Opinion
NO. 2015 CA 1029
04-15-2016
BRADLEY W. SMITH v. PAUL BABIN AND THE CITY OF BATON ROUGE, PARISH OF EAST BATON ROUGE
R. CHRIS OETJENS SCOTT M. HAWKINS BATON ROUGE, LA ATTORNEYS FOR PLAINTIFF-APPELLEE BRADLEY W. SMITH DAVID H. OGWYN MICHAEL E. PLATTE BATON ROUGE, LA ATTORNEYS FOR DEFENDANT-APPELLEE PAUL BABIN BRENT E. KINCHEN GREGORY KENT MOROUX, JR. BATON ROUGE, LA ATTORNEYS FOR DEFENDANT-APPELLANT SHELTER MUTUAL INSURANCE COMPANY
NOT DESIGNATED FOR PUBLICATION Appealed from the 19th Judicial District Court in and for the Parish of East Baton Rouge, Louisiana
Trial Court No. C498177
Honorable Timothy E. Kelley, Judge R. CHRIS OETJENS
SCOTT M. HAWKINS
BATON ROUGE, LA ATTORNEYS FOR
PLAINTIFF-APPELLEE
BRADLEY W. SMITH DAVID H. OGWYN
MICHAEL E. PLATTE
BATON ROUGE, LA ATTORNEYS FOR
DEFENDANT-APPELLEE
PAUL BABIN BRENT E. KINCHEN
GREGORY KENT MOROUX, JR.
BATON ROUGE, LA ATTORNEYS FOR
DEFENDANT-APPELLANT
SHELTER MUTUAL INSURANCE
COMPANY BEFORE: PETTIGREW, HIGGINBOTHAM, AND CRAIN, JJ. PETTIGREW, J.
Defendant insurance company challenges the trial court's judgment that arises out of an automobile-pedestrian accident that was tried to conclusion in a jury trial on the issues of liability and damages and a bifurcated bench trial on codefendant's cross-claims regarding insurance coverage issues. Both the codefendant and the plaintiff answered the appeal. For the reasons that follow, we affirm as amended.
FACTS AND PROCEDURAL HISTORY
Plaintiff, Bradley W. Smith (Smith), filed the instant suit for damages against his former co-worker, Paul Babin (Babin), and his former employer, the City of Baton Rouge/Parish of East Baton Rouge (the City/Parish), seeking damages stemming from an incident that occurred between Babin and Smith at one of the City/Parish parking lots on the morning of August 13, 2001. Smith alleged he was injured when Babin intentionally drove his personal vehicle into Smith as Smith walked from his car in the parking lot. Smith alleged Babin was liable for his damages and that the City/Parish was vicariously liable for the intentional act of its employee, Babin, which occurred during the course and scope of Babin's and Smith's employment with the City/Parish. Smith subsequently filed supplemental and amending petitions, naming State Farm Mutual Automobile Insurance (State Farm) as his personal uninsured/underinsured carrier and Shelter Mutual Insurance Company (Shelter) as Babin's liability insurer.
Smith's claim against State Farm was later dismissed after a settlement and is not at issue in this appeal. Smith's claims against the City/Parish were dismissed by the trial court on summary judgment. That judgment was affirmed by another panel of this court and is not at issue in this appeal. Smith v. Babin, 2007-0173 (La. App. 1 Cir. 11/2/07) 2007 WL 3230224 (unpublished decision), writ denied, 2008-0105 (La. 3/28/08), 978 So.2d 306.
Babin filed a cross-claim against Shelter, arguing that Shelter had refused to defend and/or indemnify him and that Shelter's actions were arbitrary and capricious. Babin sought judgment against Shelter for an amount equal to the cost and attorney fees incurred to defend the main demand, along with penalties, attorney fees, and damages for Shelter's misrepresentations of policy provisions and its arbitrary and capricious handling of his claim. Babin subsequently moved, unsuccessfully, for summary judgment on these issues. Judgment denying Babin's summary judgment was signed by the trial court on May 21, 2014.
