This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (1996).




Chad M. Lehrke, plaintiff and judgment creditor,



Tamarack Sno-Flyers, Inc., et al.,

Judgment Debtors,


EMC Underwriters Ltd., et al., garnishees,


Filed June 17, 1997


Huspeni, Judge

Ramsey County District Court

File No. C3932286

Paul R. Smith, Abrams & Smith, P.A., 700 Northstar West, 625 Marquette Ave., Minneapolis, MN 55402 (for Appellant)

David C. Hutchinson, Ann D. Bray, Geraghty, O'Loughlin & Kenney, P.A., 1400 Capital Centre, 386 N. Wabasha St., St. Paul, MN 55102 (for Respondent)

Considered and decided by Huspeni, Presiding Judge, Crippen, Judge, and Willis, Judge.



Appellants, the insurers of two default judgment debtors, were held to have a duty to indemnify them when the judgment debtors and the judgment creditor were granted summary judgment in their garnishment action against appellants. Because we hold that the exclusions in the policy preclude coverage, we reverse.


The Minnesota United Snowmobile Association (USA) procured a Comprehensive General Liability (CGL) policy from appellant EMC Underwriters Ltd. (EMC). The policy's effective dates were 11-04-91 to 11-04-92; coverage was limited to "Exhibitions inside and outside insured location." The general liability schedule provides that coverage is for "Spec[tator] Liab[ility] Only."

Snowmobile club endorsements to this policy, effective 12-06-91, were issued to Tamarack and Palisade, two snowmobile clubs. The endorsements also specified "Coverage is For Spectator Liability Only." The endorsements had lists of both sponsored club activities and excluded activities: "Motorcycle/Snowmobile Trails" and "Snowmobile Racing" were listed as excluded activities. An additional endorsement (added February 4, 1992) did, however, add coverage for a snowmobile race scheduled for January 18 and 19, 1992.[1] Tamarack and Palisade had been asked to assist with this race, which was sponsored by the McGregor Lion's Club to benefit the local community.

In December 1991, the Lion's Club members arranged to plow the area of the lake that would serve as a parking lot for the scheduled race. The plowing would facilitate thickening of the ice and would provide a snow embankment about three feet high surrounding the plowed area. Plowing was done on December 29 and 30. On the night of December 31, respondent Chad Lehrke ran his snowmobile into the embankment and was thrown onto the ice; his injuries rendered him a paraplegic. Lehrke brought an action against Tamarack, Palisade, and four other defendants.[2]

Tamarack and Palisade tendered defense of the action to EMC, but did not file an answer to the complaint. EMC denied defense on the basis that the insurance policy did not provide coverage for the accident because the accident did not occur during the two-day period of the race and Lehrke was not a spectator.

Lehrke did not enter into a Miller-Shugart agreement with Tamarack and Palisade. Instead, he sought and obtained a default judgment in the amount of $2,029,269 against them. Tamarack and Palisade did not move to vacate the default judgment.

Lehrke then brought this garnishment action against EMC to collect on the default judgment. Both parties moved for summary judgment on the issue of EMC's duty to indemnify. Lehrke was granted summary judgment for the $1,000,000 policy limit and for interest on $2,029,269 from the date of the accident until tender of the $1,000,000. EMC challenges the summary judgment.


"Insurance coverage issues are questions of law for the court." State Farm Ins. Cos. v. Seefeld, 481 N.W.2d 62, 64 (Minn. 1992). A reviewing court is not bound by and need not give deference to a trial court's decision on a purely legal issue. Frost-Benco Elec. Ass'n v. Minnesota Pub. Utils. Comm'n, 358 N.W.2d 639, 642 (Minn. 1984).

The provisions of an insurance policy are to be interpreted according to plain, ordinary sense so as to effectuate the intention of the parties. The policy should be construed as a whole with all doubts concerning the meaning of language employed to be resolved in favor of the insured. The terms of an insurance policy should be construed according to what a reasonable person in the position of the insured would have understood the words to mean rather than what the insurer intended the language to mean.

