## Facts

- A minor, Michael Maddock, constructed and operated a homemade motorized bicycle (a bicycle fitted with a small gasoline engine).
- While operating the motorized bicycle on a public street, Michael collided with a car driven by Jean Lalomia; both died from the collision.
- Michael’s father, Daniel Maddock, held two automobile liability policies issued by Bankers & Shippers Insurance Company and a homeowner’s policy issued by Insurance Company of North America.
- Laurence Lalomia (Jean’s husband) held an automobile policy issued by Liberty Mutual Insurance Company that included an uninsured motorist (UM) endorsement.
- Lalomia brought a declaratory judgment action to determine which insurer, if any, had a duty to provide coverage for damages arising from the collision.
- The motorized bicycle was unregistered, was not a conventional automobile, but was self-propelled and operated on a public highway.

## Issues

1. Whether the homemade motorized bicycle qualified as an “automobile” or covered vehicle under the Bankers & Shippers automobile liability policies.
2. Whether the homeowner’s policy’s motor-vehicle exclusion barred coverage for injuries arising from use of the motorized bicycle off the insured premises.
3. Whether, given the absence of applicable liability coverage for the motorized bicycle, the vehicle/operator qualified as “uninsured” under Lalomia’s Liberty Mutual UM endorsement.

## Decision

- The court declared Bankers & Shippers had no duty to defend or indemnify because the motorized bicycle was not an insured “automobile” under its auto policies.
- The court declared Insurance Company of North America had no liability because the homeowner’s policy excluded coverage for injuries arising out of ownership, maintenance, or use of a motor vehicle off premises, and the motorized bicycle fit the exclusion.
- The court declared Liberty Mutual was liable under the UM endorsement in Lalomia’s policy because the tortfeasor’s vehicle/operator lacked applicable liability insurance for the accident.
- The result was later affirmed by the New York Court of Appeals.

## Legal Principles

- An automobile liability policy written to insure scheduled or conventional automobiles does not extend coverage to a homemade motorized bicycle that does not fit the policy’s covered-vehicle definitions.
- A homeowner’s policy motor-vehicle exclusion can apply broadly to self-propelled vehicles operated on public roads, even if the vehicle is not a conventional “automobile.”
- UM coverage applies when the insured is legally entitled to recover from an owner or operator for whom no applicable liability insurance covers the accident; UM protections are construed to provide recovery where the tortfeasor is effectively uninsured.

## Conclusion

The court allocated risk according to policy function: the homemade motorized bicycle was outside the auto policies’ covered “automobile” definitions and within the homeowner’s motor-vehicle exclusion, leaving the injured insured’s remedy in his own policy’s uninsured motorist endorsement because no liability coverage applied to the tortfeasor’s vehicle.


Lalomia v. Bankers & Shippers Ins. Co., 312 N.Y.S.2d 1018 (N.Y. App. Div. 2d Dep't 1970)