Guideone America Insurance Company v. Parker et al
Filing
31
MEMORANDUM OPINION re 30 Order on Motion for Summary Judgment. Signed by Senior Judge Glen H. Davidson on 5/22/14. (rel)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF MISSISSIPPI
ABERDEEN DIVISION
GUIDEONE AMERICA INSURANCE COMPANY
v.
PLAINTIFF
CIVIL ACTION NO.1: 13-cv-00005-GHD-DAS
STEVE PARKER, LISA PARKER, and
MELISSA HILL PARKER
DEFENDANTS
MEMORANDUM OPINION GRANTING
PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT
Presently before the Court in this declaratory judgment action is a motion for summary
judgment [22] filed by Plaintiff Guideone America Insurance Company.
Upon due
consideration, the Court finds that the motion should be granted.
A. Factual and Procedural Background
This case involves a question of insurance coverage, and in particular, whether a certain
policy of personal automobile liability insurance issued by Plaintiff Guideone America Insurance
Company ("Plaintiff') to Defendant Steve Parker ("Mr. Parker") and his wife, Defendant Lisa
Parker ("Mrs. Parker"), extends coverage to their daughter, Defendant Melissa Hill Parker
("Melissa Parker") for liability in connection with an accident that occurred during the effective
dates of the policy, but in an automobile not listed on the policy and insured in a separate policy.
Prior to the accident, Plaintiff had issued an insurance policy, Policy Number 060131-484,
to named insured, Mr. and Mrs. Parker, covering their 2009 Ford Escape LTD and 1997 GMC
Sierra 1500 pickup truck (the "subject policy"). See Pl.'s Compl. [1] ~ 7; Defs.' Answer [11] ~ 7.
Plaintiff had also issued a separate insurance policy to Melissa Parker, covering her 2006 Honda
1
Ridgeline truck (the "policy which is not at issue"). P1.'s Compl. [1] ~ 17; Defs.' Answer [11] ~
17.
On June 11, 2011, Melissa Parker was driving her 2006 Honda Ridgeline truck when she
was involved in a single-vehicle accident in Lee County, Mississippi; her front-seat passenger,
Eddie Rayburn Collums, Jr. (the "Decedent"), died from injuries he sustained in the accident.
Following the accident, the Decedent's estate filed a wrongful death suit in state court against
Melissa Parker and John Does 1-10 seeking damages due to the accident. The Decedent's
wrongful death beneficiaries have made a demand upon Plaintiff for coverage under the subject
policy, and Melissa Parker has also made a demand for settlement of the claim of the Decedent's
estate under the subject policy.
Plaintiff has filed this action seeking a declaratory judgment that there is no coverage under
the subject policy for the 2006 Honda Ridgeline truck, which was owned and operated by Melissa
Hill Parker at the time of the accident leading to Decedent's death, and consequently, that Plaintiff
has no duty to defend or indemnify Mrs. Parker against the wrongful death claims brought by
Decedent's estate related to the accident.
Plaintiff now moves for summary judgment, arguing that the subject policy clearly,
unambiguously, and enforceably excludes coverage for the subject accident. Defendants have
responded to the motion, and Plaintiff has filed a reply. The matter is now ripe for review.
B. Summary Judgment Standard
Summary judgment "should be rendered if the pleadings, the discovery and disclosure
materials on file, and any affidavits show that there is no genuine dispute as to any material fact
and that the movant is entitled to judgment as a matter oflaw." Celotex Corp. v. Catrett, 477 U.S.
2
317,322,106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986). See FED. R. CIV. P. 56(a); Weaver v. CCA
Indus., Inc., 529 F.3d 335, 339 (5th Cir. 2008). The rule "mandates the entry of summary
judgment, after adequate time for discovery and upon motion, against a party who fails to make a
sufficient showing to establish the existence of an element essential to that party's case, and on
which that party will bear the burden of proof at triaL" Celotex Corp., 477 U.S. at 322, 106 S. Ct.
2548.
The party moving for summary judgment bears the initial responsibility of informing the
court of the basis for its motion and identifying those portions ofthe record it believes demonstrate
the absence of a genuine dispute of material fact. Id. at 323, 106 S. Ct. 2548. Under Rule 56(a),
the burden then shifts to the nonmovant to "go beyond the pleadings and by ... affidavits, or by the
'depositions, answers to interrogatories, and admissions on file,' designate 'specific facts showing
that there is a genuine issue for triaL'" Id. at 324, 106 S. Ct. 2548; Littlefield v. Forney Indep.
