits of $500,000 for each occurrence. The Policy

      provides liability coverage as follows:


              Coverage E – Personal Liability. We will pay all sums any
              insured becomes legally obligated to pay as damages because of
              or arising out of bodily injury or property damage caused by an
              occurrence to which this coverage applies.

      Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019          Page 3 of 11
                                                        ***

              We will settle or defend, as we consider appropriate, any claim
              or suit for damages covered by this policy. We will do this at our
              expense, using attorneys of our choice. This agreement to settle
              or defend claims or suits ends when we have paid the limit of
              our liability.

      (App. Vol. 2 at 145, 146) (emphasis in original). Furthermore, the Policy

      contains certain exclusions from liability coverage:


              Coverage E – Personal Liability does not apply:
                                                        ***
              (6) to bodily injury or personal injury to any insured.


      (App. Vol. 2 at 148) (emphasis in original). The Policy defines “bodily injury”

      as “physical injury, sickness or disease sustained by a person including resulting

      death of that person.” (App. Vol. 2 at 128). The Policy defines “occurrence” as

      “an accident that results in bodily injury or property damage and includes, as

      one occurrence, all continuous or repeated exposure to substantially the same

      generally harmful conditions.” (App. Vol. 2 at 129) (emphasis in original).


[7]   The Policy defines an “insured” as “any other person under the age of 21

      residing with [the named insured] who is in [the named insured’s] care . . . .”

      (App. Vol. 2 at 128) (emphasis omitted). The term “care” is not defined in the

      Policy. Additionally, separate and specific to the Personal Liability Protection

      section, an insured also means, with respect to any vehicle covered by the

      Policy, “any other person you permit to use the vehicle while on an insured

      premises.” (App. Vol. 2 at 129) (emphasis in original).


      Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019         Page 4 of 11
[8]    A few days after the accident, on April 29, 2014, Shroyer submitted a claim to

       Auto-Owners regarding the accident. Auto-Owners informed Shroyer that no

       coverage existed for the accident because J.B. “resided at the insured premises

       with his mother and Shroyer (and was an ‘insured’ under the Policy, thereby

       triggering certain Policy Exclusions).” (App. Vol. 2 at 109).


[9]    In July 2014, Berardicelli, on behalf of J.B., filed the instant lawsuit (“the

       Lawsuit”) against Shroyer, alleging that J.B. was injured on Shroyer’s property

       by Shroyer’s operation of a machine. Berardicelli later filed a “First Amended

       Complaint for Damages with Jury Demand” against Shroyer in August 2015.

       (App. Vol. 2 at 21). On October 9, 2015, Shroyer filed his answer. Auto-

       Owners continued to deny coverage for the accident.


[10]   On March 14, 2016, Shroyer filed a “Third-Party Complaint on Insurance

       Contract” against Auto-Owners requesting that the trial court enter a

       declaratory judgment stating that Auto-Owners must defend and indemnify him

       in the Lawsuit. (App. Vol. 2 at 30). Auto-Owners answered on May 10, 2016.


[11]   On October 9, 2017, Auto-Owners filed a “Motion for Summary Judgment and

       Designation of Evidence in Support Thereof.” (App. Vol. 2 at 206). On the

       same date, Auto-Owners also filed a “Brief in Support of Motion for Summary

       Judgment.” (App. Vol. 2 at 89). Auto-Owners argued that it has no duty to

       indemnify or defend Shroyer’s liability claims because the undisputed evidence

       demonstrated that J.B. was an insured under the Policy and that as a matter of

       law, any coverage for bodily injury to J.B. was excluded.


       Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019           Page 5 of 11
[12]   Auto-Owners designated several affidavits, exhibits, and depositions in support

       of its position. This evidence included testimony that Berardicelli was not

       employed, did not pay rent, and did not contribute to any household expenses

       or utilities. Shroyer “[t]old [her she] didn’t have to” pay anything, and he took

       care of the expenses himself. (App. Vol. 2 at 194). In addition to providing

       money to Berardicelli, Shroyer purchased diapers and “necessities” for her two

       sons. (App. Vol. 2 at 202). Shroyer typically told Berardicelli if the sons

       needed to be disciplined; however, he “might have told them to sit in the

       timeout chair or something like that.” (App. Vol. 2 at 204).


