                               STATE OF MINNESOTA
                               IN COURT OF APPEALS
                                     A15-1267

                                      Paek Saengkeo,
                                       Respondent,

                                            vs.

                        Minnesota Automobile Assigned Claims,
                                     Appellant.

                                  Filed April 4, 2016
                                       Reversed
                                    Stauber, Judge
                              Bjorkman, Judge, dissenting

                              Olmsted County District Court
                                 File No. 55CV144128

Raymond L. Hansen, O’Brien & Wolf, L.L.P., Rochester, Minnesota (for respondent)

Timothy J. Eiden, Nicole R. Wells, Eiden & Hatfield, L.L.C., Lake Elmo, Minnesota (for
appellant)

       Considered and decided by Connolly, Presiding Judge; Stauber, Judge; and

Bjorkman, Judge.

                                     SYLLABUS

       Under Minn. Stat. § 65B.64, subd. 3 (2014), the assigned claims plan, an injured

passenger of an uninsured vehicle is not entitled to economic loss benefits if the injured

passenger is dwelling with a family member who is an uninsured owner of a vehicle that

must be insured under Minn. Stat. § 65B.48 (2014), unless there is clear and convincing

evidence that the owner did not contemplate the use or operation of his or her uninsured

vehicle by anyone.
                                       OPINION

STAUBER, Judge

       On appeal from summary judgment in favor of respondent-injured passenger,

appellant-insurer argues that the district court erred by finding respondent eligible for

economic loss benefits under the Minnesota Automobile Assigned Claims Plan (assigned

claims plan) because respondent’s brother, with whom respondent resided, failed to

maintain insurance on a vehicle that he co-owned with his former girlfriend. We reverse.

                                            FACTS

       On August 15, 2010, respondent Paek Saengkeo was injured while he was a

passenger in an uninsured vehicle owned and operated by a third party. At the time of the

single-car accident, respondent was living with his brother and three friends, and he did not

own a vehicle or have a driver’s license.

       Because there was no insurance policy in effect under which no-fault benefits could

be paid, respondent applied for coverage through appellant Minnesota Automobile

Assigned Claims Bureau (MAACB). MAACB then transferred respondent’s claim under

the assigned-claims plan to appellant American Family Insurance. Appellant denied

respondent’s coverage request under Minn. Stat. § 65B.64, subd. 3, because respondent’s

brother (brother) resided in the same household as respondent and was an uninsured co-

owner of a motor vehicle, a 2002 Ford Explorer. Respondent subsequently filed this action

in district court seeking declaratory relief. The complaint alleged that respondent qualified

for coverage under the assigned-claims plan because although brother “held legal title to a




                                              2
motor vehicle along with his former girlfriend [girlfriend] at the time of the . . . accident, . . .

[girlfriend] was in fact the sole owner of the uninsured vehicle.”

       The parties brought cross motions for summary judgment on stipulated facts. The

parties agreed that brother was involved in a relationship with girlfriend from 2005 to 2009.

In 2008, brother and girlfriend co-signed a loan for the purchase of the Ford Explorer.

Although brother was listed as the co-owner on the vehicle’s title, the intent was for

girlfriend to own the vehicle; she made the down payment of $2,000 as well as the monthly

loan and insurance payments without assistance. Brother drove the vehicle only a few times

with girlfriend’s permission.

       Brother and girlfriend ended their relationship in August 2009. Shortly thereafter,

respondent moved in with brother and communication between brother and girlfriend

ceased. Girlfriend maintained possession of the Ford Explorer, and brother had no access to

the vehicle. On the date of the accident, girlfriend alone insured the vehicle through

American Family Insurance.

       The district court granted respondent’s motion for summary judgment and

declaratory relief. The district court found that under Minn. Stat. § 65B.64, subd. 3, the

“issue before the court is whether [brother] ‘contemplated’ use of his former girlfriend’s

vehicle at the time of the accident.” The district court determined that because brother “did

not contemplate use of [girlfriend’s] vehicle at the time of the accident,” he “was not

required to insure the vehicle within the purview of the Minnesota No-Fault Automobile

Insurance Act.” Thus, the district court concluded that respondent was qualified “to receive

economic benefits under the assigned claims plan.” This appeal followed.


