                          In the
 United States Court of Appeals
              For the Seventh Circuit
                       ____________

No. 03-3520
GREAT WEST CASUALTY COMPANY,
                                          Plaintiff-Appellee,
                              v.

NATIONAL CASUALTY COMPANY, BOGUE
ENTERPRISES, INC., RAY BOGUE, GABRIEL
M. BOGUE, CHRIS T. CRAMER; and CORY,
JOEL AND KYLE CRAMER,
                                     Defendants-Appellants.

                       ____________
            Appeal from the United States District Court
                for the Southern District of Indiana.
     No. IP 02-0936-C-M/S—Larry J. McKinney, Chief Judge.
                       ____________
     ARGUED JUNE 10, 2004—DECIDED OCTOBER 6, 2004
                      ____________



  Before CUDAHY, RIPPLE and ROVNER, Circuit Judges.
  CUDAHY, Circuit Judge. Sometimes it feels as if the only
thing that purchasing insurance actually ensures is that one
will eventually have an unpleasant dispute with the insurer
over payment on a claim. In this case, Lynn Elevator (Lynn)
sold a tractor (as in “tractor-trailer”) to Bogue Enterprises
(Bogue) under a conditional sales agreement, wherein Lynn
would hold title and registration to the tractor and Bogue
2                                               No. 03-3520

would have to comply with a number of restrictions on the
use of the tractor until it had completed payment. Predict-
ably (given that the parties are here in court) Bogue got
into an accident while driving the tractor. Lynn’s insurer,
Great West Casualty Company (Great West), sought a
declaration that it was not responsible for providing
coverage because Lynn did not own the tractor at the time
of the accident. The district court granted Great West’s
motion for summary judgment, and this appeal followed.


                    I. BACKGROUND
  The facts of this case are straightforward. Since 1992,
Bogue Enterprises has purchased a number of tractors and
trailers from Lynn Elevator. On November 20, 2001, Bogue
entered into an agreement with Lynn to purchase a 1995
Freightliner tractor (the tractor) from Lynn. Each purchase
Bogue made from Lynn included the same essential terms,
which in the case of the November 20 sale, were as follows:
    (a) the purchase price of the tractor was $11,000;
    (b) the payment schedule was a minimum of $200 per
        work week until the purchase price was paid in full;
    (c) Lynn would retain title to the tractor until paid in
        full;
    d) Lynn would maintain the license and registration
       for the tractor in its name until paid in full;
    (e) Lynn would maintain the necessary liability and
        property insurance for the tractor through its own
        policy until paid in full; however, Bogue would reim-
        burse Lynn for these costs;
    (f) The tractor would display only Lynn’s signage, plac-
        ards and permits until paid in full;
    (g) Lynn would have priority of dispatch and loading
        until paid in full;
No. 03-3520                                                 3

    (h) Lynn had the right to determine which drivers were
        allowed to operate the tractor until paid in full. The
        parties agreed that Ray Bogue, Gabriel Bogue and
        Scott Hensley—the usual Bogue drivers—could oper-
        ate the tractor;
    (i) Lynn would direct loads to Bogue to facilitate pay-
        ment of the purchase price until paid in full; and
    (j) Bogue could not haul for a competitor of Lynn until
        paid in full.
  Shortly thereafter, Bogue took possession of the tractor and
made regular payments to Lynn, as per their agreement.
On February 22, 2002, Gabriel Bogue was operating the
tractor to deliver a non-Lynn load when he got into an ac-
cident. Great West Casualty Company, Lynn’s insurer brought
a diversity suit in the Southern District of Indiana, seeking
a declaration that it was not responsible for covering the
costs of this accident. National Casualty Company, Bogue’s
insurer, which might potentially be responsible for provid-
ing coverage, defended the action. The district court granted
Great West’s motion for summary judgment, finding that its
policy did not cover claims arising from the accident, because
Bogue was the owner of the tractor at the time of the
accident. This appeal followed.