Sch. Dist., 268 F.3d 275,282 (5th Cir. 2001); Willis v. Roche Biomedical Labs., Inc., 61 F.3d 3l3,
315 (5th Cir. 1995). "In deciding whether a fact issue has been created, the court must view the
facts and the inferences to be drawn therefrom in the light most favorable to the nonmoving party."
Daniels v. City ofArlington, Tex., 246 F.3d 500, 502 (5th Cir. 20Ot).
C. Discussion and Analysis
"When, as here, jurisdiction is based on diversity, I we apply the forum state's substantive
law." Bayle v. Allstate Ins. Co., 615 F.3d 350, 355 (5th Cir. 2010). It is undisputed in this case
that Mississippi is the forum state, and Mississippi law applies.
"Under Mississippi law, an insurance policy is a contract subject to the general rules of
I There is complete diversity of citizenship: Plaintiff is a citizen of Iowa, and Defendants are each citizens
of Mississippi. See PI.'s Compl. [1],-m 1-4. The amount in controversy exceeds the sum of $75,000 exclusive of
interest and costs. ld. "i]5; Defs.' Answer [11] "i]5. Thus, diversity jurisdiction is established.
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contract interpretation." Essex Ins. Co. v. Greenville Convalescent Home Inc., 236 F. App'x 49,
51 (5th Cir. 2007) (per curiam) (citing Clark v. State Farm Mut. Auto. Ins. Co., 725 So. 2d 779,
781 (Miss. 1998». Under Mississippi law, an insurer has an absolute duty to defend a lawsuit
filed against its insured in circumstances covered by the policy. Titan Indem. Co. v. City of
Brandon, 27 F. Supp. 3d 693, 697 (S.D. Miss. 1997) (citing State Farm Mut. Auto. Ins. Co. v.
Taylor, 233 So. 2d 805, 808 (Miss. 1970); So. Farm Bureau Cas. Ins. Co. v. Logan, 119 So. 2d
268, 270-71 (Miss. 1960». The detennination of whether a liability carrier has a duty to defend
depends on the policy language and the allegations of the applicable complaint. QBE Ins. Corp.
v. Brown & Mitchell, Inc., 591 F.3d 439, 443 (5th Cir. 2009) (citing U.S. Fid. & Guar. Co. v.
Omnibank, 812 So. 2d 196, 200 (Miss. 2002». Under this "eight-comers" test, the allegations in
the complaint are analyzed against the language in the policy to determine coverage and the duty to
defend. Id. If the complaint alleges facts which are arguably within the policy's coverage, a
duty to defend arises. Id.; see Sennett v. U.s. Fid. & Guar. Co., 757 So. 2d 206, 212 (Miss. 2000)
("A liability insurance company has an absolute duty to defend a complaint which contains
allegations covered by the language of the policy, but it has absolutely no duty to defend those
claims which fall outside the coverage of the policy.").
Plaintiff argues that the subject policy excludes liability coverage for damages arising from
the accident involving Melissa Parker's 2006 Honda Ridgeline truck. The subject policy contains
a Liability Coverage provision stating:
[Plaintiff] will pay damages for "bodily injury" or "property
damage" for which any "insured" becomes legally responsible
because of an auto accident. . .. [Plaintiff] will settle or defend, as
[it] consider[s] appropriate, any claim or suit asking for these
damages. In addition to [its] limit of liability, [Plaintiff] will pay
all defense costs [it] incur[s]. . .. [Plaintiff has] no duty to defend
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any suit or settle any claim for "bodily injury" or "property damage"
not covered under this policy.
Subject Policy [22-1] at 7-8. Plaintiff maintains that the subject policy's exclusions bar coverage
for-and thus relieve Plaintiff of a duty to defend against-the wrongful death claims brought
against Mrs. Parker in state court.
Defendants argue that the exclusions do not bar coverage because the policy is ambiguous
and the exclusionary clause should be construed strictly against Plaintiff Defendants maintain
that the subject policy expressly lists Melissa Parker simultaneously as a "driver" and an "insured"
entitled to coverage and that "[t]he inconsistent exclusion should be construed against Plaintiff and
in favor of finding liability coverage." Defs.' Resp. Opp'n to PI. 's MSJ [26] ,-r 2. Alternatively,
Defendants argue that Plaintiff has failed to establish the applicability ofthe exclusionary clause.