                                                 3
                                           ISSUE

       Did the district court err by granting summary judgment to respondent on the basis

that respondent is qualified to receive economic benefits under the assigned claims plan

because respondent’s brother was not required to insure his vehicle since he did not

contemplate the use or operation of the vehicle?

                                        ANALYSIS

       Summary judgment is appropriate if “there is no genuine issue as to any material fact

and . . . either party is entitled to judgment as a matter of law.” Minn. R. Civ. P. 56.03. We

review the district court’s summary judgment decision de novo to determine whether

there are genuine issues of material fact and whether the district court erred in its

application of the law. Ruiz v. 1st Fid. Loan Servicing, LLC, 829 N.W.2d 53, 56 (Minn.

2013). A de novo standard of review also applies to a district court’s interpretation of a

statute. Premier Bank v. Becker Dev., LLC, 785 N.W.2d 753, 758 (Minn. 2010).

       The No–Fault Act requires that every Minnesota automobile owner maintain a

“plan of reparation security,” with specific, statutorily set minimum benefits, including

liability coverage. Minn. Stat. § 65B.48, subd. 1; see also Minn. Stat. § 65B.49, subd.

3(1) (2014) (setting forth the minimum coverage required). But when the No-Fault Act

was passed, it became apparent that some injured persons would not be covered because

of age or lack of car ownership. Mohs v. Parrish’s Bar, 418 N.W.2d 494, 496 (Minn.

1988). As a result, the legislature created the assigned claims plan as a “gap closing”

device that was “designed to provide these individuals basic economic loss benefits.” Id.




                                              4
“The purpose of these gap closing provisions is to provide innocent non-insureds with at

least some protection” under the No-Fault Act. Id.

       The assigned claims plan provides that, as long as specific criteria are satisfied,

certain individuals have the right to basic economic loss benefits even though there is no

identified insurance policy that provides for coverage. Minn. Stat. § 65B.64, subd. 1

(2014). But Minnesota law disqualifies any vehicle owner who fails to insure the vehicle

from participating in the assigned claims plan. See Minn. Stat. § 65B.64, subd. 3.

Minnesota law also disqualifies from the assigned claims plan “[p]ersons, whether or not

related by blood or marriage, who dwell and function together with the owner [of an

uninsured vehicle] as a family.” Id. These provisions do not apply if the owner of the

uninsured vehicle demonstrates by clear and convincing evidence “to have [not]

contemplated the operation or use of the vehicle.” Id.

       The No-Fault Act defines the owner of a vehicle as “a person, other than a

lienholder or secured party, who owns or holds legal title to a motor vehicle or is entitled

to the use and possession of a motor vehicle subjected to a security interest held by

another person.” Minn. Stat. § 65B.43, subd. 4 (2014) (emphasis added). It is undisputed

that respondent lived with his brother, a family member, and that brother is a title-holder

of the Ford Explorer. Thus, brother is an owner of the vehicle for purposes of the No-

Fault Act. But the district court concluded that respondent is “eligible to receive benefits

under the assigned claims plan” because brother did not contemplate using the Ford

Explorer he co-owned with his ex-girlfriend and, therefore, he “was not required to insure

the vehicle” under the No-Fault Act.


                                              5
       Appellant argues that the “district court erred in its analysis that the issue before

the court was whether . . . brother contemplated use of the vehicle he unquestionably co-

owned.” Instead, appellant claims that when Minn. Stat. § 65B.64, subd. 3, is read in

conjunction with Minn. Stat. § 65B.48, subd. 1, the issue is “whether any owner

contemplated the use of the motor vehicle at the time of the accident.”

       The issue presented by appellant is one of statutory construction. The object of

statutory interpretation is to ascertain and effectuate the intention of the legislative body.

Minn. Stat. § 645.16 (2014). In doing so, we first determine whether the statute’s

language, on its face, is ambiguous. Am. Tower, L.P. v. City of Grant, 636 N.W.2d 309,

312 (Minn. 2001). A statute is ambiguous if it is subject to more than one reasonable

interpretation. Amaral v. The Saint Cloud Hosp., 598 N.W.2d 379, 384 (Minn. 1999).

Words and phrases are construed according to their plain and ordinary meanings.

