Kathleen Bellorado v. Liberty Mutual Insurance Company.

NOTICE: Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule
23.0, as appearing in 97 Mass. App. Ct. 1017 (2020) (formerly known as rule 1:28,
as amended by 73 Mass. App. Ct. 1001 [2009]), are primarily directed to the parties
and, therefore, may not fully address the facts of the case or the panel's
decisional rationale. Moreover, such decisions are not circulated to the entire
court and, therefore, represent only the views of the panel that decided the case.
A summary decision pursuant to rule 23.0 or rule 1:28 issued after February 25,
2008, may be cited for its persuasive value but, because of the limitations noted
above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260
n.4 (2008).

COMMONWEALTH OF MASSACHUSETTS

APPEALS COURT

24-P-575

KATHLEEN BELLORADO

vs.

LIBERTY MUTUAL INSURANCE COMPANY.

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

In this insurance coverage dispute following an automobile

accident, plaintiff Kathleen Bellorado appeals from a summary

judgment entered in favor of defendant Liberty Mutual Insurance

Company (Liberty), and from an order denying her motion for

reconsideration. Bellorado contends that Liberty (1) waived its

right to defend its denial of coverage based on an exclusion in

its policy by not pleading that exclusion as an affirmative

defense in its answer, and (2) did not meet its burden of

proving that the exclusion applies to Bellorado's claim. We

affirm.

Background. In 2016, while driving a Ford pickup truck

owned by his employer, Todd Cunningham rear-ended Bellorado's
vehicle, causing her bodily injury. There is no dispute that

Cunningham was at fault. The truck that Cunningham drove was

insured under an automobile insurance policy issued by Pilgrim

Insurance Company. Cunningham also had an automobile policy

with Liberty (policy) on his two personal vehicles, a Porsche

and a Honda minivan. The policy contained the standard

Massachusetts automobile policy language providing coverage for

"Optional Bodily Injury to Others." It stated, in pertinent

part:

"Under this Part, we will pay damages to people injured or
killed in accidents if you or a household member is legally
responsible for the accident.

"In addition, we will not pay:

"3. For injuries resulting from an accident while you or
your spouse, if a household member, are using an auto which
you or your spouse, if a household member, own or use
regularly unless a premium for this Part is shown for that
auto on the Coverage Selections Page.

"5. While anyone is using a vehicle in the course of any
business other than the business of selling, servicing,
repairing or parking autos."

In 2019, Bellorado's counsel sent a demand letter to

Liberty pursuant to G. L. c. 93A and G. L. c. 176D. Liberty

responded with a letter denying the claim because the vehicle

that Cunningham drove was "not covered with Liberty Mutual." In

2020, Bellorado filed suit. Liberty broadly denied Bellorado's

allegations and claims in its answer, but did not assert any

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particular exclusion to coverage as an affirmative defense. In

2021, at a deposition in a separate lawsuit filed by Bellorado

against Cunningham and his employer, Cunningham testified that

it was "typical" for him to use his employer's truck for both

personal and business use, and that on the day of the accident

he was driving from his house to work.

In 2023, a few weeks before a scheduled pretrial hearing in

this action, Liberty provided Bellorado with a copy of

Cunningham's automobile policy. After Bellorado asked Liberty

to identify its basis for excluding coverage, Liberty responded

that "the coverage denial is based on" the exclusion to coverage

for "Optional Bodily Injury to Others" while using "a vehicle in

the course of any business other than the business of selling,

servicing, repairing or parking autos." After Bellorado

disagreed with that exclusion's applicability, Liberty stated

that it would "review the coverage issue further." A few months

later, Liberty moved for summary judgment. This time, Liberty

quoted the regular use exclusion to its coverage for "Optional

Bodily Injury to Others," and argued that Bellorado's claims

failed because Liberty "cannot afford coverage in an accident

where its insured, Cunningham, is driving a vehicle he regularly

uses that is not listed on his Liberty Mutual auto policy."

