United States Court of Appeals,Fourth Circuit.

REPUBLIC WESTERN INSURANCE COMPANY, Plaintiff-Appellant,

v.

Lathaddeus WILLIAMS; Elizabeth Nichols; Carolina Casualty Insurance Company; Harold Nichols; P.B. Express, Incorporated, Defendants-Appellees,

andMorgan Trevathan & Gunn, Incorporated, Defendant.

Republic Western Insurance Company, Plaintiff-Appellee,

v.

Elizabeth Nichols; Harold Nichols, Defendants-Appellants,

andLathaddeus Williams; Carolina Casualty Insurance Company; P.B. Express, Incorporated; Morgan Trevathan & Gunn, Incorporated, Defendants.

 

Argued Sept. 19, 2006.

Decided Jan. 10, 2007.

 

 

Appeals from the United States District Court for the District of South Carolina, at Charleston. Patrick Michael Duffy, District Judge. (CA-04-449-2).

 

 

Before SHEDD and DUNCAN, Circuit Judges, and Richard L. VOORHEES, United States District Judge for the Western District of North Carolina, sitting by designation.

 

Reversed by unpublished PER CURIAM opinion.

Unpublished opinions are not binding precedent in this circuit.PER CURIAM.

Lathaddeus Williams is an independent owner-operator of a 1991 Freightliner tractor (“the Freightliner”). Republic Western Insurance Company (“Republic”) issued an insurance policy to Williams providing coverage for his vehicles that are not used for commercial purposes. Carolina Casualty Insurance Company (“Carolina”) issued an insurance policy to P.B. Express, Inc. (“PBX”), which leased the Freightliner from Williams. The Carolina policy provided PBX coverage for the company’s vehicles used in commercial transportation. After a vehicle accident involving Williams (who was then driving the Freightliner) and Elizabeth Nichols, Williams filed a tort action against Nichols in state court, and she filed a counterclaim against him. Republic thereafter filed this declaratory judgment action against Williams, Nichols, Carolina, and PBX seeking a determination of the parties’ respective rights and obligations arising from the state-court litigation.

 

 

In its amended complaint, Republic also named Harold Nichols and Morgan Trevathan & Gunn, Inc. (“MTG”) as defendants. Although Harold Nichols is a party to this appeal, MTG is not. For our purposes, Harold Nichols’ interest is identical to Elizabeth Nichols’ interest.

 

On cross-motions for summary judgment, the district court originally granted summary judgment in favor of Republic and against Carolina. However, on motion for reconsideration, the district court reversed its prior ruling and granted summary judgment in favor of Carolina, holding inter alia that Williams is covered under the Republic policy but not under the Carolina policy. Republic and Nichols now appeal. Because we conclude that Williams’ accident is covered under the Carolina policy but not the Republic policy, we reverse the summary judgment and remand with instructions for the district court to enter judgment in a manner consistent with this opinion.

 

 

I

 

Summary judgment is appropriate “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 a judgment as a matter of law.” Fed.R.Civ.P. 56(c). “We review the district court’s order granting summary judgment de novo, viewing the facts in the light most favorable to, and drawing all reasonable inferences in favor of, the nonmoving party.” Garofolo v. Donald B. Heslep Assocs., Inc., 405 F.3d 194, 198 (4th Cir.2005). When faced with cross-motions for summary judgment, we review “each motion separately on its own merits to determine whether either of the parties deserves judgment as a matter of law.”  Rossignol v. Voorhaar, 316 F.3d 516, 523 (4th Cir.2003). “Although an order denying summary judgment is not independently appealable, we may review such an order when it is appealed along with an order granting a cross-motion for summary judgment.” National Coalition for Students with Disabilities Educ. and Legal Defense Fund v. Allen, 152 F.3d 283, 293 (4th Cir.1998).

 

 

A.

 

The material facts of this case are undisputed. In January 2002, Williams and PBX entered into a written agreement for services and a permanent lease of the Freightliner. The lease provided that PBX would have exclusive control of, and would assume complete responsibility for the operation of, the Freightliner when it was in use for PBX. PBX maintained a policy with Carolina to cover the company’s commercial transportation, and Williams maintained a policy with Republic to cover his vehicles when in non-commercial use.

