In a nightmare scenario, on July 4, 2016 a minor drove a 1987 golf cart owned by her neighbor with four passengers on board and collided with a 2008 Dodge Caliber. The accident resulted in significant injuries to the passengers in the golf cart including one passenger who was ejected and sustained a brain injury. Those passengers then sued the minor (her parents) in Florida state court for their injuries, hospitalization expenses, disfigurement, and mental anguish. Geico insurance company, their automobile carrier with $10,000/20,000 coverage, provided a defense to the minor pursuant to a reservation of rights clause included in the automobile insurance policy. This means that Geico defended the case by hiring an attorney to represent the minor, but reserved the right to contest that the golf cart was covered under the insurance policy. The injured passengers prevailed to the tune of an $18 million judgment, and the state court entered a final judgment in excess of the policy limits.

Following entry of the state court judgment, Geico filed a declaratory action on April 11, 2020, to determine the rights and obligations of the parties under the insurance policy in Federal Court. The ruling in the case came down to the definition of the word “auto” in the policy. As the Court stated:

“Geico contends that the testimony of all other deponents is the same and that there is no evidence to find that an “private passenger auto” is anything other than a vehicle that has the “capacity to be driven legally and safely on public highways.” So, given that Florida makes it unlawful to operate a golf cart on public roads or streets unless they meet specific exceptions, Geico concludes that there is no coverage for the underlying accident.”

Initially, the district court agreed with this reasoning and sided with Geico but, in a startling reversal, the Federal appellate court on September 29, 2022 stated:

“The district court erred in granting the insurance company’s motion for summary judgment on its claim for declaratory relief because district court erred in determining that the golf cart did not qualify as a “private passenger auto” as defined in the insurance policy and that the policy did not provide liability insurance coverage for the accident for that reason. Reading in isolation, the policy definition of “private passenger auto” included golf cart as it was a four-wheeled, privately owned, passenger vehicle.”

Because the Court ruled that the golf cart was an “private passenger auto”, the case was returned to the lower court to determine whether Geico would now be on the hook for the judgment. Obviously, this is a complicated and evolving area of law and it takes attorneys of skill and experience to address these issues for their clients.

If you own or operate a golf cart, or allow your children to drive them, are you covered? If you’ve been in an accident while in a golf cart and your insurance company refuses to pay or protect you, do you know your rights?

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