Frank’s Nursery Sales, Inc. v. City of Roseville, 295 N.W.2d 604, 608 (Minn. 1980); see

also Minn. Stat. § 645.08(1) (2014) (providing that words and phrases are construed

according to their common usage). When the legislature’s intent is clearly discernible

from a statute’s plain and unambiguous language, we interpret the language according to

its plain meaning without resorting to other principles of statutory construction. City of

Brainerd v. Brainerd Invs. P’ship, 827 N.W.2d 752, 755 (Minn. 2013).

       Minn. Stat. § 65B.64 (2014) is entitled: “Persons Entitled To Participate In

Assignment Claims Plan.” Subdivision three of that section contains the

“Disqualification” language. Minn. Stat. § 65B.64, subd. 3. The relevant language

provides: “For purposes of determining whether security is required under section


                                               6
65B.48, an owner of any vehicle is deemed to have contemplated the operation or use of

the vehicle at all times unless the owner demonstrates to the contrary by clear and

convincing evidence.” Id. Under the plain language of this subdivision, the owner of a

vehicle may rebut the presumption that the owner is required to maintain insurance on the

vehicle by showing that use of the vehicle was not contemplated. The question before us

is whether that presumption is rebutted if the owner demonstrates that (1) the owner did

not contemplate using the vehicle or (2) the owner did not contemplate use of the vehicle

by anyone.

       Respondent argues that three cases interpreting Minn. Stat. § 65B.64, subd. 3,

support his position that he is entitled to coverage under the assigned claims plan because

the statute merely requires him to show that brother did not contemplate using the

vehicle. In the first case, LaBrosse v. Aetna Casualty & Sur. Co., 383 N.W.2d 736, 737

(Minn. App. 1986), the plaintiff purchased a vehicle and then drove it for several months

without insurance. After the plaintiff could not start his vehicle one cold day, he left the

vehicle on the street in front of his house. Id. Four days later, while the vehicle was still

inoperable, the plaintiff was injured while riding in another’s uninsured vehicle. Id. On

appeal, this court concluded that the plaintiff was not entitled to economic benefits under

the assigned claims plan. The court reasoned that “[a]lthough [the plaintiff’s] car was no

longer available for actual use, there is no indication in his activities before the accident

that he was not considering future use of the vehicle if and when it could be repaired.”

Id. at 738.




                                               7
       In the second case, Kvitek v. State Farm Mut. Auto Ins. Co., the plaintiff was

injured while a passenger in another’s uninsured automobile. 438 N.W.2d 425, 426

(Minn. App. 1989), review denied (Minn. June 21, 1989). At the time of the accident, the

plaintiff owned an uninsured vehicle because his insurance was canceled after his driver’s

license had been revoked. Id. The plaintiff claimed that as a result of his license

revocation and insurance cancelation, he gave the vehicle to his father to sell. Id. The

plaintiff’s father testified that the vehicle was then parked in a parking lot with a “for

sale” sign and that “no one would have been allowed to test drive” the vehicle “because

of insurance considerations.” Id. On appeal from the denial of benefits under the

assigned claims plan, this court reversed and remanded because there was a “fact issue of

whether [the plaintiff] contemplated further use of the [vehicle].” Id. at 428.

       Finally, in Harris v. Am. Family Mut. Ins. Co., 480 N.W.2d 690, 691 (Minn. App.

1992), review denied (Minn. Mar. 26, 1992), the plaintiff’s vehicle began having

mechanical problems shortly after she purchased it. Because she decided that she could

no longer use the vehicle, the plaintiff parked the vehicle in her apartment garage until

she could repair it, allowing the insurance to lapse. Id. The plaintiff was subsequently

injured in an automobile accident while driving an uninsured vehicle owned by her

fiancé. Id. at 690-91. On appeal from the denial of coverage under the assigned claims

plan, this court reasoned that the insurer’s position that plaintiff was not entitled to

benefits “presumes mere ownership of vehicle, without the owner contemplating the

vehicle’s operation or use, is sufficient to require insurance to be purchased.” Id. at 692.

The court then concluded that because there was no evidence that the plaintiff


                                               8
contemplated the vehicle’s operation or use while it was unrepaired and in storage, she

was entitled to coverage under the assigned claims plan. Id.

