Class Worksheet, March 7
Instructions:
The attached sample Memorandum has several citations, most of which have errors. Errors may
be in the spelling of the names or the citation itself. Quotations might also have errors. Please
correct all citations. You may do this by marking the attached.
Also, I believe that there may be a relatively new case (2014-2015) from a California appellate
court dealing with this issue. See if you can find it.
ATLAS INSURANCE COMPANY,
)
A corporation,
)
Plaintiff,
) No. 12345
)
v.
) MEMORANDUM OF POINTS &
) AUTHORITIES
SAVAGE RIDER, et al.
Defendants
)
)
Facts
The defendant was involved in a motor vehicle accident on June 23 of the previous
year with an uninsured vehicle. Defendant Rider was operating a motorcycle owned by his
roommate Motorcycle Murphy. This vehicle was not covered by insurance either. However,
Rider did have a policy of automobile insurance, which policy is the subject of this lawsuit.
The insurance policy in question covers Rider while he is operating another vehicle, as long
as that vehicle is not owned by a “member of his household.”
From the deposition testimony it is clear that Rider and Murphy had a typical
roommate relationship. They shared rent on an apartment. However, they each led their own
social lives and had their own friends. Murphy in fact had a girlfriend and spent much of his
time with her, away from the apartment. Meals were seldom shared by the defendant and
his roommate.
Issue
Are roommates, who are unrelated and live separate lives, “members of the same
household” under the exclusion provision of an insurance policy?
Argument
1. A “HOUSEHOLD” REQUIRES A FAMILIAL BOND, NOT JUST A JOINT
RESIDENCE
In their complaint, plaintiffs state that the basis of the controversy is the fact that Savage
Rider was driving a vehicle owned by a member of his household. The courts in various
jurisdictions, including California, have clearly held that the mere fact that two persons
reside under the same roof does not make them members of the same household. Rather a
more familial or social bond is required. See Island v. Fireman’s Fund Indemnity Co., 30
C.2d 540 at 547–8. As the Supreme Court has stated, “Persons who dwell together as a
family constitute a ‘household.’”Arthur v. Morton 112 U.S. 495, 500.
A case on point with the one here is Bartholet v. Berkness (Minn.), 189 N.W. 2d 410.
In this case the court held that two unmarried and unrelated men, dwelling in the same
living quarters and sharing expenses but having separate and independent social lives, were
not members of the same household. And in a Texas case, the court stated:
A rather unreasonable and ridiculous result follow from an attempt to ascribe to the
term “household” in the phrase under consideration the meaning of a building or
structure, or to ascribe to the term resident a meaning which would embrace any and
all persons who sleep within or take meals at such structure . . . .
This court reached the conclusion that similar use of the term “household” connoted
a “family” or a group of persons who habitually reside under one roof and form one
domestic circle.
State Farm Mutual Automobile Insurance Company v. Walker (1960, Tex. Civ. App.) 334
S.W.2d 458, 463–464. See also Giakares v. Kincade (1961. Mo.) 330 S.W.2d 633 wherein a
grandmother was held not to be a member of the same household as her grandchildren even
though living under the same roof.
2. ANY AMBIGUITY IN THE INSURANCE POLICY MUST BE INTERPRETED
AGAINST THE INSURANCE COMPANY AND IN FAVOR OF THE INSURED
Clearly, in the common, ordinary meaning of the words, as well as by judicial interpretation
of them, “members or residents of the same household” must have more than a relationship
than just “roommates.” At most in the case at hand plaintiffs could contend that there is
some ambiguity as to the meaning of the words. However, even if that were true, plaintiff
could not prevail. It is a cardinal rule that where any ambiguity exists in an insurance policy
it must be resolved in favor of the policy holder, not the insurance company. Island v.
Fireman’s Fund Indemnity Co., 184 Pac. 153 at 159. See also Juzefsky v. Western Cas. &
Surety Co., 324 Pac. 2d 929.
3. DEFENDANT AND HIS ROOMMATE ARE NOT MEMBERS OF THE SAME
HOUSEHOLD FOR PURPOSES OF THE INSURANCE POLICY
Defendant and his roommate should not be considered members of the same household. The
purpose of an exclusionary provision in an insurance policy such as the one here is to avoid
multiple coverage of several vehicles owned by members of the same family, who, by their
close intimacy, might be expected to use each other’s vehicles without hindrance and with
or without the permission of another, thus increasing the liability of the insurer without
benefit or added premium. The facts of this case show that the defendant, Rider, and his
roommate, Murphy, led very separate and independent lives. Murphy’s vehicle was not
made freely available for Rider’s use. In fact, Rider had only used it once, the day of the
accident. Further, the motorcycle was generally kept at the house of Murphy’s parents. In
addition, there was no way that Rider could have obtained insurance for the motorcycle, as
he had no insurable interest therein.
Conclusion
The objectives of the exclusionary provisions would not be properly served by
applying the exclusion to the instant case. Judgment should be entered in favor of
defendant.