Smith subsequently moved for summary judgment, requesting that Shelter's insurance policy be declared ambiguous with regard to the issue of prejudgment judicial interest and that, as a matter of law, Shelter be obligated to pay Smith prejudgment interest from the date of judicial demand, on the entire judgment. Following a hearing, the trial court granted in part and denied in part Smith's motion in a judgment signed on December 2, 2014. The trial court found that Shelter's policy obligated it to pay prejudgment judicial interest only on its per-person $10,000.00 policy limits, running from the date of judicial demand against Babin in the original petition filed on August 9, 2002, until the date of final judgment. The trial court further ordered that Shelter was obligated to pay postjudgment interest on the total judgment amount against Babin after the time of final judgment until such time that Shelter pays, offers or deposits in the court, the per-person $10,000.00 policy limits. Finally, the trial court concluded that Shelter's policy did not obligate it to pay prejudgment judicial interest on the total judgment amount against Babin.
The issues of liability, causation, and damages were tried before a jury on September 29, 2014, through October 2, 2014; and the cross-claims of Babin against Shelter were heard on December 19, 2014, by the trial court. At the beginning of the jury trial, the parties entered into a stipulation regarding the amount of past medical expenses incurred by Smith as a result of this accident. In exchange for Smith agreeing to waive the collateral source rule, the parties stipulated that Smith had $338,556.27 in past medical expenses and that Shelter and Babin would be entitled to a dollar-for-dollar credit for workers' compensation payments in the same amount.
At the conclusion of the evidence on the issues of liability, causation, and damages, the jury rendered a verdict in favor of Smith and against Babin as follows:
1. Do you find that Paul Babin was at fault and such fault was cause in fact of the accident?
Yesv No___
(If your answer to this question is Yes, go to Question 2. If your answer to this question is No, then sign and date the Verdict Form, and notify the bailiff that you have a verdict.)
2. Do you find that Paul Babin intentionally made contact with Bradley Smith?
Yesv No___
(If your answer to this question is Yes, go to Question 3. If your answer to this question is No, go to Question 4.)
3. Were the damages to plaintiff Bradley Smith, resulting from defendant Paul Babin's actions, expected or intended from the standpoint of Paul Babin?
Yes___ Nov
4. Do you find that the fault of Paul Babin was the legal cause of any injury to Bradley Smith?
Yesv No___
(If your answer to this question is Yes, go to Question 5. If your answer to this question is No, then proceed to question 6.)
5. State the percentages of fault applicable to each party whom you have found to be at fault.
| Defendant, Paul Babin | 100% |
| Plaintiff, Bradley Smith | 0 % |
| Total: | 100% |
Note - these blanks must equal 100%
6. Please state what sum of money, if any, would reasonably and fairly compensate Bradley Smith for the following:
| A. Past Medical Expenses | $782.43 |
| B. Future Medical Expenses | [$2,500.00] |
| C. Past, present and futurephysical pain & suffering | $125,000.00 |
| D. Past, present and futuremental anguish & Emotionaltrauma | $155,400.00 |
| E. Past, present and futuredisability | $10,000.00 |
| F. Past, present and futureloss of enjoyment of life | $250,000.00 |
| Total: | [$543,682.43] |
According to the record, there was an apparent disagreement amongst the parties concerning the wording of the final judgment with regard to Smith's past medical expenses. Shelter filed a proposed judgment with the clerk of court on January 20, 2015, which judgment the trial court signed on February 25th, but later marked each page of the judgment with the phrase "See alt order." Moreover, Smith filed two proposed judgments with the trial court. Smith's first proposed judgment, which was filed on January 21, 2015, was never signed by the trial court but marked with the phrase "See alt order." His second proposed judgment, which ultimately became the final judgment of the court, was filed on February 25, 2015, and signed by the trial court February 27, 2015.
We note that counsel for Shelter did not approve this judgment "as to form and content" as is indicated by the absence of his signature on same.
In addition to the jury findings expressed above and the trial court's rulings on Babin's cross-claims, the February 27, 2015 judgment of the trial court also included the following pertinent language:
IT IS HEREBY ORDERED, ADJUDGED AND DECREED that judgment be rendered in favor of plaintiff and against defendants, Paul Babin and Shelter Mutual Insurance Company, who are jointly and in solido liable subject to the policy limits of the policy of insurance, in the amount of Five Hundred and Forty-Three thousand Six Hundred and Eighty-Two dollars and 43/100 ($543,682.43) together with legal interest from the date of the filing of the petition for damages as well as Four
Thousand Three Hundred and Thirty-Three dollars and 60/100 ($4,332.60) in costs payable to Bradley Smith as well as any and all costs of court due the East Baton Rouge Clerk of Court.
