Opinion
NUMBER 2017 CA 1356
04-18-2018
MARTHA HINCHCLIFFE v. EDNA BINABON SIAOTONG, SHELTER GENERAL INSURANCE COMPANY, AND PROGRESSIVE
James L. Maughan Zachary, LA Counsel for Plaintiff/Appellant Martha Hinchcliffe William C. Helm Stephen F. Butterfield Baton Rouge, LA Counsel for Defendant/Appellee Progressive Paloverde Insurance Company Phillip E. Foco Baton Rouge, LA Counsel for Intervenor Stonetrust Commercial Insurance Company Bryan J. Haydel, Jr. Baton Rouge, LA Counsel for Defendant Shelter Mutual Insurance Company
Appealed from the Twentieth Judicial District Court In and for the Parish of West Feliciana State of Louisiana
Suit Number 22735 Honorable William G. Carmichael, Presiding James L. Maughan
Zachary, LA Counsel for Plaintiff/Appellant
Martha Hinchcliffe William C. Helm
Stephen F. Butterfield
Baton Rouge, LA Counsel for Defendant/Appellee
Progressive Paloverde Insurance
Company Phillip E. Foco
Baton Rouge, LA Counsel for Intervenor
Stonetrust Commercial Insurance
Company Bryan J. Haydel, Jr.
Baton Rouge, LA Counsel for Defendant
Shelter Mutual Insurance Company BEFORE: GUIDRY, PETTIGREW, AND CRAIN, JJ. GUIDRY, J.
In this personal injury action, plaintiff, Martha Hinchcliffe, appeals from a judgment of the trial court granting summary judgment in favor of defendant, Progressive Paloverde Insurance Company (Progressive), and dismissing her claims against it with prejudice. For the reasons that follow, we affirm.
FACTS AND PROCEDURAL HISTORY
Edna Siaotong enrolled at Louisiana Safety and Driving Academy (LSDA) to obtain additional driver training and experience. Her driving instructor was Hinchcliffe, an employee of LSDA. On August 8, 2015, Siaotong was driving a 2012 Nissan Versa owned by LSDA and Hinchcliffe was riding in the passenger seat. While driving in a southerly direction on U.S. Highway 61, in an area where the road was being resurfaced, Siaotong lost control of the vehicle and struck a tree. At the time of the accident, LSDA had a commercial automobile insurance policy with Progressive, and Siaotong had a personal automobile insurance policy with Shelter Mutual Insurance Company (Shelter).
Thereafter, on August 4, 2016, Hinchcliffe filed a petition for damages, naming Siaotong, Shelter, and Progressive as defendants and asserting that she sustained serious and permanently disabling injuries, including a broken leg and ankle, multiple spine fractures, and soft tissue injuries. Particularly, with regard to Progressive, Hinchcliffe asserted that LSDA was the named insured under the Progressive policy and that Siaotong was an insured under the omnibus language in the Progressive policy. Hinchcliffe further alleged that Progressive had denied coverage under an employer liability exclusion in its policy, but that the exclusion was not applicable to the instant case.
On August 22, 2016, Stonetrust Commercial Insurance Company (Stonetrust), the worker's compensation carrier of LSDA, filed a motion for leave to file a petition of intervention. Stonetrust asserted that at the time of the accident, Hinchcliffe was an employee of LSDA working in the course and scope of her employment and that Stonetrust had paid and/or would become obligated to pay medical expenses and indemnity benefits to Hinchcliffe. The trial court granted Stonetrust leave to file its petition of intervention on August 23, 2016, which Stonetrust subsequently filed, seeking subrogation and reimbursement for worker's compensation benefits paid or to be paid on behalf of Hinchcliffe.
Thereafter, Progressive filed a motion for summary judgment, asserting that its policy of liability insurance issued to LSDA excluded coverage for Hinchcliffe's loss on the ground that the accident at issue and Hinchliffe's damages were bodily injury to an employee of "any insured" arising out of or within the course of that employee's employment by any insured or performing duties related to the conduct of any insured's business. Progressive attached a copy of its insurance policy to its motion.
Following a hearing on Progressive's motion, the trial court signed a judgment granting summary judgment in favor of Progressive and dismissing Hinchliffe's claims against it with prejudice. Hinchcliffe now appeals from this judgment.
