Opinion
Civil Action No. 99-3189, Section "L"
May 4, 2000
ORDER AND REASONS
Before the Court is the motion of plaintiff Odyssey Re (London) Limited f/k/a Sphere Drake Insurance, P.L.C. for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure. For the following reasons, plaintiffs motion is GRANTED.
I. BACKGROUND
This case arises from an action filed in the 32nd Judicial District Court for the Parish of Terrebone by Roland and Stacie Molinere against Polaris Industries, Inc. ("Polaris") and Paul's Outboard Repairs and Marine Sales, Inc. ("Paul's"). The Molineres seek damages resulting from injuries suffered by their son, Roland Molinere, Jr., when he was struck by a jet ski being operated by his father, Roland Molinere, Sr. The Molineres allege that Paul's Outboard sold the jet ski to the Molineres and subsequently serviced it for them. They allege that Paul's failed to properly repair the jet ski, failed to warn of its defects and dangerous conditions, and breached implied warranties of fitness.
Odyssey Re (London) Limited, f/k/a Sphere Drake Ins. P.L.C. ("Odyssey Re"), issued a commercial insurance policy to Paul's effective December 16, 1997 through December 16, 1998. Paul's original application indicated that it wanted to obtain coverage for injuries included within the products-completed operations hazard. Notwithstanding Paul's application, the policy issued by Odyssey Re contained an endorsement which excluded coverage for such injuries. The insurance policy defines the products-completed operations hazard as injuries or property damage occurring under certain conditions. Neither party disputes the fact that the Molineres' injuries fall under the products-completed operations provision; however, both parties disagree as to whether Paul's policy included such coverage.
Odyssey Re filed an action for Declaratory Judgment in this Court pursuant to 28 U.S.C. § 2201 and Rule 57 of the Federal Rules of Civil Procedure. Odyssey Re now moves for summary judgment alleging that the insurance policy which it sold to Paul's does not cover the products-completed operations hazard, and therefore, does not cover the injuries incurred by the Molineres.
II. SUMMARY JUDGMENT STANDARD
Summary judgment is appropriate if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56(c). In this analysis, the Court must view the facts and inferences from the evidence in the light most favorable to the nonmoving party. See Crescent Towing Salvage Co. v. M/V ANAX, 40 F.3d 741, 743 (5th Cir. 1994). Once the moving party demonstrates that there is no issue of material fact, the burden shifts to the nonmoving party to prove that there is an issue of material fact. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). The nonmoving party may not depend solely on denials contained in the pleadings, but must submit specific facts. See Fed.R.Civ.P. 56(e). If the factual context makes the nonmoving party's claims implausible, that party must come forward with more persuasive evidence than would otherwise be necessary to show an issue of material fact. See Matsushita, 475 U.S. at 587.
III. ANALYSIS
Paul's claims that the policy should cover the products-completed operations hazard because it indicated on the insurance application that it wanted such coverage. Paul's argues that because its application is attached to the policy, its intention of obtaining products-completed operations coverage becomes an integral part of the policy and conflicts with the attached exclusion. Furthermore, Paul's supports its contention that it received coverage for the products-completed operations hazard because it paid a higher premium. Paul's explains that any conflict between the policy and the endorsement should be interpreted in its favor. Odyssey Re, on the other hand, contends that its endorsement to the policy is clear and it specifically excludes products-completed operations coverage.
Considering the evidence in a light most favorable to the defendant, the Court assumes that the policy includes Paul's application and that there is a conflict between the policy and the endorsement. When a conflict exists between the policy and endorsement, the endorsement must govern. See Roberts v. P. J. Boat Service, Inc., 357 F. Supp. 729, 734 (E.D. La. 1973). The Roberts court held that an endorsement excluded bodily injury within the completed operations hazard or the products hazard even when those hazards were provided for by the general coverage provisions of the policy. See id. Louisiana courts have also stated that when conflicts arise between the policy and an endorsement, the endorsement prevails. See Duplantis v. State Farm General Insurance Co., 606 So.2d 51, 53 (La.App.Ct. 3rd 1992). Whether Paul's application could be made a substantive part of the insurance policy is uncertain; however, even if it were, it would then be subject to any endorsements. Therefore, even if the policy includes the application as Paul's contends, Odyssey Re effectively excluded coverage for the products-completed operations hazard.
In addition, Paul's allegation that it received extended coverage because it paid increased premiums is without merit. Many circumstances arise which cause an increase in premiums. The mere fact that Paul's had applied for extended coverage does not indicate the extent of the coverage which it ultimately received. In fact, Odyssey Re's affidavits indicate that Paul's agent was aware that the policy quote was for a renewal of the old policy which did not include coverage for the products-completed operations hazard. Furthermore, the uncontested affidavit of the insurance underwriter supports Odyssey Re's contention that Paul's agent never received a quote for coverage including the products-completed operations hazard. Therefore, all of the evidence taken as a whole indicates that the insurance policy did not include coverage for the Molineres' injuries.
IV. CONCLUSION
For the foregoing reasons, the motion of plaintiff Odyssey Re (London) Limited (f/k/a Sphere Drake Insurance, P.L.C.) for summary judgment is hereby GRANTED, and it is DECLARED that Odyssey Re (London) Limited provides no insurance coverage to defendants Paul's Outboard Repairs and Marine Sales, Inc. and Louisiana Performance Center, L.L.C. for the injuries sustained by Roland Moliniere, et al. as outlined in the complaint. Each party shall bear their own costs.