## Facts

- Debra L. Richardson was injured when her vehicle was rear-ended by a car driven by Richard Byron Ludwig and owned by Elizabeth Couture (Ludwig’s stepmother).
- At the time of the collision, Ludwig was returning from delivering pizza for Jermike Corporation, a Domino’s Pizza franchisee.
- Couture’s vehicle was insured under a State Farm personal auto policy that covered Couture and Ludwig as a resident relative and permissive user.
- Jermike was insured under a U.S. Fire business automobile policy providing liability coverage for “hired autos” and “non-owned autos,” including autos owned by employees or household members while used in the business.
- Richardson sued Ludwig, Couture, Jermike, and Domino’s Pizza; the defendants asserted cross-claims.
- A coverage dispute arose between State Farm and U.S. Fire regarding whether U.S. Fire covered Ludwig and, if so, whether U.S. Fire or State Farm was primary.

## Issues

1. Whether Ludwig was an insured under Jermike’s U.S. Fire business auto policy when driving Couture’s car as part of pizza delivery work.
2. If U.S. Fire provided coverage for Ludwig, whether U.S. Fire’s coverage was primary or excess to State Farm’s personal auto coverage on the vehicle.

## Decision

- The Minnesota Court of Appeals reversed summary judgment for State Farm.
- The court held Ludwig was not an insured under the U.S. Fire business auto policy’s non-owned auto coverage.
- The court held, alternatively, that even if U.S. Fire’s policy covered Ludwig, U.S. Fire’s coverage would be excess to State Farm’s coverage on the owned vehicle.

## Legal Principles

- A business auto policy’s “non-owned auto” provision generally protects the named insured business against liability arising from employees’ use of non-owned vehicles; it does not automatically confer insured status on employee drivers.
- When one policy insures the vehicle and driver as permissive user (personal auto policy) and another provides non-owned auto coverage tied to business use (commercial policy), the vehicle’s insurer is ordinarily primary and the non-owned auto coverage is excess, absent clear contrary policy language.

## Conclusion

The court determined that the employer’s commercial non-owned auto coverage did not insure the delivery driver while operating a household member’s vehicle, and that any such coverage would, in any event, be secondary to the personal auto policy insuring the vehicle and permissive use.


Richardson v. Ludwig, 495 N.W.2d 869 (Minn. Ct. App. 1993)