 

At the inception of the lease, Williams completed an employment application with PBX and a pre-employment drug screen. PBX provided Williams with placards containing the PBX logo that were affixed to the sides of the Freightliner. PBX’s placards and all of its identifying numbers remained on the Freightliner throughout the lease. PBX also supplied Williams with an accident kit to be kept in the Freightliner at all times. The accident kit contained a disposable camera, a Carolina accident information form, and an insurance card indicating proof of PBX’s insurance with Carolina.

 

Pursuant to the lease, Williams would operate the Freightliner as a local driver for PBX. Under this arrangement, Williams used the Freightliner to haul containers between the PBX terminal and three Charleston, South Carolina, shipyards. PBX typically employed four local drivers at any given time, and it required these drivers to come to its terminal and obtain their assignments personally from the city dispatcher. PBX gave its drivers one assignment at a time, and when a driver was sent to a shipyard, he had to return to the PBX terminal to get the next assignment.

 

Williams, like all PBX local drivers, was paid only for time spent hauling containers. Although PBX did not require Williams to arrive at the terminal at any specific time for his first assignment of each day, he normally went to the PBX terminal with the expectation that work was immediately available. PBX permitted Williams to drive the Freightliner to and from work everyday and to park it overnight in a lot on a side street about one mile from his home. PBX did not direct Williams’ route between his home and the PBX terminal, and it did not direct the routes he took while hauling containers.

 

PBX required its local drivers to perform a pre-trip inspection before starting and driving a truck. Williams performed his daily pre-trip inspection every morning in the lot near his home where he parked the Freightliner. Williams testified that the Freightliner was “for business, not for pleasure,” J.A. 272, and that he only drove it for business; when he was not conducting business, he parked the truck.

 

 

B.

 

On April 30, 2003, Williams was driving the Freightliner from the overnight parking lot to the PBX terminal when he was involved in an accident with Elizabeth Nichols. At the time of the accident, Williams was on his way to work, expecting to receive his first assignment for the day. That morning, Williams acted in his usual course by walking to the lot near his home, performing the required pre-trip inspections, and driving to the PBX terminal, with the Carolina placards affixed to the Freightliner, to obtain his assignments for the day. Because Williams had not yet arrived at the PBX terminal, he was not hauling a container (i.e., he was “bobtailing”).

 

Immediately following the accident, Williams gave the investigating officer his license, vehicle registration, and the Carolina insurance card contained in the PBX accident kit. Williams then called PBX as required by PBX procedures. Williams spoke to James Floyd, the PBX southeast regional manager, who advised him to get the disposable camera from the accident kit and take pictures. Floyd also advised Williams to fill out the Carolina accident information form contained in the accident kit. Shortly after Williams called PBX, Patrick Crowell of PBX prepared a “First Report of Accident” on a PBX form. In describing the accident on the form, Crowell wrote that the driver was pulling onto the interstate when a lady pulled into his lane. Crowell also noted that the driver was coming from home to work.

 

Floyd met Williams at the hospital. Upon arriving at the hospital, Floyd secured the camera and the Carolina accident information form completed by Williams. Floyd also instructed Williams to undergo drug and alcohol testing, which Williams did. Crowell later collected the information obtained from Williams and had it sent to PBX’s corporate office.

 

Williams’ employment with PBX was terminated in January 2004, at which time a Termination Record Form was prepared. This form contained an “Accident Detail” showing that Williams was involved in one accident while with PBX, namely, the April 30, 2003, accident. The form stated that this accident was “DOT recordable.” PBX acknowledged that an accident is not “DOT recordable” if the PBX driver was on his own time and in his own vehicle.

 

 

C.

 

Williams sued Nichols in state court alleging that her negligence caused the accident, and Nichols filed a counterclaim alleging that the accident resulted from his negligence. Upon receipt of a demand letter from Williams, Republic defended him under a reservation of rights.