[13]   In response, Shroyer filed his “Brief in Opposition to Motion for Summary

       Judgment” and designated evidence in support of his position that J.B. was not

       an insured under the Policy. Included in this evidence was Shroyer’s own

       testimony that he was never involved in any of the decision-making regarding

       the various needs of the children. He also testified that he never watched them.

       Likewise, Berardicelli testified that when she had an errand to run, she “always

       had [the boys] with [her].” (App. Vol. 3 at 48). She also testified that she took

       care of the discipline and if an issue did arise, she would “take care of it.”

       (App. Vol. 3 at 48). Furthermore, she stated that she provided food for her

       children through “food stamps[.]” (App. Vol. 3 at 57).


[14]   The trial court held a hearing on Auto-Owners’ motion for summary judgment

       and denied the motion. The trial court did not make any specific findings or

       conclusions regarding its denial of the motion. At the request of Auto-Owners,



       Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019           Page 6 of 11
       the trial court certified its denial of summary judgment for interlocutory appeal,

       and our Court accepted jurisdiction.

                                                     Decision
[15]   Auto-Owners appeals the trial court’s denial of summary judgment. Auto-

       Owners contends that J.B. was an “insured” under the Policy, resulting in the

       exclusion of any coverage for bodily injury to J.B. Auto-Owners presents two

       theories on appeal. First, Auto-Owners asserts that J.B. was in Shroyer’s care,

       thus making him an insured under one definition in the Policy. Second, Auto-

       Owners argues that the accident and injuries arose out of J.B.’s use of a covered

       vehicle with Shroyer’s permission on the insured premises, thus making him an

       insured under another separate definition in the Policy. Because the designated

       evidence shows that J.B. was in Shroyer’s care and qualifies as an insured under

       the first theory, we need not address the merits of Auto-Owners’ second theory.


[16]   When reviewing the grant or denial of summary judgment, we apply the same

       test as the trial court: summary judgment is appropriate only where the

       designated evidence shows there is no genuine issue of material fact and the

       moving party is entitled to judgment as a matter of law. Hughley v. State, 15

       N.E.3d 1000, 1003 (Ind. 2014); Ind. Trial Rule 56(C). “Insurance policies are

       governed by the same rules of construction as other contracts. As with other

       contracts, the interpretation of an insurance policy is a question of law.” Briles

       v. Wasusau Ins. Companies, 858 N.E.2d 208, 213 (Ind. Ct. App. 2006) (citations

       omitted). Further, the “[c]onstruction of a written contract is a question of law

       for which summary judgment is particularly appropriate.” Weidman v. Erie Ins.

       Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019          Page 7 of 11
       Group, 745 N.E.2d 292, 297 (Ind. Ct. App. 2001). And where the challenge to

       summary judgment raises questions of law, we review them de novo. Rogers v.

       Martin, 63 N.E.3d 316, 320 (Ind. 2016).


[17]   In ruling on a motion for summary judgment, not only all facts but also all

       “‘reasonable inferences drawn from those facts are construed in favor of the

       nonmoving party.’” Auto-Owners Ins. Co. v. Harvey, 842 N.E.2d 1279, 1289 (Ind.

       2006) (quoting Colonial Penn Ins. Co. v. Guzorek, 690 N.E.2d 664, 667 (Ind.

       1997)). A party seeking appellate reversal of the denial of summary judgment

       must demonstrate that the designated evidentiary matter negates the existence

       of any genuine issue of material fact and that the moving party is entitled to

       judgment as a matter of law. T.R. 56(C); Cinergy Corp. v. Assoc. Elec. & Gas Ins.

       Servs., Ltd., 865 N.E.2d 571, 574 (Ind. 2007).


