Argonaut Insurance Company v. Atlantic Specialty Insurance Company

Filing 35

ORDER AND REASONS granting 17 Motion for Summary Judgment. Plaintiff's claims are dismissed with prejudice. Signed by Judge Lance M Africk on 05/09/2022. (ko)

Case 2:21-cv-01602-LMA-MBN Document 35 Filed 05/09/22 Page 1 of 13

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
ARGONAUT INSURANCE COMPANY

CIVIL ACTION

VERSUS

No. 21-1602

ATLANTIC SPECIALTY INSURANCE
COMPANY

SECTION I

ORDER & REASONS
Before the Court is a motion1 for summary judgment filed by defendant
Atlantic Specialty Insurance Company (“ASIC”). Plaintiff Argonaut Insurance
Company (“Argonaut”) opposes 2 the motion. ASIC filed a reply. 3 For the reasons that
follow, the Court will grant the motion and enter judgment in favor of ASIC.
I. BACKGROUND
A. February 22, 2019 Collision
This action arises out of a 2019 vehicular collision in New Orleans, Louisiana,
and an ensuing tort action (“the underlying lawsuit”) brought in Orleans Parish Civil
District Court. 4 The undisputed facts 5 are as follows: On February 22, 2019, Darrell
Esnault (“Esnault”), a commercial truck driver, was operating a 2005 Freightliner,
unit number TG27 (the “truck”), which was leased by Double S Transportation, LLC

R. Doc. No. 17.
R. Doc. No. 19.
3 R. Doc. No. 22.
4 R. Doc. No. 17-4.
5 R. Doc. No. 17-2 (joint stipulation).
1
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(“Double S”) to Triple G Express, Inc. (“Triple G”). 6 Esnault delivered his final load of
the day to the Norfolk Southern Railroad Terminal, located at 2900 Florida Avenue,
New Orleans, Louisiana. 7 He departed the terminal at approximately 3:50 p.m.,
“bobtailing” the tractor of the truck—meaning that he was driving the tractor without
a trailer attached to it. 8
Esnault then traveled toward a Save-A-Lot grocery store located at the
intersection of Paris Avenue and Mirabeau Avenue. 9 On the way, Esnault saw a
friend on Paris Avenue, stopped for approximately five minutes, exited his vehicle,
and spoke with his friend. 10 Thereafter, Esnault returned to his vehicle and continued
traveling north on Paris Avenue towards the Save-A-Lot. 11 As Esnault drew closer to
Save-A-Lot, he realized that he did not have enough cash to make his contemplated
purchases, so he turned around and headed south on Paris Avenue towards Gentilly
Boulevard “to go to his residence,” where the truck is normally garaged. 12 Esnault
reached the intersection of Paris Avenue and Gentilly Boulevard, which is
approximately three to four blocks away from his residence. 13 “Then, Esnault turned
right on Gentilly Boulevard to go to his residence, but before he got to his residence,
he contemplated [purchasing cigarettes at] a Shell Station or a nearby convenience
Id. at 1 ¶ 1.
Id. at 2 ¶ 7.
8 Id.; see also R. Doc. No. 17-9, at 6 (defining “bobtailing”).
9 R. Doc. No. 17-2, at 2 ¶ 8.
10 Id. at 2 ¶ 9.
11 Id. at 2 ¶ 10.
12 Id. at 2 ¶¶ 11–13; R. Doc. No. 17-3, at 4 ¶ 19; R. Doc. No. 19-1, at 2 ¶ 19.
13 R. Doc. No. 17-2, at 2 ¶ 12.
6
7

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store located near the corner of Paris Avenue and Gentilly Boulevard, which would
have required another U-turn in the opposite direction of his residence.” 14
As Esnault started to turn left from the outer lane to the left lane at the
intersection of Gentilly Boulevard and Republic Street, in order to make the U-turn,
a Nissan Altima, driven by Christian Davis (“Davis”), collided with the left side of the
truck. 15 The accident occurred approximately 22 minutes after Esnault departed from
the Norfolk Southern Railroad Terminal. 16 “If the accident had not occurred, Esnault
would have eventually returned to his residence located at 2346 Gentilly Boulevard,
New Orleans, Louisiana, and garaged his truck.” 17
B. Insurance Policies
At the time of the accident, Argonaut had issued Commercial Auto Policy
Number AVT 100003600 to Triple G, which provided Motor Carrier Coverage in the
amount of $1,000,000. 18 Additionally, ASIC had issued a policy to Triple G, which
includes Non-Trucking Liability coverage (“the NTL policy”), the scope of which is
specified in the policy’s Section One. 19 The policy limit for Section One is $500,000. 20

