Progressive Northern Insurance v. Enterprise Rent-A-Car Co. of Boston, Inc.

Broderick, J. The plaintiff, Progressive Northern Insurance Company (Progressive), appeals from the Superior Court’s {Brennan, J.) order granting summary judgment for the defendant, Enterprise Rent-A-Car Company of Boston, Inc. (Enterprise). Progressive sought a declaratory judgment that Enterprise has the legal obligation to provide primary protection, pursuant to the Financial Responsibility Act, for all New Hampshire accidents involving its fleet of rental vehicles. See RSA ch. 264 (1998 & Supp. 2002). The court ruled in favor of Enterprise. We affirm. The facts are not in dispute. This case arose from two separate car accidents occurring in 1999 and 2000. In each incident, the driver alleged to be responsible for the accident was operating a car rented from Enterprise and maintained a personal automobile insurance policy with Progressive. The drivers were sued for damages arising out of the accidents. Progressive acknowledges that its policies provide insurance to the drivers in connection with these accidents, although the policies provide that its coverage is excess when its insured is involved in an accident while occupying a vehicle not owned by the insured. Enterprise — 490 — maintains that it owes no duty to defend or indemnify its lessees. Enterprise is self-insured for two million dollars. The parties agree that sections 3 and 20 of RSA chapter 264, the Financial Responsibility Act, govern the outcome of this case. Progressive’s position is that the statutory provisions require that Enterprise demonstrate an ability to pay and actually make payment to any person injured by the negligent operation of its rental vehicles. Enterprise’s -position is that the statute applies equally to drivers and owners and that payment is tied to liability incurred. ' “This court is the final arbiter of the intent of the legislature as expressed in the'words of a statute considered as a whole.” Dionne v. City of Manchester, 134 N.H. 225, 227 (1991) (quotations and brackets omitted). “[LJegislative intent is to be found not in what the legislature might have intended, but rather, in the meaning of what it did say.” Id. (quotation omitted). “New Hampshire does not require every motor vehicle to be insured, or even, in some cases, proof of financial responsibility prior to the operation of a vehicle.” Coltey v. N.E. Telephone, 135 N.H. 223, 224 (1991). However, following a reported accident, RSA 264:3 (1993) requires that the “driver or owner or both” furnish “sufficient security to satisfy any judgment... for damages resulting from such accident as may be recovered against such owner or driver.” RSA 264:3, I (emphasis added). The amount of proof of financial security required is $25,000 due to death or injury to one person, $50,000 due to death or injury to two or more persons, and $25,000 due to property damage. RSA 264:20 (1993). As RSA 264:20 states, proof of financial responsibility “shall mean proof of ability to respond in damages for any liability thereafter incurred, as a result of accidents ... arising out of the ownership, maintenance, control, or use of a motor vehicle.” (Emphasis added.) Failure to comply with the statute results in the suspension of the driver’s license and registration certificate and the surrender of registration plates and suspension of the owner’s registration certificates, plates and license. RSA 264:3, I. The statute does not apply if: (1) the owner or driver has in effect with respect to the vehicle involved in the accident a motor vehicle liability insurance policy; (2) the driver, if not the owner of the vehicle, has a motor vehicle liability policy with respect to his driving of vehicles not owned by him; or (3) the owner or driver has satisfied the director of motor vehicles that the liability of such owner or driver for the damages resulting from such accident is covered by proof of financial responsibility. RSA 264:3, II (a)-(c). Progressive argues that pursuant to the Financial Responsibility Act, Enterprise, as the owner of the vehicles, has the legal obligation to provide — 491 — primary protection. Progressive cites Universal Underwriters Insurance Co. v. Allstate Insurance Co., 134 N.H. 315 (1991), and Liberty Mutual Insurance Co. v. Home Insurance Indemnity Co., 116 N.H. 12 (1976), for support. These cases, however, are based on an interpretation of conflicting provisions in the parties’ insurance policies and provide little guidance on the issues before us. In both Universal and Liberty, resolution of the question whether an owner’s insurance is primary when the driver’s negligence caused the accident or whether the owner’s or driver’s policy is primary depended upon an interpretation of the applicable contracts. Here, the only insurance contract is that between the drivers and Progressive. This is not a case of conflict between general excess coverage clauses. According to Progressive, this court’s holding in Rosenblum v. Griffin, 89 N.H. 314 (1938), mandates that “if and when Enterprise automobiles are involved in automobile accidents causing damages, Enterprise, since it has chosen ... to carry no liability insurance, must forfeit its right to register its rental fleet and it must forfeit its motor vehicle plates, unless and until it agrees to pay the damages caused by the use of its automobiles upon the New Hampshire roadways — the damages which Enterprise has failed and refused to pay in these two cases.” This statement, however, is based on a misreading of both Rosenblum and the Financial Responsibility Act. In Rosenblum, truck A collided with truck B and the accident was alleged to be the fault of truck B. Truck A’s owner carried no liability insurance and was otherwise unable to prove financial responsibility and therefore lost his registration and license. Regardless of the fact that he was not at fault, the court held that truck A’s owner still had to establish financial responsibility “to meet [his] possible liability for damages arising from accidents occurring while [his] vehicles [were] being operated.” Rosenblum, 89 N.H. at 315. Rosenblum does not establish that truck A’s owner had to pay the statutory financial responsibility amounts, but, rather, that he had to show that he could pay if he were found liable. New Hampshire law does not require Enterprise to carry liability insurance. Coltey, 135 N.H. at 224. Enterprise has complied with the financial responsibility statute by “satisfying the director that [it] has financial ability to comply -with the requirements of [the] chapter.” RSA 264:21, III (1993). Furthermore, there are no claims that Enterprise caused the accidents at issue in this case. The claims are that the accidents were the fault of the drivers. The purpose of the Financial Responsibility Act is to provide compensation for persons harmed by the negligent operation of motor — 492 — vehicles in this State. “The paramount purpose of the [Act] is not to protect the tort-feasor, but to provide compensation to persons harmed by the negligent operation of motor vehicles.” Peerless Ins. Co. v. Vigue, 115 N.H. 492, 494 (1975). The law is intended to induce, but not to compel, motor vehicle operators to provide security to persons injured by their negligence. American Mut. &c Ins. Co. v. Company, 87 N.H. 374, 376 (1935). We cannot conclude that under the plain language of the statute, the owner of an automobile must provide primary financial responsibility protection for the benefit of the driver. As RSA 264:3 simply states, the owner or driver must furnish sufficient security to satisfy any judgment for damages resulting from the accident as may be recovered against the owner or driver. Payment for damages resulting from an accident depends on “liability thereafter incurred.” RSA 264:20. Progressive proceeds on the erroneous assumption that by virtue of its status as a self-insurer, Enterprise has assumed all of the obligations which arise under a policy of insurance. Enterprise’s responsibility, however, is one imposed by statute. Nothing in the statute requires that the guarantee by a self-insurer to pay any judgment against it be construed to operate for the benefit of the negligent driver. Because the issue decided today relates to the meaning and interpretation of the State’s Financial Responsibility Act in the rental car context and because the dissent cogently identifies a contrary view, we respectfully suggest that the legislature closely examine the intended reach of the Act. Some States have crafted statutory provisions that specifically address the questions raised in this case. See, e.g., Utah Code Ann. § 41-12a-401, 407(2) (1998); Chambers v. Agency Rent-A-Car, Inc., 878 P.2d 1164, 1165-67 (Utah Ct. App. 1994). Affirmed. BROCK, C.J., and Dalianis, J., concurred; DUGGAN, J., with whom NADEAU, J., joined, dissented.