WALTER CLARK ERWIN, Plaintiff, v. LENA LOWDERMILK TWEED, Defendant No. COA00-250 (Filed 3 April 2001) 1. Insurance--UIM coverage--family farm trust vehicles--individually owned The trial court correctly granted summary judgment for plaintiff in a declaratory judgment action to determine UIM coverage for vehicles owned by a family farm trust where defendant contended that plaintiff was not entitled to coverage because the farm trust had a legally independent existence. The General Assembly has recognized the importance of maintaining the family farm, whatever legal entity it assumes, and has enacted legislation treating family farms differently in insurance regulations and for property tax purposes. Vehicles owned by a the family farm trust on this record are to be treated as “individually owned” for insurance purposes; the present occupier of the farm, who is a 20% owner and trustee, is the named insured; and any family member residing in the same household is a class I insured under the policy. 2. Insurance--UIM coverage--stacking--private passenger or fleet vehicle--weight of vehicle--issue of fact The trial court erred in a declaratory judgment action to determine UIM coverage by finding that a business auto policy could be stacked with a personal auto policy and granting summary judgment for plaintiff. An insured party may only stack interpolicy underinsured motorist coverages for non-fleet private passenger vehicles; the weight of the vehicle determines whether it is a private passenger vehicle or a fleet vehicle and there was no information here conclusively determining the weight. N.C.G.S. § 58-40-10(b). 3. Insurance--UIM claim--notice to insurer Defendant-insurer’s agents had prompt notice of plaintiff’s UIM claim where plaintiff stated that he was in and out of defendant’s local office almost daily to chat and discuss various matters relating to his insurance with his personal agent and that he was “virtually certain” that various members of the office inquired about his son’s health and accident recovery progress. Appeal by defendant from order and declaratory judgment entered 11 December 1999 by Judge James U. Downs in Burke County Superior Court. Heard in the Court of Appeals 22 January 2001. Bryce Thomas & Associates, by Bryce O. Thomas, Jr., for the plaintiff-appellee. Willardson & Lipscomb, L.L.P., by William F. Lipscomb, for unnamed defendant-appellant. EAGLES, Chief Judge. Unnamed defendant (hereinafter “Farm Bureau”) appeals from the order and declaratory judgment finding that the plaintiff was entitled to underinsured motorist coverage under two insurance policies. The polices covered vehicles owned by Bellevue Farm Trust (“hereinafter BFT”). Plaintiff lives on Bellevue Farm with his parents and is a beneficiary of BFT. The evidence presented at the hearing tends to show the following. On 19 December 1993 plaintiff, the 15 year old child of W.C. Erwin, Jr., was struck and injured on his bicycle by the vehicle driven by defendant Tweed. Defendant Tweed’s vehicle was covered by a policy issued by State Auto Insurance Company which provided bodily injury coverage in the amount of $50,000.00 per person. State Auto tendered its limits -- $12,666.00 to plaintiff’s parents for medical bills, and the balance of $37,334.00 to plaintiff. On 16 October 1996 plaintiff notified unnamed defendant in writing of a UIM claim. Plaintiff argues he is entitled to UIM coverage under three policies issued by Farm Bureau. Farm Bureau Policy No. AP 3725121 is issued to plaintiff’s parents. Farm Bureau Policy Nos. BAP 2040951 and AP 3915189 are issued to BFT. All three provide UIM coverage. Farm Bureau does not dispute coverage under Policy No. AP 3725121, however it denies coverage under policy Nos. BAP 2040951 and AP 3915189 on the basis that plaintiff is not a family member of BFT and was not in a covered auto at the time of the accident. [1] The UIM coverage provisions of the Farm Bureau policy allow insureds to recover for personal injuries, defining "insured" as: 1. You or any family member. 2. Any other person occupying: a. your covered auto; or b. any other auto operated by you.3. Any person for damages that person is entitled to recover because of bodily injury to which this coverage applies sustained by a person listed in 1. or 2. above. Farm Bureau argues that since the insured in these two policies is BFT, and plaintiff was not in a covered auto, plaintiff’s injuries are not covered. Farm Bureau relies on Busby v. Simmons, 103 N.C. App. 592, 406 S.E.2d 628 (1991) and Stockton v. N.C. Farm Bureau, 139 N.C. App. 196, 532 S.E.2d 566, disc. rev. denied, 352 N.C. 683, 545 S.E.2d 727 (2000), in support of this position. In Busby, the policy covered a sub-chapter S corporation’s vehicles. The corporation was owned 2/3 by the plaintiff and 1/3 by plaintiff’s father. The Busby plaintiff was not in a covered auto at the time of the accident. This Court held that “named insured” did not include “officers, directors or stockholders of a corporation when the named insured is a corporation.” Busby, 103 N.C. App. at 596, 406 S.E.2d at 630. In Stockton, the named insured was “Oak Farm.” Stockton, 139 N.C. App. at 197, 532 S.E.2d at 567. “Oak Farm” is the name of an unincorporated piece of land. Id. at 200, 532 S.E.2d at 568. A family lives on it and farms it, but Oak Farm is not a separate legal entity and has no independent legal existence. Id. This Court held that Oak Farm was indistinguishable from the owners of Oak Farm and concluded that UIM coverage was available for family members of Oak Farm’s owners even though they were not injured in a covered vehicle. Id. Farm Bureau argues that if the named insured, unlike Stockton, has a legally independent existence and is not an individual, then there can be no coverage for insureds not actually occupying a covered automobile. Farm Bureau reasons that since there is a trust document for BFT and trusts are recognized as legal entities, then insureds of BFT not in a covered automobile, such as plaintiff, are not entitled to UIM coverage under those policies. As applied in the context of family farms, we disagree. I. Legislative Treatment of Family Farms A. TaxationThe United States Congress has recognized the special problems facing a family farmer and efforts to preserve the family farm for future
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