IT IS FURTHER ORDERED that the defendants are entitled to a credit in the amount of Seven Hundred Eighty-Two dollars and 43/100 ($782.43), or the amount equal to past medical expenses as awarded by the jury as a result of a pre-trial stipulation between the parties. Judicial interest shall run on the credited amount from the date of judicial demand until October 2, 2014.
On October 31, 2014, Smith filed with the trial court a "Motion for New Trial, Motion for a Judgment Notwithstanding Verdict; or, alternatively, Motion for Additur." Smith argued that based on the parties' pretrial stipulation regarding his past medical expenses, the jury made an improper reduction of the past due medical expenses based on the amount of out-of-pocket costs that he had incurred and that this reduction was in violation of the collateral source rule. Smith asserted further that although the parties stipulated to the credit on the amount awarded, there was no such agreement as to the prejudgment interest. As such, Smith maintained that he was entitled to prejudgment interest in excess of $260,000.00 on the special damages.
The following statement appears in Smith's memorandum in support of his motions: "At the commencement of trial, the parties stipulated that the special damages for past due expenses were $336,267.38 and that the defendants would be entitled to a dollar for dollar reduction of that amount if the jury were to find causation between the accident and the resulting expenses." As previously indicated, the figure stipulated to by the parties was $338,556.27. However, before the stipulation was agreed upon, there was some discussion about the numbers not matching up exactly and the fact that there was a $2,000.00 difference. Nonetheless, the parties agreed to the $338,556.27 amount in the end.
Smith's motions for new trial and JNOV, or alternatively, motion for additur proceeded to hearing on March 16, 2015, at which time the trial court heard argument from respective counsel. The trial court concluded that based on the evidence presented, an additur in the amount of $338,556.27 was warranted. The trial court further ruled that interest was only to be paid after the credits were applied. In an order signed on April 2, 2015, the trial court granted an additur in favor of Smith in the amount of $338,556.27, ordered that Shelter and Babin were "entitled to a credit for workers' compensation payments in the same amount of $338,556.27," and denied Smith's motion for JNOV and motion for new trial.
On March 24, 2015, Shelter filed a petition and order for devolutive appeal of the trial court's February 27, 2015 judgment An order granting said appeal was signed by the trial court on March 26, 2015.
In an effort to clarify the issue of judicial interest on the past medicals, Shelter filed a motion to amend the February 27, 2015 judgment under La. Code Civ. P. art. 1951. Said motion was subsequently denied by the trial court at a hearing on June 22, 2015. Shelter also filed an action for nullity of judgment for fraud or ill practices. There is no disposition in the record for this action.
To the extent that Shelter's appeal may seem premature as it was filed prior to the trial court's judgment on the motions for new trial and JNOV was signed, we note that any previously existing defect arising from the premature order of appeal was cured by the trial court's denial of the motions for new trial and JNOV in its April 2, 2015 order. La. Code Civ. P. art. 2087(D). Thus, this appeal is properly before us, and we will consider both the February 27, 2015 judgment on the merits as well as the trial court's April 2, 2015 order on the motions for new trial, JNOV, and additur.
Shelter assigns the following specifications of error for our review:
1. The Trial Court erred in including in the original judgment the line "Judicial interest shall run on the credited amount from the date of judicial demand until October 2, 2014."Both Smith and Babin answered the appeal. Smith assigns the following errors:
2. The Trial Court erred in finding that plaintiff Bradley Smith's damages were not expected or intended from the standpoint of Paul Babin.
1. The trial court committed legal and reversible error by allowing the admission into evidence an irrelevant and hearsay document which purported to be a declarations page but was in fact a "paid receipt".In his brief to this court, Babin alleges the trial court committed the following reversible errors:
2. The trial court committed legal and reversible error by finding, as a matter of law, that the policy of insurance issued by Shelter Mutual Insurance Company was not vague and ambiguous as to Shelter's obligations to pay judicial interest.
1. Deciding that Shelter Mutual Insurance Company did not owe a duty to defend under the policy issued to Paul Babin, and Louisiana Law.
2. Concluding that Shelter Mutual Insurance Company was not in bad-faith when it denied the duty to defend it owed its insured, Paul Babin.
