author: OPALA, V.C.J.

text:
    2003 OK 88
    Debra DELK, Plaintiff, v. MARKEL AMERICAN INSURANCE COMPANY, a Virginia Corporation, Defendant.
    No. 99,117.
    Supreme Court of Oklahoma.
    Oct. 21, 2003.
    Rehearing Denied Dec. 15, 2003.

      Peter J. Ram and James A. Belote, Stipe Law Firm, Oklahoma City, OK, for plaintiff.
    Bruce V. Winston, Walker, Ferguson & Ferguson, Oklahoma City, OK, for defendant.

      . Identified herein are those counsel for the parties whose names appear on the briefs filed in this court.

   OPALA, V.C.J.

T1 The United States District Court for the Western District of Oklahoma (certifying court) certified a question of law pursuant to the Revised Uniform Certification of Questions of Law Act, 20 0.9.2001 § 1601 et seq. We have reformulated the question as authorized by § 1602.lof the Act. We answer the following reformulated question:

May an insured cotenant who occupies the insured property as her home and who has insured the property for its full value recover (within the policy limits) more than the value of her fractional legal interest in the property?

We answer this reformulated question in the affirmative.

I

THE ANATOMY OF FEDERAL LITIGATION

12 In April 1998 James Delk executed a warranty deed conveying equal fractional interests in his residence to six of his relatives, including his daughter, Debra Delk (plaintiff or Delk). The other five cotenants named in the deed are plaintiff's adult son, John, his minor children, Julian and Cheyenne Delk, plaintiffs minor son, Tanner Mabry, and plaintiff's adult nephew, Cody Delk. Plaintiff lived in the home with John and his family until it was destroyed by fire in September 2001.

{3 Markel American Insurance Company (defendant) in May 1999 issued to plaintiff as the sole named insured a homeowner's policy covering the residence. The application did not ask plaintiff about the nature or extent of her legal title. Plaintiff contends that she informed defendant she was taking over as policyholder from her father and that she would be making the premium payments. Plaintiff renewed the policy on a yearly basis at an annual premium of $786.00. The policy was in force and effect when the house was destroyed by fire. The policy limits for dwelling coverage stand at $104,000.00. The policy at issue is the only property insurance covering the home. Plaintiff alone paid the annual premiums. She and her adult son, John, contend they had an understanding that plaintiff would obtain insurance on the home and that she alone would be entitled to any proceeds recovered in the event of an insured loss.

T4 When the home was destroyed by fire in September 2001, plaintiff made a claim under the policy for the amount of the policy's dwelling coverage limits. Defendant learned while investigating the claim that plaintiff owned only a one-sixth interest in the insured property. Defendant then denied plaintiff's claim as to all but one-sixth of the policy limits on the grounds that her insurable interest-and hence the insurer's indemnification duty-was limited to plaintiff's fractional share of the property's ownership.

T5 Plaintiff then brought this action against defendant in the United States District Court for the Western District of Oklahoma for breach of contract and breach of the insurer's implied duty of good faith and fair dealing. Both parties moved for summary judgment. Unable to determine how Oklahoma law would quantify plaintiff's insurable interest in the home, the federal district court judge submitted to this court the certified question of law which we answer today as reformulated.

II

THE NATURE OF THE COURTS FUNCTION WHEN ANSWERING QUESTIONS FROM A FEDERAL COURT

T6 In answering questions posed by a federal court, the parameters of state-law claims or defenses identified by the submitted questions may be tested, but it is not this court's office to intrude (by its responses) upon the certifying court's decision-making process. The latter must be left entirely free to assess the impact of our answers and then make its own appraisal of the proof in the case before it.

17 Because this case is not before us for decision, we refrain (as we must) from applying the declared state-law responses to the facts in the federal-court litigation, which have been tendered for review by the certifying court either in the form of evidence adduced at trial or by acceptable probative substitutes (so-called "evidentiary materials"). The task of analyzing today's answer for its application to this case is deferred in its entirety to the certifying court.

III

THE PURPOSE OF THE INSURABLE INTEREST REQUIREMENT AND THE GUIDING PRINCIPLE BEHIND ITS IMPLEMENTATION IN OKLAHOMA

18 An insurance contract is valid and enforceable only to the extent that the insured has an insurable interest in the subject matter of the policy. This requirement has long been a part of Oklahoma's common law and also stands today as a statutory prerequisite for the validity of an insurance contract. The pertinent subsection of 36 0.8.2001 § 3605 states: "No insurance contract on property or of any interest therein or arising therefrom shall be enforceable as to the insurance except for the benefit of persons having an insurable interest in the things insured." The insurance policy at issue in this case also contains a provision limiting defendant's liability to the insurable interest an insured person has in property covered by the policy.

4 9 An insurable interest is the relationship or connection a person must have with the subject matter of an insurance policy in order to insure it. The insurable interest doe-trine developed over the course of several centuries in response to certain public policy concerns related to insurance. The foremost historical justification for the insurable interest requirement was to prohibit wagering contracts in the guise of insurance. Odd as it may strike us today, insurance as an instrument of wagering was a common and accepted practice in mid-eighteenth century England. Parliament, responding to the pernicious effects of this practice, passed a series of statutes beginning in the middle of the eighteenth century requiring as a prerequisite for the validity and enforceability of an insurance contract that the insured have an interest in the contract's subject matter. While the historical anti-wagering foundation of the insurable interest doctrine remains valid, other public policy objectives have greater resonance today. The distinction between wagering and insurance is now so firmly established in public perception, that the justification for the insurable interest doctrine is more readily apprehended today as the prevention of unproductive and wasteful commercial transactions, the limitation of insurance to true indemnity, and the deterrence of the fraudulent destruction of insured property.

1 10 The doctrine of insurable interest initially entered American jurisprudence by way of decisional law, but many jurisdictions have over the years enacted insurable interest statutes. While American jurisdictions generally agree on the necessity of an insurable interest, they are divided on what constitutes such an interest. The nature of the interest that qualifies as insurable has changed over time and is gradually broadening. Two competing theories have evolved for measuring the nexus which must be present between the property and its insured for an insurable interest to attach. The literature refers to one of these as the "legal interest" theory and to the other as the "factual expectation" theory.

111 In Snethen v. Oklahoma State Union of the Farmers Educational and Cooperative Union of America, we adopted the factual expectation theory of insurable interest.Under this theory there is an insurable interest in property if the insured would gain some economic advamtiage by its continued existence or would suffer some economic detriment in case of its loss or destruction. This is also the theory espoused by the provisions of 86 0.8.2001 § 3605.B., which define insurable interest as: "any actual, lawful, and substantial economic interest in the safety or preservation of the subject of the insurance free from loss, destruction, or pecuniary damage or impairment. % Snethen held that the word "lawful" as used in § 3605.B. is not synonymous with the word "legal" and does not require the application of the legal interest theory, but is merely used in the sense that the interest was not acquired in violation of the law.

1 12 The purpose of the insurable interest requirement must stand at the center of any analysis of the doctrine's application. This is so whether the inquiry concerns the complete presence or absence of an insurable interest or whether, as here, it concerns the extent or measure of an insurable interest. Judicial consideration must be given to whether the contract suggests an element of wager on the part of the insured, ie. whether it appears that the insured was betting on the loss of property with which he (or she) had little or no connection. The court must also consider whether recovery by the insured would exceed the loss actually suffered, thereby providing motivation for destroying the property. The insurable interest requirement should not be extended beyond the reasons for its existence by an overly technical construction that frustrates the legitimate expectations of the insured or that permits an insurer to avoid the very risk it intended to insure. With these considerations in mind, we address the extent of this plaintiff's insurable interest under Oklahoma law.

IV

THE INSURABLE INTEREST OF A CO-TENANT IN POSSESSION MAY EXCEED THE QUANTUM OF HIS (OR HER) FRACTIONAL LEGAL ESTATE IN THE COTENANCY PROPERTY WHERE THE INSURING CO-TENANT ACTS AS THE MANAGING AGENT FOR THE JOINT OWNERS

T13 Defendant invokes the oft-repeated statement that a cotenant's insurable interest is limited to his (or her) interest in the property. While we agree with this as a general proposition, we note that it is an abstraction that begs the question of what qualifies as an interest. Defendant argues that the intent of the general proposition is to limit a cotenant's interest to the quantum of his (or her) legal title We grant that under some circumstances a cotenant's insurable interest may properly be so limited, but we regard Oklahoma's factual expectation approach to insurable interest as authorizing under proper cireumstances recovery by a cotenant of more than the cotenant's fractional interest in the insured property.

114 Tenaney in common is a joint interest in property. Its only essential element is a unity of the right of possession. While each tenant in common has a separate and distinct title which is held independently of the other cotenants, each stands to the other in a relation of mutual trust and confidence. One tenant in common may not act or claim "in derogation of" the interest of the other joint owners. This means that a cotenant is not allowed to lessen or diminish the value or effect of the other cotenant's right, title, interest or status in the land.