 

Thereafter, Republic filed this declaratory judgment action in the district court against Williams, Elizabeth and Harold Nichols, Carolina, PBX, and MTG seeking a determination of the parties’ respective rights and obligations arising from the state-court litigation. Subsequently, each party moved for summary judgment. Carolina and PBX argued that Republic’s non-commercial policy applied because Williams was not operating the Freightliner in the “actual use of, or in the business of,” PBX at the time of the accident. Conversely, Republic maintained that it was not obligated to provide coverage because Williams was operating in the business of PBX at the time of the accident, and therefore the exclusionary language of Republic’s policy applied. Republic also asserted that PBX is not an insured under Republic’s policy and therefore lacked standing to assert claims for coverage, defense, or bad faith against Republic. Nichols asserted that both the Republic and Carolina policies provide coverage to Williams because under the Carolina policy, the Freightliner was a hired auto and Williams was using the Freightliner with PBX’s permission, and under Republic’s policy the business exclusion does not apply because the Freightliner was not being used in the business of PBX at the time of the accident.

 

 

PBX had filed a counterclaim against Republic asserting that it was an insured under the Republic policy, that Republic had a duty to defend any lawsuit under the policy, and that Republic was acting in bad faith by not providing coverage or a defense.

 

On cross-motions for summary judgment, the district court held (1) Williams was not owed coverage under the Republic policy because of that policy’s business exclusion; (2) Williams was owed coverage as a permissive user under PBX’s policy with Carolina; and (3) PBX was not an insured under Republic’s policy. Carolina and PBX then moved for reconsideration, which the district court granted. On reconsideration, the district court reversed its prior order and held that Williams was not acting in the business of PBX at the time of the accident and that coverage for Williams applied under Republic’s policy. The district court further held that Williams was not covered under the Carolina policy because he was not a permissive user as defined by that policy. Upon reconsideration, the district court did not address whether or not PBX was an insured under the Republic policy; however, by granting summary judgment in favor of PBX, the district court effectively held that PBX was an insured under the Republic policy.

 

 

II

 

On appeal, Republic contends that the district court erred in holding that the business exclusion of its policy does not apply. Republic also contends that the district court erred in holding that Williams was not covered under the permissive use provisions of the Carolina policy. On cross appeal, Nichols contends that both policies apply. For the reasons stated below, we agree with Republic.

 

 

Republic also contends that the district court abused its discretion by granting the motion for reconsideration. We find no merit to this contention.

 

A.

 

We first address Republic’s argument that coverage for Williams is excluded under the Republic policy because Williams was acting “in the business of” PBX at the time of the accident. The Republic policy reads in relevant part:

No Liability Coverage is afforded when described vehicles … [are] used to carry property in any business or in route for such purpose.

 

J.A. 664. Although at the time of the accident Williams was not carrying a load and did not have a specified load to pick up, the parties do not dispute that he was on his way to the PBX terminal with the purpose of obtaining a work assignment. As such, Williams was acting in accordance with his usual course of business, which was to drive to the PBX terminal to obtain his work assignments for the day. We conclude that these undisputed facts establish that Williams was “in route … to carry property” for PBX’s business at the time of the accident. Accordingly, we hold that the Republic policy excludes coverage for Williams regarding the underlying accident.

 

 

Nichols contends that the exclusion is not part of the insurance contract because it is contained in the certificate of insurance and not in the contract. We have reviewed this issue and find that Williams’ certificate of insurance was expressly incorporated into the policy.

 

Although the actions taken by PBX immediately following the accident do not independently establish that Williams was “in route to carry property” for PBX, the following facts provide further support for such a finding. After the accident, PBX conducted a thorough investigation. PBX acknowledged that this investigation would not have been necessary if Williams had not been either on the job, under dispatch, or acting in the business of PBX at the time of the accident. Furthermore, PBX listed the accident as DOT recordable on Williams’ termination form, and it admitted that an accident is not DOT recordable if the PBX driver is on his own time and in his own vehicle. J.A. 368-69. Finally, Williams testified that the Freightliner was “for business, not for pleasure” and that he only drove the truck for business. J.A. 272.

 

B.

 

We now turn to the question of whether Williams is covered under the Carolina policy based on the permissive use provision of that policy. The Carolina policy reads in relevant part:

We will pay all sums an “insured” legally must pay as damages because of “bodily injury” … to which this insurance applies caused by an “accident” resulting from the ownership, maintenance, or use of a covered “auto.”

 

J.A. 585. The Carolina policy defines “insureds” as being:a. You for any covered “auto.”

b. Anyone else while using with your permission a covered “auto” you own, hire, or borrow.