Bellorado cross-moved for partial summary judgment. Following

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multiple rounds of briefing and a hearing, the judge allowed

Liberty's motion for summary judgment, denied Bellorado's cross

motion, and declared that Liberty's policy does not provide

coverage for Bellorado's claim. Judgment entered dismissing the

complaint, and Bellorado's motion for reconsideration was

denied.

Discussion. "We review a grant of summary judgment de novo

to determine 'whether, viewing the evidence in the light most

favorable to the nonmoving party, all material facts have been

established and the moving party is entitled to a judgment as a

matter of law.'" Juliano v. Simpson, 461 Mass. 527, 529-530

(2012), quoting Augat, Inc. v. Liberty Mut. Ins. Co., 410 Mass.

117, 120 (1991). See Mass. R. Civ. P. 56 (c), as amended, 436

Mass. 1404 (2002).

1. Waiver. Bellorado contends that Liberty waived its

right to defend its denial of coverage by not pleading the

regular use or any other exclusion as an affirmative defense in

its answer. Massachusetts Rule of Civil Procedure 8 (c), 365

Mass. 749 (1974), provides:

"In pleading to a preceding pleading, a party shall set
forth affirmatively accord and satisfaction, arbitration
and award, assumption of risk, contributory negligence,
discharge in bankruptcy, duress, estoppel, failure of
consideration, fraud, illegality, injury by fellow servant,
laches, license, payment, release, res judicata, statute of
frauds, statute of limitations, waiver, and any other
matter constituting an avoidance or affirmative defense."

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As Bellorado points out, a failure to plead an affirmative

defense can in some circumstances result in waiver and exclusion

of the defense from the case. See Alicea v. Commonwealth, 466

Mass. 228, 236 n.12 (2013), citing Demoulas v. Demoulas, 428

Mass. 555, 575 n.16 (1998); Anthony's Pier Four, Inc. v. HBC

Assocs., 411 Mass. 451, 471 (1991), citing 5 C.A. Wright & A.R.

Miller, Federal Practice & Procedure § 1278, at 477 (2d ed.

1990). Although insurance policy coverage exclusions are not

among the affirmative defenses listed in rule 8 (c), Bellorado

cites a handful of cases in Massachusetts in which an exclusion

has been raised or referred to as an affirmative defense. See,

e.g., New England Envtl. Techs. v. American Safety Risk

Retention Group, Inc., 738 F. Supp. 2d 249, 254 (D. Mass. 2010);

Richardson v. Liberty Mut. Fire Ins. Co., 47 Mass. App. Ct. 698,

699-700 (1999). Bellorado also cites decisions from other

jurisdictions holding that an insurer waives its ability to

assert an exclusion by failing to plead it as an affirmative

defense in its answer. See, e.g., Jones v. Florida Ins. Guar.

Ass'n., 908 So.2d 435, 452 (Fla. 2005).

No such categorical rule of waiver has been adopted in

Massachusetts. While it is true that an insurer bears the

burden of proving an exclusion to coverage, the initial burden

is on the insured to prove that "the claimed loss falls within

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the coverage of the insurance policy." Boazova v. Safety Ins.

Co., 462 Mass. 346, 351 (2012). If the insured meets that

burden, "the burden then shifts to the insurer to show that a

separate exclusion to coverage is applicable." Id. See

Dorchester Mut. Ins. Co. v. Miville, 491 Mass. 489, 493 (2023);

Whitecap Int'l Seafood Exporters, Inc. v. Eastern Ins. Group,

LLC, 97 Mass. App. Ct. 578, 581-582 (2020). Under this burden-

shifting framework, the imposition of an inflexible requirement

on insurers to plead exclusions as affirmative defenses would be

impractical, in part because the asserted basis for coverage may

not always be evident from the insured's complaint. Here,

Bellorado did not identify a specific basis for coverage by

Liberty in her complaint, but rather alleged generally that

Liberty "insured" Cunningham "for his negligence which resulted

in Bellorado's injuries." To be sure, because the record shows

that Bellorado's counsel did not have a copy of Cunningham's

policy until he asked Liberty for it two years later, it may

have been difficult for Bellorado to state the basis for her

claim for coverage with greater precision. Nevertheless,

Liberty did not waive its right to assert exclusions under the

policy by filing an answer that denied Bellorado's claim at the

same level of generality.