DISCUSSION
Standard of Review
A motion for summary judgment is a procedural device used to avoid a full scale trial when there is no genuine issue of material fact. M/V Resources LLC v. Louisiana Hardwood Products LLC, 16-0758, p. 8 (La. App. 1st Cir. 7/26/17), 225 So. 3d 1104, 1109, writ denied, 17-1748 (La. 12/5/17), 231 So. 3d 624. A motion for summary judgment is properly granted if the motion, memorandum, and supporting documents show that there is no genuine issue as to material fact and that the mover is entitled to judgment as a matter of law. La. C.C.P. art. 966(A)(3). The only documents that may be filed in support of or in opposition to the motion are pleadings, memoranda, affidavits, depositions, answers to interrogatories, certified medical records, written stipulations, and admissions. La. C.C.P. art. 966(A)(4). The court may consider only those documents filed in support of or in opposition to the motion for summary judgment and shall consider any documents to which no objection is made. La. C.C.P. art. 966(D)(2). In determining whether summary judgment is appropriate, appellate courts review evidence de novo under the same criteria that govern the trial court's determination of whether summary judgment is appropriate. M/V Resources LLC, 16-0758 at p. 9, 225 So. 3d at 1109.
When the issue before the court on the motion for summary judgment is one on which the party bringing the motion will bear the burden of proof at trial, the burden of showing there is no genuine issue of material fact remains with the party bringing the motion. See La. C.C.P. art. 966(D)(1); Simmons v. Weiymann, 05-1128, p. 3 (La. App. 1st Cir. 8/23/06), 943 So. 2d 423, 425. An insurer seeking to avoid coverage through summary judgment bears the burden of proving some exclusion applies to preclude coverage. Simmons, 05-1128 at p. 3, 943 So. 2d at 425.
The issue of whether an insurance policy, as a matter of law, provides or precludes coverage is a dispute that can be resolved properly within the framework of a motion for summary judgment. Green v. State Farm Mutual Automobile Insurance Company, 07-0094, p. 3 (La. App. 1st Cir. 11/2/07), 978 So. 2d 912, 914, writ denied, 08-0074 (La. 3/7/08), 977 So. 2d 917. Summary judgment declaring a lack of coverage under an insurance policy may not be rendered unless there is no reasonable interpretation of the policy, when applied to the undisputed material facts shown by the documents supporting the motion, under which coverage could be afforded. Green, 07-0094 at p. 3, 978 So. 2d at 914. Insurance Coverage
An insurance policy is a contract between the parties and should be construed using the general rules of contractual interpretation. If the words of the policy are clear and explicit and lead to no absurd consequences, no further interpretation may be made in search of the parties' intent, and the agreement must be enforced as written. La. C.C. art. 2046; Fouquet v. Daiquiris & Creams of Mandeville, L.L.C., 10-0233, p. 4 (La. App. 1st Cir. 9/13/10), 49 So. 3d 44, 47.
The purpose of liability insurance is to afford the insured protection from damage claims; therefore, policies should be construed to effect, not to deny, coverage. Myers v. Welch, 17-0063, p. 9 (La. App. 1st Cir. 10/25/17), 233 So. 3d 49, 55, writ denied, 17-2165 (La. 3/9/18), ___ So. 3d ___. Thus, a provision which seeks to narrow the insurer's obligation is strictly construed against the insurer, and, if the language of the exclusion is subject to two or more reasonable interpretations, the interpretation which favors coverage must be applied. Myers, 17-0063 at p. 9, 233 So. 3d at 55. It is equally well settled, however, that subject to the above rules of interpretation, insurance companies have the right to limit coverage in any manner they desire, so long as the limitations do not conflict with statutory provisions or public policy. Myers, 17-0063 at p. 9, 233 So. 3d at 55.
The Progressive policy provides that coverage under Part 1, Liability to Others, does not apply to:
Employee Indemnification and Employer's Liability Bodily Injury to:
a. An employee of any insured arising out of or within the course of:
(i) That employee's employment by any insured; or
(ii) Performing duties related to the conduct of any insured's business; or
b. The spouse, child, parent, brother or sister of that employee as a consequence of Paragraph a. above.
The exclusion uses the phrase "any insured," which by its inclusive nature brings both the named insured and any other insured (i.e. omnibus insured) within the scope of the exclusion. It is undisputed that Hinchcliffe, an employee of LSDA, the named insured, sustained bodily injury while in the course and scope of her employment with LSDA. As such, the plain language of the exclusion clearly applies to the facts of the instant case and excludes coverage for Hinchcliffe's damages.