 

J.A. 585. PBX is the named insured in the Carolina policy. This provision thus requires two elements in order for someone other than PBX to qualify as an additional insured: (1) use of an owned, hired, or borrowed auto; and (2) permission from PBX. Carolina does not contend that the Freightliner is not a “hired auto.” Therefore, for our purposes the only question is whether Williams was using the Freightliner with permission from PBX.

 

Carolina contends that the permissive use provision is inapplicable because Williams operated as an independent contractor; as such, he had the right to use the Freightliner without permission from PBX. Carolina further asserts that pursuant to the lease, PBX had no authority to grant permission to Williams to operate the Freightliner at the time of the accident or at any other time the Freightliner was not in “actual use” for PBX. We disagree with Carolina.

 

The lease reads in relevant part:

Carrier shall have Exclusive possession, control, and use of the equipment and shall assume complete responsibility for the operation of the equipment while in actual use for the Carrier. Whenever the equipment is not in actual use for Carrier, the equipment shall bear no placard or other reference of any kind to Carrier.

 

J.A. 444 (emphasis added). The lease defines PBX as the “carrier” and the Freightliner as “equipment.” The Department of Transportation has issued the following regulation with respect to equipment leases between motor carriers and owner/operators (such as the lease in this case):(c) Exclusive possession and responsibilities:

(1) The lease shall provide that the authorized carrier lessee shall have exclusive possession, control, and use of the equipment for the duration of the lease. The lease shall further provide that the authorized carrier lessee shall assume complete responsibility for the operation of the equipment for the duration of the lease.

 

49 C.F.R §  376.12(c)(1) (emphasis added).

 

Although the lease specifies that PBX (the lessee) will assume responsibility for the operation of the Freightliner only “while in actual use” for PBX, this regulation requires that PBX have exclusive possession and assume complete responsibility for the Freightliner “for the duration of the lease.” The lease, which was in effect at the time of the underlying accident, thus fails to meet the requirements of the regulation. Because parties may not enter into a contract that violates the law, PBX-by operation of the regulation-had exclusive possession and control of the Freightliner throughout the term of the lease. Therefore, because PBX allowed Williams to drive the Freightliner to and from work, his use of the Freightliner was necessarily permissive. Accordingly, Williams was a permissive user at the time of the accident, and coverage for Williams is provided under the Carolina policy.

 

 

Ohio law governs interpretation of the Carolina policy. “It is elementary that no valid contract may be made contrary to statute, and that valid, applicable statutory provisions are parts of every contract.”  Bell v. Northern Ohio Tel. Co., 78 N.E.2d 42, 43 (Ohio 1948).

 

Like other federal trucking regulations, §  376.12(c)(1) was “intended to safeguard the public by preventing authorized carriers from circumventing applicable regulations by leasing the equipment and services of independent contractors exempt from federal regulation.” Hartford Ins. Co. of the Southeast v. Occidental Fire & Cas. Co. of N.C., 908 F.2d 235, 238 (7th Cir.1990).

 

III

 

For the reasons stated above, the judgment of the district court is reversed and the case is remanded to the district court with instructions to enter judgment in a manner consistent with this opinion.

 

 

Because we conclude that the Republic policy does not provide coverage for Williams, we hold that PBX does not have a claim for bad faith against Republic.

 

REVERSED.

Court of Appeals of Michigan.

AMERISURE MUTUAL INSURANCE COMPANY, Plaintiff/Counter defendant-Appellant,

v.

CAREY TRANSPORTATION, INC., Diane Carey, and Gerri Thomas, Defendants/Counter plaintiffs-Appellees

andGerald Thomas, Trailer X-Press, Inc., and Phoenix Insurance Group, Defendants-Appellees.

 

Jan. 4, 2007.

 

 

Wayne Circuit Court; LC No. 05-503294-CK.

 

Before: FORT HOOD, P.J., and MURRAY and DONOFRIO, JJ.

PER CURIAM.

