The Maryland Court of Special Appeals reviewed a wrongful death case involving a truck accident and addressed the issue of whether the defendant had insurance coverage. In Glass v. State Farm Fire & Cas. Ins. Co. (Md. Ct. Spec. App. Aug. 5, 2015), the defendant’s employee was driving the company delivery van and lost control of it. The van swerved across the center lines and hit the victim’s vehicle head-on. The victim died of injuries caused by the accident shortly thereafter. The victim’s husband brought a personal injury negligence and wrongful death suit against the employee and the employer, and he later amended the complaint to include the employer’s insurer.
The parties disputed whether the accident was covered under the business policy issued by the insurer, due to the unintended entanglement of two separate legal entities of the employer. In 2004, the employer created a general partnership. The general partnership purchased and owned the van driven by the employee, as well as the insurance policy in effect at the time of the accident. However, when the employer formed an LLC in 2006, intending to merge the general partnership with the LLC, it was never properly completed. As a result, both companies remained in existence as separate legal entities, and the general partnership held title to the van and the insurance policy. Although the employer began conducting business in the name of the LLC, it was performing the contractual obligations of the general partnership.
The parties filed motions for declaratory judgment for the trial court to decide the issue of insurance coverage. After an evidentiary hearing, the trial court found that at the time of the accident, the company was conducting business on behalf of the general partnership, and the van was owned by the general partnership. Therefore, the court held, the accident was not covered under the business policy through an exemption to a coverage exclusion for injuries arising out of the use of a non-owned automobile.