"Where an insurance policy is clear and unambiguous, the meaning and effect of the
policy is a question of law." Essex Ins. Co., 236 F. App'x at 51 (citing Love by Smith v.
McDonough, 758 F. Supp. 397, 399 (S.D. Miss. 1991)).
"[T]he policy itself is the sole
manifestation of the parties' intent and no extrinsic evidence is permitted absent a finding by a
court that the language is ambiguous and cannot be understood from a reading of the policy as a
whole." Cherry v. Anthony, Gibbs & Sage, 501 So. 2d 416, 419 (Miss. 1987). "Insurance
contracts are construed strictly against the insurer and in favor of the policyholder." Johnson v.
Preferred Risk Auto. Ins. Co., 659 So. 2d 866, 871 (Miss. 1995) (internal citation omitted). In
particular, "[w]here a clause of an insurance policy subject to dispute involves exceptions or
limitations on the insurer's liability under the policy, [the Mississippi Supreme Court] construes
the policy even more stringently." See J & W Foods Corp. v. State Farm Mut. Auto. Ins. Co., 723
So. 2d 550, 552 (Miss. 1998). Cf Gov't Emps. Ins. Co. v. Brown, 446 So. 2d 1002, 1006 (Miss.
5
1984) (holding that without clear and unambiguous language of limitation by insurer, insurer
cannot limit recovery for benefits for which an insured paid a premium); Hartford Ace. & Indem.
Co. v. Bridges, 350 So. 2d 1379, 1381-1382 (Miss. 1977) (holding that because language seeking
to limit liability of insurer was ambiguous and difficult to understand, aggregating of coverages
was warranted). The United States District Court for the Southern District of Mississippi has
explained:
Mississippi's law recognizes the general rule that provisions of an
insurance contact are construed strongly against the drafter.
Consistent with this principle, insuring clauses are construed
broadly to effect coverage, and exclusionary clauses that restrict
coverage are construed narrowly against the insurer. So, to benefit
from an exclusionary provision in an insurance contract, the insurer
must show that the exclusion applies and that it is not subject to any
other reasonable interpretation that would afford coverage.
Canal Ins. Co. v. T.L. James & Co., Inc., 911 F. Supp. 225, 28 (S.D. Miss. 1995) (citing generally
Nationwide Mut. Ins. Co. v. Garriga, 636 So. 2d 658 (Miss. 1994)). However, the Mississippi
Supreme Court has stated: "[W]hen insurance policy language is clear and unambiguous, this
Court will not adopt a strained interpretation in order to create nonexistent coverage that the
insurer otherwise has not assumed." Titan Indem. Co., 825 So. 2d at 658. In this case, the Court
finds that "the terms of [the subject] policy are clear, plain and explicit," and thus, this Court will
not "give a forced construction to the policy." See id.
It is undisputed that Mr. and Mrs. Parker are insured under the subject policy and that the
policy specifically refers to their 2009 Ford Escape LTD and 1997 GMC Sierra 1500 pickup truck.
PL's CompI. [1] ~ 7,20; Defs.' Answer [ll] ~ 7; see Subject Policy [22-1] at 2.2 It is further
undisputed that the subject policy was issued from April 23, 2011 until October 23,2011, and that
2 The Court notes that Mr. and Mrs. Parker are the only named insured on the Declarations page. See
Subject Policy [22-1] at 2.
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the accident occurred on June 11, 2011; thus, the subject policy was in effect at the time of the
accident. Pl.'s Compl. [1]
W7,
14; Defs.' Answer [11]
~
14; Defs.' Resp. Opp'n to Pl.'s MSJ
[27] at 1; see Subject Policy [22-1] at 2. It is also undisputed that although Plaintiff agrees under
the terms of the subject policy to be liable for bodily injury liability coverage up to $100,000 per
person and $300,000 per accident, Plaintiff is not liable for the accident if it did not fall within the
terms of the policy. PI.' s Compi. [1]
W 8, 20; Defs.'
Answer [11]
~~
8, 20; see Subject Policy
[22-1] at 2, 7-8. Finally, it is undisputed that Melissa Parker is listed as a driver in the subject
policy. PI. 's Compl. [1] ~ 9; Defs.' Answer [11] ~ 9; see Subject Policy [22-1] at 3.
The subject policy provides in Part A-Liability Coverage, Insuring Agreement:
"[Plaintiff] will pay damages for 'bodily injury' or 'property damage' for which any 'insured'
becomes legally responsible because of an auto accident. . .. [Plaintiff] will settle or defend, as
[it] consider[s] appropriate, any claim or suit asking for these damages ...." Subject Policy
[22-1] at 7.