On April 19, 2006, the circuit court entered an order granting summary disposition in favor of Gerri Thomas (Gerri), Trailer X-Press, Inc. (TXP), Phoenix Insurance Group (Phoenix), Carey Transportation, Inc. (CTI), and Diane Carey (Diane). Plaintiff/Counter defendant, Amerisure Mutual Insurance Company (Amerisure), appeals the circuit court’s order as of right, arguing that the “employer’s liability,” “wokers’ compensation,” and “fellow employee” exclusions contained in its policy excluded coverage to Gerri because her injuries arose “out of and in the course of her employment.” We reverse the circuit court’s order to the extent that it granted summary disposition in favor of Gerri and CTI, and to the extent that it ruled that Amerisure had a duty to defend and indemnify Mike  and CTI, and that TXP was a “motor carrier for-hire” and was required to carry $750,000 worth of insurance coverage.

 

 

Mike Thomas is the husband of Gerri and was the operator of a tractor trailer in the course of his employment with CTI when the accident occurred, resulting in injuries to Gerri who occupied the “sleeper berth” of the tractor at the time.

 

I. Background

 

Mike and Gerri were employed by CTI and dispatched to drive goods from Michigan to California. Mike and Gerri successfully completed their trip to California, and were subsequently dispatched to pick up produce in Salinas, California, and drive it back to Michigan. In an effort to make their trips as quick and efficient as possible, Mike and Gerri alternated driving duties, with the “off-duty” individual spending time resting in the “sleeper berth” so that he or she could be rested for his or her next driving shift, as well as be in compliance with the Federal Motor Carrier Safety Regulations hours-of-service rules. On June 30, 2004, approximately two hours after Mike and Gerri’s third driver change in Cheyenne, Wyoming, where Mike took over driving duties and Gerri entered the “sleeper berth,” Mike took a corner at too high of a speed causing CTI’s truck to turn over, which resulted in injuries to both Mike and Gerri.

 

 

During a specified eight-day period, a driver cannot drive more than 14 hours in a 24-hour period, nor can a driver drive more than 11 hours straight without a rest period. A rest period must consist of ten consecutive hours, which must be spent in the “sleeper berth” if the truck is moving. 49 CFR §  395.1

 

On November 8, 2004, Gerri filed suit in Ottawa Circuit Court against Mike and CTI alleging negligent operation of a motor vehicle. On February 4, 2005, Amerisure filed a declaratory action in Wayne Circuit Court to determine whether its policy with CTI provided liability coverage to Gerri, as well as to determine if it had to provide a defense and/or indemnify Mike, Diane, TXP or CTI in regard to the pending tort suit in Ottawa Circuit Court. Amerisure also sought a determination regarding the priority of coverage provided by Phoenix.  After various motions for summary disposition were filed, the Wayne Circuit Court concluded that the exclusions contained in Amerisure’s policy did not apply because Gerri’s injuries did not arise out of and in the course of her employment with CTI. Accordingly, the trial court entered an order granting summary disposition in favor of Gerri and CTI. The order also reflected that the court had ruled that Amerisure had a duty to defend and indemnify Mike and CTI, and that TXP was a motor carrier for hire with respect to the operation of the tractor-trailer on June 30, 2004, and thus, was obligated to have $750,000 of liability coverage.

 

 

Amerisure later conceded that it had a duty to defend and indemnify TXP and Diane, and acknowledged that its policy was primary to Phoenix’s policy.

 

II. Standard of Review

 

We review a circuit court’s decision to grant or deny a motion for summary disposition de novo. Dressel v. Ameribank, 468 Mich. 557, 561; 664 NW2d 151 (2003). Summary disposition is proper under MCR 2.116(C)(10) if the documentary evidence shows that there is no genuine issue regarding any material fact and the moving party is entitled to judgment as a matter of law.  Veenstra v. Washtenaw Country Club, 466 Mich. 155, 164; 645 NW2d 643 (2002).

 

Here, the circuit court’s order granting summary disposition in favor of appellees was predicated on its finding that the exclusions contained in Amerisure’s policy with CTI did not preclude coverage for the June 30, 2004, accident because Gerri’s injuries did not arise out of and in the course of her employment with CTI. The proper interpretation of a contract, including an insurance policy, and whether the language of the contract is ambiguous are questions of law that we review de novo. Klapp v. United Ins Group Agency, 468 Mich. 459, 463; 663 NW2d 447 (2003). We also review preliminary legal questions, such as the interpretation of a statute, de novo. Wakin v. Chamberlain, 467 Mich. 329, 332; 653 NW2d 176 (2002).