1 15 While none of these attributes of cotenancy places an affirmative duty on one cotenant to insure the common property for the benefit of the other joint owners, coten-ants clearly have a mutual and reciprocal interest in the safety and preservation of the common property. This is especially true where the cotenants are all family members and the common property is the residence of some or all of them. Each has a reciprocal expectation of economic advantage from the home's continuing existence and its availability as a residence for the others. When the residence is destroyed, the occupants lose more than their individual fractional legal interests in the property. Before the home's destruction, they all have a place to live. Afterwards, they are homeless and must go to the expense of securing another home.

116 In such a case it would not be unusual for one of the resident cotenants to be given the responsibility of maintaining and protecting the property for the benefit of the other co-owning family members. A co-tenant who has assumed or who has been given such general managerial authority over the property is free to exercise that authority by taking any measure which a reasonably prudent person in that position would take to protect the property, including purchasing insurance for the benefit of all joint owners. A tenant in common who manages family-owned property which serves as the residence of all or some of the family clearly has a substantial economic interest in the continued existence of the property both as an individual and as the representative of the family.

$17 Whether Delk was in fact authorized by the other cotenants as their agent to secure fire coverage for the co-owned premises is a question of fact for resolution by the certifying court. We would only note here that the realities of a cotenancy relationship in which the cotenants are all family members, some or all of whom occupy the premises as their home, suggest that something less than a formal agreement would suffice to establish the requisite agreement or understanding.

{18 The provisions of 86 0.8.2001 § 3605.0. state, "The measure of an insurable interest in property is the extent to which the insured might be dammified by loss, injury, or impairment thereof." The statutory formulation is simply another way of saying that the insured may recover the amount which will indemnify him (or her) for the loss suffered. Indemnification is measured by .the extent to which the insured has been economically impacted by the happening of the insured event. Assuming the existence of the requisite agency relationship between plaintiff and her co-owners, anything less than a recovery in the amount of the value of the property (up to the policy limits) will not constitute full indemnity for the loss.

T19 It might be objected that allowing a fractional interest holder to recover the full value of the fee interests under an insurance contract implicates the public policy concerns underlying the insurable interest requirement. In response we would underscore that the insuring cotenant acts as an agent for the other co-owners in acquiring insurance on the premises and any recovery is held in trust by the insuring -cotenant for the benefit of the other joint owners. An agent is a fiduciary with respect to any matter in the scope of the ageney relationship. An agent receiving money belonging to the principal holds the money in trust for the principal's benefit. Should the insuring co-tenant fail to account to the other joint owners for their share of the proceeds, an action to impress the funds with a constructive trust would be available. The insuring cotenant can have no motivation for wagering on the property's loss and cannot profit by its destruction where the insurer is required to pay the coverage limits, but each cotenant is legally entitled to only his share of the proceeds.

120 The ordinary person purchasing insurance cannot be expected to understand a term of art such as insurable interest in a policy of insurance. All the insured knows is that he (or she) has paid money to secure protection for the insured property and in case it is destroyed the insurer will cover the loss. The policy of insurance in this case states that it covers "your [the insured's] dwelling." On the eleventh page of the policy, fifth among a list of fifteen conditions is the insurable interest limitation. The insurer never asked the insured about her legal interest in the insured property. The policy limits and the premium paid by this insured clearly demonstrate her intent that more than her bare legal interest be insured. An insurer cannot lead an unsophisticated insured into believing that protection of the family home has been procured and then after the occurrence of the insured event deny full coverage.

{21 Finally, it is immaterial to the risk assumed by the insurer whether this plaintiff was acting as the agent of the joint owners or whether she was the property's sole owner. The insurer believed it was entering into a contract of indemnity for the full value of the home up to the coverage limits. Its obligations are not increased by the actual status of the legal title to the insured premises. The risk it assumed is the risk it incurred.

V

A COTENANT IN POSSESSION, BEING LEGALLY LIABLE TO THE OTHER JOINT OWNERS FOR DAMAGE TO OR DESTRUCTION OF THE COMMON PROPERTY, HAS AN INSUERABLE INTEREST TO THE EXTENT OF HIS (OR HER) POTENTIAL LEGAL LIABILITY

122 Plaintiff also urges us to instruct the certifying court that she has an insurable interest in the whole dwelling by virtue of her use and occupancy of it as her residence. We need not decide whether bare possession would suffice to permit a cotenant in possession of a dwelling to insure it for its full value. This is so because we recognize the traditional common-law rule that whenever one person is by cireumstances placed in such a position with regard to another, that, if he (or she) did not use ordinary care and skill in his (or her) own conduct, he (or she) would cause danger of injury to the person or property of the other, a duty arises to use ordinary care and skill to avoid such danger. A cotenant who occupies and uses the common property falls within this rule. He (or she) is obligated to use ordinary care in the use of the common property and stands liable to the other joint tenants for damage to or destruction of the property. A coten-ant in possession may hence become subject to pecuniary loss in tort if the dwelling is damaged or destroyed. This legal liability provides an insurable interest for purposes of property insurance.

123 The separate writing of the justice who partially concurs in today's pronouncement suggests that our answer to the certified question establishes as a matter of law that a cotenant in possession has an insurable interest in the common property by virtue of the cotenancy relationship. This is a misstatement of our holding, which rests on the potential liability of a cotenant in possession to the other cotenants for damage to or destruction of the common property and not on a status-based duty to insure the common property for the benefit of the other joint owners.

[24 The objection could be raised that a cotenant who could recover all the insurance proceeds upon a total loss of the common property might be tempted to destroy the property and then either keep the proceeds or use them to rebuild, excluding the former cotenants from ownership of the new premises. Cotenancy principles preclude this result. Just as the aequisition of an adverse title inures to the benefit of other joint owners, so, too, must the recovery of insurance proceeds. The insuring cotenant in possession must account to the other joint owners for their share of the insurance proceeds and a suit to impress a constructive trust on the proceeds would be available to the other cotenants if the insuring cotenant fails to make the required accounting.

125 CERTIFIED QUESTION ANSWERED

1 26 WATT, C.J., and HODGES, LAVENDER, SUMMERS and WINCHESTER, JJ., concur.

1 27 HARGRAVE and KAUGER, JJ., concur in result.

128 BOUDREAU, J., concurs in part and dissents in part.

BOUDREAU, J., concurring in part and dissenting in part.

1 1 I agree with the majority that a tenant in common, in possession of the common property, has an insurable interest to the extent of his or her potential legal lability for the loss or destruction of the property. However, I would base this holding on the status based duty of the cotenant in possession to preserve the common property for the benefit of the other cotenants, and not on a duty derived from general negligence principles.

T2 The majority opinion recognizes that each tenant in common has a mutual and reciprocal interest in the safety and preservation of the common property. Beyond that, a cotenant in sole possession has a duty to preserve the common property for the benefit of the other cotenants. See, eg., Gearhart v. Gearhart, 218 SW. 81, 33 (Mo. 1919) (a cotenant in sole possession and enjoyment of the common property is deemed to have undertaken the discharge of certain duties to his cotenants, such as preserving the property); Caffey v. Caffey, 274 Ark. 835, 625 S.W.2d 444, 445 (1981); Bailey v. Parker, 492 So.2d 1175, 1177 (Fla.App.1986); In re Estate of Ray, 7 Tll.App.3d 488, 287 N.E.2d 144, 149 (1972); Ellis v. Snyder, 88 Kan. 638, 112 P. 594, 595 (1911); Smither v. Betts, 264 S.W.2d 255, 257 (Ky.App.1954);, Baird v. Moore, 50 N.J.Super. 156, 141 A.2d 824, 827 (1958); Mastbaum v. Mastbaum, 126 N.J. Eg. 366, 9 A.2d 51, 55 (Ch.1989); Clute v. Clute, 197 N.Y. 439, 90 N.E. 988, 990 (1910).

T3 Insurable interest is defined as "any actual, lawful, and substantial economic interest in the safety or preservation of the subject of the insurance free from loss, destruction or pecuniary damage or impairment." 86 0.$.2001, § 3605(B). Because a cotenant in sole possession of the common property has a legal duty to preserve the common property for the benefit of the other coten-ants, she is potentially liable to her cotenants for loss, destruction or impairment of the property. Accordingly, she has an actual, lawful, and substantial economic interest in the safety or preservation of the common property that is the subject of the insurance. This economic interest allows a cotenant in possession of the entire common property to claim an insurable interest in the value of the entire common property.

T4 Allowing a cotenant in possession to recover the full value of the property under an insurance contract does not undermine the public policy concerns underlying the insurable interest requirement. In the event of a loss, the cotenant in possession will not be able to retain the entire proceeds of the policy. Tenants in common each stand in a relation of mutual trust and confidence to each other. Rex Oil Refining, Inc. v. Shirvan, 1967 OK 127, 448 P.2d 82, 87. Where one cotenant comes into possession of funds belonging to other cotenants, she becomes a trustee of such funds and stands in a fiduciary relationship to the other cotenants. Ludey v. Pure Oil Co., 1981 OK 527, 157 Okla. 1, 11 P.2d 102, 104. A constructive trust would arise where there is a breach of this fiduciary relationship. Renegar v. Bruning, 1942 OK 99, 190 Okla. 340, 128 P.2d 686, 687.