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Furthermore, even with affirmative defenses subject to rule

8 (c), the key question is, as the judge recognized, whether the

defendant provided adequate notice to the plaintiff of the

defense. See NTV Mgt., Inc. v. Lightship Global Ventures, LLC,

484 Mass. 235, 240 (2020). Massachusetts courts have declined

to find waiver where sufficient notice of an unpleaded

affirmative defense was provided to the opposing party during

litigation. See, e.g., id. (no waiver where defendants

identified during discovery Federal statutes underlying their

contention that plaintiff was required to register as broker-

dealer); Demoulas, 428 Mass. at 575 n.16 (no waiver where bona

fide purchaser defense "was raised by both parties in briefs and

at a hearing" in connection with defendant's motion for directed

verdict); Bendetson v. Building Inspector of Revere, 36 Mass.

App. Ct. 615, 620 n.9 (1994) (no waiver of unpleaded res

judicata defense "where the defendant raised the argument in his

brief in opposition to the plaintiff's motion for summary

judgment, and the plaintiff raised a counter-argument in his

reply brief").

Here, Liberty provided Bellorado with adequate notice of

its reliance on the regular use exclusion. After receiving

Bellorado's demand letter, Liberty replied with a letter that

denied coverage because the vehicle Cunningham drove was "not

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covered with Liberty Mutual," but rather a "commercial vehicle"

for his employer covered by a business commercial policy owned

by that company. Liberty then cited the regular use exclusion

in its motion for summary judgment, served on July 3, 2023. In

her initial summary judgment memorandum, Bellorado relied on the

policy's general provision of coverage for "Optional Bodily

Injury to Others," but did not address the regular use exclusion

that Liberty had raised. Following a hearing, the transcript

for which Bellorado has not included in the record,1 the judge

allowed Bellorado to file a supplemental memorandum addressing

the regular use exclusion. In that supplemental memorandum,

Bellorado argued both waiver and that the exclusion did not

apply to her claim. Bellorado did not request additional

discovery to address the exclusion's applicability. See

Mass. R. Civ. P. 56 (f), 365 Mass. 824 (1974). We conclude that

Liberty did not waive its ability to assert the regular use

exclusion as a basis for denying Bellorado's claim.

1 It is a "fundamental and long-standing rule of appellate
civil practice" that the appellant must include in the appendix
all materials that "are essential for review of the issues
raised on appeal." Shawmut Community Bank, N.A. v. Zagami, 30
Mass. App. Ct. 371, 372-373 (1991), S.C., 411 Mass. 807 (1992).
See Mass. R. A. P. 16 (e), as appearing in 481 Mass. 1628
(2019); Mass. R. A. P. 18, as appearing in 481 Mass. 1637
(2019).

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2. Applicability of the regular use exclusion.

"Interpretation of an insurance contract is a pure question of

law." Zurich Am. Ins. Co. v. Medical Props. Trust, Inc., 494

Mass. 382, 386-387 (2024), citing Ken's Foods, Inc. v. Steadfast

Ins. Co., 491 Mass. 200, 203 (2023). Our task is to "construe

the words of the policy in their usual and ordinary sense."

Mahoney v. American Auto. Ins. Co., 83 Mass. App. Ct. 677, 679

(2013), quoting Hakim v. Massachusetts Insurers' Insolvency

Fund, 424 Mass. 275, 280 (1997). Because Liberty's policy is

the standard form automobile liability policy approved by the

commissioner of insurance, construction of the policy language

"is exempt from the usual construction against the drafter;

rather, it is interpreted in its ordinary sense." Oliveira v.