 

 

III. Analysis

 

In relevant part, Amerisure’s policy states that it “will pay all sums an ‘insured’ legally must pay as damages because of ‘bodily injury’ or ‘property damage’ to which this insurance applies, caused by an ‘accident’ and resulting from the ownership, maintenance or use of a covered ‘auto.’ “  However, Amerisure’s policy also contains three relevant exclusions. One exclusion, “Employee Indemnification and Employer’s Liability,” states that Amerisure’s policy does not cover bodily injury to:

 

 

The parties agree that, absent an applicable exception, the policy would cover the accident.

 

[a]n ‘employee’ of the ‘insured’ arising out of and in the course of:

(1) Employment by the ‘insured’ or

(2) Performing the duties related to the conduct of the ‘insured’s’ business

 

 

Furthermore, Amerisure’s “Fellow Employee” exclusion states that Amerisure’s policy does not cover bodily injury to:

any fellow ‘employee’ of the ‘insured’ arising out of and in the course of the fellow ‘employee’s’ employment or while performing duties related to the conduct of your business.

 

 

Finally, Amerisure’s “Workers’ Compensation” exclusion states that Amerisure’s policy does not cover:

[a]ny obligation for which the ‘insured’ or the ‘insured’s’ insurer may be held liable under any workers’ compensation, disability benefits or unemployment compensation law or any similar law.

 

 

Moreover, the federally mandated “MCS-90” endorsement contained in Amerisure’s policy, which provides indemnity coverage to the “insured” for “any final judgment recovered against the insured for public liability resulting from negligence in the operation, maintenance or use of motor vehicles,” expressly provides that the indemnity coverage does not “apply to injury to or death of the insured’s employees while engaged in the course of their employment.” Thus, Amerisure correctly points out that its policy does not cover Gerri’s injuries, nor does it have a duty to defend Mike or CTI, if Gerri’s injuries arose “out of and in the course of” her employment or if Gerri was “performing the duties related to the conduct of the insured’s business.” Furthermore, Amerisure does not have to indemnify Mike or CTI if Gerri’s injuries occurred “while engaged in the course of [her] employment.”

 

The terms of an insurance policy are given their commonly used meanings, unless clearly defined in the policy. Twichel v. MIC General Ins Corp, 469 Mich. 524, 534; 676 NW2d 616 (2004). Amerisure’s policy does not define “arising out of and in the course of” employment, “performing duties related to the conduct of” the insured’s business, nor “while engaged in the course of” employment. However, an ambiguity is not created because the definition of a word that has a common usage has been omitted. Morinelli v. Provident Life & Accident Ins Co, 242 Mich.App 255, 262; 617 NW2d 777 (2000). An insurance contract is only ambiguous if its “provisions are capable of conflicting interpretations.” Farm Bureau Mut Ins Co v. Nikkel, 460 Mich. 558, 566; 596 NW2d 915 (1999). If insurance contract language, exclusionary clauses in particular, are found to be ambiguous, any ambiguities must be strictly construed against the insurer to maximize coverage. American Bumper & Manufacturing Co v. Hartford Fire Ins Co, 452 Mich. 440, 448; 550 NW2d 475 (1996); Zurich American Ins Co v. Amerisure Ins Co, 215 Mich.App 526, 533; 547 NW2d 52 (1996).

 

Given the common usage of the questioned terminology, we conclude that the questioned terminology is not ambiguous. Morinelli, supra at 262. Because Amerisure’s policy did not define the aforementioned terminology, we will look to collateral sources, such as Black’s Law Dictionary, to find the commonly used meaning of the terminology. Twichel, supra at 534; Morinelli, supra at 262 (a court may consult a legal dictionary to determine the meaning of a phrase that has a peculiar legal meaning).