[5 I do not think it is necessary for us to decide whether a cotenant in possession who has insured the common property for its full value may recover more than the value of her fractional interest in the property when she acts as the managing agent for the joint owners. In Jones v. University of Central Oklahoma, 1995 OK 138, 910 P.2d 987, 989, we cautioned that we would not presume any facts outside those offered by the certification order. The certification order contained no facts indicating plaintiff was acting as an agent of the other fractional owners, nor did the plaintiff allege or tender evidentiary materials establishing such an agreement between herself and the remaining cotenants.

      . The provisions of 20 0.$.2001 § 1602 state:
      "Power to Answer. The Supreme Court and the Court of Criminal Appeals may answer a question of law certified to i by a court of the United States, or by an appellate court of another state, or of a federally recognized Indian tribal government, or of Canada, a Canadian province or territory, Mexico, or a Mexican state, if the answer may be determinative of an issue in pending litigation in the certifying court and there is no controlling decision of the Supreme Court or Court of Criminal Appeals, constitutional provision, or statute of this state."

      . The provisions of 20 0.$.2001 § 1602.1 state:
      "Power to Reformulate Question. The Supreme Court of this state may reformulate a question of law certified to it."

      . The question certified to us by the federal court inquires:
      "'What is the insurable interest of a property owner who, along with five co-tenants, owns an undivided one-sixth interest in an insured dwelling and who utilizes the dwelling as her residence?"

      . The material accompanying the federal court's certification order consists of the pleadings, the parties' motions for summary adjudication with attached exhibits, and briefs in support of and in opposition to the motions. The parties submitted additional briefs to this court at our request.

      . The policy also provides other coverage in the following amounts:
      Other Structures Coverage-$10,400.00.
      Personal Property Coverage-$41,600.00.
      Additional Living Cost and Fair Rental Value-$10,400.00.
      Personal Liability-$25,000.00.
      Medical Payment to Others-$500.00.

      . Plaintiff moved for summary judgment on the breach of contract claim alone, while defendant moved for summary judgment on both the breach of contract claim and on the claim for breach of the insurer's implied duty of good faith and fair dealing. Only the breach of contract claim is directly implicated in today's answer.

      . See Uniform Laws Annotated, Uniform Certification of Questions of Law Act/Rule (1995); Goldschmidt, Certification of Questions of Law; Federalism in Practice, American Judicature Society (1994).

      . See, eg., Shebester v. Triple Crown Insurers, 974 F.2d 135, 137 (10th Cir.1992).

      . Schmidt v. United States, 1996 OK. 29, 17, 912 P.2d 871, 873; Brown v. Ford, 1995 OK 101, 14, 905 P.2d 223, 226; Bonner v. Okla. Rock Corp., 1993 OK 131, 12, n. 3, 863 P.2d 1176, 1178, n. 3; Shebester v. Triple Crown Insurers, 1992 OK 20, T8, n. 4, 826 P.2d 603, 606, n. 4.

      . Fireman's Fund Ins. Co. v. Cox, 1918 OK 570, 15, 71 Okla. 97, 175 P. 493, 493.

      , Id.

      . 36 0.$.2001 § 3605.

      . See 36 0.$.2001 § 3605.4.

      . The policy states in relevant part, "In the event of a loss, we will not pay for more than the insurable interest that an insured person has in the property covered by this policy ...."

      . See the following articles and treatises touching on the origin of the insurable interest doctrine: Bertram Harnett and John V. Thornton, "Insurable Interest in Property: A Socio-Economic Reevalution of a Legal Concept," 48 Comm. L.Rev. 1162, 1178-1183 (1948); William T. Vu-kowich, "Insurable Interest: When It Must Exist in Property and Life Insurance," I Wirramerre LJ. 1, 1 (1971); Robert Stuart Pinzur, "Insurable Interest: A Search for Consistency," 46 Ins. Coun-set J. 109, 110-111 (1979); Emeric Fischer, "The Rule of Insurable Interest and the Principle of Indemnity: Are They Measures of Damages in Property Insurance?" 56 Imp. LJ. 445, 446 (1981); Johnny C. Parker, "Does Lack of an Insurable Interest Preclude an Insurance Agent from Taking an Absolute Assignment of His Client's Life Policy," 31 U Riucu. L.Rev. 71 (Jan. 1997); Hugh J. Fegan, "Notes on the Development of the Doctrine of Insurable Interest," 8 Gro LJ. 1-13 (1919); Gary I. Salzman, "The Law of Insurable Interest in Property Insurance," 1966 Ins. LJ. 394, 394-96; Robert E. Keeton and Alan I. Widiss, Insurance Law: A cutE to FUNDAMENTAL Principes, Lesar Doctrines, amp CommErciat Practices, § 3.1(c) at 136-137 (Student ed.1988); Jeffrey W. Stempel, Law or Insurance Contract Disputes § 1.04[a] and [b] at 1-17-1-23 (1999); and EJ. MacGillivray, Insurance Law 104 ef seq.(1912).

      . See Keeton and Widiss, supra at 138.

      . Gambling was the "pet vice" of seventeenth and eighteenth century England and the courts' attitude toward the practice "reflected popular feeling." Fegan, supra note 16 at 7-8. Hence, before Parliament intervened, most forms of wagering were valid at common law and wagering agreements were generally enforceable in English courts. MacGillivray, supra note 16 at 104. The courts' practice of enforcing wagers per se was applied in the eighteenth century to the enforcement of wagers in the form of marine and life insurance policies, but the early English decisions with respect to fire insurance took the opposite view. See Sadlers Co. v. Badcock, 2 Atk. 554, 26 Eng. Rep. 733 (1743), in which Lord Hardwicke explained that fire insurance did not bave the same history or attributes as marine insurance and that for fire insurance to be enforceable the insured must have an interest in the property insured. Id. at 556, 26 Eng. Rptr. at 734. See also Lynch v. Dalzell, 4 Bro. P.C. 431, 2 Eng. Rep. 292 (1729).
      Even with respect to marine insurance, it has been suggested that the belief that the common law approved of wagering in that type of insurance may rest on a fallacy. The notion that the courts would enforce wagering policies on ships is usually traced to the case of Depaba v. Ludlow, 1 Comyns 361, 92 Eng. Rep. 1112 (1721), in which the plaintiff contracted for marine insurance "interest or no interest." When the ship was lost, the plaintiff sought recovery under the policy. The court held that the clause "interest or no interest" in the contract constituted a valid and enforceable waiver by the insurer of proof of interest at trial. The decision appears to assume that the plaintiff had an interest in the insured property and clearly did not hold that wagering policies were valid, but only that parties to an insurance contract were free to agree to a waiver of proof of interest at trial. Nevertheless, the effect of Depaba's holding was to provide an apparent legal justification for using marine insurance as an instrument of wagering. In a short time, the practice became so widespread and socially invidious that Parliament was forced to act, passing in 1746 a statute prohibiting the purchase of marine insurance by those without an interest in the subject. See the provisions of 19 Geo. II, c. 37 (1746), discussed infra note 20. When the question later arose in Craufurd v. Hunter, 8 TR. 13, 101Eng. Rptr. 1239(1798), whether plaintiffs could recover under a marine insurance policy without alleging they had an interest in the ships, Lord Kenyon, viewing the 1746 statute as Parliamentary recognition that before the statute's passage insurance could be procured without interest, opined that "at common law a person might have insured without having any interest," Id. at 23, 101 Eng. Rptr. at 1245. Commenting on Lord Kenyon's view of the common law, Lord Eldon in Lucena v. Crau-furd, 2 Bos. & Pul. 269, 127 Eng. Rptr. 630 (1806), expressed doubt that Lord Kenyon had correctly stated the rule, opining that the early decisions did no more than dispense with proof of interest at trial and the statute merely addressed the problems that arose from dispensing with that proof. Id. at 321-22, 127 Eng. Rptr. 650-651.
      For a discussion of how the doctrine that wagering policies on ships were valid at common law inadvertently arose and of how that doctrine came to apply to life insurance as well, see Ruse v. Mutual Benefit Life Ins. Co., 23 NNY. 516 (1861). But see, MacGillivray, supra note 16 at 104, who argues that although the interest or no interest clauses were originally included in legitimate insurance contracts to permit an insured to recover at trial without going to the trouble of proving his interest, they were in fact upheld by the English courts even after it was clear that they had become nothing but a subterfuge for gambling. Id.

      . The detrimental effects of wagering have often been noted. In one commentator's words, the unearned gains that come from wagering "lead to idleness, and the wagerer becomes a social parasite. Useful business and industry are thereby discouraged. On the moral side, idleness leads to vice; and the impoverishment of the loser entails misery, and, in consequence, crime." Edwin W. Patterson, "Insurable Interest in Life," 18 Corum. L.Rev 381, 386 (1918).

