C.H. Heist Caribe Corp. v. American Home Assurance Co., 640 F.2d 479, 481 (3d Cir. 1981). A particular provision of an insurance policy is ambiguous "only if reasonably intelligent persons would honestly differ as to its meaning, when considering it in the context of the entire policy." Federal Kemper Ins. Co. v. Ward, 679 F. Supp. 489, 494 (E.D. Pa. 1988), aff'd, 860 F.2d 1074 (3d Cir. 1988).
Courts have generally found the term "regular use" unambiguous. Indeed, it appears that every Pennsylvania state court to have considered the question has come to that conclusion. See Crum and Forster v. Travelers Corp., 428 Pa. Super. 557, 631 A.2d 671, 673 (Pa. Super. 1993) ("The exclusionary language is not ambiguous"); State Farm Mut. Auto Ins. Co. v. Brnardic, 441 Pa. Super. 566, 657 A.2d 1311, 1313 (Pa. Super. 1995), alloc. denied, 670 A.2d 142 (Pa. 1995) ("insurance policy in question is clear"); Kieffer v. Nationwide Mut. Ins. Co., 7 Pa. D. & C. 3d 293 (1978) ("Plaintiff argues that the provisions of the subject policy are ambiguous. We do not agree."). Courts in other jurisdictions have reached similar results. See, e.g., Grange Ins. Ass'n v. MacKenzie, 37 Wash. App. 703, 683 P.2d 221 (Wash. App. 1984), aff'd, 103 Wash. 2d 708, 694 P.2d 1087 (Wash. 1985); Woodman v. Hartford Accident & Indemnity Co., 27 Mass. App. Ct. 1120, 537 N.E.2d 601 (Mass. App. 1989). In fact, defendant Sizemore
points to no case in which a court has found the term "regular use" ambiguous.
Instead, Sizemore relies on the sentence that immediately follows the "regular use" exclusion in the Nationwide policy -- "Furnished for regular use does not include a motor vehicle rented from a rental company for less than 28 days", see Sizemore Mem., exh. C at 8 -- and argues that Nationwide's failure to include clarifying language for non-rental situations dictates that the term "regular use" is ambiguous as it applies to the present case. Under Pennsylvania law, "an insurer's failure to utilize more distinct language which is available reinforces a conclusion of ambiguity." McMillan v. State Mut. Life Assur. Co. of America, 922 F.2d 1073, 1077 (3d Cir. 1990). That is, a court should not impute to an insurance company "the benefit of qualifying language which it chose not to adopt." Id. at 1077 n.4. Rather, a court may consider "whether alternative language, if used, would have put the matter beyond reasonable question." Vlastos v. Sumitomo Marine & Fire Ins. Co. (Europe), 707 F.2d 775, 778 (3d Cir. 1983). Because Nationwide clarified the meaning of "regular use" with respect to rental cars, Sizemore concludes, its failure to clarify the term in other contexts makes the term ambiguous as applied to the facts of the present case.
Sizemore's argument has some persuasive force. It can succeed, however, only if there exists "alternative language" which Nationwide could have adopted, but chose not to employ. Tellingly, Sizemore includes no such language. A bright-line temporal rule applying to car rentals is relatively simple to develop and apply. No such bright-line rule would seem to be readily available for cars borrowed from family members (or anyone else). See State Farm Mut. Auto. Ins. Co. v. Townsend, 361 N.W.2d 332 (Iowa App. 1984) ("No hard and fast rule has been or can be established for determining the question of what constitutes furnishing for regular use, but each case must stand or fall on the particular facts"). When a car is rented, the transaction occurs against a detailed backdrop of rules allocating rights and responsibilities; there is, indeed, a written contract explicitly delineating those rights. No such clear "transaction" occurs when a person lends her car to a friend or a member of her family.
A temporal limit would not suffice to distinguish regular from irregular use in this noncommercial context. Rarely is an automobile lent or left for a particular time period, as it is in a rental situation. Indeed, a car may not even be available for continuous usage, as a hired car is during the period of rental. See, e.g., Knack v. Phillips, 134 Ill. App. 3d 117, 479 N.E.2d 1191, 1195, 89 Ill. Dec. 185 (Ill. App. 1985) (car driven only on weekdays, when owner was away at naval base).
