IL App (1st Dist.)/Scope of Auto “Use”

Livery driver walking passenger to door may count as “use” of vehicle

The Illinois First District Appellate Court, in an opinion written by Justice Harris (Justices Mikva and Connors concurring), applying Illinois law, found that injuries sustained during the escort of a passenger from a livery vehicle to the door of the passenger’s destination may be found to arise out of “use” of the vehicle.  The Appellate Court found that, considering the nature of the insured’s business, the language of the insurance policy in question, and the broad understanding of the word “use” in auto insurance policies generally, insurer First Chicago Insurance Co. (“First Chicago”) has a duty to defend its insured against a suit brought by Ronald Dixon for injuries sustained by Dixon while the insured livery company’s employee walked Dixon from the livery vehicle to the door of a hospital.

The insured livery company, My Personal Taxi and Livery, Inc. (“Livery Service”), employed Juan Rangel as a driver.  Rangel drove Dixon, a blind man, to a hospital.  Upon arrival, Rangel began walking Dixon to the door of the hospital, and allegedly caused Dixon to walk into a concrete pole.  Dixon sued Rangel and Livery Service.  Livery Service had a business auto insurance policy issued by First Chicago during the events in question.  First Chicago brought a declaratory judgement action seeking judgement that it was not obligated to defend its insured in Dixon’s underlying suit.  The trial court granted summary judgement in favor of First Chicago, and Dixon appealed.

First Chicago’s essential argument is that the insurance policy was an auto policy, but the events in the underlying suit did not take place in a vehicle, and did not arise during use of a covered vehicle, because Dixon was already at his destination, had left the vehicle, and by doing so had ceased any “use” of the vehicle.  Thus, the use of the vehicle was “merely incidental” and “too remote” to allow recovery under the auto policy.

The Appellate Court highlighted several factors that contribute to a finding that Livery Service escorting Dixon to the hospital door constituted “use” of the vehicle under the policy.  First, the policy was not a general auto policy, but a business policy specifically for livery vehicles, and a livery company will routinely perform extra tasks beyond mere driving, such as assisting with luggage or, as in this case, walking passengers to doors.  Further, the policy uses the word “use,” which is interpreted broadly in a large body of auto insurance caselaw.  According to the Appellate Court, had First Chicago wished to cover only operation of the vehicle, they could have used the word “operation” in place of “use.”

The Appellate Court also noted that the policy excluded bodily injury or property damage “resulting from the handling of property” before such property is loaded into a covered vehicle or after it is removed from a covered vehicle.  Since First Chicago specifically excluded injuries arising from property handling before or after such property is loaded into a covered vehicle, the Appellate Court concluded (1) that First Chicago knew how to draft an effective exclusion for loading and unloading, but declined to draft such an exclusion for the loading or unloading of people, and (2) First Chicago knew that injuries sustained outside the insured vehicle could still be subject to claims under the policy.

Taking these factors into account, the Appellate Court held that First Chicago has a duty to defend Livery Service against Dixon’s underlying lawsuit.  First Chicago Ins. Co. v. My Personal Taxi and Livery, Inc., 2019 IL (1st) 190164 (Oct. 11, 2019).