      . The first of these statutes, 19 Geo. II, c. 37 (1746), prohibited the procurement of marine insurance without proof of interest. In the preamble, Parliament noted that insurance had become "a mischievous kind of gaming," and a justification for the fraudulent destruction of insured property. Id. at § 1. Approximately thirty years later, Parliament enacted a similar restriction on life insurance, 14 Geo. III, c. 48 (1774), in response to wagering on lives and events in which the insured had no interest. See Roy Kreitner, "Speculations of Contract, or How Contract Law Stopped Worrying and Learned to Love Risk," 100 Corum. L.Rev. 1096, 1099 (May 2000). After its initial introduction into England at the beginning of the eighteenth century, life insurance became increasingly speculative so that by the time Parliament acted to outlaw life insurance without interest, gambling in lives had become quite bold and tasteless. Insurance was written on the lives of famous people, on the outcome of battles, on who would be the next mistress of the French monarch, on jury verdicts, and on various other life and death matters in which the insured had no personal stake in the outcome other than the profit he might make from tragedy or hardship befalling strangers. See Lorraine J. Daston, "The Domestication of Risk: Mathematical Probability and Insurance 1650-1830," in 17s Prosastustic Revorurion 237, 244 (1987).

      . Keeton and Widiss, supra note 16 al 138. Nevertheless, recent judicial decisions continue to rely on the avoidance of gambling as one of the principle rationales behind the insurable interest requirement. Id.

      . "While in a broad semantic sense all insurance contracts are wagers, the notion has developed in the law that if there is an interest in the subject matter of the insurance, independent of the occurrence of the insured event, then there is no wager." Harnett and Thornton, supra note 16 at 1184. The persistence of the perception of insurance and gambling as two sides of the same coin is evident in the following passage from the 1898 treatise, Ter Hisrory or GamBLinc IN Enctanp, by John Ashton:
      "[Plaradoxical as it may appear, there is a class of gambling which is not only considered harmless, but beneficial, and even necessary-I mean Insurance. Theoretically, it is gambling proper. You bet 2s. 6d. to £100 with your Fire Insurance; you equally bet on a Marine Insurance for the safe arrival of your ships or merchandise; and it is also gambling when you insure your life." Id. at 275.

      . Keeton and Widiss, supra note 16 at 138. (''The argument is that allowing the purchase of insurance as a wager for fortuitous profits rather than as a means of securing protection against fortuitous losses, is unproductive. Such contracts do not, either directly or indirectly, provide any needed service or aid in the making of any product, and in these circumstances, the administrative costs of making such contracts available result in a net societal loss.").

      . Harnett and Thornton, supra note 16 at 1183. The principle of indemnity is fundamental to insurance law. It holds that insurance payments are restricted to an amount which will compensate the insured for the loss suffered from the impairment of the insured property. While limiting insurance to indemnity is usually enumerated as a distinct purpose of the insurable interest doctrine, it is in reality little more than another aspect of the policies against wagering and against fostering the temptation to destroy insured property. It is "the wagering policy accoutered in different verbal cloth." Id.

      . Harnett and Thornton, supra note 16 at 1181-1183 ("The theory behind this policy is simple: if the insured has no "interest" in the subject matter of the insurance, he is likely to destroy the subject matter in order to gain the benefit of the insurance." After presenting the theory, Harnett and Thornton proceed to debunk it, concluding that the insurable interest requirement not only does not minimize this temptation, but actually increases it.).

      . Fagen, supra note 16 at 2.

      . While the statutes passed in the eighteenth century required that an "interest'" be present, it was left to the judiciary to decide the nature of the connection to the property (or life) which would qualify as an "interest." The legal interest theory requires that the insured's expectation of benefit from the continued existence of the subject of the insurance be based on a legally or equitably cognizable interest in the property. This view has its roots in Lord Eldon's opinion in Lucena v. Craufurd, supra note 18, where he reasoned that "expectation though founded on the highest probability, [is] not interest," Id at 321, 127 Eng. Rptr. at 650, and "if moral certainty be a ground of insurable interest, there are hundreds, perhaps thousands, who would be entitled to insure" the same property. Id. at 324, 127 Eng. Rep. at 651. The legal interest theory recognizes as insurable not only the interest of fee holders, but also those of life tenants (Farmers' Mut. Fire & Lightning Ins. Co. v. Crowley, 354 Mo.649, 190 S.W.2d 250 (1945)); remain-dermen, (Id.); reversioners (Comvis v. Citizens' Mut. Fire Ins. Co., 127 Mich.616, 86 NW.994 (1901)); lessors (Hale v. Simmons, 200 Ark.556, 139 S.W.2d 696 (1940)); lessees (Id.); mortgagees (Allen v. St. Paul Fire & Marine Ins. Co., 167 Minn.146, 208 N.W.816 (1926)); pledgees (Duns-more v. Franklin Fire Ins. Co., 299 Pa.S6, 149 A.163 (1930)); and lienholders (Hayward Lumber & Inv. Co. v. Lyders, 139 Cal.App.517, 34 P.2d 805 (1934)).

      . The factual expectation theory also has its roots in Lucena v. Craufurd, supra note 18. In a separate opinion in that case, Lord Lawrence said,
      "'that insurance is a contract by which one party in consideration of a price paid to him adequate to the risk, becomes security to the other, that he shall not suffer loss, damage, or prejudice by the happening of the perils specified to certain things which may be exposed to them. If this be the general nature of the contract of insurance, it follows that it is applicable to protect men against uncertain events which may in any wise be of disadvantage to them; not only those persons to whom positive loss may arise by such events, occasioning the deprivation of that which they may possess, but those also who in consequence of such events may be intercepted from the advantage or profit, which but for such events they would acquire according to the ordinary and probable course of things. . .. To be interested in the preservation of a thing, is to be so circumstanced with respect to it as to have benefit from its existence, prejudice from its destruction." Id. at 301-302, 127 Eng. Rptr. at 642-43.

      . 1983 OK 17, 664 P.2d 377.

      . Id. at % 9, 664 P.2d at 380.

      . Id. at 18, 664 P.2d at 380. See also Granite State Ins. Co. v. Lowe, 362 So.2d 240, 241(Ala.Civ.App.1978) (construing statutory language identical to § 36 0.$.2001 § 3605 and holding that the statute espouses the factual expectation theory of insurable interest}.

      . The factual expectation theory has come to enjoy widespread legislative and judicial support. For an enumeration of jurisdictions with a similar or identical definition of insurable interest to that recognized in Oklahoma, see Parker, supra note 16 at 109, n. 7. See also Harrison v. Fortlage, 161 U.S. 57, 65, 16 S.Ct. 488, 490, 40 L.Ed. 616 (1896), where at the end of the nineteenth century the United States Supreme Court called the factual expectation theory of insurable interest "well settled." It is the preferred theory among legal commentators. See e.g. Harnett and Thornton, supra note 16 at 1188; 3 G. Couch, Crerore-pra or Ins. Law § 24.13 (2d ed.1984); Salzman, supra note 16 at 405; Pinzur, supra note 16 at 111; Note, "Insurable Interest in Property: An Expanding Concept," 44 Iowa L.Rev. 513-522 (1958). The factual expectation theory is employed in the definition of insurable interest provided in C. Bennett, Dictionary or Insurance 178 (1992) ("'the insured must be in a legally recog-nised relationship with the subject-matter of insurance whereby he benefits by its safety or absence of liability and is prejudiced by its damage or destruction or creation of liability.").

      . Snethen, supra note 29 at 113, 664 P.2d at 381.

      . Defendant argues that this court should not consider whether plaintiff has an insurable interest as managing agent of the property for the family's benefit because plaintiff did not allege or tender evidentiary material establishing that an agreement regarding the procurement of insurance existed between plaintiff and anyone other than her adult son, John. Defendant contends that consideration of this argument would hence violate the stricture in Jones v. University of Central Oklahoma, 1995 OK 138, 15, 910 P.2d 987, 989, that we may not presume any facts outside those offered by the certification order. The separate writing of the partially concurring justice agrees with defendant on this point, but we disagree. While neither the certification order nor the pleadings employ the word agent or agency, the certification order clearly sets forth the facts necessary for a consideration of an agency relationship. Together, plaintiff, her son, John, and the three minor children account for five of the six cotenants. If, as we suggest infra note 45, the adults can act on behalf of their children in insuring the property, five/sixths of the legal interests in the property would be covered by the understanding between plaintiff and John that plaintiff was to insure the premises. We agree that the certification order is silent as to any agreement or understanding plaintiff may have had with the remaining cotenant, her adult nephew, and today's pronouncement does not presume that such an agreement or understanding existed. Whether plaintiff acted as the agent of her sons and her grandchildren does not hinge upon whether she had a similar agreement or understanding with the remaining cotenant. The presence or absence of that agreement or understanding would only affect plaintiff's right to recover the policy's proceeds attributable to the remaining cotenant's interest. It is not for this court to determine whether plaintiff may or may not at this stage of the federal proceeding offer proof-if it exists-of an agreement or understanding with her nephew regarding the purchase of insurance covering the dwelling. It is our task to provide the federal court with a range of scenarios, if any, that would militate in favor of or against recovery. It is for the federal court upon an evidentiary hearing to determine whether the plaintiff has tendered proof of facts that do indeed support her claim.

      . See eg. 3 on Insurance 3d, § 42:45 (1997), which states:
      "A tenant in common has an insurable interest to the extent of his or her interest in the property ... When a part owner insures his or her individual interest, he or she need not specify the nature of his or her interest, but it is essential that he or she not insure for more than his or her interest...."

