Use and occupation

This case is interesting.  It was always understood that when someone exited their vehicle for a limited purpose and another vehicle hit that person, first-party coverage should be provided by the carrier of their own vehicle.

But there was also a belief that the person who exited the said vehicle was also a pedestrian and the insurance carrier of the vehicle that hit said person would also be liable for first-party benefits.  Nakhla tells us otherwise.  This is a must read for when you get the inevitable use and operation question.

Matter of Government Empls. Ins. Co. v Nakhla, 2016 NY Slip Op 04219 (2d Dept. 2016)

(1) “ORDERED that the judgment is reversed insofar as appealed from, on the law, with costs, those branches of the petition which were to join PSK Hacking Corp., EKAM Transportation, and American Transit Insurance Company as additional respondents to the proceeding and to temporarily stay arbitration pending a hearing on the relative liability of the petitioner and American Transit Insurance Company are granted, and the matter is remitted to the Supreme Court, Queens County, for further proceedings consistent herewith.”

(2) “On July 17, 2012, Peter Nakhla was driving a taxicab owned by PSK Hacking Corp., registered to EKAM Transportation, and insured by American Transit Insurance Company (hereinafter American Transit). Nakhla was stopped at an intersection when another vehicle struck the taxicab in the rear. When Nakhla exited the taxicab to look for damage to the taxicab, the offending vehicle drove away and collided with Nakhla, who was now outside the taxicab. The offending vehicle left the scene and is unidentified.”

(3) “Although Nakhla’s personal vehicle was not involved in the accident, Nakhla qualified for SUM coverage under the GEICO policy insuring his personal vehicle under the provision which provides coverage for the named insured. However, the priority of coverage provision in GEICO’s policy provided that the uninsured motorist or SUM coverage, if any, under the policy insuring the vehicle occupied by him was to be applied first, and prohibited the stacking of policies.”

(4) “Thus, the crucial issue of fact in this case is whether Nakhla occupied his taxicab at the time of the second impact and, therefore, whether the policy limits of American Transit, which insured the taxicab, should be applied first. GEICO’s policy defines “occupying” as “in, upon, entering into, or exiting from a motor vehicle”—a definition taken from Insurance Law § 3420(f)(3), which defines occupying as “in or upon or entering into or alighting from” a vehicle. The question is whether “a departure from a vehicle is occasioned by or is incident to some temporary interruption in the journey and the occupant remains in the immediate vicinity of the vehicle and, upon completion of the objective occasioned by the brief interruption, he intends to resume his place in the vehicle” (Matter of Rice v Allstate Ins. Co., 32 NY2d 6, 10-11). Here, GEICO established that Nakhla was an occupant of the taxicab at the time of the second impact through the submission of Nakhla’s examination under oath testimony, which indicated that he alighted from the taxicab after the first impact to determine whether it had been damaged

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