"Insured" is broadly defined in this provision to mean: "[y]ou or any 'family
member' for the ownership, maintenance[,] or use of any auto ...." Id. at 8. By the clear terms
of the subject policy, Melissa Parker falls within the definition of "insured" in this provision, as
she is a family member and owned and used her 2006 Honda Ridgeline truck. However, this
liability provision also states: "[Plaintiff has] no duty to defend any suit or settle any claim for
'bodily injury' or 'property damage' not covered under this policy." Id. at 7.
Included within the Liability Coverage section is a provision entitled "Exclusions," which
provides in pertinent part in Exclusion B.3 that there is no liability coverage for "the ownership,
maintenance[,] or use of: 1. Any vehicle other than '[the named insured's] covered auto' which is:
a. Owned by any 'family member,' or b. Furnished or available for regular use of a 'family
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member.'" Id. at 9. The Mississippi Supreme Court has repeatedly upheld similar exclusionary
provisions for family members as valid and enforceable in Mississippi, Thompson v. Miss. Farm
Bureau Mut. Ins. Co., 602 So. 2d 855, 857 (Miss. 1992), explaining that such policies "reveal an
obvious purpose to avoid a multiple coverage of several vehicles owned by members of the same
family, who, by their close intimacy, may be expected to use the cars of each other without
hindrance and with or without permission, thus increasing the liability of the insurer who has a
right to expect each owner to contract for his own coverage," Fleming v. Travelers Ins. Co., 39 So.
2d 885,886-87 (Miss. 1949), and that "[t]here is no valid reason why insurance companies should
not have the right, by contract, to avoid coverage for those in the family circle ....," Perry v. So.
Farm Bureau Cas. Ins. Co., 170 So. 2d 628,630 (Miss. 1965). Accord Thompson v. Miss. Farm
Bureau Mut. Ins. Co., 602 So. 2d 855, 856-58 (Miss. 1992); Alfa Ins. Corp. v. Hassel/e, 74 So. 3d
371,375-76 (Miss. Ct. App. 2011).3 Accordingly, this Court finds that Exclusion B.3 is valid and
enforceable in this case.
For the reasons stated below, reading the liability section of the subject policy in toto,
3 Other courts have had occasion to interpret exclusionary provisions identically worded to Exclusion B.3
in the case sub judice, and with similar or identically worded liability provisions as a whole, and have upheld the
exclusionary provisions as clear and unambiguous. See, e.g., Cincinnati Ins. Co. v. Moen, 940 F.2d 1069, 1074-1075
(7th Cir. 1991); Am. Commerce Ins. Co. v. Stewart, No. 3:1O-cv--05240-RBL, 2010 WL 2990938, at +3-5 (W.D.
Wash. July 27, 2010); Scarino v. Standard Fire Ins. Co., No. Civ.A04-5878, 2005 WL 3307081, at +3 (E.D. Pa. Nov.
28,2005); Jerge v. Buettner, 687 N.E.2d 1328, 1328 (N.Y. 1997); Hastings Mut. Ins. Co. v. Carpentier, No. 4-12
0281,2013 WL 164962, at +8-9 (Ill. App. 4 Dist. Jan. 15,2013); Selective Ins. Co. ojAm. v. Arrowood Indem. Co.,
No. 23400, 2010 WL 580984, at +3 (Ohio App. 2 Dist. Feb. 19,2010); Danze v. Katz, 2009 WL 578644, at +4--6 (N.J.
Super. AD. Mar. 9, 2009); Motorists Mut. Ins. Co. v. Wroblewski, 898 N.E.2d 1272, 1276-1277 (Ind. App. 2009);
Wil/ev. Courtney, 943 So. 2d515,519(La.App. 5 Cir. 2006);Snowv. WAm.Ins. Co., 161 S.W.3d338,340-41 (Ky.
App. 2004); Annendariz v. Progressive Cnty. Mut. Ins. Co., 112 S.W.3d 736, 738-39 (Tex. App.-Houston 14 Dist.
2003); Griswold v. Integon Gen. Ins. Corp., 560 S.E.2d 861,866 (N.C. App. 2002); Jefferson v. Scariano, 949 P.2d
120, 121 (Colo. App. 1997); Domingue v. Rodrigue, 686 So. 2d 132, 135-37 (La. App. 1 Cir. 1996); Scott v. Am.