      . DeMik v. Cargill, 1971 OK 61, 112, 485 P.2d 229, 233.

      . Matthews v. Matthews, 1998 OK 66, N11, 961 P.2d 831, 834. The common law concept of unity of possession means that each cotenant is entitled to occupy every part of the co-owned property regardless of the quantum of the occupier's fractional interest, subject only to the other cotenants' equal right of possession.

      . Id.

      . Rex Oil Refining Inc. v. Shirvan, 1967 OK 127, 124, 443 P.2d 82, 87.

      . The term "derogation" is "[o}rdinarily used to indicate an avoidance of; the abrogation of; or the lessening in value of, a right or other legal relationship or status." Joun M. Gros. sary or REAL Estate Law 270 (1972) (emphasis supplied). For an in-depth discussion of the term, see Sharon v. Sharon, 75 Cal. 1, 16 P. 345, 370 (1888) (Thornton, J., dissenting) (stating that [dJerogation is ... the act of taking away or destroying the value or effect of anything, or of limiting its extent, or of restraining its operation; a 27").

      . Rex Oil Refining, supra note 39 at 124, 443 P.2d at 87 (cotenants stand to each other in a relation of mutual trust and confidence; neither will be permitted to act in hostility to the other in reference to the joint estate); Wallace v. Brooks, 1944 OK 76, 135, 194 Oka. 137, 147 P.2d 784, 790 (an outstanding adversary title acquired by a cotenant inures to the benefit of the other coten-ants); Burt v. Steigleder, 1928 OK 349, 112, 132 Okla. 217, 270 P. 54, 55-56 (a purchase of an outstanding adverse title by a cotenant will be held in equity to have been made for and on behalf of all the cotenants); Arthur v. Coyne, 1912 OK 243, 15, 32 Okla. 527, 122 P. 688, 690.

      . Matthews, supra note 37 at 111, 961 P.2d at 835.

      . Gray v. Holman, 1995 OK 118, 17, 909 P.2d 776, 779-80 (recognizing that a mother with no legal estate in her son's property might nevertheless, acting as her son's agent, insure the son's property in her own name but on her son's behalf).

      . Agency has been defined as "a contract by which one person, with greater or less discretionary powers, undertakes to represent another in certain business relations." Francis WHarton, A commentary on tae Law or AcEncy anp AcEnts § 1 at 1(1876). See also restatement or THs Law (See onp) or Aczncy § 1, which defines agency as "the fiduciary relation which results from the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and consent by the other so to act." For a history of common-law agency, see B.S. and R.J.C. Munpay, An or THE Law Or Acency pp. 1-225 (Butterworths 1992).

      . The certification order points out that three of the six cotenants in this case are minors. Minors have statutory limitations on their capacity to enter into insurance contracts and they are barred by statute from appointing agents. See the provisions of 36 0.$.2001 § 3606 (insurance contracts by minors) and 15 0.$.2001 § 17 (appointment of agents by minors), respectively. No person in Oklahoma, including a parent, has control over the property of a child unless appointed by the court. Wagnon v. Carter, 1975 OK 9, 147, 539 P.2d 735, 740; Jones v. Goldsberry, 1926 OK 523, 14, 118 Okla. 219, 247 P. 60, 61. Yet parents are the natural guardians of their children. Guardianship of Hight, 1944 OK 143, 116, 194 Okla. 214, 148 P.2d 475, 480. As their children's natural guardians, parents ordinarily have the minimal right to their custody, control, and care. It is their duty to support and educate their children. 10 0.$.2001 § 4. They are liable to third persons for necessities furnished their children when they neglect to provide the children with necessities. 10 0.$.2001 § 13. The right of parents to the care, custody, companionship and management of their child is a fundamental right protected by the federal and state constitutions. McDonald v. Wrigley, 1994 OK 25, "9, 870 P.2d 777, 781. The relationship is in the nature of a trust, subject to control and regulation by the state. Carignan v. State, 1970 OK 82, 110, 469 P.2d 656, 659. Implicit in a parent's duty to care for a child is the means to carry out that duty, including the authority to take reasonable measures to protect the child's property interests. This may include obtaining insurance on property the child owns. When the parent and child are cotenants and the parent insures his (or her) own interest in the co-owned premises or authorizes another cotenant to procure insurance to proteci the parent's interest in the property, the parent may also agree on behalf of the child that any insurance obtained protect the child's interest as well. Whether the parent has done so is a question of fact. © «

      . Restatement or tas Law (SEconp) or acency § 13.

      . A fiduciary stands in the status of trustee in relation to his (or her) principal. Panama Processes, S.A. v. Cities Service Co., 1990 OK 66, 135, 796 P.2d 276, 290.

      . An implied trust or constructive trust arises by operation of law. It is imposed against an individual when the individual obtains a legal right to property through fraudulent, abusive means or through a method which violates equity and good conscience. Matter of Estate of Ingram, 1994 OK 51, 119, 874 P.2d 1282, 1287. A constructive trust is one of equity's most powerful fraud-rectifying devices. The primary reason for imposing a constructive trust is to avoid unjust enrichment. Easterling v. Ferris, 1982 OK 99, T 10, 651 P.2d 677, 680.

      . The certification order states that plaintiff's adult son, John, not only agreed with plaintiff that she would procure the insurance on the property but also that she alone would collect the proceeds in the event of an insured loss. Whether such an agreement is contrary to public policy and whether it can bind the interests of the minor cotenants even if valid between the adults are issues not presented by, nor fairly comprised in, the question certified to us, which addresses only the relative rights of the insurer and the insured.

      . See Collins v. Quincy Mutual Fire Ins. Co., 297 N.C. 680, 256 S.E.2d 718, 721 (1979); Convis, supra note 27 at 622-23.

      . Collins, supra.

      . Iglehart v. Bd. of County Comm'rs of Rogers County, 2002 OK 76, §10, 60 P.3d 497, 502; Heaven v. Pender, 11 Q.B.D. 503, 509, 1883 WL 19069.

      . Keeton, supra note 16 at 111.

      . None of the cases cited in the separate writing holds that the duty of a cotenant in possession to preserve the common property includes an affirmative duty to insure. In Estate of Ray, 7 IIL App.3d 433, 287 N.E.2d 144 (1972), the decedent was the owner of a one-third interest in a farm as a tenant in common with his six adult children who each owned a one-ninth interest. The deceased father had lived alone on the farm, had operated the farming business, and had purchased homeowner's insurance on the property out of the profits of the farming operation. The farmhouse was destroyed by fire while the father was still alive but in a nursing home and the question before the court was whether the father was a constructive trustee of the insurance proceeds for the benefit of his six children. The court held that the deceased was a constructive trustee and that the proceeds of the insurance applicable to the ownership of the six children must be turned over to the administrator of decedent's estate. The court noted the generally accepted rule that a tenant in common in possession of property and in receipt of all profits from the property has a duty to be reasonably prudent in maintaining and preserving the property. The court went on to say that this duty "would extend to keeping the property insured for the benefit of all owners" because "absent such duty the co-tenant in possession could use the avails of the commonly owned property to obtain insurance to the extent of its full value in his name alone, and upon the loss by fire of such property retain as his own the entire proceeds of the policy." Id. at 149. The import of the court's holding is not that the status of cotenant requires a co-tenant in possession to acquire insurance on the property, but only that if he does insure the property out of the property's "avails" the court will deem the proceeds to belong to all cotenants.
      In Baird v. Moore, 50 N.J.Super. 156, 141 A.2d 324 (1958), a mother assigned a leasehold estate in her residence to her son and daughter as tenants in common. The son lived there for some years but then voluntarily left to live elsewhere. The daughter remained, cared for the mother, and paid taxes, insurance premiums, and necessary repairs on the property. After the death of the mother and son, the daughter brought an action against the son's administra-trix for partition of the leasehold estate and for an accounting. The trial court disallowed, in assessing defendant's liability in the accounting for maintenance expenses, any contribution by defendant for the period after the son moved out of the common household. On appeal, the court held that the deceased son's estate was chargeable in the accounting for his ratable share of maintenance expenses, including insurance premiums, even after he moved out of the house. The case does not stand for the proposition that a cotenant in possession is required to obtain insurance on the common property by virtue of his status as cotenant in possession. Rather, the case considers the principles controlling the right of a cotenant to use property without charge or to be subject to a charge when seeking contribution from other cotenants for maintenance expenses.
      Mastbaum v. Mastbaum, 126 N.J. Eq. 366, 9 A.2d 51 (Ch.1939) involved four cotenants of a two-family house. Two of the cotenants occupied the upstairs apartment. The downstairs apartment was rented. The co-tenants out of possession sought a partition and accounting, including the rental value of the apartment occupied by the cotenants in possession. Defendant cotenants in possession presented an accounting of the rent collected from the downstairs apartment and ask to be discharged because they spent the rental income on repairs, insurance, taxes, etc. In defining the principles governing an accounting in a cotenancy situation, the court recited that a tenant in common who is in sole possession of the common property is under a duty to his co-tenants to preserve the property by making needful, ordinary repairs, and paying taxes, mortgage interest and insurance premiums. The court did not hold that the cotenancy relationship imposed an affirmative duty on a cotenant in possession to insure the property.