Hinchcliffe relies on Pullen v. Employers' Liability Assurance Corporation, Ltd., 230 La. 867, 89 So. 2d 373 (La. 1956), for the proposition that the employer liability exclusion must be analyzed solely from the viewpoint of the insured for whom liability coverage is sought. However, we find Pullen to be distinguishable, as the unqualified language of the policy at issue therein, which referred simply to "the insured," was not as specific as the language in the Progressive policy. Pullen, 89 So. 2d at 872.
Furthermore, we do not find that applying the employer liability exclusion as written would lead to absurd consequences under the facts of this case. LSDA had in effect a workers' compensation policy to cover injuries sustained by employees like Hinchcliffe while in the course and scope of their employment. Coverage for these same injuries under the Progressive policy would lead to a duplication of coverage and in fact, many liability policies contain such employer liability exclusions to avoid this double exposure. See 15 William Shelby McKenzie, H. Alston Johnson, III, Louisiana Civil Law Treatise, Insurance Law and Practice § 3:38 (4th ed. 2016).
Finally, we do not find that the employer liability exclusion in the Progressive policy conflicts with statutory provisions or public policy. The Louisiana Motor Vehicle Safety Responsibility Law, La. R.S. 32:851 through La. R.S. 32: 1043, sets forth a mandatory, comprehensive scheme to provide financial protection to those involved in motor vehicle accidents. Sensebe v. Canal Indemnity Company, 10-0703, p. 8 (La. 1/28/11), 58 So. 3d 441, 446. This protective statutory scheme not only mandates that owners of motor vehicles obtain insurance coverage, but these comprehensive statutes also mandate many of the contractual terms of insurance policies. Sensebe, 10-0703 at p. 8, 58 So. 3d at 446.
Particularly, La. R.S. 32:900(B)(2) sets forth the requirement for insurance policies to designate which drivers are covered. Under La. R.S. 32:900(B)(2), there is a mechanism for motor vehicle liability policies to cover not only the insured specifically named in the policy, but also to cover any other driver who drives with the permission of the named insured. Sensebe, 10-0703 at p. 9, 58 So. 3d at 447. This "omnibus" coverage requirement is crucial to Louisiana's public policy and as such, omnibus coverage is incorporated into every policy of insurance to which it is applicable, as if it were written in the policy. Sensebe, 10-0703 at pp. 9-10, 58 So. 3d at 447.
Louisiana Revised Statute 32:900(B) provides, in part:
Such owner's policy of liability insurance:
* * *
(2) Shall insure the person named therein and any other person, as insured, using any such motor vehicle or motor vehicles with the express or implied permission of such named insured against loss from the liability imposed by law for damages arising out of the ownership, maintenance, or use of such motor vehicle or motor vehicles ... .
However, the legislature has provided for certain exceptions to omnibus coverage, such as permitting an owner to exclude a named person as an insured under a commercial policy if the owner obtains and maintains in force another policy of motor vehicle insurance providing coverage for the person so excluded and permitting an insurer and the insured to exclude from coverage the named insured and the spouse of the named insured, as well as any other named person who is a resident of the same household as the named insured. See La. R.S. 32:900(B)(2)(d) and 32:900(L). Furthermore, La. R.S. 32:900(E) authorizes employer liability exclusions, providing:
Such motor vehicle liability policy need not insure any liability under any worker's compensation law nor any liability on account of bodily injury to or death of an employee of the insured while engaged in the employment, other than domestic, of the insured, or while engaged in the operation, maintenance or repair of any such motor vehicle nor any liability for damage to property owned by, rented to, in charge of or transported by the insured.
The language of the employer liability exclusion in the Progressive policy follows the language found in La. R.S. 32:900(E). Therefore, because employer liability exclusions are an exception to coverage authorized by La. R.S. 32:900, we do not find that the exclusion in the Progressive policy conflicts with statutory law. See Sensebe, 10-0703 at p. 16, 58 So. 3d at 451.
We also do not find that the exclusion in Progressive's policy violates public policy. The overriding goal of the Louisiana Motor Vehicle Safety Responsibility Law is to provide compensation for persons injured by the operation of an insured vehicle. Marcus v. Hanover Insurance Company, Inc., 98-2040, p. (La. 6/4/99), 740 So. 2d 603, 608. Enforcing the exclusion in the Progressive policy does not undermine this goal, because Hinchcliffe has received compensation for her injuries from LSDA's workers compensation insurer.
CONCLUSION
For the foregoing reasons, we affirm the judgment of the trial court. All costs of this appeal are assessed to Martha Hinchcliffe.
AFFIRMED.