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Arceneaux v. Amstar Corp.

Court of Appeal of Louisiana, Fourth Circuit

February 25, 2015

DANIEL ARCENEAUX, LOUIS DAVEREDE, JR. VIVES LEMMON AND JULES MENESSES, ET AL.
v.
AMSTAR CORP., AMSTAR SUGAR CORP., TATE AND LYLE NORTH AMERICAN SUGARS, INC., AND DOMINO SUGAR COMPANY, ET AL

Page 116

APPEAL FROM ST. BERNARD 34TH JUDICIAL DISTRICT COURT. NO. 86-959, DIVISION " B" C\W 105-703, 106-082, DIVISION " E" . Honorable Robert J. Klees, Judge Pro Tempore.

Paul A. Tabary, III, TABARY AND BORNE, LLC, Three Courthouse Square, Chalmette, LA AND Lee M. Epstein (PRO HAC VICE), Flaster Greenberg P.C., Philadelphia, PA, COUNSEL FOR PLANTIFF/APPELLEE.

Glenn G. Goodier, JONES WALKER L.L.P., New Orleans, LA, COUNSEL FOR DEFENDANT/APPELLANT.

Court composed of Judge Max N. Tobias, Jr., Judge Madeleine M. Landrieu, Judge Joy Cossich Lobrano.

OPINION

Madeleine M. Landrieu, Judge

Page 117

[2014-0271 La.App. 4 Cir. 1] This appeal concerns a purely legal issue: the scope of an insurer's duty to defend in a long latency disease case where the insurer's occurrence-based policies were in effect for only a portion of the time span during which the plaintiffs' alleged exposure occurred.

FACTS AND PROCEEDINGS BELOW

In 2006, two sets of plaintiffs (respectively referred to as the " Barbe plaintiffs" and the " Waguespack plaintiffs" ) filed separate suits against American Sugar Refineries, Inc. (" American Sugar" ) alleging that they had suffered occupational hearing loss from their exposure to industrial noise while working at the defendant's Arabi, Louisiana refinery during various years ranging from 1941 to 2006.[1] These two suits were then consolidated in the trial court with the still pending Arceneaux action, a suit that had been filed in 1999 against Tate & Lyle North American Sugars, Inc. (T & L), the predecessor of American Sugar, by other [2014-0271 La.App. 4 Cir. 2] claimants alleging occupational hearing loss as a result of exposure to noise at the same refinery. The present appeal concerns only the Barbe and Waguespack plaintiffs, not the Arceneaux plaintiffs, whose claims have been litigated extensively in the trial court, this court and the Louisiana Supreme Court. See: Arceneaux v. Amstar Corp., 2005-0177 (La.App. 4 Cir. 12/14/05), 921 So.2d 189 (hereinafter referred to as " Arceneaux I " ); Arceneaux v. Amstar Corp., 2006-1592 (La.App. 4 Cir. 10/31/07), 969 So.2d 755 (hereinafter referred to as " Arceneaux II " ); and Arceneaux v. Amstar Corp., 2010-2329 (La. 7/1/11), 66 So.3d 438 (hereinafter referred to as " Arceneaux III " ).

On September 19, 2007, defendant American Sugar brought a third-party demand against Continental Casualty Company (" Continental" ) alleging that Continental had issued certain policies that provided coverage for the plaintiffs' claims during a portion of the time span cited in the plaintiffs' petition. American Sugar further alleged that it had put Continental on notice of the litigation in June of 2006 and that Continental had breached its policies by failing to provide American Sugar

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with a defense. Continental answered the third-party petition acknowledging it had issued eight occurrence-based policies to American Sugar that were in effect from 1963 to 1978, but asserted as an affirmative defense that some of those policies (those in effect prior to 1975) contained an exclusion for claims made by employees of the insured. Continental did not provide a defense, but in March, 2008, offered to pay and began paying twenty-five percent (25%) of [2014-0271 La.App. 4 Cir. 3] American Sugar's defense costs, reserving its right to dispute its obligation to pay and/or provide a defense in further proceedings.

On May 22, 2013, more than five years after filing its third-party demand, American Sugar brought a motion for partial summary judgment seeking reimbursement from Continental for 100% of the costs incurred by American Sugar in defending the litigation since its inception, as well as a declaration that Continental owed American Sugar a full defense going forward; American Sugar also sought attorney's fees and statutory penalties for alleged bad faith on the part of Continental. The trial court heard the motion on August 30, 2013. At the conclusion of the hearing, the trial court ruled from the bench, granting the motion for partial summary judgment in part, finding that Continental was obliged to provide American Sugar a complete, one hundred percent (100%) defense going forward from the date of the ruling. The trial court denied the motion for summary judgment in all other respects, thus denying American Sugar's claims for reimbursement of past defense costs, attorney's fees and penalties for bad faith. The trial court did not give oral or written reasons for judgment. In its written judgment signed October 3, 2013, the trial court designated the judgment as final for purposes of immediate appeal pursuant to Louisiana Code of Civil Procedure article 1915(B).

Continental suspensively appeals the judgment, arguing that the trial court misinterpreted the law in long latency disease cases when it ordered Continental to provide a full defense to American Sugar despite the fact that Continental's [2014-0271 La.App. 4 Cir. 4] policies covered only 26 months of the approximately 60-year time span during which the plaintiffs' alleged exposure occurred.

ISSUE

Whether the trial court erred by ordering Continental to provide American Sugar with a full defense going forward in this litigation is purely an issue of law. The parties do not dispute the relevant facts. Continental argues that the trial court's ruling ignores the current law with respect to long latency disease cases, as expressed by the Louisiana Supreme Court in Southern Silica of Louisiana, Inc. v. Louisiana Insurance Guaranty Ass'n, 2007-1680 (La. 4/8/08), 979 So.2d 460. Continental contends that Southern Silica establishes that, in a long latency disease case, an insurer issuing an occurrence-based policy or policies in effect for only a portion of the alleged time of exposure is not obligated to provide its insured a full defense, but only to pay a pro-rata share of the defense costs based upon the allegations of the petition and the four corners of the insurer's policy or policies. Continental argues that in this case, because it had policies without employee exclusions in effect for only 26 months (from Dec. 31, 1975 to March 1, 1978), its pro-rata share of defense costs is 4.3%.[2]

Page 119

Conversely, American Sugar argues that the trial court did not err by ordering Continental to provide a full defense because the insurer's duty to defend under Louisiana law is no different in a long latency disease case than it is in any [2014-0271 La.App. 4 Cir. 5] other case involving multiple insurers, each of which has a duty to provide a full defense if, based on the petition, any of the plaintiffs' claims is covered by its policy.

STANDARD OF REVIEW

We review the granting of a motion for summary judgment de novo, using the identical criteria that govern the trial court's consideration of whether summary judgment is appropriate. Smitko v. Gulf South Shrimp, Inc., 2011-2566, p. 7 (La.7/2/12), 94 So.3d 750, 755. A motion for summary judgment " shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions, together with the affidavits, if any, show that there is no genuine ...


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