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 Interpretation of Contract
(Nava v. Mercury Casualty Co)
 

Contract Interpretation-Ordinary and Popular Sense (Civ. Code, § 1644)
(Nava v. Mercury Casualty Co)

discussion

            According to the plain language of defendant’s policy, the Ford Escort is not a non-owned automobile because it was registered to a person listed as a driver in the policy.  The policy therefore does not provide coverage for Dustin’s negligence.

            Plaintiffs, however, contend that “the term ‘registered’ is ambiguous and should not be construed to include vehicles registered to someone without their consent or vehicles registered in the wrong manner by mistake.”  They reason that “The term ‘registered to’ would seem to refer to the ‘registered owner’ of a vehicle.”  They then cite cases for the proposition that registration records are not conclusive on the issue of ownership of a vehicle.  They assert that Dustin’s grandfather was simply misguided in registering the Ford Escort in Robert’s name at Robert’s address and that defendant did not rely to its prejudice on the registration records.  And they conclude that “The meaning of ‘registered to’ in the definition of non-owned automobile should be construed narrowly, not expansively and should be limited to those vehicles properly registered to a person under the provisions of the vehicle code.”

            The flaw in plaintiffs’ argument is that the language of the policy is clear and explicit:  if the vehicle is “registered to” a listed driver, it is not a non-owned automobile for which coverage is provided.  Here, the Ford Escort was “registered to” Robert (and Brandi).  Robert was a listed driver (as was Brandi).  The vehicle was therefore not a non-owned automobile.  (Civ. Code, § 1644 [“The words of a contract are to be understood in their ordinary and popular sense, rather than according to their strict legal meaning; unless used by the parties in a technical sense, or unless a special meaning is given to them by usage, in which case the latter must be followed”].)

There is simply no room for plaintiffs’ theory that there is an unwritten qualification to the phrase, “registered to,” that excludes from its definition persons who are not the actual owners of the vehicle.  Moreover, even assuming that the phrase could be susceptible of more than one meaning as plaintiffs suggest, the susceptibility is abstract and disappears when the contract as a whole is considered.  This follows because defendant’s policy defines a non-owned automobile as one that is not “owned by” or “registered to” a listed driver.  In other words, by excluding both concepts (ownership and registration) from the definition of non-owned automobile, the policy acknowledges that there is a difference between the concepts.  Stated yet again another way, if the concept of registration was intended to be defined narrowly (actual owners only), it would be unnecessary to mention the concept of ownership.  (Civ. Code, § 1641 [“The whole of a contract is to be taken together, so as to give effect to every part, if reasonably practicable, each clause helping to interpret the other”].)  Thus, plaintiffs’ argument that registration means actual ownership is inconsistent with the contract as a whole.

Nava v. Mercury Casualty Co-May 14 2004-H026223-CA6

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