Kulane v. Great American Assurance Company

Background

In November 2020, Abdikarim Kulane was hauling cargo in his Freightliner semi-trailer on Interstate 35 in Kansas when another driver caused an accident. Kulane suffered serious injuries. The other motorist’s insurance was insufficient to cover those injuries.

Great American Assurance Company insured the semi under a “Non-Trucking Liability and Physical Damage Policy” that included $1 million in underinsured-motorist coverage. Great American denied Kulane’s coverage claim, relying on the policy’s business-use exclusion. That exclusion applied to injuries from accidents occurring while the covered vehicle was being used in a lessee’s business or to transport cargo. The policy stated that the exclusion also applied to uninsured- and underinsured-motorist coverage. Kulane conceded that he was hauling cargo when the accident occurred.

Arguments

Kulane moved for partial summary judgment, which is a request for judgment on a legal issue without a trial. He argued that the Minnesota underinsured-motorist endorsement required Great American to provide coverage because the endorsement did not specifically exclude business use. He also argued that Minnesota’s No-Fault Act made the business-use exclusion invalid.

The court rejected Kulane’s first argument. The endorsement stated that the policy’s provisions applied unless the endorsement modified them. Because the endorsement did not address business use, the court concluded that it did not modify the policy’s business-use exclusion.

Kulane relied on the Minnesota Supreme Court’s decision in Latterell, which held that Minnesota’s No-Fault Act made a business-use exclusion unenforceable in an automobile insurance policy. The court identified possible reasons why Latterell might not control here: Kulane’s policy was a trucking-insurance policy rather than an automobile policy, and the motor carrier that engaged Kulane may have been required to carry separate insurance while the semi was being used for the carrier’s business.

Ruling

The court did not finally decide whether the business-use exclusion was enforceable under Minnesota law. It stated that discovery might show either that no other policy provided underinsured-motorist coverage or that Kulane was covered by one or more additional policies. Those facts could affect whether the policy reasons discussed in Latterell applied.

The court therefore held that the motion was premature and ordered that Kulane’s Motion for Partial Summary Judgment, Docket No. 11, was DENIED without prejudice under Federal Rule of Civil Procedure 56(d)(1).