                     II. DISCUSSION
  We review a district court’s grant of summary judgment
de novo. See Wyninger v. New Venture Gear, Inc., 361 F.3d
965, 974 (7th Cir. 2004). In doing so, we construe all facts
in favor of the non-moving party. See id.; Rogers v. City of
Chicago, 320 F.3d 748, 752 (7th Cir. 2003). Summary judg-
ment is proper “if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to
any material fact and that the moving party is entitled to
judgment as a matter of law.” Fed. R. Civ. P. 56(c) (2004).
4                                                      No. 03-3520

A. “Owner”
  The two insurers in this case disagree as to whether
Bogue or Lynn was the owner of the tractor at the time of
the accident. Great West is hoping that Bogue owned the
tractor so that Bogue’s insurer (National Casualty) will be
the primary insurer responsible for covering the loss. National
Casualty hopes to show that Lynn owned the tractor so that
Lynn’s insurer (Great West) will be primarily responsible.
The parties do not dispute that, if Lynn was the owner, then
Bogue was using the tractor with Lynn’s permission.
  In order to determine whether a party in possession of a
vehicle is an owner or a permissive user under an insurance
omnibus clause, we look to Indiana’s financial responsibility
statute for the operation of motor vehicles. See O’Donnell v.
Am. Employers Ins. Co., 622 N.E.2d 570, 574 (Ind. Ct. App.
1994). Under this statue, “[i]f a motor vehicle is the subject
of an agreement for the conditional sale or lease . . . with
the right of purchase upon the performance of the condi-
tions stated in the agreement and with an immediate right
of possession vested in the conditional vendee or lessee . . .
the conditional vendee or lessee . . . is considered to be the
owner . . . .” Ind. Code § 9-13-2-121; see also Cincinnati Ins.
Co. v. Moen, 940 F.2d 1069, 1073-74 (7th Cir. 1991). In the
present case, the tractor was subject to a conditional sales
agreement. Bogue had the right of purchase upon per-
formance of the conditions stated in the agreement and the
immediate right of possession. Therefore, a straightforward
application of this statute makes it clear that Bogue was
the “owner” rather than a permissive user.1


1
   Even if the statute did not apply in this case, it appears that the
result would be the same because under the common law, the
“owner” is the party who bears the risk of loss. See Automobile
Underwriters v. Tite, 85 N.E.2d 365, 367 (Ind. App. 1949) (en banc)
(“It is generally said that he is the owner of property who, in the
case of its destruction, must sustain the loss.”). Under Indiana’s
                                                        (continued...)
No. 03-3520                                                         5

  National Casualty, however, argues that the courts of
Indiana look not just to the statute but to various indicia of
ownership and control. It further argues that Lynn main-
tained “control” over the tractor because the sales agree-
ment contained a number of conditions with which Bogue
had to comply until the tractor was paid in full. For instance,
the agreement mandated that the tractor display Lynn’s
signage; Lynn would have priority of dispatch and load;
Bogue could not haul for a Lynn competitor and Lynn was
permitted to determine who could drive the tractor.
  It is true that Indiana courts have discussed other “in-
dicia of ownership,” but in no case has an Indiana court
used other indicia to contradict the plain language of this
statute.2 In other words, in every case, the purchaser in pos


1
   (...continued)
version of the Uniform Commercial Code (UCC), in the case of a
sale of a vehicle, the risk of loss passes to the buyer on delivery or
receipt. See Ind. Code §§ 26-1-2-401; 26-1-2-509(3); Pekin Ins. Co.
v. Charlie Rowe Chevrolet, Inc., 556 N.E.2d 1367, 1371 (Ind. Ct.
App. 1990); O’Donnell, 622 N.E.2d at 575-76. Moreover, under the
agreement, Bogue was responsible for the cost of all maintenance,
repair and insurance of the tractor. Great West Br. at 10. This
suggests that the parties to the agreement intended that Bogue
would bear the risk of loss.
2
   National Casualty relies mainly on two Indiana cases for the
proposition that Indiana courts consider various indicia of own-
ership and control. In O’Donnell, the court did consider five indicia
of ownership: (1) whether the parties executed the sales contract;
(2) whether the buyer had remitted a down payment; (3) whether
the sale was conditioned on financing and whether financing was
obtained; (4) whether the vehicle bore an interim license plate;
and (5) whether title had passed from the seller to the buyer. See
622 N.E.2d at 573. However, the O’Donnell court used these
factors only to show that there had been a “completed sale.” In the
present case, it is without question that the parties completed the
                                                       (continued...)
6                                                   No. 03-3520

