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Fagg v. Progressive Gulf Insurance Co.

United States District Court, W.D. Virginia, Roanoke Division

January 8, 2020



          Hon. Glen E. Conrad Senior United States District Judge.

         Plaintiff Preston Scott Fagg seeks a declaratory judgment in diversity regarding insurance coverage from Progressive Gulf Insurance Company ("Progressive"), an Ohio corporation, after he purchased a car and was struck by an uninsured motorist soon thereafter. This matter is before the court on cross-motions for summary judgment regarding the ownership of a car and concomitant insurance coverage, which raise novel and surprisingly knotty questions of state law. The parties argued their well-briefed motions in a hearing before the court on December 2, 2019. For the reasons that follow, the court denies Fagg's motion for summary judgment and grants summary judgment for Progressive.


         The material facts in this case are simple and stipulated. On April 29, 2016, Fagg paid Joseph Lee Horton $6, 000.00 for the purchase of a 1999 Suzuki Vitara (the "Suzuki"). ECF Nos. 10-2 and 12-1, Stipulation of Facts ("SOF") ¶ 1. Fagg and Horton intended that Fagg purchase the Suzuki, and that Horton would have no further financial responsibility regarding the Suzuki. Id. ¶¶ 2, 14. Fagg took physical possession of the Suzuki on that same date. Id. ¶3.

         Horton also signed the certificate of title[1] to the Suzuki, and delivered it to Fagg. Fagg and Horton intended that Horton convey title and complete ownership of the Suzuki to Fagg. Yet Fagg never presented the title for the Suzuki to the Virginia Department of Motor Vehicles ("DMV"). Id. ¶¶ 4-7. The title for the Suzuki contained a section, required by Virginia Code § 46.2-629, for Horton to certify that the mileage on the Suzuki's odometer was the actual mileage on the vehicle. Horton did not complete the odometer certification. ECF Nos. 10-1 at 2, 12 at 1.

         Meanwhile, Horton had an auto insurance policy issued by Progressive, which was in effect at the relevant times (the "Policy"). The Policy included uninsured motorist coverage providing up to $100, 000 of coverage per person, subject to the conditions of the Policy. SOF ¶¶ 12-13; ECF No. 12-1 at 5-58. Part C of the Policy defines the scope of that coverage. Under Subparagraph A of Part C, coverage is afforded for "damages which an 'insured' ... is legally entitled to recover from the owner or operator of an 'uninsured motor vehicle' ...." An 'insured' is subsequently defined, in Sub-paragraph C, as:

1. You or any "family member."
2. Any other person "occupying" "your covered auto."
3. Any person for damages that person is entitled to recover because of "bodily injury" to which this coverage applies sustained by a person described in 1 or 2 above.

         Sub-paragraph J of the Definitions section of the Policy defines "any vehicle shown in the Declarations" as a "covered auto." The Suzuki is listed on the Declarations Page of the Policy. ECF No. 12-1 at 6.

         The day after he bought the Suzuki, and while driving it, Fagg had the misfortune of being struck by an uninsured motorist. He sustained serious injuries. SOF ¶¶ 8-10.

         Statutory Background

         The parties' motions and arguments rely in large part on Virginia's statutes covering the titling of motor vehicles. Va. Code Ann. § 46.2-600 et seq. The court includes certain statutory provisions in relevant part for ease of reference.

         Virginia Code § 46.2-620, which is titled "Period of validity of certificate of title," states:

Every certificate of title issued under this chapter shall be valid for the life of the motor vehicle ... so long as the owner to whom it is issued shall retain legal title or right of possession of or to the vehicle. Such certificates need not be renewed except on a transfer of title or interest of the owner.

         Virginia Code § 46.2-628, which is titled "How certificate of title transferred," states:

The owner of a motor vehicle... registered under this chapter, when transferring or assigning his title or interest thereto, shall fully and correctly endorse the assignment and warranty of title on the certificate of title of the motor vehicle ... to its purchaser, with a statement of all security interests on it, and shall deliver the certificate to the purchaser or transferee at the time of delivering the motor vehicle, .... Any owner who willfully fails fully and correctly to endorse the assignment and warranty of title shall be guilty of a Class 3 misdemeanor.

         Virginia Code § 46.2-629, which is titled "Odometer reading to be reported on certificate of title, application, or power of attorney," states:

A. Every owner or transferor of any motor vehicle, including a dealer, shall, at the time of transfer of ownership of any motor vehicle by him, record on the certificate of title, if one is currently issued on the vehicle in the Commonwealth, and on any application for certificate of title the reading on the odometer or similar device ... at the time of transfer....
B. The Department shall not issue to any transferee any new certificate of title to a motor vehicle unless subsection A has been complied with.

         Virginia Code § 46.2-630, which is titled "Transfer and application for certificate of title forwarded ...

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