Circuit Judge Robert Timm handed down a decision determining more than $1,000,000 of insurance coverage was available for our client and other victims. The factual setting in which the case arose is as follows:

A car accident occurred on February 14, 1998. The automobile involved was owned by a garage/convenience store. The owner of the business allowed his daughter to drive the vehicle. At the time of the accident she was a passenger. She had allowed a friend of hers to operate the vehicle. The car went off a curve and struck a utility pole. Two of the passengers, including the vehicle owner’s daughter, were severely injured.

The vehicle owner had a standard garagekeeper’s policy with Employers Mutual Casualty Company (EMC) with $1,000,000 liability limits, which had the appropriate boxes checked to provide coverage for “any auto.” In purchasing personal auto insurance, the same insurance agent placed this business vehicle on a personal automobile insurance policy.

EMC contended that there was no liability coverage for personal use of the vehicle, and that this inventoried vehicle from the used car dealership part of the business was not disclosed to the company at the time the insurance was procured. EMC also contended that SDCL 58-23-4 put the garagekeeper’s policy in the third position for coverage. State Auto contended that the family exclusion applied, barring any coverage for the owner’s daughter, and that State Auto should be in the last position as to insurance coverage. American Family contended that there was coverage, but that the driver’s carrier should be in the last position as to priority.

The Court determined that in the application process, the insured had disclosed the existence of the used car dealership. There were documents in EMC’s file that supported this conclusion.

The Court also determined that there is no implied exclusion for personal use in a standard garagekeeper’s policy. There clearly was no express exclusion, so an implied exclusion was the only basis the insurance company could utilize.

The Court determined that the family exclusion limitation in the personal auto policy providing coverage for “named insureds” includes those people covered by SDCL 58-23-6(5).

Finally, with respect to the garagekeeper’s priority statute, SDCL 58-23-4(2), the Court found priority in the following order: the personal coverage on the vehicle was first; the coverage of the driver was second; and the garagekeeper’s coverage was moved into the last position as a result of the above-noted statute.

The net effect of the decision was to provide an additional $1,025,000 of coverage for the victims of the accident.