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Omnibus insurance clause does not cover Second Permittee.

Payne v. Erie Ins. Exch.
2015 Md. LEXIS 172, 1 (Md. Mar. 30, 2015) (not yet published)

by Gregory Emrick, Associate
Semmes, Bowen & Semmes (

Available at:

This Opinion of the Court of Appeals follows the opinion of the Court of Special Appeals as reported at

In February 2008, Plaintiff was struck by a vehicle being operated by Abdulkhalek, but owned by Alan Dwyer. Mr. Dwyer had purchased the vehicle for the use of his 34-year old daughter, Karen Dwyer (“Daughter”) who suffered from Lupus, and her three (3) children. The Daughter and her family lived with Dwyer at his home. Erie Insurance Exchange (“Erie”) provided insurance to Dwyer. While Mr. Dwyer had given his Daughter the vehicle to use as she wished, he imposed one significant restriction – Abdulkhalek, the father of her children, was not permitted to operate the vehicle. On February 11, 2008, his Daughter was ill from complications related to her Lupus, and she requested that Abdulkhalek use the vehicle to pick up the kids. Though the school was two (2) blocks away in the same housing development, Abdulkhalek took the vehicle to a gas station a few miles away. As he was leaving the gas station, he drove into the back of Plaintiff’s vehicle. Thereafter, Plaintiff filed a lawsuit against Abdulkhalek and Erie. At the pretrial hearing, the trial court denied Plaintiff’s motion for declaratory judgment and summary judgment, and granted Erie’s motion for summary judgment. Plaintiff timely appealed.

The Court of Special Appeals reviewed the grant of summary judgment and upheld the trial court’s decision, finding that “the coverage of the policy did not extend to Abdulkhalek, the ostensible second permitted, who was expressly prohibited from driving the [vehicle], who nonetheless did so without the necessary presence of the first permittee, and who in any event exceeded the scope of any even implicitly permitted use.” The Plaintiff filed a writ of certiorari to the Court of Appeals, which was granted.

The Court of Appeals first reviewed the record to assure that the case was disposed of appropriately by summary judgment. As there were no disputes of material facts, the questions were solely legal, namely that the Daughter was not in the vehicle and that Abdulkhalek was operating the vehicle for her benefit. The issues, however, arose in the application of the law to those facts and could therefore be determined by summary judgment.

The Court noted that Abdulkhalek’s authority to use the vehicle, as the second permittee, only extended to the use in benefit of the first permittee, the Daughter. She had asked Abdulkhalek to drive to the elementary school. The Court could not find a fact or reasonable inference from the record that justified Abdulkhalek’s presence at the accident scene. Without additional information, such as his asking to go on the errand to get gas or that this was the only way he knew to get to the elementary school, there were no facts to support a finding that he was in that location for the benefit of the Daughter. For this reason, Maryland’s highest Appellate Court held that the trial court properly granted Erie’s motion for summary judgment, and likewise affirmed the Court of Special Appeals’ decision which affirmed the trial court’s grant of summary judgment for Erie.

Judge Watts filed a concurrence, noting that in his reading of the Maryland case law, he concluded that the specific prohibition against Abdulkhalek’s driving the vehicle eliminated coverage unless the first permittee was in the vehicle, the use is for the first permittee’s benefit, and the use is within the scope of permission granted by the named insured.