Opinion
2013 CA 1522
07-21-2014
MICHELLE LAZARE v. COLUMBIA SUSSEX CORPORATION AND TROPICANA ENTERTAINMENT, L.L.C.
Brian D. Calvit Baton Rouge, LA Attorney for Plaintiff-Appellant Michelle Lazare John P. Wolff, III Nancy B. Gilbert Chad A. Sullivan C. Reynolds LeBlanc Keogh, Cox & Wilson, Ltd. Baton Rouge, LA Attorneys for Defendant-Appellee Federal Insurance Company Brett M. Bollinger L. Peter Englande, Jr. Zaunbrecher Treadaway, L.L.C. Covington, LA Attorneys for Defendant-Appellee Columbia Sussex Corporation
NOT DESIGNATED FOR PUBLICATION
On Appeal from the 19th Judicial District Court
Parish of East Baton Rouge, Louisiana
Docket No. 564,663, Section 27
Honorable Todd W. Hernandez, Judge Presiding
Brian D. Calvit
Baton Rouge, LA
Attorney for
Plaintiff-Appellant
Michelle Lazare
John P. Wolff, III
Nancy B. Gilbert
Chad A. Sullivan
C. Reynolds LeBlanc
Keogh, Cox & Wilson, Ltd.
Baton Rouge, LA
Attorneys for
Defendant-Appellee
Federal Insurance Company
Brett M. Bollinger
L. Peter Englande, Jr.
Zaunbrecher Treadaway, L.L.C.
Covington, LA
Attorneys for
Defendant-Appellee
Columbia Sussex Corporation
BEFORE: PARRO, GUIDRY, AND DRAKE, JJ.
PARRO, J.
Michelle Lazare appeals a judgment in favor of Columbia Sussex Corporation (Columbia), granting its motion for summary judgment and dismissing her claims against it. For the following reasons, we affirm the judgment.
BACKGROUND
On May 27, 2006, Ms. Lazare was operating a vehicle owned by Columbia and Tropicana Entertainment L.L.C. (Tropicana) on the River Road in Baton Rouge, Louisiana, when she was involved in an accident with a vehicle driven by Paul Laugand and insured by State Farm Automobile Insurance Company (State Farm). Ms. Lazare's damages exceeded the coverage under Mr. Laugand's State Farm policy, and she settled with State Farm for its policy limits. She then filed suit against Columbia and Tropicana, alleging that under Louisiana's uninsured/underinsured motorist (UM) laws, they were obligated to pay for the damages she had sustained that exceeded the State Farm coverage. She also sought penalties, interest, and attorney fees for their arbitrary and capricious failure to pay her UM claim, despite amicable demand.
Tropicana filed for bankruptcy, and the proceedings were stayed for several years until the bankruptcy was complete. After the stay order was lifted, Ms. Lazare settled her claim with Tropicana. A motion and order for partial dismissal was filed, dismissing all claims against Tropicana but reserving her rights against any other parties. In a supplemental and amending petition, Ms. Lazare named as an additional defendant Federal Insurance Company (Federal), alleging that Federal had issued Columbia an automobile liability insurance policy covering the vehicle she had been driving when the accident occurred.
Columbia filed a motion for summary judgment on the grounds that it was not an insurer and that the plaintiff could not establish that it provided UM coverage for its vehicles. After a hearing, the trial court granted the motion and dismissed all claims against Columbia in a judgment signed April 26, 2013.
Ms. Lazare filed a devolutive appeal, asserting two assignments of error:
1. The trial court committed legal error in finding that the policy issued by Federal Insurance Company did not contain a Self Insured Retention and
thus all liability was with Federal.
2. The trial court erred when it found that Columbia Sussex was not liable on the basis that Columbia Sussex is not an insurer.
APPLICABLE LAW
Summary Judgment
A motion for summary judgment is a procedural device used when there is no genuine issue of material fact for all or part of the relief prayed for by a litigant. Duncan v. U.S.A.A. Ins. Co., 06-363 (La. 11/29/06), 950 So.2d 544, 546; see LSA-C.C.P. art. 966. An appellate court reviews a trial court's decision to grant a motion for summary judgment de novo, using the same criteria that govern the trial court's consideration of whether summary judgment is appropriate. Smith v. Our Lady of the Lake Hosp., Inc., 93-2512 (La. 7/5/94), 639 So.2d 730, 750. The motion should be granted only if the pleadings, depositions, answers to interrogatories, and admissions, together with the affidavits, if any, admitted for purposes of the motion for summary judgment, show that there is no genuine issue as to material fact and that the mover is entitled to judgment as a matter of law. LSA-C.C.P. art. 966(B)(2); George S. May Int'l Co. v. Arrowpoint Capital Corp., 11-1865 (La. App. 1st Cir. 8/10/12), 97 So.3d 1167, 1171.