R. Doc. No. 17-2, at 2 ¶ 13. Both parties have stipulated to the fact that Esnault
intended to purchase cigarettes at the Shell station or convenience store.
R. Doc. No. 33.
15 Id. at 3 ¶ 14.
16 Id. at 3 ¶ 15.
17 Id. at 3 ¶ 16.
18 R. Doc. No. 19, at 2.
19 R. Doc. No. 17, at 6.
20 Id.
14

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The NTL policy states that Section One “only applies to Losses that occur . . .
when a Covered Truck is Non-Trucking.” 21 The policy states that a truck is “NonTrucking” when it “is subject to an active Permanent Lease with a government
regulated Motor Carrier and is either Bobtail or Deadhead and is operating solely
for personal use unrelated to the business of the Motor Carrier.” 22 The policy
further provides that a truck is “not Non-Trucking” when it is “returning to the
Truck’s Primary Garage Location subsequent to delivering a load[.]” 23 The
“Primary Garage Location” is “the home parking base for a Truck or the terminal
from which the Truck customarily obtains hauling assignments.” 24
C. Ensuing Litigation
In the underlying lawsuit, Davis named Argonaut, ASIC, Esnault, Double S,
and Triple G as defendants. 25 Davis’s state court petition stated that “at all material
times . . . [Esnault] was on a mission and/or errand for [Triple G] and/or [Double S]
on the date of this accident[.]” 26 Argonaut provided a defense to Esnault, Triple G,
and Double S, and settled Davis’s claims as to those defendants for $750,000. 27 The
order of dismissal, executed in January 2021 as a result of the settlement, stated that
Davis “retains all claims and rights . . . against Atlantic Specialty Insurance
R. Doc. No. 17-9, at 9 (emphasis in original).
22 Id. at 6 (emphasis in original). The parties do not dispute that the truck was subject
to an active permanent lease with a government regulated motor carrier.
23 Id. at 6–7.
24 Id. at 7.
25 R. Doc. No. 17-3, at 1.
26 R. Doc. No. 17-4, at 3 ¶ VI.
27 R. Doc. No. 19-1, at 1.
21

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Company.” 28 Davis assigned all of his remaining rights to Argonaut. 29 An order of
dismissal as to all remaining defendants was executed on February 22, 2022. 30
Argonaut filed the above-captioned action in this Court, seeking damages from
ASIC. 31 Argonaut argues that ASIC’s NTL policy covered the collision and, therefore,
that ASIC should have been the primary insurer in settling Davis’s claims. 32
Argonaut argues that ASIC had a duty to provide coverage and to defend Esnault and
Triple G in the underlying lawsuit. 33 Argonaut argues that it has the right to recover
$500,000 from ASIC—in other words, the maximum limit under ASIC’s policy. 34
Additionally, Argonaut argues that it is entitled to recover special damages in the
amount of $30,384.95 for the cost of defending the underlying lawsuit. 35
In the instant motion for summary judgment, ASIC argues that its NTL policy
did not cover the collision at issue and that Argonaut is not entitled to recover any
damages from ASIC in connection with the underlying settlement. ASIC also submits
that, even if the NTL policy covered the collision, ASIC did not have a duty to defend
in the underlying lawsuit, and that Argonaut has no basis to seek contribution from
ASIC, whether directly or through subrogation of Davis’s claims. 36

R. Doc. No. 17-8.
29 R. Doc. No. 17-7, at 5.
30 R. Doc. No. 19-3.
31 R. Doc. No. 1, at 6 ¶ 17.
32 Id. at 4 ¶ 11, 6 ¶ 17.
33 Id. at 6 ¶ 17.
34 Id. at 5 ¶ 15.
35 Id. at 6 ¶ 17.
36 R. Doc. No. 17-1, at 10–12, 19–21.
28