Any attempt to define "regular use" in the context of an informal agreement between relatives or friends is further complicated by the range of purposes for which such agreements may be entered into. The agreements may include restrictions on operation of the car, see Interinsurance Exchange v. Smith, 148 Cal. App. 3d 1128, 196 Cal. Rptr. 456 (Ct. App. 1983) (driver did not have own set of keys and had to ask permission for each use); may have as their primary purpose storage rather than use, see State Farm Mut. Auto. Ins. Co. v. Townsend, 361 N.W.2d 332 (Iowa 1984) (owner sought place to leave car while serving 30-day jail sentence); or may contemplate use for the benefit of the owner rather than the insured, see Shelter Mut. Ins. Co. v. Tucker, 864 F.2d 413 (6th Cir. 1988) (applying Tennessee law) (car purchased so that members of insured's family could drive owner to appointments); Giokaris v. Kincaid, 331 S.W.2d 633 (Mo. 1960) (driver had set of keys to her mother's car but drove it only when her mother needed a ride). Any of these factors -- none of which is present in the rental car context -- would complicate if not confound a search for a bright-line rule on what constitutes "regular use." Further, such agreements are generally informal matters, unarticulated by the terms of a written document. Key terms of the agreement (for insurance purposes) may -- like the length of time Gertrude Shoemaker intended to let Brynn Shoemaker use her car -- go unstated. In short, it does not appear to this court that clarifying language was in fact readily available to Nationwide in defining "regular use" in the non-rental context. Defendants have provided no example of such language to contradict the court's conclusion.
Defendants offer no other compelling argument for a determination that the term "regular use" is ambiguous. Indeed, courts seem to have had little trouble defining the term -- there appears to be a consensus that it refers, depending on the context, to "a principal use as distinguished from a casual or incidental use," Crum and Forster v. Travelers Corp., 428 Pa. Super. 557, 631 A.2d 671 (Pa. Super. 1993), or "uninterrupted normal use for all purposes," Central Security Mutual Insurance Co. v. DePinto, 235 Kan. 331, 681 P.2d 15 (Kan. 1984). Where courts have had difficulty is not in the definition of the term, but in its application.
B. The "regular use" exception
Where, as here, jurisdiction is based upon the diverse citizenship of the parties and state substantive law governs, a federal court turns for guidance to the highest court of the state whose law is to be applied. The Pennsylvania Supreme Court has, however, made no authoritative pronouncement with regard to the "regular use" exclusion. Accordingly,
the task of a federal tribunal is to predict how the court would rule. To make this prognostication, [a court is] not inflexibly confined by dicta or by lower state court decisions, although [it] should look to such statements as indicia of how the state's highest court might decide . . . . The policies underlying the applicable legal doctrines, the doctrinal trends indicated by these policies and the decisions of other courts may also inform [its] analysis.
McMillan v. State Mut. Life Assur. Co. of America, 922 F.2d 1073, 1077 (3d Cir. 1990).
1. Pennsylvania cases
Since the Pennsylvania Supreme Court has not addressed "regular use," it is appropriate to turn to the pertinent decisions of the Pennsylvania Superior Court and Pennsylvania's trial courts. These decisions teach that, as a general matter, exclusions from coverage are to be narrowly construed. See Eichelberger v. Warner, 290 Pa. Super. 269, 434 A.2d 747 (Pa. Super. 1981). The "regular use" exclusion in particular has been explicated by the Superior Court only once.
In Crum and Forster v. Travelers Corp., 428 Pa. Super. 557, 631 A.2d 671 (Pa. Super. 1993), the court, interpreting language very similar in relevant part to that at issue here
, noted that "courts struggle" with application of the regular use exclusion "because each case must be decided on its own facts and circumstances . . . ." 631 A.2d at 673. The facts in that case involved a driver who had "driven the car owned by his grandparents on an average of five times per week for and during the entire four years preceding the accident" at issue. Id. at 674. The court observed that "whether a vehicle is covered, or whether it is excluded under a provision denying coverage where such vehicle is furnished for the insured's (or family member's) regular use, normally becomes a jury question." Id. (quoting 6C Appleman, Insurance Law and Practice § 4455 at 565). The court went on to note that "where the facts are not in dispute, however, and reasonable minds cannot differ regarding the result, the issue of coverage can be decided as a matter of law by the court.. . . This is such a case." Id. at 673-74.
Two decisions of the Court of Common Pleas, to which a federal court also may look as "indicia of how the state's highest court might decide," also address the "regular use" issue. In Kieffer v. Nationwide Mut. Ins. Co., 7 Pa. D. & C. 3d 293 (1978), a daughter worked during the week away from her parents' home and left her car there during the week; while she was away, the car was available to her mother "whenever she wanted." Id. at 298. The registration card and keys were left along with the car at the mother's home. The court found that the car was furnished for the regular use of the owner's family, including her mother.
In Johnson v. Braunsberg, 51 Pa. D. & C. 2d 659 (1970), the owner of a car was inducted into the military and left his car with his father to be sold.
The father was unable to obtain a suitable offer for the car in the next two months; the owner's brother, who lived with his parents and thus was covered by their automobile insurance policy, made use of the car and was involved in an accident. The court found no "regular use" and thus no exclusion from coverage, because the automobile had been left to be sold and "any use was incidental to that purpose." Id. at 663. In the absence of evidence showing "frequent and regular" use of the car by the owner's brother, the court found that the car had not been "furnished for [his] regular use." The court observed that
in an age when relatives often lend their cars to one another, the restrictive interpretation urged upon us . . . would create a wide gap in insurance coverage. . . . Insofar as there is an absence of exclusionary words which clearly relate to a specific factual situation, an insurance contract should be interpreted to provide coverage.