[18]   The parties do not dispute that Auto-Owners would not have to provide

       coverage for bodily injury if J.B. was an “insured.” Instead, they dispute the

       existence of a genuine issue of material fact as to whether J.B. was an insured

       under the Policy by virtue of being in Shroyer’s “care.” Although the term

       “care” is undefined in the Policy, the Indiana Supreme Court has previously

       reviewed the definition of “care” as used in an insurance policy. In Holiday

       Hospitality Franchising, Inc. v. AMCO Ins. Co., 983 N.E.2d 574 (Ind. 2013), a

       minor was molested at a hotel by a hotel employee. The minor’s parents were

       not at the hotel, and the minor was staying in a room rented to his friend’s

       mother. The hotel’s insurance policy excluded coverage for molestation “by



       Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019         Page 8 of 11
       anyone of any person while in the care, custody or control of the insured.” Id.

       at 576. The phrase “care, custody, or control” was not defined in the policy.


[19]   In discerning the meaning of “care” as used in an insurance policy, the court

       noted that the dictionary definition of “care” was defined as “[t]he function of

       watching, guarding, or overseeing.” Id. at 579 (citing Webster’s II New College

       Dictionary 168 (1995)). Using this definition, the supreme court focused on the

       child’s status and held that the child was in the hotel’s “care” for purposes of

       the insurance policy, as it was undisputed that the minor was molested by a

       hotel employee while he was a guest at the hotel, was staying in a room rented

       to the mother of his friend, and was in the room behind a locked door when the

       employee entered and molested him.


[20]   Turning to this case, when we focus on the child’s status, as did our supreme

       court in Holiday Hospitality, we conclude that J.B. was an insured under the

       Policy at the time of the accident. As defined in the Policy, an insured means

       “any other person under the age of 21 residing with [the named insured] who is

       in [the named insured’s] care . . . .” (App. Vol. 2 at 128) (emphasis omitted). It

       is undisputed that J.B., three years old at the time, was under the age of 21 and

       was residing with Shroyer. Both Shroyer and Berardicelli testified about J.B.’s

       age and that J.B., his brother, and Berardicelli lived with Shroyer at the insured

       premises from the summer of 2013 until April 2014.


[21]   It is also undisputed that Berardicelli did not work while living with Shroyer

       and was not responsible for paying rent, sharing in any of the utilities, or


       Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019          Page 9 of 11
       household expenses because Shroyer “[t]old [her she] didn’t have to.” (App.

       Vol. 2 at 194). Rather, Shroyer took care of the expenses himself and provided

       Berardicelli with money because they “were together.” (App. Vol. 2 at 194).

       Further, Shroyer purchased a vehicle for Berardicelli and paid for its

       maintenance and gas. Shroyer testified that he provided diapers and other

       “necessities” for J.B. and his brother. (App. Vol. 2 at 202). Although Shroyer

       would typically tell Berardicelli if the brothers needed to be disciplined, he

       “might have told them to sit in the timeout chair or something like that.” (App.

       Vol. 2 at 204). Thus, by providing a place to live, transportation, financial

       support, and other necessities, Shroyer engaged in “the function of watching,

       guarding, or overseeing[]” the various needs and overall well-being of J.B. See

       Holiday Hospitality, 983 N.E.2d at 579.


[22]   Shroyer’s argument that Berardicelli possessed the “sole responsibility”

       concerning the watching, guarding or overseeing of J.B. is unconvincing.

       (Shroyer’s Br. 18). The concept of “care” is not a mutually exclusive concept.

       See, e.g., Holiday Hospitality, 983 N.E.2d at 580-581 (holding that hotel guest

       molested by hotel employee was under the “care, custody or control” of the

       hotel, within the meaning of a similar insurance coverage exclusion, despite

       also being in the care of his friend's mother). Although J.B. was in the care of

       his mother Berardicelli, he was still, as a matter of law, in Shroyer’s care.


[23]   Auto-Owners has demonstrated that the designated evidence negates the

       existence of any genuine issue of material fact and is entitled to judgment as a

       matter of law. Thus, under the Policy, J.B. was an insured at the time of the

       Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019          Page 10 of 11
       accident and any coverage for bodily injury to J.B. is excluded. Accordingly,

       we reverse the trial court’s denial of summary judgment and remand with

       instructions to grant summary judgment in favor of Auto-Owners.


[24]   Reversed and remanded.


       Najam, J., and Altice, J., concur.




       Court of Appeals of Indiana | Opinion 18A-CT-1330| June 19, 2019      Page 11 of 11