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II. STANDARD OF LAW
Summary judgment is proper when, after reviewing the pleadings, the
discovery and disclosure materials on file, and any affidavits, the court determines
that there is no genuine dispute of material fact and that the movant is entitled to
judgment as a matter of law. See Fed. R. Civ. P. 56. “[A] party seeking summary
judgment always bears the initial responsibility of informing the district court of the
basis for its motion, and identifying those portions of [the record] which it believes
demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett,
477 U.S. 317, 323 (1986). The party seeking summary judgment need not produce
evidence negating the existence of a material fact, but need only point out the absence
of evidence supporting the other party’s case. Id.; Fontenot v. Upjohn Co., 780 F.2d
1190, 1195 (5th Cir. 1986).
Once the party seeking summary judgment carries its burden, the nonmoving
party must come forward with specific facts showing that there is a genuine dispute
of material fact for trial. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S.
574, 587 (1986). The showing of a genuine issue is not satisfied by creating “‘some
metaphysical doubt as to the material facts,’ by ‘conclusory allegations,’ by
‘unsubstantiated assertions,’ or by only a ‘scintilla’ of evidence.” Little v. Liquid Air
Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (citations omitted). Instead, a genuine issue
of material fact exists when the “evidence is such that a reasonable jury could return
a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986). “Although the substance or content of the evidence submitted to support or
dispute a fact on summary judgment must be admissible . . . . the material may be
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presented in a form that would not, in itself, be admissible at trial.” Lee v. Offshore
Logistical & Transp., LLC, 859 F.3d 353, 355 (5th Cir. 2017) (quotation omitted).
The party responding to the motion for summary judgment may not rest upon
the pleadings but must identify specific facts that establish a genuine
issue. Anderson, 477 U.S. at 248. The nonmoving party’s evidence, however, “is to be
believed, and all justifiable inferences are to be drawn in [the nonmoving party’s]
favor.” Id. at 255; see also Hunt v. Cromartie, 526 U.S. 541, 552 (1999).
III. LAW AND ANALYSIS
“The interpretation of an insurance contract presents a question of law, rather
than fact, and therefore is an appropriate matter for determination by summary
judgment.” Martco Ltd. P’ship v. Wellons, Inc., 588 F.3d 864, 878 (5th Cir. 2009)
(citations omitted). “Louisiana law provides that an insurance policy is a contract
between the parties and should be construed using the general rules of contract
interpretations set forth in the Louisiana Civil Code.” First Am. Bank v. First Am.
Transp. Title Ins. Co., 585 F.3d 833, 837 (5th Cir. 2009). “The role of the judiciary in
interpreting an insurance contract is to ascertain the common intent of the insured
and insurer as reflected by the words of the policy.” Gorman v. City of Opelousas, 148
So. 3d 888, 892 (La. 2014) (quoting Peterson v. Schimeck, 729 So. 2d 1024, 1028 (La.
1991)). “When the words of an insurance contract are clear, explicit and lead to no
absurd consequences, courts must enforce the contract as written and make no
further interpretation in search of the parties’ intent.” Id. (quoting Peterson, 729 So.
2d at 1028); see also La. Civ. Code. art 2046.

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“Ambiguous policy provisions are generally construed against the insurer and
in favor of coverage.” Cadwallader v. Allstate Ins. Co., 848 So. 2d 577, 580 (La.
2003). “Under this rule of strict construction, equivocal provisions seeking to narrow
an insurer’s obligation are strictly construed against the insurer.” Id. However, this
principle “applies only if the ambiguous policy provision is susceptible to two or
more reasonable interpretations.” Id. (emphasis in original). “An insurance policy
should not be interpreted in an unreasonable or strained manner so as to enlarge or
to restrict its provision beyond what is reasonably contemplated by its terms or so as
to achieve an absurd conclusion.” Lodwick, LLC v. Chevron U.S.A., Inc., 126 So. 3d
544, 549–50 (La. App. 2 Cir. 2013). “Likewise, a court should not strain to find
ambiguity in a policy where none exists.” Id.
ASIC contends that, because “Esnault was returning from dropping off a load
at the time of this accident, and would not have even been operating the Truck at all
had it not been for the delivery he had been obligated to make, it is clear that he was
not operating the subject Truck solely for personal use at the time the accident
occurred, such that the underlying claim is properly excluded from coverage under
this general definition alone.” 37
Argonaut states that it is “is not taking the position that any ‘route deviation’
. . . would have triggered ASIC’s Non-Trucking coverage” and suggests, for instance,
that stopping to purchase gas or to use the restroom would not be considered “non-