Commerce Ins. Co., 94 Mass. App. Ct. 276, 278-279 (2018),

quoting Kanamaru v. Holyoke Mut. Ins. Co., 72 Mass. App. Ct.

396, 399 (2008).

In arguing that her claim is covered by Liberty's policy,

Bellorado primarily relies on the first sentence of the

"Optional Bodily Injury to Others" provision, which states that

coverage applies when an insured "is legally responsible for the

accident," even if the vehicle driven by the insured is not

listed under the policy. As the judge explained, however, even

though "the policy does provide coverage for situations where an

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insured is operating vehicles in addition to vehicles [that] are

listed in the policy and would qualify as 'your auto,' this

obligation is not without contractual limitations or exclusions

listed in that same provision." Specifically, the regular use

exclusion denies coverage for injuries resulting from an

accident where the insured used a vehicle "which you or your

spouse, if a household member, own[s] or use[s] regularly,"

unless a premium was paid for that vehicle. The purpose of the

"Optional Bodily Injury to Others" provision combined with the

regular use exclusion is to provide coverage for "occasional and

incidental use of other . . . vehicles . . . without the payment

of an additional premium, but to exclude the habitual use of

other cars, which would increase the risk on the insurer without

a corresponding increase in the premium." Safety Ins. Co. v.

Day, 65 Mass. App. Ct. 15, 20 (2005), quoting Galvin v. Amica

Mut. Ins. Co., 11 Mass. App. Ct. 457, 459 (1981). Relevant

considerations in applying the regular use exclusion include

whether the operator used the vehicle to commute to work, had

exclusive use of the vehicle for any significant period, and had

unrestricted use of it. Id. at 22.

Liberty met its burden of showing that the regular use

exclusion applies to Bellorado's claim. See Boazova, 462 Mass.

at 351. At his deposition in the related case (the

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admissibility of which Bellorado did not contest), Cunningham

testified that he had worked for thirty-five years at a company

owned by his parents. He testified that it was "typical" for

him to use his employer's vehicle, and that he used the vehicle

for both personal and business purposes. On the day of the

accident, Cunningham was driving from his house to work. These

undisputed facts established that Cunningham used the vehicle on

a consistent and frequent basis.2 See Safety Ins. Co., 65 Mass.

App. Ct. at 21-22. See also Turner v. Aetna Cas. & Sur. Co., 36

Mass. App. Ct. 921, 923 (1994) ("frequent [and] systematic" use

of vehicle as passenger or driver constituted regular use under

exclusion).

Citing Galvin, 11 Mass. App. Ct. at 459, Bellorado contends

that the regular use exclusion applies only where "members of a

family may have two or more automobiles actually or potentially

used, but only insure one automobile." In Galvin, supra at 459-

462, however, we held that the exclusion precluded coverage

under a personal auto policy to a police officer who was

2 For similar reasons, we reject Bellorado's argument that
the vehicle qualified as "your auto" under the policy because it
was "used as a temporary substitute for" Cunningham's listed
vehicles (the Porsche and the Honda minivan) while they were
"out of normal use because of a breakdown, repair, servicing,
loss or destruction." Bellorado did not present any evidence
showing that, on the day of the accident, Cunningham was using
his company's truck as a temporary substitute or that his
covered vehicles were out of normal use.

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involved in a collision while operating one of a fleet of police

cruisers available to him at work. We are similarly unpersuaded

by Bellorado's reliance on cases from other jurisdictions

holding that the regular use exclusion does not apply to the

personal use of work vehicles. Because Bellorado did not

present any evidence disputing that Cunningham regularly used

his employer's vehicle for both personal and business purposes,

the judge properly concluded that the exclusion applies, allowed

Liberty's motion for summary judgment, and dismissed Bellorado's

claims.

Judgment affirmed.

Order denying motion for
reconsideration affirmed.

By the Court (Blake, C.J.,
Hodgens & Toone, JJ.3),

Clerk

Entered: April 24, 2025.

3 The panelists are listed in order of seniority.

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