United States District Court, D. Minnesota
KATHERINE MENENDEZ UNITED STATES MAGISTRATE JUDGE.
matter is before the Court on American Family Mutual
Insurance Company's (“American Family”)
Motion for Summary Judgment. [SJ Mot., ECF No. 32.] The
parties have consented to the exercise of jurisdiction by the
undersigned United States Magistrate Judge. [ECF No. 22.] For
the reasons that follow, American Family's motion is
16, 2016, Daniel Pilarski was visiting a Wisconsin cabin
owned by his friend William Reiter. [Ex. A to the Compl., ECF
No. 3-1; Decl. of Dahrim Boulware (“Boulware
Decl.”) ¶ 4, Ex. B (“Pilarski
Statement”) at 2, ECF No. 34-2.] Mr. Reiter and Mr.
Pilarski took Mr. Reiter's boat out on the water that
day. [Pilarski Statement at 2.] The boat has an
inboard-outdrive motor. [Boulware Decl. ¶ 5, Ex. 3.]
When the two returned to the cabin from the boat ride, they
attempted to place the boat back into Mr. Reiter's
boathouse. [Ex. A to Compl.; Pilarski Statement at 2.] To
accomplish this task, Mr. Pilarski operated a motorized boat
winch, but he sustained a serious injury to his left hand in
the process of reeling in the boat. [Ex. A to Compl.;
Pilarski Statement at 2-5, 6; Boulware Decl. ¶ 6, Ex. 4
(“Reiter Statement”) at 5, ECF No. 34-4.] When
the boat was still about six to eight feet from being fully
loaded into the boathouse and the cable was very tight, Mr.
Pilarski's left hand was trapped by the cable as he tried
to guide cable onto the winch's spool. [Pilarski
Statement at 2-5; Reiter Statement at 4-6.] Ultimately, Mr.
Pilarski lost two fingers on his left hand, and suffered
serious damage to a third. [Pilarski Statement at 6, 8.] Mr.
Pilarski filed a personal injury lawsuit against Mr. Reiter
in Ramsey County District Court (the “underlying
action”), alleging that Reiter's negligence caused
the injuries. [Ex. A to Compl.]
Reiter tendered the defense of the underlying action to
American Family, with which he has a Wisconsin Homeowners
Policy. [Compl. ¶¶ 14-15, ECF No. 3.]
American Family agreed to defend Mr. Reiter, but strictly
reserved its rights. [Id. ¶ 15.] American
Family seeks a declaratory judgment that an exclusion in Mr.
Reiter's policy applies, meaning it has no duty to defend
or indemnify Mr. Reiter for any losses suffered by Mr.
Pilarski. [Id. ¶¶ 19-21.]
Reiter's American Family policy covers
“compensatory damages for which any insured is legally
liable because of bodily injury or property damage caused by
an occurrence covered by [the] policy.” [Boulware Decl.
¶ 3, Ex. 1 (“AF Policy”) at 9.] American Family
is also required to provide a defense at its expense if a
suit is brought against Mr. Reiter. [AF Policy at 9.] As
defined in the AF Policy, an “occurrence”
includes an accident that results in bodily injury. [AF
Policy at 2.] And “bodily injury” includes
“bodily harm.” [AF Policy at 1.] American Family
also agreed to pay the medical expenses incurred or medically
ascertained within three years from the date of an accident
causing bodily injury to a person on the covered property
with permission of the insured. [AF Policy at 9.] None of
these portions of the AF policy are in dispute.
there are several provisions in Mr. Reiter's
homeowner's policy that exclude coverage for certain
types of personal liability and medical expenses. One of
these personal liability and medical expense exclusions
applies to watercraft. It reads:
a. We will not cover bodily injury or property damage arising
out of the ownership, supervision, entrustment, maintenance,
operation, use, loading or unloading of a watercraft:
(1) with inboard or inboard-outdrive motor power owned by any
(2) with inboard or inboard-outdrive motor power of more than
50 horsepower rented to any insured;
(3) that is a sailing vessel, with or without auxiliary
power, 26 feet or more in length owned by or rented to any
(4) that is an iceboat, airboat, air cushion or similar type
of craft; or
(5) powered by one or more outboard motors with more than 50
total horsepower, owned by any insured.
This exclusion does not apply while such crafts are stored on
the insured premises nor to bodily injury to any domestic
employee arising out of and in the course of employment by
[AF Policy at 12.] The dispute between American Family and
Mr. Pilarski in this declaratory judgment action centers on
Family asserts that it is entitled to summary judgment on its
declaratory judgment claim because the watercraft exclusion
plainly and unambiguously applies to the accident at issue
here. Specifically, American Family argues that the
undisputed facts show Mr. Pilarski sustained a bodily injury
arising out of the loading of a watercraft with ...