37

R. Doc. No. 17-1, at 13 (emphasis in original).
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trucking.” 38 However, Argonaut submits that stopping to “purchase groceries or
cigarettes” is “purely . . . personal” in nature, such that the driver would be considered
to be “non-trucking.” 39 Argonaut also emphasizes the fact that Esnault needed to
make a U-turn and travel away from his residence in order to complete his
contemplated stop at a nearby Shell station or convenience store.
First, the Court looks to the term “Non-Trucking,” which is defined, in relevant
part, as when a truck is “operating solely for personal use unrelated to the business
of the Motor Carrier.” 40 The inclusion of the term “solely” in this definition is
significant, because it indicates that the policy contemplates that a truck may
simultaneously be put to both business and personal use. Additionally, the relevant
coverage exception, which applies when the truck is “returning to the Truck’s Primary
Garage subsequent to delivering a load,” 41 does not state that the return trip must be
the most direct route possible, nor does it explicitly preclude drivers from making
brief stops or detours along the way.
The caselaw on this issue, although sparse, supports the interpretation that
minor personal detours do not render a truck to be “non-trucking.” For instance, in
Great West Casualty Insurance Co. v. Burns, 2020 WL 2776495 (M.D. Ga. May 28,
2020), the court considered the same ASIC Non-Trucking policy in a context that
bears some factual similarities to the instant case. The court concluded that if a truck

R. Doc. No. 19, at 6.
39 Id.
40 R. Doc. No. 17-9, at 6.
41 Id. at 7.
38

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driver made a “personal errand to grab food” while he was en route to pick up a load,
this would “not change the essential nature of his trip.” Id. at *8. Such a stop would
be a “minor personal detour,” which “would not have altered the reason he was
operating his tractor that morning, which was to further [his carrier’s] commercial
interests by picking up a load[.]” Id. 42 See also, e.g., Forkwar v. Empire Fire & Marine
Ins. Co., 487 F. App’x 775, 780 (4th Cir. 2012) (concluding that a “business use”
exception applied, despite the fact that the truck driver stopped for a meal on his way
to pick up a load that he had been tasked with retrieving). The parties have not
provided, nor is the Court aware of, any cases in which a court has concluded that a
short personal detour effectively rendered the driver to be “non-trucking.”
Argonaut points to the fact that the General Policy Definitions section of the
policy defines the term “Route Deviation” as

meaning “a deviation from the

customary business route to pursue personal interests,” 43 and asserts that this term
must be read in harmony with the relevant exception to the Non-Trucking coverage. 44
However, as ASIC notes, “none of the relevant policy provisions at issue in this case
make use of the defined term ‘Route Deviation’ or otherwise indicate that they are

Ultimately, evidence in the record conflicted with the driver’s testimony that he
intended to make a brief detour for a meal. Burns, 2020 WL 2776495, at *8–9.
Because there were genuine disputes of material fact as to the driver’s intended
destination, among other things, the court denied the motion for summary judgment.
Id. at *9. No such factual disputes exist in this action because the parties have jointly
stipulated that Esnault intended to get cigarettes at a nearby gas station or
convenience store prior to the collision. See supra n.14.
43 R. Doc. No. 17-9, at 7.
44 R. Doc. No. 19, at 6.
42