       Although LaBrosse, Kvitek, and Harris, all iterate that insurance is not required if

an owner of a vehicle does not contemplate the vehicle’s use, the language used in those

cases fails to differentiate between whether insurance is required (1) only if the owner

contemplated using the vehicle or (2) if the owner contemplated the vehicle’s use by

others. For example, in reversing and remanding, this court in Kvitek stated that there

was a fact issue as to “whether [the plaintiff] contemplated further use of his [vehicle].”

438 N.W.2d at 428. But in the very next sentence, this court phrased the issue on remand

as “whether use of [the plaintiff’s vehicle] was contemplated.” Id. And in Harris, this

court concluded that “the time during which a vehicle is intentionally put in storage, and

not some future time when the vehicle may be repaired, is the relevant time period for

determining if the vehicle’s use or operation is contemplated.” 480 N.W.2d at 692

(emphasis added). But the court went on to state that there was “no evidence that, while

[the plaintiff’s vehicle] was in storage and unrepaired, [the plaintiff] contemplated its

operation or use.” Id. (emphasis added). Consequently, the cases cited by respondent

do not definitively resolve the issue, and no other binding authority construes the relevant

statutory language.

       Nonetheless, we conclude that the issue is resolved by the plain language of the

assigned claims plan. In setting forth the basis for disqualification of coverage under the

assigned claims plan, section 65B.64, subdivision 3 specifically references section

65B.48, and premises the disqualification of economic loss benefits on the failure to


                                              9
insure as “required” by that statute.1 See Minn. Stat. § 65B.64, subd. 3 (stating that “[f]or

purposes of determining whether security is required under section 65B.48”). Moreover,

LaBrosse, Kvitek, and Harris each refer to Minn. Stat. § 65B.48, subd. 1, to determine if

the plaintiffs were disqualified from benefits under the assigned claims plan due to their

failures to maintain insurance.2 Thus, a determination of whether respondent is entitled

to benefits under the assigned claims plan ultimately rests on whether his brother was

required to insure his vehicle as set forth in Minn. Stat. § 65B.48, subd. 1.

       Minn. Stat. § 65B.48, subd. 1 provides in relevant part:

                      Every owner of a motor vehicle of a type which is
              required to be registered or licensed or is principally garaged
              in this state shall maintain during the period in which operation
              or use is contemplated a plan of reparation security under
              provisions approved by the commissioner, insuring against
              loss resulting from liability imposed by law for injury and
              property damage sustained by any person arising out of the
              ownership, maintenance, operation or use of the vehicle.


1
  At the time Harris was decided, Minn. Stat. § 65B.64, subd. 3 (1986) stated:
                     A person shall not be entitled to basic economic loss
              benefits through the assigned claims plan with respect to injury
              which was sustained if at the time of such injury the injured
              person was the owner of a private passenger motor vehicle for
              which security is required under section 65B.41 to 65B.71 and
              that person failed to have such security in effect. Members of
              the owner’s household other than minor children shall also be
              disqualified from benefits through the assigned claims plan.
The paragraph discussing whether the owner of a vehicle contemplated the vehicle’s use
or operation was not added to section 65B.64, subdivision 3 by the legislature until 1990.
See 1990 Minn. Laws ch. 456, § 2, at 457.
2
  The relevant language in the current version of section 65B.48, subdivision 1 remains
unchanged from the versions in effect at the time LaBrosse, Kvitek, and Harris were
decided. Compare Minn. Stat. § 65B.48, subd. 1 (2014) with Minn. Stat. § 65B.48, subd.
1 (1986).


                                             10
       The plain language of section 65B.48, subdivision 1 states that an owner of a

vehicle is required to maintain insurance “during the period in which operation or use [of

the vehicle] is contemplated.” Id. This language is clear. It does not state that an owner

is required to maintain insurance if the owner “contemplates his or her use or operation of

the vehicle.” Rather, the statute requires the owner of a vehicle to maintain insurance on

the vehicle if the owner contemplates that anyone will use or operate the vehicle. See id.

Although we acknowledge that the purpose of the assigned claims plan may be to provide

coverage to respondent, the plain language of section 65B.48, subdivision 1 indicates that

the unique facts of this case prevent respondent from being entitled to coverage. And it is

well settled that this court will not re-write an unambiguous statute to conform to what

may be the legislature’s intent. See, e.g., Frederick Farm, Inc. v. Cty. of Olmsted, 801

N.W.2d 167, 172 (Minn. 2011) (stating that an appellate court cannot “add words to a

statute ‘that are purposely omitted or inadvertently overlooked’ by the Legislature”

(quoting Premier Bank v. Becker Dev., LLC, 785 N.W.2d 753, 760 (Minn. 2010)).