session of a vehicle sold under a conditional sales contract
was deemed the owner rather than a permissive user. The
agreement in the present case may be considerably more
restrictive than the typical conditional sales agreement—
which is often conditioned only on regular payment. Indiana’s
financial responsibility statute, however, also applies to
leases, which commonly contain restrictive conditions. See,
e.g., Nichols Cyclopedia of Legal Forms Ann. § 6.1803 (2003)
(form automobile lease with option to purchase limiting the
lessee’s ability to use the vehicle out of state, limiting the
lessee’s ability to assign or sublease, requiring lessee, inter
alia, to maintain and service the vehicle, to maintain
insurance, etc.). This suggests that the Indiana legislature
intended the plain language of the statute to apply regard-
less of the presence of restrictive conditions in the agree-
ment.
   Indiana’s bright-line test of ownership makes a great deal
of sense from a policy perspective. The alternative multi-factor


2
  (...continued)
sale transaction. Id. Therefore, it is not surprising that these
“indicia of ownership” support Bogue’s ownership. In both the
present case and O’Donnell, the parties had executed a contract,
were making payment and there were no other conditions prece-
dent to be met. Finally, it should be noted that nowhere does
O’Donnell state or suggest that the element of “control” should be
considered by the court in determining ownership. In Farm
Bureau Mutual Insurance Company of Indiana v. Emmons, the
court did discuss the concept of “control,” but only to make the
unremarkable point that once a seller has sold an automobile to
a buyer, he no longer has “control” over the car and therefore the
buyer could not have been using the automobile with the seller’s
permission. See 104 N.E.2d 413, 415 (Ind. App. 1952). The holding
in Emmons does not necessarily imply that, if the seller had sold
the automobile but maintained some level of control (through
conditions), the buyer would be using the automobile with the
seller’s permission.
No. 03-3520                                                        7

“control” analysis which Great West is proposing would
result in great uncertainty. In conditional sale situations
like this one, ownership could only be definitively deter-
mined ex post by the court. A seller or lessor would be forced
to ponder: Did I include too many conditions in this con-
tract? Are the conditions too restrictive? Did I maintain too
much control? For instance, imagine if we were to hold that
Lynn maintained ownership of the tractor because it
retained the right to determine which drivers could operate
the tractor until payment was made in full. Would that mean
that Seller Corp. maintains ownership of a car if, under the
same circumstances, it (a) requires that only licensed or
insured drivers operate the vehicle; (b) requires that only
drivers with excellent driving records operate the vehicle;
or (c) prohibits use of the vehicle by the nation’s 50 worst
drivers (as identified by name)? What if, instead, Seller
Corp. required that the vehicle not be driven on certain
highways or at speeds over 80 mph until paid in full? There
are infinite permutations, and the consequence of a bad
guess would be dramatic.3
   Great West relies heavily on Riehl v. Nation Mutual
Insurance Company for the proposition that we must con-
sider various indicia of ownership and control. Riehl, however,
is distinguishable. See 374 F.2d 739 (7th Cir. 1967). In Riehl,
the parties executed two separate written agreements con-
temporaneously. The first document was a typical sales
agreement, whereas the second agreement stated, “I hereby
give Leo Lawson, Jr. permission to use my 1960 Rambler
Wagon.” Id. at 743. The existence of these two seemingly
contradictory agreements created at least ambiguity as to


3
  The bright-line definition of “owner” has the further benefit of
placing the risk of loss on the lower cost accident avoider—the
party with possession of the vehicle. It unlikely that any rational
sales condition (no matter how restrictive) could alter the fact that
the possessor is better able to prevent accidents cheaply than is
the seller.
8                                                No. 03-3520