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made subject to that term in any way.” 45 Additionally, ASIC persuasively asserts that
“[t]he fact that the return trip provision does not reference Route Deviations hurts
rather than helps Argonaut’s argument” because “[t]he provision could have
specifically excepted Route Deviations from its scope but plainly does not.” 46
“That ‘contractual language may, on occasion, pose difficult factual
applications . . .’ and that the parties disagree as to coverage, does not
create ambiguity.” Mahaffey v. Gen. Sec. Ins. Co., 543 F.3d 738, 741 (5th Cir. 2008)
(quoting Empire Fire & Marine Ins. Co. v. Brantley Trucking, Inc., 220 F.3d 679, 681
(5th Cir. 2000)). The Court concludes that the language of the NTL policy is
unambiguous, and that the NTL policy does not cover the collision at issue in this
action. However, to the extent that the policy might be deemed ambiguous, the Court
also concludes that Argonaut’s proffered interpretation is unreasonable.
Specifically, it would be unreasonable to interpret the policy as preventing
drivers from making brief stops or detours to tend to basic personal needs. For
instance, it would be difficult to believe that the NTL policy would preclude a driver
from stopping to use the restroom. Similarly, it would be difficult to believe that the
policy would preclude a driver experiencing drowsiness from stopping for coffee or to
stretch his legs. Argonaut, for its part, at least concedes that stopping for gas or to
use the restroom would not render the driver “non-trucking,” but maintains that
stopping for groceries or cigarettes is purely personal in nature, and would render the

45
46

R. Doc. No. 22, at 6.
Id. at 6–7.
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driver “non-trucking.” 47 However, the text of the policy provides no basis for drawing
such distinctions. While stopping for gas is perhaps an example of a detour that could
be described as solely for business purposes, any other kind of detour—including a
stop to use the restroom, or to get coffee or food—could be characterized as at least
partially personal in nature. The Court concludes that it would be unreasonable to
read the NTL policy as precluding stops or detours of any kind whatsoever, and
further concludes that it would be unreasonable to read Argonaut’s proposed
distinctions into the policy.
Argonaut also cautions that, “[i]n essence, ASIC’s position is that until Esnault
returned home, he was not Non-Trucking, no matter what he was doing or where he
was going.” 48 The Court does not believe that such an extreme implication flows from
its interpretation of the policy. Future cases may present factual scenarios that test
the outer boundaries of the NTL policy, but the instant case does not. The collision
occurred approximately 22 minutes from the time that Esnault left the Norfolk
Southern Railroad Terminal. 49 While Esnault did not take the most direct route home
after dropping off his last load of the day, he also did not stray far from the route. He
briefly drove towards a grocery store, before realizing that he did not have sufficient
cash and drove towards his residence. 50 He stopped for five minutes to talk with a

R. Doc. No. 19, at 6.
48 Id. at 4.
49 R. Doc. No. 17-2, at 2 ¶ 12.
50 Id. at 2 ¶¶ 8, 10, 11.
47

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friend whom he saw on the street. 51 His subsequently-contemplated trip to a nearby
gas station or convenience store, while requiring him to drive in the opposite direction
of his residence, would have taken him approximately three to four blocks away from
his residence, at most. 52 The Court concludes, in light of the limited purpose, distance,
and duration of Esnault’s attempted detour, that the truck was not being operated
solely for personal use at the time of the collision.
In sum, the Court concludes that the NTL policy is unambiguous. However, to
the extent that the NTL policy could be deemed ambiguous, Argonaut’s proposed
interpretation is unreasonable. Cadwallader, 848 So. 2d at 580. The Court therefore
concludes that the NTL policy did not apply at the time of the collision. Having so
concluded, the Court declines to reach the parties’ arguments as to ASIC’s duty to
defend and contribution. Accordingly,
IT IS ORDERED that the motion for summary judgment is GRANTED and
that plaintiff’s claims are DISMISSED WITH PREJUDICE.
New Orleans, Louisiana, May 9, 2022.

_______________________________________
LANCE M. AFRICK
UNITED STATES DISTRICT JUDGE

Id. at 2 ¶ 9.
Id. at 2 ¶ 12. The Court does not deem the fact that Esnault’s contemplated detour
required him to drive in the opposite direction of his primary garage to be dispositive.
Detours, by definition, require the driver to depart from the most direct route to some
degree. Whether the detour entails a U-turn or, for instance, exiting a highway to
drive to a nearby gas station, is of little import. The purpose, distance, and duration
of the detour bear more relevance to the inquiry.
51
52

13