Accordingly, we conclude that under the plain language of Minn. Stat. § 65B.48, subd. 1,

respondent’s brother, as a vehicle owner, was required to maintain insurance on the Ford

Explorer as long as use of the vehicle was contemplated by anyone.

       The record reflects that use of the Ford Explorer was contemplated at the time of

the accident; girlfriend was using the Explorer, and the last time brother communicated

with girlfriend, he knew that she was using the vehicle. If brother had any question about

the vehicle’s use or whether he should maintain insurance on the vehicle, he could have

removed his name from the title to ensure that he was not a legal owner of the Ford


                                            11
Explorer. He did not. Because he remained an owner of the vehicle, and use of the

vehicle was contemplated at the time of the accident, brother was required to maintain

insurance on the Explorer under section 65B.48, subdivision 1. The district court erred

by concluding that respondent was not disqualified from benefits under the assigned

claims plan because respondent’s brother failed to insure the vehicle he owned.

                                     DECISION

       A person is not entitled to economic benefits under the assigned-claims plan if the

person is dwelling with a family member who is an owner of an uninsured vehicle unless

the owner demonstrates that the owner was not required to maintain insurance on the

vehicle because use of the vehicle was not contemplated by anyone. Because respondent

was living with his brother, who was the co-owner of a vehicle that he did not insure, and

brother’s former girlfriend was using the vehicle, respondent is not entitled to economic

loss benefits under the assigned claims plan. Accordingly, the district court erred by

denying appellant’s motion for summary judgment and granting respondent’s motion for

summary judgment and declaratory relief.

       Reversed.




                                            12
BJORKMAN, Judge (dissenting)

       I respectfully dissent. Because the undisputed record demonstrates that brother did

not contemplate using the 2002 Ford Explorer at the time of respondent’s accident, I

conclude that respondent is not disqualified from receiving economic-loss benefits under

the assigned claims plan and would affirm.

       The facts relevant to brother’s ownership and contemplated use of the Explorer are

undisputed. At the time of respondent’s accident, brother held title to the Explorer, but had

not used or even had access to it for over a year. During that time, girlfriend had exclusive

use of the Explorer and obtained insurance for it, identifying herself as the sole named

insured. The parties agree that this is the relevant time period for purposes of determining

brother’s obligation to obtain insurance for the Explorer. On this record, evidence that

brother did not contemplate using the Explorer during the relevant time period is not just

clear and convincing, it is undisputed and conclusive.

       Appellant, in essence, argues these facts are not determinative because Minn. Stat.

§ 65B.48, subd. 1 (2014) requires a vehicle owner to obtain insurance if the owner

contemplates anyone using the vehicle. This argument is at odds with the plain language

of Minn. Stat. § 65B.64, subd. 3 (2014) as well as our caselaw interpreting Minn. Stat.

§ 65B.48 (2014).

       Although the broad language of Minn. Stat. § 65B.48, subd. 1, and the definition of

“owner” in Minn. Stat. § 65B.43, subd. 4 (2014), provide generally that every title holder

must obtain insurance for a vehicle when any use is contemplated, the more specific

language of Minn. Stat. § 65B.64, subd. 3, the provision under which appellant would deny


                                             D-1
coverage, must guide our analysis. In enacting Minn. Stat. § 65B.64, subd. 3,3 the

legislature created a specific standard and framework for determining the insurance

obligations of a vehicle owner in the context of disqualification from receiving benefits

under the assigned claims plan. This standard focuses on whether “an owner” contemplates

use of the vehicle rather than whether “every owner” contemplates such use as the broader

statute, Minn. Stat. § 65B.48, subd. 1, provides. I am persuaded that this distinction makes

a difference.