Standard Ins. Co. ojWis., 392 N.W.2d461, 463-64 (Wis. App. 1986). See also Leteffv. Md. Cas. Co., 91 So. 2d 123,
132 (lst Cir. 1956) (quoting Fleming v. Travelers Ins. Co., 39 So. 2d 885, 887 (Miss. 1949)); Di Orio v. NJ. Mfrs. Ins.
Co., 398 A2d 1274 (N.J. 1979) (holding that such exclusions "reflect[] a simple though important purpose: to prevent
an insured from obtaining coverage for some or all cars regularly used or owned by the insured by merely listing only
one automobile in the family policy ... and thereafter paying a premium calculated by the insurer upon the risk created
by the ownership and use of only that one listed car").
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Plaintiff has demonstrated that the Exclusions provision applies in the case sub judice and Melissa
Parker's accident in her 2006 Honda Ridgeline truck does not fall within the subject policy. Thus,
Plaintiff has no liability for the accident under the subject policy. As stated above, the applicable
"Exclusions" provision states in pertinent part in Exclusion B.3 that there is no liability coverage
for "the ownership, maintenance[,] or use of: 1. Any vehicle other than '[the named insured's]
covered auto' which is: a. Owned by any 'family member,' or b. Furnished or available for regular
use of a 'family member.''' Subject Policy [22-1] at 9.
By the terms of the subject policy,
"[y]our covered auto" is defined in pertinent part as "[a]ny vehicle shown in the Declarations."
See id. at 6. The 2006 Honda Ridgeline truck is not shown in the Declarations section of the
subject policy; only the 2009 Ford Escape LTD and 1997 GMC Sierra are shown. See id. at 2.
The 2006 Honda Ridgeline truck was indisputably owned by Melissa Parker and used by her at the
time of the accident. See Pl.'s Compl. [1]
~
15; Defs.' Answer [11]
~
15. Therefore, the 2006
Honda Ridgeline truck is not a covered auto under the terms of the subject policy. Further, it is
undisputed that Melissa Parker is a family member of the named insured as defined in the subject
policy: "a person related by blood ... who is a resident of [the named insured's] household." See
Subject Policy [22-1] at 6; Defs.' Counterclaim [11]
~
3; PI.'s Mem. Br. Supp. MSJ [23] at 5.
Considering all ofthese factors together, there is no liability coverage for ownership, maintenance,
or use of Melissa Parker's 2006 Honda Ridgeline truck, which is not listed as a covered auto in the
subject policy and is owned by Melissa Parker herself, a family member ofthe named insured, Mr.
and Mrs. Parker. See Subject Policy [22-1] at 9.
Because the 2006 Honda Ridgeline truck was not a covered auto under the subject policy
and was owned by Melissa Parker, a "family member" as that term is defined in the subject policy,
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the subject policy expressly excludes liability coverage for Melissa Parker's accident in her 2006
Honda Ridgeline truck. Accordingly, under the provisions of the subject policy, Plaintiff does
not have a duty to defend or indemnify Defendants in the state-court wrongful death suit arising
from Melissa Parker's accident in her 2006 Honda Ridgeline truck. 4
D. Conclusion
For the foregoing reasons, Plaintiff Guideone America Insurance Company's motion for
summary judgment [22] is GRANTED. Plaintiff Guideone America Insurance Company has no
duty to defend or indemnify Defendants Steve Parker, Lisa Parker, or Melissa Hill Parker against
the state-court claims brought by the wrongful death beneficiaries ofthe Decedent, Eddie Rayburn
Collums, Jr., in connection with the accident involving Defendant Melissa Hill Parker's 2006
Honda Ridgeline truck.
A separate final judgment in accordance therewith shall issue this day.
THIS, the
{)~0
(\
day of May, 2014.
SENIOR JUDGE
4 The Court notes that "the duty to defend is 'broader than the insured's duty to indemnifY under its policy
of insurance.'" See Essex Ins. Co. v. Greenville Convalescent Home Inc., 236 F. App'x 49,52 (5th Cir. 2007) (per
curiam) (quoting Cullop v. Sphere Drake Ins. Co., 129 F. Supp. 2d 981, 982 (S.D. Miss. 2001) (internal quotation
marks and citation omitted». Thus, because this Court fmds that Plaintiff has no duty to defend in the state-court
wrongful death suit, there is similarly no duty to indemnifY in the suit.
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