DISCUSSION
Shelter's Appeal
Judicial Interest
In its first assignment of error, Shelter argues that Smith has no legal basis to recover judicial interest on the stipulated past medical specials ($338,556.27) prior to the application of the stipulated credit. Rather, Shelter maintains, Smith may only recover judicial interest on the amounts actually awarded. Thus, Shelter asserts that the line "Judicial interest shall run on the credited amount from the date of judicial demand until October 2, 2014" should be stricken from the trial court's February 27, 2015 judgment. Smith counters that because the pretrial stipulation was silent as to interest, the general principles of legal interest found in La. Code Civ. P. art. 1921 apply. Article 1921 provides that "[t]he court shall award interest in the judgment as prayed for or as provided by law." (Emphasis added). Smith argues that since the word "shall" in article 1921 is mandatory, the trial court lacks discretion to deny interest if interest is prayed for or provided for by law. We agree with Shelter regarding this issue.
As previously indicated, the parties entered into a pretrial stipulation whereby in exchange for Smith agreeing to waive the collateral source rule, the parties stipulated that Smith had $338,556.27 in past medical expenses and that Shelter and Babin would be entitled to a dollar-for-dollar credit for workers' compensation payments in the same amount. We find that once the parties agreed to the terms of the stipulation and entered same into the record prior to the start of the trial, the issue of past medical expenses should have never been put before the jury for consideration. It only served to confuse the issue and, as the trial court found, allowed the jury to award an amount for past medical expenses ($782.43) that was "not supportable by any of the evidence that was provided;" a number that "based on the evidence presented," no "trier-of-fact could have come up with." Thus, the trial court's February 27, 2015 judgment will be amended to reflect a reduction equal to the amount awarded by the jury for past medical expenses, $782.43. Moreover, that portion of the judgment awarding defendants a credit in the amount of $782.43 is also stricken from the judgment as that is not the amount stipulated to by the parties as Smith's past medical expenses.
As noted by the trial court at the hearing on Smith's motions for new trial, JNOV, and additur, the facts of this case were somewhat unusual in that Smith waived the collateral source rule and the parties agreed to the amount of the past medical expenses, as well as the dollar-for-dollar credit to be awarded to the defendants for workers' compensation payments in the same amount. The trial court found that was a good indication of the parties' intent to enter into the stipulation and ruled that judicial interest was to be paid after the credits were applied. Based on our review of the record before us, we find no error in this ruling. We note, however, that although the trial court observed as such in its oral reasons for judgment, it did not address this issue in its April 2, 2015 order. Thus, the trial court's February 27, 2015 judgment will be amended, in part, to delete the reference to precredit judicial interest awarded on the past medical expenses and to incorporate the language from the trial court's April 2, 2015 order concerning the stipulated amount of past medical expenses and the credit associated with same.
Were Damages Caused by Babin Expected or Intended
The second issue Shelter presents for our review is that the trial court was manifestly erroneous in its finding that Smith's damages were not expected or intended from the standpoint of Babin. Citing Breland v. Schilling, 550 So.2d 609, 611 (La. 1989) ("The subjective intention and expectation of the insured determine which injuries fall within and which fall beyond the scope of coverage under this policy,") and Great American Ins. Co. v. Gaspard, 608 So.2d 981, 985 (La. 1992) ("The subjective intent of the insured, as well as his reasonable expectations as to the scope of his insurance coverage, will determine whether an act is intentional."), Shelter posits that it is manifest error that the jury would find that Babin intentionally hit Smith with the force testified to by Smith and not expect or intend severe personal injury.
Smith counters that whether Babin subjectively intended to cause the injuries that Smith suffered has relevance only to the issue of coverage. And because Shelter has admitted coverage and paid its policy limits plus interest, Smith submits that this issue is not properly before this court for review. Smith argues further that there is no justiciable issue before the court as Babin (whom Shelter does not represent in this appeal) is liable for the entirety of the judgment, regardless of whether he subjectively intended or expected the results of the impact, We agree with Smith on this issue.
At the start of the December 19, 2014 hearing on Babin's cross-claims against Shelter, counsel for Shelter stated: "Coverage is -- we're not going to be arguing coverage today. ... Shelter has paid its policy limits to the [plaintiff], based upon the trial court's verdict, ... and interest on that as well What we are arguing today is duty to defend."