 

Here, the circuit court determined that Gerri’s injuries did not arise out of and in the course of her employment with CTI. In doing so, the circuit court agreed with appellees argument that the federal Motor Carrier Safety regulations, which provide safety regulations for the trucking industry, should be used to help define the meaning of “arising out of and in the course of” employment. The federal Motor Carrier Safety regulations, which have been adopted by Michigan pursuant to MCL 480.11 a, state that “time spent resting in a sleeper berth” is not considered to be “on-duty time.” 49 CFR §  395.2. However, since the federal Motor Carrier Safety regulations do not define or even utilize the phrase “arising out of and in the course of employment,” and instead merely contain measures to insure the safety of truck drivers, we conclude that it was error for the circuit court to use the federal Motor Carrier Safety regulations definition of “on-duty” to define what Amerisure meant when it attempted to exclude coverage for injuries “arising out of and in the course of” employment. Twichel, supra at 534; See also People v. Yamat, 475 Mich. 49, 54-58; 714 NW2d 335 (2006) (stating that cases interpreting terms in an insurance contract are not pertinent to determining the definition of a different statutory term relating to the same subject matter). And, as explained below, just because an employee is considered to not be “on-duty” at the time he or she is injured, does not necessarily mean that his or her injuries did not arise “out of and in the course of” employment.

 

Since Amerisure did not define “arising out of and in the course of” employment, and Michigan courts have not previously interpreted this exclusionary language in any other insurance contract, we look to a legal dictionary for help to define this phrase that has a peculiar legal meaning. See Morinelli, supra at 262. Black’s Law Dictionary defines “course of employment” as “events that occur or circumstances that exist as part of one’s employment; esp., the time during which an employee furthers an employer’s goals through employer-mandated directives.” Black’s Law Dictionary, Deluxe Seventh Edition (West 1999).

 

 

We note that this Court has held that the exclusionary insurance policy language “arising out of his or her employment” should be construed in a manner consistent with the Workers’ Disablity Compensation Act (WDCA) because the language is identical to that used in §  301, and thus, it is believed that the language was crafted in consideration of workers’ compensation law. State Farm Mut Auto Ins Co v. Roe, 226 Mich.App 258, 265; 573 N.W.2d 628 (1997). In the context of the WDCA, this Court has concluded that an injury arises “out of and in the course of employment” if a causal connection exists between the injury and a work-related event and the predominant cause of the harm is not attributable to a personal risky choice where the circumstance of employment do not significantly add to the risk of harm. Ruthruff v. Tower Holding Corp/Tower Automotive, Inc, 261 Mich.App 613, 618-619; 684 NW2d 888 (2004). Furthermore, in Beck v. C & J Commercial Driver Away, Inc, 260 Mich. 550, 553-554; 245 NW 806 (1932), our Supreme Court concluded that employees who were sleeping in their vehicles incident to their employment were considered to be within the course of their employment for purposes of the WDCA. However, as previously discussed, in Yamat, supra at 54-58, our Supreme Court strongly suggested that it is improper for courts to use cases interpreting insurance contract terms as a guide to interpret statutory terms, and vice versa. Thus, we will not use cases interpreting the WDCA’s statutory terms as a guide in this insurance contract dispute. Id .

 

Here, we conclude that Gerri’s injuries occurred as a result of a circumstance that existed as part of her employment. The following undisputed facts support this conclusion. It is undisputed that Gerri and Mike were employees of CTI and were driving cross-country pursuant to a CTI dispatch. It is also undisputed that as a result of driving cross-country, Mike and Gerri needed to comply with federal law regarding driving and rest time. As a result of that circumstance, Gerri was resting in the “sleeper berth” while Mike was driving, and the accident occurred under that scenario.

 

In other words, although the federal and state regulations indicated that Gerri was off duty while in the sleeper, the regulations designation of this “off duty” time is to inform drivers that when they are in the sleeper, they need not comply with any of the safety standards. But because Gerri was in the sleeper to comply with the rest period regulations, and these rest period regulations only come into play because Gerri and Mike were dispatched by CTI to drive cross-country, we conclude Gerri was injured in the course and scope of her employment.

 

It is irrelevant whether Mike and Gerri were required to work as a driving team, as they were operating as one in this particular instance. The fact that Gerri was not being paid at the time of the accident is also not dispositive, as under the relevant definition, Gerri’s presence in the “sleeper berth” was a circumstance that occurred as a result of her cross-country over the road employment with CTI.