whether the parties intended a sale or a permissive use. That
ambiguity does not exist in this case. Moreover, although in
Riehl we considered various indicia of ownership and con-
trol, it was in an effort to determine when the parties in-
tended ownership to pass. In this case, however, the question
of when ownership would pass (if at all) is answered by the
statute. See Ind. Code § 9-13-2-121; O’Donnell, 622 N.E.2d
at 574-76 (finding that the purchaser under a conditional
sales agreement was the owner of the vehicle at delivery,
despite a provision of the purchase order stating that “Pur-
chaser shall not have any rights in the Vehicle to be pur-
chased until Dealer receives final payment.”). To the extent
the parties’ intent is relevant in this case, it is clear from
the record that the parties intended a sale rather than use
by permission. See, e.g., App. at 18. A vehicle being used by
a person with permission is generally easy to spot, and we
spot none here. See, e.g., State Farm Mut. Auto. Ins. Co. v.
Gonterman, 637 N.E.2d 811, 813 (Ind. Ct. App. 1994) (daugh-
ter); Allstate Ins. Co. v. United Farm Bureau Mut. Ins. Co.,
618 N.E.2d 31, 32 (Ind. Ct. App. 1993) (sister-in-law);
Manor v. Statesman Ins. Co., 612 N.E.2d 1109, 1113 (Ind.
Ct. App. 1993) (employee); Auto-Owners Ins. Co. v. United
Farm Bureau Mut. Ins. Co., 560 N.E.2d 549, 550-51 (Ind.
Ct. App. 1990) (drinking buddy); State Farm Mut. Auto. Ins.
Co. v. Auto. Underwriters, Inc., 371 F.2d 999, 1002 (7th Cir.
1967) (son). Therefore, we agree with the district court and
conclude that Bogue was the owner of this tractor at the
time of the accident.


B. Use with permission
  National Casualty argues that even if Bogue was the
owner of the tractor at the time of the accident, Lynn’s in-
surer, Great West, may still be liable because the Great West
policy covers “[a]nyone . . . while using with your permission
a covered ‘auto’ you own, hire, or borrow.” App. at 6 (empha-
sis added). National Casualty argues that “Bogue would
No. 03-3520                                                 9

still be an insured if Lynn Elevator did not own the tractor
but it had the power to grant permission to use the tractor,
and the tractor was a covered auto that Lynn Elevator did
hire and or borrow, even if it was not doing so at the time.”
Nat’l. Cas. Br. at 20 (emphasis added). There are at least
two problems with this argument.
   First, Lynn did not have the power to grant permission to
use the tractor after it sold it to Bogue. See Emmons, 104
N.E.2d at 415. The conditional sales agreement did not
require Bogue to seek permission before using the tractor,
and the agreement did not give Lynn the right to prevent
Bogue from using the tractor. App. at 17-21. It is true that
Lynn could determine which of Bogue’s drivers were per-
mitted to drive the tractor. Id. at 19(i). However, under the
agreement, Bogue’s usual drivers (Ray Bogue, Gabriel Bogue
and Scott Hensley) were permitted to drive the tractor. Id.
If Lynn had later contacted Bogue and insisted that no Bogue
driver had permission to drive the tractor, it would likely be
in breach of an implied condition of the sales agreement
that Lynn would not interfere with Bogue’s ability to use
the tractor for normal trucking purposes. Ind. Code § 26-1-
1-203 (“Every contract or duty within [the UCC] imposes an
obligation of good faith in its performance or enforcement.”).
Similarly, the fact that Lynn had priority of dispatch and
load, as well as a non-compete agreement, does not mean
that Bogue was using the tractor with Lynn’s permission
any more than an attorney under a retainer agreement with
client A works with other (non-adverse, non-retainer) clients
with the permission of client A. See 7 Am. Jur. 2d Attorneys
at Law § 263 (discussing retainer agreements).
  Second, National Casualty’s argument requires that we
read the Great West policy to cover the tractor if Lynn did,
at times, hire or borrow the tractor, even if it was not doing
so at the time of the accident. In other words, National
Casualty argues that “if the covered auto is an auto that
Lynn Elevator ever hires or borrows, it would fulfill this
condition” and thus be covered by Great West. Nat’l. Cas.
10                                               No. 03-3520

Br. at 20 (emphasis added). The Great West policy, however,
makes clear that it only covers borrowed or hired tractors
while they are being hired or borrowed by or from the
insured. See App. at 8 (policy section B-5(a)) (“This Coverage
Form’s Liability Coverage is primary for any covered ‘auto’
while hired or borrowed by you and used exclusively in your
business as a ‘trucker’ . . . . Coverage is excessive over any
other collectable insurance . . . for any covered ‘auto’ while
hired or borrowed from you by another ‘trucker.’ ”) (empha-
sis added). Both parties agree that this accident did not
occur while the tractor was hired or borrowed by Lynn. For
these reasons, National Casualty’s argument fails and we
AFFIRM the decision of the district court.

A true Copy:
       Teste:

                        ________________________________
                        Clerk of the United States Court of
                          Appeals for the Seventh Circuit




                   USCA-02-C-0072—10-6-04