It is well settled that courts will not decide abstract, hypothetical, or moot controversies, or render advisory opinions with respect to such controversies. Louisiana State Board of Nursing v. Gautreaux, 2009-1758, p. 4 (La. App. 1 Cir. 6/11/10), 39 So.3d 806, 811, writ denied, 2010-1957 (La. 11/5/10), 50 So.3d 806. An issue is moot when a judgment or decree on that issue has been "deprived of practical significance" or "made abstract or purely academic." Thus, a case is moot when a rendered judgment or decree can serve no useful purpose and give no practical relief or effect. Animal Legal Defense Fund v. State, Dept. of Wildlife and Fisheries, 2012-0971, pp. 15-16 (La. App. 1 Cir. 4/25/13), 140 So.3d 8, 19, writ denied, 2013-1565 (La. 10/4/13), 122 So.3d 1025 (quoting Gautreaux, 2009-1758 at 5, 39 So.3d at 811). Accordingly, this assignment of error does not merit any further review.
Smith's Answer to the Appeal
Alleged Evidentiary Error
In his first assignment of error, Smith asserts the trial court committed reversible error by allowing a purported declarations page from Shelter's insurance policy into evidence. He argues that the declaration page was for an effective date outside of the scope of the accident in question. Smith contends further that the paid receipt submitted along with the policy fails to provide any reference to the policy it is associated with or clearly state liability limits and was therefore irrelevant. Smith maintains that not only did his counsel object to the introduction of the Shelter policy, but that the objection was effectively sustained by the trial court when the trial court allowed the introduction of the policy, but advised Shelter that it could supplement the record at a later date with a complete copy of the policy. Shelter responds by arguing that the trial court correctly admitted the policy into evidence as Smith not only failed to object to its introduction, but stipulated that Babin had insurance in place with Shelter at the time of the accident.
Generally, the trial court is granted broad discretion in its evidentiary rulings and its determinations will not be disturbed on appeal absent a clear abuse of that discretion. Wright v. Bennett, 2004-1944, pp. 6-7 (La. App. 1 Cir. 9/28/05), 924 So.2d 178, 183. Additionally, La. Code Evid. art. 103(A) provides, in pertinent part, that "[e]rror may not be predicated upon a ruling which admits or excludes evidence unless a substantial right of the party is affected[.]" The proper inquiry for determining whether a party was prejudiced by a trial court's alleged erroneous ruling on the admission or denial of evidence is whether the alleged error, when compared to the entire record, had a substantial effect on the outcome of the case. If the effect on the outcome is not substantial, reversal is not warranted. A party alleging prejudice by the evidentiary ruling of the trial court bears the burden of so proving. Wright, 2004-1944 at 6, 924 So.2d at 183.
A review of the record from the jury trial reveals that when counsel for Shelter attempted to introduce the copy of its policy, along with the declarations page in question, and a copy of a paid receipt for the policy term July 26, 2001 through October 26, 2001 (hereinafter referred to as "the Shelter policy" for ease of reference), a bench conference ensued during which counsel for Smith stated "I don't have an objection." Rather, he noted his concern that it was "the wrong policy" because Shelter had produced two different policies with two different effective dates. Counsel for Smith went on to add that they "had stipulated to it." The parties ultimately stipulated to the fact that Babin had insurance in place with Shelter at the time of the accident, and the trial court accepted the exhibit, in globo, into evidence with the understanding that counsel for Shelter would be allowed to supplement the record at a later date if necessary.
When this matter reconvened on December 19, 2014, for the bench trial on Babin's cross-claims against Shelter, counsel for Smith reasserted his objection to the introduction of the declarations page of the Shelter policy. Counsel for Smith argued, "We don't have any direct evidence of the policy that was in effect at the time of the accident, which is the relevant policy. So, we would like you to exclude, as you did originally, the policy that was added into evidence and that [counsel for Shelter] was given time to supplement and had not." The trial court entertained arguments on the issue and ruled that because the policy number that appeared on the declarations page was the same policy number that appeared on the renewal, there was a valid policy in effect at the time of the accident.
Initially, we note that contrary to Smith's argument on appeal, the trial court did in fact admit the Shelter policy into evidence during the jury trial phase of this case. The following colloquy illustrates the trial court's intent in this regard:
THE COURT: I am admitting into evidence the effective policy. Just make sure you all know whether or not the terms and conditions are the same and put the proper one into evidence, okay? ...With regard to the supplementation of the record, counsel for Smith made the following statement during his argument to the trial court on December 19, 2014, "And what your honor had ruled was that you would allow [counsel for Shelter] additional time to supplement the record. The next day he comes and says, no, look, we're fine with what we've got." We note that when this issue was originally raised during the jury trial, counsel for Shelter indicated his belief that the Shelter policy being introduced was, in fact, the correct policy. Thus, this becomes a non-issue to this court, as it obviously was to the trial court as well.