      . See cases cited supra note 41.

      . The insurable interest of a cotenant in possession must be based on the status-based duty to preserve the property for the benefit of the other joint owners, and not on the general duty to exercise ordinary care so as not to injure the person or property of another. The following example illustrates why the difference is important. A lessee under a three-month rental agreement undoubtedly has a duty to exercise ordinary care not to damage the leased premises and is subject to potential liability to the lessor for failure to do so. However, I do not believe the majority would conclude that the lessee has an insurable interest in the leased premised he or she occupies.

      . Most jurisdictions state that a cotenant in possession has a duty to preserve the property by making needful, ordinary repairs, payment of taxes and other annually maturing liens. Some jurisdictions have gone so far as to say this duty includes the responsibility to keep the property insured. See, eg., In re Estate of Ray, 7 IIl. App.3d 433, 287 N.E.2d 144, 149 (1972); Baird v. Moore, 50 N.J.Super. 156, 141 A.2d 324, 327 (1958); Mastbaum v. Mastbaum, 126 N.J. Eq. 366, 9 A.2d 51, 55 (Ch.1939). However, the certified question does not require us to hold that the cotenant in possession has a duty to keep the property insured or to settle legal issues regarding compelled contribution between cotenants.

      . In Part V, the majority concludes as a matter of law that plaintiff has an insurable interest in the entire property simply by virtue of her status as a cotenant in sole possession of the common property. This makes it unnecessary to determine whether the plaintiff was the "managing agent" of her other cotenants.


source: Caselaw Access Project

author:
BOUDREAU, Justice:
      KAUGER, J.

license: Public Domain

text:
    2003 OK 97
    Dale PLY, Plaintiff, v. NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PENNSYLVANIA and Safeco Insurance Company of America, Defendants.
    No. 91,108.
    Supreme Court of Oklahoma.
    Nov. 12, 2003.
    Rehearing Denied Dec. 18, 2003.

      (G. Steven Stidham, Brian S. Gaskill, Brian T. Inbody, Tulsa, OK, for plaintiff.
    Jo Anne Deaton, Tulsa, OK, for defendant National Union Fire Insurance Company of Pittsburgh, Pennsylvania.
   BOUDREAU, Justice:

T 1 Plaintiff, Dale Ply, suffered severe electric burns in a tragic accident that occurred while he worked on overhead electric wires from the raised bucket of a bucket truck. Plaintiff's employer, Davis H. Elliot Company, Inc., owned the bucket truck and insured it through National Union Fire Insurance Company of Pittsburgh, Pennsylvania, with an uninsured motorist (UM) endorsement. Plaintiff recovered workers' compensation benefits for his accidental injuries and now seeks to recover UM benefits.

2 Plaintiff filed a complaint in the United States District Court for the Northern District of Oklahoma against the UM insurer, alleging that the accident arose out of Elliot Company's negligent use and negligent maintenance of the bucket truck. Insurer moved for summary judgment asserting that plaintiffs accident did not fall within the seope of the UM coverage because 1) his injuries were not caused by the actual use of the bucket truck by another person, and 2) even if Elliot Company negligently maintained the bucket truck, his injuries were not caused by such negligence.

T3 At the summary judgment hearing, the court determined that there is no Oklahoma law controlling the questions presented. Accordingly, the federal district court, pursuant to the Revised Uniform Certification of Questions of Law Act, 20 0.8.Supp.1997, §§ 1601 et seq., certified the following questions of state law to this Court:

1. Whether an employer's or supervisor's instructions or directions to its employee regarding work to be performed by that employee, which involves the use of a company-owned vehicle, can constitute "use" of the vehicle by the employer or supervisor so as to give rise to potential liability under Oklahoma's uninsured motorist laws; and
2. Whether allegations of an employer's non-contemporaneous negligent maintenance of an employer-owned vehicle, if proven, are sufficient to establish an employee's potential entitlement to uninsured motorist benefits.

I 4 We reformulate the first question within the confines of the certified statement of facts. We answer the two questions of state law in the affirmative.

I. Statement of Facts

1 5 The federal court certified the following statement of facts:

1. Plaintiff, Dale Ply ("Ply"), received severe electrical burns, resulting in amputation of both his arms, in an accident which occurred on May 17, 1996, while he was working in the raised bucket of a bucket truck owned by his employer, Davis H. Elliot Company, Inc. ("Elliot Compa-ny3’)‘
2. The accident occurred when Ply was "tying in" electrical wires on a job near Broken Bow, Oklahoma, and came into contact with an energized line.
3. The bucket truck in which Ply was working at the time of the accident was owned by Elliot Company and insured by National Union Fire Insurance Company of Pittsburgh, Pennsylvania ("National Union"), which carried the uninsured motorist coverage for Elliot Company's vehicles.
4. Ply was working alone in the bucket truck when his accident occurred with the knowledge of and pursuant to directions and instructions he received earlier that day from his supervisor.
5. Ply has alleged in his lawsuit that Elliot Company's Safety Handbook required that aerial bucket equipment should only be operated when at least two persons completely familiar with the hydraulic controls were present.
6. Ply has alleged in his lawsuit filed against National Union seeking uninsured motorist benefits that the accident resulted from the "use" of the bucket truck by Elliot Company or by Ply's supervisor, also an employee of Elliot Company.
7. The only vehicle which was present at the scene at the time of Ply's accident was the bucket truck owned by Elliot Company. No other vehicles were involved in the accident.
8. An investigation conducted by Elliot Company revealed that Ply's accident occurred when a canvas and leather tool bag, which was attached and hanging from the outside of the bucket, came into contact with an energized wire located below Ply.
9. The investigation further concluded that "whether the presence of a second crew member would have prevented the accident cannot be determined with any certainty."
10. Ply has alleged in his lawsuit filed against National Union seeking uninsured motorist benefits that there was a hydraulic fluid leak in the bucket truck's bhydrau-lie boom which would occasionally cause the bucket to sag. Ply claims that the hydraulic boom on the bucket sagged right before his injury, causing him to come into contact with the energized line.
11. Ply has alleged in his lawsuit that Elliot Company did not properly maintain the hydraulic boom on the subject bucket truck.
12. Ply has alleged in his lawsuit that Elliot Company, through its supervisor, was negligent in instructing him to work alone in the bucket truck.

T6 Ply claims he is entitled to recover uninsured motorist insurance benefits from Elliot Company's policy on the basis that: 1) Elliot Company, as his employer, was at fault in the use of its bucket truck when its supervisor assigned him to work alone from the bucket truck and this negligent use of the bucket truck caused his injuries; and 2) Elliot Company, as owner of the bucket truck, was negligent in the maintenance of the bucket truck and its negligent maintenance caused his injuries. National Union answers that: 1) an absent employer cannot be viewed as an uninsured motorist; and 2) any negligence in the maintenance of the bucket truck did not cause Ply's injuries.

II. The uninsured motorist statute, 36 00.98.2001, § 3636.

T7 Our analysis must begin with the UM statute, 36 0.8.2001, § 3636. The statute mandates UM coverage to protect insured persons from monetary loss due to personal injury resulting from an accident caused by another who carries no liability insurance or who is underinsured. Uptegraft v. Home Insurance Co., 1988 OK 41, ¶ 6, 662 P.2d 681, 684.

T8 Our decisional law teaches that § 3636 mandates UM coverage where: 1) the injured person is an insured under the UM provisions of a policy; 2) the injury to the insured has been caused by an accident; 3) the injury to the insured has arisen out of the "ownership, maintenance or use" of a motor vehicle; and 4) the injured insured is "legally entitled to recover damages from the owner or operator of the uninsured motor vehicle." These four elements of an UM claim are determined from the facts and cireumstances of each claim.

III. The First Certified Question

T9 The first question certified by the federal court reads:

Whether an employer's or supervisor's instructions or directions to its employee regarding work to be performed by that employee, which involves the use of a company-owned vehicle, can constitute "use" of the vehicle by the employer or supervisor so as to give rise to potential liability under Oklahoma's uninsured motorist laws?

{10 This question does not concern the first three elements of the mandated UM coverage set out above. It rests on the presumptions that Ply is an insured under the UM provisions in National Union's policy issued to Elliot Company; that Ply's injuries were accidental; and that Ply's injuries arose out of the use of a motor vehicle.

11 Although expressed in terms of "use" of a motor vehicle, the substance of this query into potential Hability relates to the employer's fault rather than use. In essence, it is an inquiry as to whether an employer providing faulty or negligent directions or instructions to an employee relating to the use of an employer-owned vehicle can be considered someone at fault from whom the injured employee may be "legally entitled to recover" under § 3636. Accordingly, we reformulate the question to plainly state its substance, as follows:

Where a supervisor, acting on behalf of the employer, provides faulty or negligent instructions or directions to an employee relating to the use of an employer-owned motor vehicle and the employee is injured while following the instructions, can the employer be considered at fault within the meaning of the phrase "legally entitled to recover from the owner or operator" in § 3636 of title 86 of the Oklahoma Statutes.