Canadian Universal Ins. Co. v. Fire Watch, Inc., 258 N.W.2d 570, 572 (Minn. 1977) (citations omitted).

EMC contends first that neither Tamarack nor Palisade was engaged in any of the "sponsored club activities" listed on their endorsements at the time the accident occurred.[3] We agree. The "sponsored club activity" at issue here was the snowmobile race scheduled for January 18 and 19. While Lehrke argues that the language of the master general policy issued to USA supersedes the limiting language of the endorsements, this view was specifically rejected in Benton Cty. Agr. Soc. v. St. Paul Surplus, 372 N.W.2d 383 (Minn. App. 1985).

[The insurer] argues the trial court failed to read the policy as a whole when it concluded the language contained in the hazard schedule superseded the specific endorsements contained in the policy. [The insurer] claims the hazard schedule identifies the potential liability producing activities but does not enlarge coverage under the terms of the policy itself. [The insured] contends [the endorsement] does not exclude those events specifically included in the hazard schedule. We disagree. * * * The supreme court has also consistently held that "where provisions in the body of the policy conflict with an endorsement, the provision of the endorsement governs." Dairyland Ins. Co. v. Implement Dealers Ins. Co., 294 Minn. 236, 245, 199 N.W.2d 806, 811 (1972).

Benton Cty., 372 N.W.2d at 385-86.[4] Any coverage available to Tamarack and Palisade was available only under the endorsement, not under provisions of the master general policy. While snowmobile races generally were excluded even under the endorsement, a specific exception to that exclusion was made for the race of January 18 and 19, 1992.

Notably, coverage under both the master policy and the endorsement applied only to spectators. Lehrke was not a spectator because the snowmobile race occurred weeks after his injury; he was injured by an activity undertaken in preparation for the race. There was no connection between his injury and any of the sponsored club activities listed in the endorsements.

While the snowmobile club endorsements issued to Tamarack and Palisade restrict coverage to "spectators only," the district court construed the term "spectator" to mean "the general public who are non-members of the insured club * * *." We disagree with this broad construction.

The terms of an insurance policy should be construed according to what a reasonable person in the position of the insured would have understood the words to mean * * *.

Canadian Universal, 258 N.W.2d at 572. A reasonable person in the position of Tamarack and Palisade would have understood that the coverage provided by EMC's policy applied to spectators at club events. Lehrke was not a spectator at a club event. There is no basis for the district court's extremely broad construction of the term "spectator."

The snowmobile club endorsements issued to Tamarack and Palisade do not extend coverage to one who was injured while not a spectator and whose injury had no connection with a covered club event. We therefore reverse the determination of the district court that EMC has a garnishable liability to judgment debtors Tamarack and Palisade.

In view of our decision that the EMC policy does not provide coverage in this case, we need not address EMC's argument that the district court erred in refusing to revisit the issue of Tamarack's and Palisade's liability.[5] Neither do we address the question of EMC's liability for interest.


[ ]1This endorsement was actually added after the race had been held.

[ ]2Claims against the other defendants were resolved with Pierringer releases; Lehrke received a total of $607,500.

[ ]3Lehrke moves to strike the statement in EMC's reply brief that Tamarack and Palisade were not additional insureds under the USA policy but rather were insured only by the endorsements, alleging that EMC first raised this issue in its reply brief. Our review of the record persuades us that EMC argues consistently in its initial brief that Tamarack and Palisade were covered only by the endorsements, not by the master policy issued to USA. We therefore deny Lehrke's motion.

[ ]4Lehrke attempts to distinguish Benton Cty., arguing that the policy in that case included language restricting coverage "to such of the following Coverages as are indicated by specific premium charge or charges." Id. at 385. However, because Benton Cty. held that the endorsement superseded this language, this distinction is irrelevant.

[ ]5The district court observed that Tamarack's and Palisade's liability had been conclusively established by the default judgment two years earlier and that the reasonable time for moving to vacate that judgment pursuant to Minn. R. Civ. P. 60.02 had elapsed.