[COUNSEL FOR SHELTER]: I believe that this is the correct policy.
THE COURT: All right. I will give you the opportunity, so long -- and I want all counsel to agree before you give it to the court reporter for entry into the record. I will admit the correct one, but you just supplement and make sure all parties agree which one you're working from.
[COUNSEL FOR SHELTER]: So put this one in now?
[COUNSEL FOR PLAINTIFF]: Just wait.
THE COURT: No, no. All you just say is you're asking to admit it. I'll admit it and allow you to supplement with the full, okay?
[COUNSEL FOR SHELTER]: Thank you, judge.
REPORTER'S NOTE: At this time the conference at the bench was concluded.
THE COURT: All right. I'll accept that exhibit into the record. You can supplement the record with her as soon as you have the complete copy with you and all parties agree that it is the complete copy, but I will accept it into evidence[.]
We have considered the respective arguments of the parties and the pertinent documents before us and find no reason to exclude the Shelter policy. As noted by the trial court, the policy number on the declarations page in question, 17-1-4373679-2, is the same policy number that appears on the paid receipt for the renewal for the July 26, 2001 to October 26, 2001 policy period. And although the Policy Form Number, A-256-A, only appears on the declarations page and not on the paid receipt for the renewal, we note that the policy limits are listed on the paid receipt as follows: "A.D. $10,000 [which corresponds to the "Accidental Death" benefits of $10,000 listed on the declarations page], E.R.S. $30 [which corresponds to the "Emergency Road Service" benefits of $30 listed on the declarations page], COLL DED $500 COMP DED $250 LIAB 10/20/10 UM 10/20 [all which correspond to the liability limits listed on the declarations page]." Based on our review of the record as a whole, we cannot find any clear error or abuse of discretion in the trial court's decision to admit the Shelter policy into evidence. This assignment of error is without merit.
Ambiguity of Shelter Policy
In his second assignment of error, Smith argues that the trial court erred in denying his summary judgment and determining that Shelter's policy, as a whole, was clear and unambiguous regarding Shelter's obligation to pay prejudgment judicial interest on the entirety of the judgment. Shelter counters that its policy language concerning judicial interest is clear and enforceable and that the trial court correctly concluded that it was only responsible for prejudgment judicial interest on the $10,000.00 per person policy limits.
As previously noted, this issue was before the trial court in Smith's motion for summary judgment, which was denied by the trial court on December 2, 2014. Generally, an appeal may not be taken from the trial court's denial of a motion for summary judgment. See La. Code Civ. P. art. 968. However, it may be reviewed on an appeal of a final judgment in the suit. Gilchrist Const. Co., L.L.C. v. State, Dept. of Transp. and Development, 2013-2101, p. 7 (La. App. 1 Cir. 3/9/15), 166 So.3d 1045, 1051, writ denied, 2015-0877 (La. 6/30/15), 172 So.3d 1097. When an unrestricted appeal is taken from a final judgment, the appellant is entitled to seek review of all adverse interlocutory rulings, in addition to review of the final judgment. Cajun Constructors, Inc. v. EcoProduct Solutions, LP, 2015-0049, p. 9 (La. App. 1 Cir. 9/18/15), 182 So.3d 149, 155, writ denied, 2015-1908 (La. 11/20/15), 180 So.3d 1287. Therefore, we also consider Smith's argument that the trial court erroneously denied its motion for summary judgment on this issue.
Summary judgments are reviewed on appeal de novo. An appellate court thus asks the same questions as does the trial court in determining whether summary judgment is appropriate: whether there is any genuine issue of material fact, and whether the mover-appellant is entitled to judgment as a matter of law, Jones v. Clesi Foundations, L.L.C., 2015-0157, p. 4 (La. App. 1 Cir. 11/3/15), 183 So.3d 532, 534.
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. See La. Civ. Code art. 2046; Sova v. Cove Homeowner's Ass'n, Inc., 2011-2220, p. 5 (La. App. 1 Cir. 9/7/12), 102 So.3d 863, 867. Unless the words of the policy have acquired a technical meaning, they are to be construed using their plain, ordinary, and generally prevailing meaning. See La. Civ. Code art. 2047; Bennett v. Ragon, 2004-0706, p. 6 (La. App. 1 Cir. 3/24/05), 907 So.2d 116, 120.