       By using the term “an owner,” the legislature recognized that in situations involving

co-owners, it is possible that each owner may have his own contemplation as to the

vehicle’s usage. This case exemplifies this situation. Brother was “an owner” of the

Explorer during the relevant time period, but he demonstrated by undisputed evidence that

he did not contemplate using the vehicle during that time. Girlfriend was also “an owner”

during the relevant time period, and she clearly contemplated and actually used the vehicle

during that time. To the extent “an owner” may be precluded from receiving benefits under

the assigned claims plan, girlfriend is that owner. Because the record demonstrates by clear

and convincing evidence that brother did not contemplate the use of the Explorer during

the relevant time period, respondent, as brother’s household member, is not disqualified

from participation in the assigned claims plan under Minn. Stat. § 65B.64, subd. 3.




3
   “For purposes of determining whether security is required under section 65B.48, an
owner of any vehicle is deemed to have contemplated the operation or use of the vehicle at
all times unless the owner demonstrates to the contrary by clear and convincing objective
evidence.” Minn. Stat. § 65B.64, subd. 3.

                                            D-2
       Even before the relevant provision of Minn. Stat. § 65B.64, subd. 3 was effective,

in Harris v. Am. Family Mut. Ins. Co., 480 N.W.2d 690, 692 (Minn. App. 1992), review

denied (Minn. Mar. 26, 1992), this court rejected the argument that ownership of a vehicle,

in and of itself, triggers the obligation to obtain insurance under Minn. Stat. § 65B.48, subd.

1. Harris was injured while driving an uninsured motor vehicle owned by a friend. At the

time of the accident, Harris owned but was not using a vehicle that had multiple mechanical

issues. Harris had parked the vehicle in a garage and let the insurance coverage lapse until

such time as she was able to repair and use the vehicle. As here, American Family argued

that Harris was not entitled to benefits under the assigned claims plan because she failed to

insure her owned vehicle. The focus of our analysis was the legislature’s intent when

requiring an owner to obtain insurance during “the period in which operation or use is

contemplated.” Harris, 480 N.W.2d at 691. We concluded that the relevant time period

was when Harris intentionally put her vehicle into storage, not some future time when the

vehicle might be repaired and put back into use. And we held, on that record, that Harris

was not obligated to insure her vehicle—and thus not ineligible for benefits under the

assigned claims plan—during the relevant time period when her accident occurred.4 Here,

too, I would conclude that mere ownership, without contemplated use, is insufficient to


4
  This court noted that the legislature amended Minn. Stat. § 65B.64, subd. 3 in 1990 to
permit vehicle owners to show they did not contemplate use of a vehicle for purposes of
the disqualification provision in the assigned claims plan. Harris, 480 N.W.2d at 692. But
we did not decide whether the amendment applied retroactively because our decision rested
on Minn. Stat. § 65B.48, subd. 1. Following Harris, the legislature further amended Minn.
Stat. § 65B.64, subd. 3 to proscribe the evidentiary standard an owner must meet to
establish that use of the owned vehicle is not contemplated—clear and convincing
evidence. Minn. Stat. § 65B.64, subd. 3 (1996).

                                             D-3
trigger an obligation to obtain insurance under Minn. Stat. § 65B.48, subd. 1, the violation

of which precludes participation in the assigned claims plan under Minn. Stat. § 65B.64,

subd. 3.

       I agree with the majority that the assigned claims plan is designed to provide

innocent non-insureds with some degree of protection, Mohs v. Parrish’s Bar, 418 N.W.2d

494, 496 (Minn. 1988). Providing benefits to respondent would serve that purpose.

Respondent was not a licensed driver, did not own a vehicle (under any definition of

ownership), and was an innocent passenger when he was seriously injured. He had no

reason to obtain insurance. Nor as a practical matter did brother act irresponsibly by not

insuring girlfriend’s vehicle that he did not use and that girlfriend properly insured.

       Moreover, permitting respondent to recover economic-loss benefits is consistent

with the public policy expressed in the Minnesota No-Fault Act. The act is designed to

“relieve the severe economic distress of uncompensated victims of automobile accidents”

by requiring automobile insurers to offer and vehicle owners to purchase insurance that

will cover basic economic loss. Minn. Stat. § 65B.42, subd. 1 (2014). Providing benefits

to respondent under the assigned claims plan honors both goals. Respondent receives

compensation for the medical expenses and other economic loss he sustained as a result of

the accident. And girlfriend fulfilled the requirement that the Explorer be insured under a

policy that includes economic-loss benefits. Accordingly, I would affirm.




                                             D-4