The burden of proof remains with the mover. However, if the mover will not bear the burden of proof at trial on the matter that is before the court on the motion for summary judgment, the mover's burden on the motion does not require him to negate all essential elements of the adverse party's claim, action, or defense, but rather to point out to the court that there is an absence of factual support for one or more elements essential to the adverse party's claim, action, or defense. Thereafter, if the adverse party fails to produce factual support sufficient to establish that he will be able to satisfy his evidentiary burden of proof at trial, there is no genuine issue of material fact. LSA-C.C.P. art. 966(C)(2). A summary judgment may be rendered dispositive of a particular issue, theory of recovery, cause of action, or defense, in favor of one or more parties, even though the granting of the summary judgment does not dispose of the entire case. LSA-C.C.P. art. 966(E). However, a summary judgment may be rendered or affirmed only as to those issues set forth in the motion under consideration by the court at that time. LSA-C.C.P. art. 966(F)(1).
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. Johnson v. Allstate Ins. Co., 95-1953 (La. App. 1st Cir. 5/10/96), 673 So.2d 345, 347, writ denied, 96-1292 (La. 6/28/96), 675 So.2d 1126. In seeking a declaration of coverage under an insurance policy, Louisiana law places the burden on the plaintiff to establish every fact essential to recovery and to establish that the claim falls within the policy coverage. McDonald v. American Family Life Assur. Co. of Columbus, 10-1873 (La. App. 1st Cir. 7/27/11), 70 So.3d 1086, 1089. 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 evidence supporting the motion, under which coverage could be afforded. Jones v. Estate of Santiago, 03-1424 (La. 4/14/04), 870 So.2d 1002, 1010.
Insurance Contracts
An insurance policy is an agreement between the parties and should be construed according to the general rules of interpretation of contracts as set forth in the Louisiana Civil Code. Cadwallader v. Allstate Ins. Co., 02-1637 (La. 6/27/03), 848 So.2d 577, 580. When interpreting insurance contracts, the court's responsibility is to determine the parties' common intent. Louisiana Ins. Guar. Ass'n v. Interstate Fire & Cas. Co., 93-0911 (La. 1/14/94), 630 So.2d 759, 763; see LSA-C.C. art. 2045. The parties' intent, as reflected by the words of the policy, determines the extent of coverage. Ledbetter v. Concord Gen. Corp., 95-0809 (La. 1/6/96), 665 So.2d 1166, 1169, decree amended, 95-0809 (La. 4/18/96), 671 So.2d 915.
When the words of a contract are clear and explicit and lead to no absurd consequences, no further interpretation may be made in search of the parties' intent. LSA-C.C. art. 2046. Such intent is to be determined in accordance with the general, ordinary, plain, and popular meaning of the words used in the policy, unless the words have acquired a technical meaning. Ledbetter, 665 So.2d at 1169; see LSA-C.C. art. 2047. If the policy wording at issue is clear and expresses the intent of the parties, the agreement must be enforced as written. Ledbetter, 665 So.2d at 1169. An insurance policy should not be interpreted in an unreasonable or a strained manner so as to enlarge or restrict its provisions beyond what is reasonably contemplated by its terms or to achieve an absurd conclusion. Reynolds v. Select Properties, Ltd., 93-1480 (La. 4/11/94), 634 So.2d 1180, 1183. Absent a conflict with statutory provisions or public policy, insurers are entitled to limit their liability and to impose and enforce reasonable conditions on the policy obligations they contractually assume. Parekh v. Mittadar, 11-1201 (La. App. 1st Cir. 6/20/12), 97 So.3d 433, 438.
ANALYSIS
The only issue before the district court on the motion for summary judgment was whether Columbia provided UM coverage for the vehicle being driven by Ms. Lazare when the accident occurred. Columbia claimed it was not an insurer and did not itself provide any insurance whatsoever, including UM coverage. Columbia supported its motion with the affidavit of its risk manager, Myra Kashner, who averred that Columbia was not and is not an insurance company, did not insure the vehicle, and did not provide any UM coverage for the vehicle and/or the accident.
Ms. Lazare opposed the motion and attached a copy of a business automobile liability insurance policy issued by Federal, which designates Columbia as the named insured and provides UM coverage for Columbia's vehicles licensed or garaged in Louisiana in the amount of $1,000,000 per accident. The policy also has an endorsement that provides for a deductible in the amount of $250,000 per accident for bodily injury, property damage, and UM claims. This endorsement states:
The damages caused in any one "accident" that would otherwise be payable ... pursuant to any uninsured or underinsured motorists financial responsibility law will be reduced by the amount shown in the Schedule above. The applicable Limit of Insurance shall be reduced by the amount of such deductible.
* * *
To settle any claim or "suit," we will pay all or any part of the applicable
deductible amount. You agree to reimburse us within fifteen (15) days of the date you receive such notice. Your obligation to reimburse us pursuant to this endorsement shall continue until we determine, in our sole judgment, that we have no further obligations under this policy.
Ms. Lazare contends that this policy language constitutes a self-insured retention, whereby Columbia is self-insured for the first $250,000 of any claim, including a UM claim. Columbia counters that the policy language clearly states that the $250,000 is a deductible, not a self-insured retention, and that if it is determined that there is coverage under the Federal policy for Ms. Lazare's UM claim, it would be Federal's responsibility to pay that claim. Columbia further argues that even if the policy were construed to provide a self-insured retention, the cases interpreting such policies have uniformly held that UM benefits are not required or provided within self-insured retentions.