 

 

We are not persuaded by appellees’ hypothetical fears of what could result under our ruling. Our task is to decide the case in accordance with the law and facts developed in the case, not to be swayed by hypothetical results.

 

Accordingly, construing “arising out of and in the course of” employment in a consistent manner with the definition contained in Black’s Law Dictionary, we conclude that, under the factual scenario before us, Gerri’s injuries arose “out of and in the course of” her employment, and thus, likewise occurred “while engaged in the course of employment.” The circuit court erred when it held that the exclusions contained in Amerisure’s policy were not applicable to preclude coverage, and likewise erred when it held that Amerisure had a duty to defend and indemnify Mike and CTI.

 

Finally, Amerisure, TXP and Phoenix also argue that the circuit court erred when it concluded that TXP was a “motor carrier for-hire” and was required to carry $750,000 worth of insurance coverage. Under the federal Motor Carrier Safety Act and the federal Motor Carrier Safety regulations, which have been adopted by Michigan pursuant to MCL 480.11 a, “for-hire motor carriers” or “private motor carriers” are required to maintain liability insurance in the amount of $750,000 for nonhazardous interstate or foreign commerce that has a “gross vehicle weight of 10,001 pounds or more.” 49 CFR 387.1; 49 CFR 387.3; 49 CFR 387.9. “For-hire motor carriers” or “private motor carriers” include, but are not limited to, “a motor carrier’s agent, officer, or representative; an employee responsible for hiring, supervising, training, assigning, or dispatching a driver; or an employee concerned with the installation, inspection, and maintenance of motor vehicle equipment and/or accessories.” 49 CFR 387.5. A “for-hire” carrier is in the “business of transporting, for compensation, the goods or property of another.” 49 CFR 387.5. A “for-hire motor carrier” is additionally defined as “a person engaged in the transportation of goods or passengers for compensation.” 409 CFR 390.5. In Del Real v. United States Fire Ins Crum & Forster, 64 F Supp 2d 958, 964 (ED CA 1998), the court held that a company that leased a trailer that was involved in an accident involving one of its lessee’s employees driving a tractor carrying lessor’s trailer, was not a “for-hire motor carrier.”

 

Here, the circuit court found that TXP was a “motor carrier for hire,” and was required under the federal regulations to carry $750,000 worth of insurance coverage. The circuit court concluded that the tractor-trailer was one vehicle, and thus, the vehicle as a whole needed to have $750,000 worth of insurance coverage.

 

It is undisputed that the tractor-trailer involved in the accident was considered to be one vehicle under Michigan law. 49 CFR 387.305; MCL 480.1 1a. Furthermore, it is undisputed that the tractor-trailer was required to have $750,000 worth of coverage to be in compliance with the federal Motor Carrier Safety Act. 49 CFR 387.1; 49 CFR 387.3; 49 CFR 387.9. However, even though TXP was a registered authorized federal motor carrier, we conclude that TXP was not a “for-hire motor carrier” regarding the accident in question because TXP was not hired to transport the goods being delivered by Gerri and Mike, and did not dispatch or employ Mike or Gerri, but rather merely leased the trailer involved in the accident to CTI for a flat weekly rate. 49 CFR 387.5; 40 CFR 390.5; Del Real, supra at 964. Therefore, the circuit court erred when it held that TXP was a “motor carrier for-hire” and was required to carry $750,000 worth of insurance coverage. 49 CFR 387.1; 49 CFR 387 .3; 49 CFR 387 .9.

 

 

It is undisputed that CTI was a motor carrier for hire, and that CTI carried $750,000 worth of coverage for the vehicle involved in the accident pursuant to its policy with Amerisure. The tractor trailer was therefore in compliance with the federal Motor Carrier Safety Act regardless of whether TXP carried the required $750,000 worth of coverage for the accident in question. 49 CFR 387.1; 49 CFR 387.3; 49 CFR 387.9; 49 CFR 387.305.

 

Accordingly, we reverse the circuit court’s April 19, 2006, order to the extent that it granted summary disposition in favor of Gerri and CTI, and to the extent that it ruled that Amerisure had a duty to defend and indemnify Mike and CTI, and that TXP was a “motor carrier for-hire” and was required to carry $750,000 worth of insurance coverage.

 

Reversed and remanded. We do not retain jurisdiction.