112 In answering this novel question, we look first to Oklahoma UM law. Under our UM statute, a liability policy must provide UM coverage to an insured who is "legally entitled to recover from the owner or operator of an uninsured vehicle." Under our UM jurisprudence, the phrase "legally entitled to recover" normally refers to issues of fault. Uptegraft v. Home Insurance Co., 1983 OK 41, at ¶ 6, 662 P.2d at 684. The phrase requires that "there must be a tort-feasor, someone who has committed a wrong from which the insured has suffered damages, before uninsured motorist coverage can come into play." Martin v. Hartford Underwriters Insurance Co., 1996 OK 55, ¶4, 918 P.2d 49, 51. It does not mean that the injured insured must secure a judgment." Rather, it means that the injured insured must establish fault on the part of the "owner or operator" of an uninsured vehicle and the extent of his or her damages. See, Uptegraft v. Home Insurance Co., 1983 OK 41, at ¶ 9, 662 P.2d at 685.

1 18 The issue of fault is determined by the application of legal principles to the facts presented. If an insured can establish that his or her injury was caused by negligence on the part of the owner or operator of an uninsured vehicle, he or she can recover UM benefits. Negligence comprehends a failure to exercise due care required by the cireum-stances of the case, that is, a failure to do what an ordinary prudent person would have done under the cireumstances or the doing of what such a person would not have done under the cireumstances. Kelly v. Cann 1942 OK 299,¶ 122, 192 Okla. 446, 136 P.2d 896, 899; Salazar v. City of Oklahoma City, 1999 OK 20, ¶ 20, 976 P.2d 1056, 1064.

14 National Union urges that Ply's accident does not come within the seope of the mandated UM coverage because there was no negligent uninsured motorist. It points out that the only motorist involved in the asccident was Ply and that no other person was occupying or using the vehicle. It argues that to be at fault under $ 3636, an employer must be a motorist, ie., it must exercise active control or supervision of the vehicle in its transportation nature.

1 15 We disagree. We have defined "operator" to include any person who is engaged in activity related to the transportation nature of the vehicle. Safeco Insurance Co. v. Sanders, at 131, 803 P.2d at 696. However, we have also said that UM-covered use is not limited to the driving-operation use of the uninsured motor vehicle. Willard v. Kelley, 1990 OK 127, at 119, 803 P.2d at 1131.

116 Section 3636 identifies two separate groups of persons from whom an injured insured may be legally entitled to recover 1) owners of uninsured vehicles or 2) operators of uninsured vehicles. The argument advanced by National Union would require an injured insured to demonstrate that he or she is legally entitled to recover from an "operator" of an uninsured vehicle. To accept National Union's argument, we would have to ignore the plain language of the statute that requires UM coverage for injury if the insured is legally entitled to recover from an "owner" of an uninsured vehicle. According to the statute, an insured who has suffered an injury caused by an accident arising out of the use of an uninsured motor vehicle may recover UM benefits if the insured can demonstrate that he or she is "legally entitled to recover damages" from either the owner or the operator of the uninsured motor vehicle.

17 In sum, an employer may be at fault within the meaning of the phrase "legally entitled to recover from the owner or operator" in § 8686 where a supervisor, acting on behalf of the employer, provides faulty or negligent instructions or directions to an employee relating to the use of an employer-owned motor vehicle and the employee is injured while following the instructions. Allegations of such fault would present questions of fact that must be decided upon the evidence. We, of course, offer no opinion on the merits of Ply's allegations.

IV. The Second Certified Question

118 The second question certified by the federal court reads:

Whether allegations of an employer's non-contemporaneous negligent maintenance of an employer-owned vehicle, if proven, are sufficient to establish an employee's potential entitlement to uninsured motorist benefits.

119 This question relates to the statutory requirement that the injury to the insured must arise out of the "maintenance" of a motor vehicle. It requires us to interpret the statutory language "arising out of .. maintenance". More precisely, we must determine whether the injury must occur during maintenance in order to be within the maintenance provision in § 8636. This is a first impression question in this jurisdiction and apparently has not been considered by our sister jurisdictions.

1 20 Statutory words are to be understood in their ordinary sense, unless a contrary intention plainly appears. 25 0.8.2001, § 1; see also, W.S. Dickey Clay Mfg. Co. v. Ferguson Inv. Co., 1963 OK 298, 388 P.2d 300. In interpreting § 3636, we have followed the literal meaning and import of the language. Keel v. MFA Insurance Co., 1976 OK 86, 1[ 10, 553 P.2d 153, 155.

21 In construing the phrase "arising out of use" in § 3636, we have determined that it consists of ordinary words with comprehensive significance which encompass a broad spectrum of factual sequences that might result in injury covered by the HKability insurance. Safeco Insurance Co. v. Sanders, 1990 OK 129, ¶ 10, 803 P.2d 688, 691. In construing "arising out of ... use" in a liability policy, we have described the phrase as broad, general and comprehensive. Penley v. Gulf Insurance Co., 1966 OK 84, ¶ 33, 414 P.2d 305, 311. Similarly, other jurisdictions have accorded broad meaning to the phrase "arising out of" as used in motor vehicle liability policies, concluding that "arising out of" is understood to mean "originating from," "having its origins in," "growing out of," or "flowing from". See, Lawver v. Boling, 71 Wis.2d 408, 238 N.W.2d 514 (1976) and the numerous cases cited in Couch on Insurance 3d, § 119.33, note 50, p. 119-50, and 6B Appleman, Insurance Law and Practice, § 4317, ftnt 49.05, pp. 368-64. Accord, State Auto. Mutual Insurance Co. v. Rainsberg, 86 Ohio App.3d 417, 621 N.E.2d 520 (1998) construing "arising out of" for purposes of UM coverage.

122 National Union urges a restrictive reading of "arising out of maintenance." It argues that the maintenance provision in § 3636 means that the injury must occur during the act of maintenance of an uninsured motor vehicle. National Union does not, however, cite any authority directly on point." In the absence of legal authority holding that injury must occur contemporaneously with the maintenance of a vehicle before UM coverage applies, we cannot accept the limited reading of "arising out of ... maintenance" that National Union seeks to impose.

123 Although not addressing the precise issue presented by this certified question, the Supreme Court of Oregon has indicated that it would assign a broad meaning to "maintenance" for purposes of UM coverage. In Oakridge Community Ambulance Service v. United States Fidelity & Guaranty Co., 278 Or. 21, 563 P.2d 164 (1977), the Oregon court observed that if the failure to maintain an ambulance caused delay in transporting a patient and the patient died because of the delay, the death would be viewed as "arising out of the maintenance" of the ambulance for motor vehicle liability purposes. Likewise, an appellate court in Illinois recognized that the plain meaning of "arising out of maintenance" is that liability will accrue where faulty or negligent maintenance of a vehicle results in an incident causing damages to another. Bituminous Casualty Corp. v. North River Insurance Co., 46 Ill.App.3d 654, 658, 361 N.E.2d 60, 68, 5 Ill.Dec. 60, 68 (1977).

24 This Court has previously concluded that the language in § 3686 should be interpreted to accomplish the legislative purpose of providing coverage for injuries that would otherwise go uncompensated. Simmons v. Hartford Accident & Indemmity Company, 1975 OK 155, 548 P.2d 1384. In so doing, we have ascribed a broad, general and comprehensive meaning to the statutory words "arising out of". Safeco Insurance Co. v. Sanders, supra. Our extant jurisprudence compels us to reject an interpretation of § 3636 that would exclude from UM coverage injury resulting from non-contemporaneous negligent maintenance of a motor vehicle.

(25 In sum, allegations of an employer's non-contemporaneous negligent maintenance of an employer-owned vehicle, if proven, are sufficient to establish an employee's potential entitlement to uninsured motorist benefits. The allegations would present a question to be decided from the facts and cireumstances of the case. We, of course, offer no opinion on the merits of Ply's allegations.

CERTIFIED AND REFORMULATED CERTIFIED QUESTIONS ANSWERED.

WATT, C.J., and HODGES, LAVENDER, SUMMERS, and BOUDREAU, JJ. concur.

KAUGER, J., by separate writing, concurs specially.

OPALA, V.C.J., and HARGRAVE, J. and WINCHESTER, J., by separate writing, dissent.

KAUGER, J.

concurring specially:

1 I agree with the majority that 36 O.S. 2001 § 3636 extends coverage to insured individuals entitled to recover damages from either owners or operators of uninsured or underinsured motor vehicles. I also agree that an employer's non-contemporaneous negligent maintenance of an employer-owned vehicle may be sufficient to establish an employee's potential entitlement to uninsured motorist benefits.

12 I write separately to emphasize that the facts of this cause differ significantly from an instance in which an owner who is also an operator attempts to recover uninsured or underinsured benefits from an insurer. In that instance, the insured owner and operator will have no coverage unless, as the owner and operator, the party regulates and controls the actual operation of the vehicle at the time of the accident.

T3 Here, the employer, not the employes, is the owner of the vehicle. Nevertheless, an employer who is an owner or operator may be at fault within the meaning of 86 0.8.2001 § 3636, where a supervisor's instructions are so straightforward and clear on the faulty or negligent operation of a vehicle as to leave the employee with the impression that only such operation is appropriate. In such a situation, the employer may be considered to be responsible for the personal physical management of the vehicle.