The nature of self-insurance and its relationship to UM coverage was explained by the Louisiana Supreme Court in Hearty v. Harris. 574 So.2d 1234, 1237-38 (La. 1991). The court stated:
Pursuant to [LSA-R.S.] 32:861(A), the owner of every motor vehicle registered in the state of Louisiana ... is prospectively required to maintain proof of financial responsibility by: (1) purchasing a motor vehicle liability policy with limits which conform to the requirements of [LSA-R.S.] 32:900(B)(2) or a binder for the same; (2) posting a motor vehicle liability bond which satisfies the requirements of [LSA-R.S.] 32:861(B); (3) depositing with the state treasurer sufficient cash and securities under the provisions of [LSA-R.S.] 32:861(C); or (4) obtaining a certificate of self-insurance in accordance with the terms of [LSA-R.S.] 32:1042.Based on this explanation, it is clear that even if the Federal policy provided for a self- insured retention by Columbia, self-insurance is not insurance at all and would not provide UM coverage.
It is important to understand that self-insurance is, in actuality, not insurance at all. It is merely one of the four methods by which an owner of a motor vehicle is allowed to meet the requirements of the [Louisiana Motor Vehicle Safety Responsibility Law]. ... [S]elf-insured vehicles are uninsured ... .
* * *
While Louisiana courts have consistently recognized that a certificate of self-insurance indicates the self-insurer possesses sufficient assets to satisfy judgments if found legally liable, the courts have refused to consider a certificate of self-insurance an insurance "policy." Jones v. Henry, 542 So.2d 507, 509 (La. 1989) (self-insurers do not have to provide uninsured motorist coverage); Jordan v. Honea, 407 So.2d 503, 504 (La. App. 1st Cir. 1981), writ denied, 409 So.2d 654 (La. 1982) (uninsured motorist coverage is required only if there is an insurance policy). (Emphasis added).
Moreover, our reading of the language of the policy reveals that it does not provide a self-insured retention, but a standard deductible in the amount of $250,000 per accident for UM coverage. The endorsement containing the deductible is entitled "Deductible Liability." Although two paragraphs of the endorsement refer to the "Aggregate Deductible," there is no aggregate deductible amount shown on the policy endorsement. The endorsement provides that the applicable limit of insurance shall be reduced by the amount of the deductible shown in the schedule, which is $250,000 per accident. It further states that to settle any claim or suit, the insurer "will pay all or any part of the applicable deductible amount." The insured is required to reimburse the insurer within 15 days of receiving notice of such payment. This language is clear and explicit and does not lead to any absurd consequences. Columbia has no obligation to pay UM damages to Ms. Lazare. Columbia's obligation is to reimburse Federal for any UM payments it may make to Ms. Lazare if and when the facts in this case establish that the Federal policy provides UM coverage for the vehicle driven by her at the time of the accident. Therefore, the trial court did not err in concluding that the Federal policy imposes no liability on Columbia for payment of UM damages to Ms. Lazare.
The $250,000 deductible also pertains to bodily injury, property damage, covered pollution cost or expense, defense costs, and other supplementary payments.
We also conclude that the court did not err in determining that Columbia is not an insurer. Columbia supported its motion with the affidavit of its risk manager, who stated that Columbia was not and is not an insurance company, did not insure the vehicle driven by Ms. Lazare, and did not provide any UM coverage for the vehicle and/or the accident. Ms. Lazare did not produce any evidence to support the conclusion that Columbia is or acts as an insurer, only that Columbia is an insured under the Federal policy. Therefore, since she did not produce factual support sufficient to establish that she would be able to satisfy her evidentiary burden of proof at trial on this issue, there was no genuine issue of material fact, and the court correctly granted the motion for summary judgment.
In a brief to this court, Federal pointed out that in oral reasons for its judgment on the motion, the trial court stated, "[T]he court finds that under the policy, all liability is with Federal." The issue of Federal's liability was not before the court on the motion for summary judgment. Federal's alleged liability has not yet been addressed by the trial court, and any judgment regarding Federal will be proper only after it is adjudicated at a later date. The signed judgment contains no similar language. It simply grants the motion for summary judgment and dismisses all claims against Columbia. It is the formal, signed judgment that governs the controversy, not any comments made in oral or written reasons for judgment. See State v. Property seized from Miller $20.919.00 in U.S. Currency, 13-0715 (La. App. 1st Cir. 12/27/13), 137 So.3d 42, 45, writ denied, 14-0193 (La. 4/4/14), 135 So.3d 645. The trial court's oral or written reasons for judgment form no part of the judgment, but are merely an explication of the trial court's determinations. See Woolev v. Lucksinqer, 09-0571 (La. 4/1/11), 61 So.3d 507, 572. Therefore, the trial court's comment in oral reasons regarding Federal's liability will not affect any further proceedings in this case.
CONCLUSION
For the above reasons, the judgment of the trial court, dismissing all claims against Columbia Sussex Corporation, is affirmed. All costs of this appeal are assessed to Michelle Lazare.
AFFIRMED.