Annette failed to make her car loan payments. This default resulted in a visit from Ted the repo man. When Ted was about to drive away with Annette’s car, Annette decided that it was a good time to remove some personal items from the trunk. Ted, being a conscientious employee, wasn’t deterred. He drove off with Annette still clinging to the tow bar, trying to open the trunk. Annette was flung to the ground like a sacked quarterback. Her knee was cut up in the process.
Annette sued the repo man and his company. Trying to add insult to injury, they tried to obtain insurance coverage from Annette’s car insurance policy. That is, Ted and the repo company tried to force Annette’s insurance company to pay compensation for the injuries that they themselves had caused her to suffer.
Why should Annette’s insurance company have to pay, you ask? Because, claimed the friendly repo man, an automobile insurance policy covers not only the car owner, but also any permitted drivers. So, for example, if a car owner lends his car to a friend, and the friend has an accident, the friend is covered by the owner’s policy.
The repo company conceded that Ted was not Annette’s friend (at least not a very close one). However, Ted was authorized by the car loan agreement that Annette signed to repossess the car if Annette did not pay. Therefore, the company argued, he was a “permitted” driver, and covered by the policy.
No way, ruled the appellate court. The word “permitted” implies that permission can be denied. Surely, the repo company would not claim that Annette could default on her loan and then refuse to permit repossession of the car. Therefore, the repo company and Ted could only ask their own insurance company, not Annette’s, to pay for Annette’s injuries. If their premium went up because of that, too bad.
The court’s ruling makes sense. However, I must report that the court did not decide the question that everyone wants to know: whether Ted, Annette, or both of them, should be nominated for the 2012 “World’s Most Clueless Litigant” prize.