WINCHESTER, J., dissenting, with whom OPALA, V.C.J., and HARGRAVE, J., join:

T1 Sometimes legal reasoning becomes so convoluted when applying marginally applicable cases in the construction of statutes that the end result bears no resemblance to the apparent intent of the statute. I believe that is true in this case. Uptegraft v. Home Ins. Co., 1983 OK 41, ¶ 6, 662 P.2d 681, 683-684 states: "The purpose of an uninsured motorist provision in an insurance contract is to protect the insured from the effects of personal injury resulting from an accident with another motorist who carries no insurance or is underinsured." At the risk of oversimplifying, who is the uninsured/under-insured motorist? The plaintiff had been the only motorist, and at the time of his accident, he was not a motorist.

12 The truck was parked and the plaintiff was working alone in a raised bucket mounted on the back of the truck when he received severe electrical shock because the bucket contacted a live electrical line. The plaintiff properly recovered workers compensation benefits. But he now sues for uninsured motorist benefits. Clearly the truck did not contribute to his injuries. It was his operation of the bucket that caused his injury, independent of the truck it was mounted on.

T3 I would answer, "No," to both the federal certified questions.

      . Plaintiff also sued Safeco Insurance Company of America, the uninsured motorist carrier for Mary A. Whaler, plaintiff's mother, with whom he was living at the time of the accident. Prior to the order certifying the questions of state law to this Court, Safeco was dismissed with prejudice as a party.

      . In 1997, the Legislature revised the Uniform Certification of Questions of Law Act, 1997 Okla. Sess. Laws, ch. 61, which is now codified at 20 0.$.2001, §§ 1601 et seq.

      . 20 0.$.2001, § 1604 provides that the certifying court must set out the facts relevant to the question and acknowledge that this Court may reformulate the question.

      . The version of § 3636 applicable to Ply's 1996 accident is 36 O.$.Supp.1995, § 3636. Because the pertinent provisions of the 1995 version remain the same, this opinion references the latest codification of the statute in 2001. The pertinent provisions of § 3636 read:
      A. No policy insuring against loss resulting from liability imposed by law for bodily injury or death suffered by any person arising out of the ownership, maintenance or use of a motor vehicle shall be issued ... unless the policy includes the coverage described in subsection B of this section.

        B. The policy referred to in subsection A of this section shall provide coverage therein or supplemental thereto for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles. ...

      . We have said that UM coverage is available once it is determined that the injured person is an insured under the policy, Torres v. Kansas City Fire and Marine Insurance Co., 1993 OK 32, " 12, 849 P.2d 407, 411, and that a person qualifying as an insured is entilled to recover not only under his or her own UM policies but also under the UM endorsement for the motor vehicle in which he or she was located at the time of the injury. Id., 1993 OK 32, at T 15, $49 P.2d at 412.

      . The accidental nature of the injurious event is determined from the point of view of the injured insured. Willard v. Kelley, 1990 OK 127, 116, 803 P.2d 1124, 1130.

      . For purposes of § 3636, an injury "arises out of" the ownership, maintenance or use of an uninsured motor vehicle where the facts show that the injury is causally connected to the uninsured motor vehicle. Mayer v. State Farm, 1997 OK 67, 17, 944 P.2d 288, 290; Safeco Insurance Co. of America v. Sanders, 1990 OK 129, 112, 803 P.2d 688, 691; and Willard v. Kelley, 1990 OK 127, at % 18, 803 P.2d at 1130-31.

      . Uptegraft v. Home Insurance Co., 1983 OK 41, at 19, 662 P.2d at 685; and Martin v. Hartford Underwriters Insurance Co., 1996 OK 55, \ 4, 918 P.2d 49, 51.

      . The defendant argues in its brief that Ply's injury did not arise out of the "use" of the bucket truck as that term is understood in the UM statute. However, the question certified does not ask whether Ply's injury arose out of the use of a motor vehicle. The certified question assumes that Ply's injury is causally connected to use of a motor vehicle in its transportation nature. For us to visit an issue outside of the range of the certified questions would be an unwarranted assumption of reviewing power. 20 0.S.2001, §§ 1601 et seq.

      . 20 0.$.2001, § 1602.1.

      . In support of this argument, National Union cites State Auto. Mutual Insurance Co. v. Rainsberg, 86 Ohio App.3d 417, 621 N.E.2d 520 (1993); Sicarelli v. State Farm Fire & Casualty Co., 556 So.2d 179 and Plattenburg v. Allstate Insurance Co., 918 F.2d 562 (5th Cir.1990). These cases are legally and factually inapposite.
      In the Ohio case, the defendant struck two persons as they attempted to direct traffic away from a stalled vehicle (the uninsured vehicle) in which they had been passengers, killing both persons and injuring his wrist. The Ohio court determined that the injury to defendant's wrist was not caused by the stalled uninsured motor vehicle. In the Louisiana case, plaintiff alleged that an unknown van crossed his path causing him to swerve and hit a utility pole. The Louisiana jury entered a finding against plaintiff and plaintiff appealed evidentiary and fact issues. In the Fifth Circuit case, the court considered the propriety of summary judgment in a bad faith case out of Texas. In that case, the record showed that the plaintiff was the driver at fault who collided with an uninsured motorist.

      . For purposes of motor vehicle insurance, the word "maintenance" covers all acts which come within its ordinary scope and meaning, including acts of commission or omission relative to the external and mechanical condition of a vehicle. 6B Appleman, Insurance Law and Practice, § 4315, p. 339. The motor vehicle statutes impose certain external and mechanical requirements upon a motor vehicle that will be operated upon the public roads. For instance, 47 O.S. 2001, § 12-301 requires a motor vehicle be equipped with brakes and § 12-303 requires that the brakes by "maintained in good working order". This Court has held that the owner may be liable for injury caused by faulty maintenance of brakes or failure to maintain the brakes, Bush v. Middleton, 1959 OK 116, 340 P.2d 474 and 47 O.$.Supp.1957, § 148; that the owner and the operator may be liable for failure to exercise ordinary care regarding faulty brakes that have been previously repaired, Gowins v. Merrell, 1975 OK 135, 541 P.2d 857; but that neither the owner nor operator will be liable for unexpected brake failure where the owner properly maintains the brakes and the operator acts with ordinary care after a brake failure occurs, Weaver v. Hoster, 1969 OK 128, 459 P.2d 614.

      . UM coverage is triggered if the at-fault motorist is a co-employec even though the co-employee is not answerable in a tort action because of the workers' compensation immunity. Torres v. Kansas City Fire and Marine Insurance Co., 1993 OK 32,115, 849 P.2d 407, 412; Barfield v. Bar-field, 1987 OK 72, 113, 742 P.2d 1107, 1112.

      . As support for this argument, National Union cites cases from sister jurisdictions. Each of the cited cases, however, turned on the failure to prove causation. The court, in each case, found that the injury in question had no causal connection with the maintenance of the vehicle. In Marklund v. Farm Bureau Mutual Insurance Co., 400 N.W.2d 337 (Minn.1987), the plaintiff slipped on a patch of ice and fell at the gas station as he walked around the vehicle to get his checkbook to pay for gasoline and the court determined that the injury was causally connected to the premises rather than the maintenance of the vehicle. In Miller v. Loman, 518 N.E.2d 486, 492 (4th Dist.Ind.App.1987), the plain-tif{/passenger exited the vehicle to remove a muffler that fell off the vehicle from the roadway and was hit by another vehicle and the court determined that any causal connection between the injury and maintenance of the vehicle is too farfetched. In Kurlak v. United Services Auto. Assoc., 362 So.2d 463, 464 (Ist Dist.Fla.App. 1978), the owner of the uninsured vehicle was providing grease to plaintiff, at plaintiff's request, to service plaintiff's vehicle when the grease penetrated the skin on plaintiff's hand and the court determined that the owner of the uninsured motor vehicle had ceased maintenance of his vehicle and was engaged in helping plaintiff service his own vehicle and there was no causal connection between the injury and the maintenance of the uninsured vehicle. And, in Walsh v. National Indemnity Co., 80 N.C.App. 643, 343 S.E.2d 430, 433 (N.C.1986), the plaintiff was hauling tires to a shop for repairs when a truck negligently backed into him and the court found the alleged facts did not arguably show a causal connection between the injury and repair or maintenance of the tires.

      . Title 36 0.$.2001 § 3636 provides in pertinent part:
      "A. No policy insuring against loss resulting from liability imposed by law for bodily injury or death suffered by any person arising out of the ownership, maintenance or use of a motor vehicle shall be issued, delivered, renewed, or extended in this state with respect to a motor vehicle registered or principally garaged in this state unless the policy includes the coverage described in subsection B of this section. B. The policy referred to in subsection A of this section shall provide coverage therein or supplemental thereto for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles and hit-and-run motor vehicles because of bodily injury, sickness or disease, including death resulting therefrom...."

      . Safeco Ins. Co. of America v. Sanders, 1990 OK 129, 115, 803 P.2d 688. [The Legislature's use of the phrase, "uninsured motorist" implies an intent that the injury be connected to a motorist's use of a vehicle.].

      . Title 36 0.$.2001 § 3636, see note 1, supra.