The Shelter policy provides as follows with regard to pre- and postjudgment interest:
ADDITIONAL PAYMENTS
In addition to our limits of liability, we will pay for an insured, under these coverages, the following costs and expenses resulting from such accident:
(1) All costs we incur in the settlement of any claim or the defense of any suit;
(2) Court costs in a suit for damages;
(3) Interest on damages owed by the insured due to a judgment and accruing:
(a) after the judgment, and until we pay, offer or deposit in court, the amount due under this coverage; or
(b) before the judgment, when owned [sic] by law, but only on that part of the judgment we pay.
In ruling on the summary judgment below, the trial court considered lengthy arguments from counsel and the policy language as it pertained to judicial interest. The trial court ultimately ruled that because the language concerning postjudgment interest was ambiguous, the ambiguity would inure to the benefit of the insured. However, the trial court concluded that the language regarding prejudgment interest was not ambiguous. In its December 2, 2014 judgment, the trial court granted Smith's summary judgment in part, finding that Shelter's policy obligated it to pay prejudgment interest only on its per-person $10,000.00 policy limits, running from the date of judicial demand against Babin in the original petition filed on August 9, 2002, until the date of final judgment. The trial court further ordered that Shelter was obligated to pay postjudgment interest on the total judgment amount against Babin after the time of judgment until such time that Shelter pays, offers, or deposits in the court, the per-person $10,000.00 policy limits. The trial court denied Smith's summary judgment in part, concluding that Shelter's policy did not obligate it to pay prejudgment interest on the total judgment amount against Babin.
Considering the above provisions of the Shelter policy, as well as our review of the policy in its entirety, we agree with the trial court's denial, in part, of Smith's summary judgment and limiting prejudgment judicial interest to the $10,000.00 per person policy limits. This assignment of error has no merit.
Babin's Answer to the Appeal
Duty to Defend
Babin argues on appeal that under Louisiana law, Shelter owed him a duty to defend and was arbitrary and capricious in its failure and/or refusal to defend and/or indemnify him in the instant litigation. Babin cites to the "eight-corners" rule as support for his position that Shelter was under an obligation to defend him. Shelter responds, arguing that the trial court was correct in determining that based on Smith's alleged facts indicating an intentional hit, Shelter was under no duty to defend Babin in this case.
North American Treatment Systems, Inc. v. Scottsdale Ins. Co., 2005-0081, p. 21 (La. App. 1 Cir. 8/23/06), 943 So.2d 429, 443-444, writs denied, 2006-2918, 2006-2803 (La. 2/16/07), 949 So.2d 423, 424 (The issue of whether a liability insurer has the duty to defend a civil action against its insured is determined by application of the "eight-corners rule," under which an insurer must look to the "four corners" of the plaintiff's petition and the "four corners" of its policy to determine whether it owes that duty.). --------
As with Smith's argument regarding the ambiguity of Shelter's policy, these issues were previously considered by the trial court in a motion for summary judgment. Judgment denying same was signed by the trial court on May 21, 2014. Nonetheless, we will consider these issues in our review of the merits of the final judgment of this case. See La. Code Civ. P. art. 968; see also Gilchrist Const Co., L.L.C., 2013-2101 at 7, 166 So.3d at 1051; Cajun Constructors, Inc., 2015-0049 at 9, 182 So.3d at 155.
In denying Babin's motion for summary judgment on the duty to defend issue, the trial court gave the following oral reasons for judgment:
When I reviewed the petition, the petition itself clearly sounds [in] intentional torts not negligence. It lays out an intentional tort, intentional actions are an exclusion of the policy. They properly rejected coverage, if there was no coverage there's no duty to defend. Therefore, there was not a duty to defend based upon the ... four corners of the policy and what was set forth in the petition. It's a clear intentional tort sounding petition.
Similarly, in denying Babin's cross-claims against Shelter, the trial court maintained its position that Smith consistently alleged facts indicating an intentional act:
[T]his is a fact pleading state. When I read the four corners of the petition and the facts that are alleged, and I read the policy, clearly and unambiguously intentional acts are the facts that are being alleged. At the time the decision was made, there was no duty to defend. There was no coverage. The fact that the defendant later changed his tune for purposes of the jury, and this -- this is one of those cases where bad facts make bad law. You got somebody who tried to recover one way, couldn't do it, so when it got in front of a jury, changed his story. All of the allegations are intentional acts. Intended intentional acts. Shelter was not arbitrary, capricious, or in any way in bad faith in making its decision that it did not have coverage, nor did it have a duty to defend.
Again, bad facts make bad law. Were I to rule any other way, it would allow anybody to change their position when they lost on their original pleading of facts, to come into court, change their story in front of a different trier of fact, and recover. It would not be just. It would not be fair. It would put insurance companies in a position where they could never look at a petition and make a decision as to whether they have coverage or a duty to defend, because they would always have to have coverage, always have to have a duty to defend, until the final resolution before a jury, no matter how many times the story changed.
And in this particular case, the court looks at the petition, looks at the policy, looks at the actions taken by the insurance company at the time presented to them, and not what this court believes is some fabricated story told to the jury -- in front of a jury for purposes to gain recovery when he couldn't gain recovery on his initial facts.
There was no arbitrary and capricious action, there was no failure in any part of the duties of the insurer. The four corners of the petition and in the policy clearly were met. They were within their right to deny coverage and deny counsel and representation. And that's the ruling of the court.
According to the record, when Smith filed his original petition against Babin and the City/Parish on August 9, 2002, he alleged he was struck by a vehicle driven by Babin and that the "cause of [his] injury was due to an intentional act" of Babin while he was in the course and scope of his employment with the City/Parish. Smith alleged further that the City/Parish was liable to him for the injuries he sustained caused by the intentional acts of its employee, Babin, and that Babin had previously engaged in a pattern of harassment of him in violation of the Louisiana Employment Discrimination Law, La. R.S. 23:301, et seq.
On August 8, 2003, Smith filed a first amending and supplemental petition, naming State Farm as his uninsured/underinsured carrier and alleging that State Farm acted arbitrarily, capriciously, and without probable cause in handling his claim. However, Smith stated that "[a]ll remaining allegations of the original petition are reiterated and realleged herein." It was not until June 26, 2008, when Smith filed a second amending and supplemental petition adding Shelter as a defendant, that negligence was added as an alternative theory of recovery in this case. Smith alleged, in the alternative, that his damages were due to "the fault and negligent acts of [Babin] for failing to keep proper lookout, failure to properly control his vehicle, failing to see what he should have seen and other acts of negligence to be shown at a trial in this matter." Based on our review of the record and the applicable jurisprudence, we find no error in the trial court's ruling on this issue. Despite the use of the word "negligent" in the June 26, 2008 petition, Smith clearly alleged intentional, not negligent, acts by Babin. Thus, based on the facts and circumstances herein, Shelter was under no duty to defend Babin.
CONCLUSION
For the above and foregoing reasons, the February 27, 2015 judgment of the trial court is amended, in part, to provide as follows:
IT IS HEREBY ORDERED, ADJUDGED AND DECREED that judgment be rendered in favor of plaintiff and against defendants, Paul Babin and Shelter Mutual Insurance Company, who are jointly and in solido liable subject to the policy limits of the policy of insurance, in the amount of Five Hundred and Forty-Two thousand Nine Hundred dollars ($542,900.00) together with legal interest from the date of the filing of the petition for damages as well as Four Thousand Three Hundred and Thirty-Three dollars and 60/100 ($4,332.60) in costs payable to Bradley Smith as well as any and all costs of court due the East Baton Rouge Clerk of Court.In all other respects, the judgment is affirmed. All costs associated with this appeal are divided equally amongst the parties, Shelter Mutual Insurance Company, Bradley W. Smith, and Paul Babin.
IT IS FURTHER ORDERED that an additur is granted in favor of plaintiff, Bradley Smith, and against defendants, Paul Babin and Shelter Mutual Insurance Company, in the amount of Three Hundred and Thirty-Eight thousand Five Hundred and Fifty-Six dollars and 27/100 ($338,556.27), same being the amount stipulated to by the parties as the past medical expenses incurred by plaintiff, Bradley Smith.
IT IS FURTHER ORDERED that pursuant to the pretrial stipulation of the parties, the defendants, Shelter Mutual Insurance Company and Paul Babin, shall be entitled to a credit for workers' compensation payments in the amount of Three Hundred and Thirty-Eight thousand Five Hundred and Fifty-Six dollars and 27/100 ($338,556.27).