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Barber v. Louisiana Municipal Risk Management Agency Group Self-Insured Fund

Court of Appeals of Louisiana, Third Circuit

December 28, 2017

SARAH BARBER, ET AL.
v.
LOUISIANA MUNICIPAL RISK MANAGEMENT AGENCY GROUP SELF-INSURED FUND, ET AL.

         APPEAL FROM THE NINTH JUDICIAL DISTRICT COURT PARISH OF RAPIDES, NO. 251, 753 HONORABLE GEORGE CLARENCE METOYER JR, DISTRICT JUDGE

          Douglas K. Williams Christopher A. Mason Breazeale, Sacshe & Wilson, L.L.P. COUNSEL FOR DEFENDANT-APPLICANT-APPELLEE: Republic Fire & Casualty Ins. Co.

          Randall B. Keiser Jeremy C. Cedars Keiser Law Firm, P.L.C. COUNSEL FOR DEFENDANT-RESPONDENT: Estate of Larry Jeane, Sr.

          Derrick G. Earles David C. Laborde Jeff D. Easley Laborde Earles Law Firm COUNSEL FOR PLAINTIFFS-RESPONDENTS: Sarah Barber Elizabeth Spivey Sarah Barber, o/b/o Abbigail Turner Racheal Spivey Jamie Turner Wallace Spivey Jamie Turner, o/b/o Abbigail Turner Dana Spivey

          Court composed of Elizabeth A. Pickett, D. Kent Savoie, and Van H. Kyzar, Judges.

          ELIZABETH A. PICKETT JUDGE.

         Republic Fire and Casualty Insurance Company (Republic), a defendant in the case before us, appeals a judgment of the court denying, in part, its motion for summary judgment, which found that the umbrella insurance policy issued to Larry and Johanna Jeane provided liability coverage for the damages suffered by the injured plaintiffs. The plaintiffs, Sarah Barber and Jamie Turner (individually and on behalf of their minor daughter Abbigail Turner), Dana Spivey, Elizabeth Spivey, Wallace Spivey, and Racheal Spivey (collectively "the Barber plaintiffs"), have answered the appeal, seeking redaction of language from the judgment requiring "exhaustion of the underlying LMRMA Busines Auto Agreement, …, and any other insurance available to the Estate of Jeane." The Estate of Larry Jeane has filed an answer to the appeal alleging that subsequent to the January 30, 2017 judgment, Republic waived its coverage defense by contesting the liability of Larry Jeane for the damages suffered by the Barber plaintiffs without providing separate counsel to the Estate of Jeane.

         The Estate of Jeane has also filed an Exception of No Right of Action and Mootness, and the parties have filed numerous motions in this court.

         FACTS

         Larry Jeane, the elected Marshal of Pineville, Louisana, was driving his city marshal vehicle when he crossed the center line and collided with a vehicle in which the Barber plaintiffs were the passengers. Mr. Jeane died two days later from injuries sustained in the collision, and the Barber plaintiffs sustained injuries. The Barber plaintiffs sued the Louisiana Municipal Risk Management Agency Group Self-Insured Fund (LMRMA), the City of Pineville, the Estate of Larry Jeane, Shelter Mutual Insurance Co., the Rapides Parish Police Jury, the State of Louisiana, the City of Pineville City Marshal's Office, Republic, and an unnamed insurance company. The Estate of Jeane filed a cross-claim against Republic.

         The Estate of Jeane filed a motion for summary judgment seeking a ruling that the Umbrella Liability Policy issued by Republic provided coverage for the accident. Republic, who issued a Personal Auto Policy and an Umbrella Liability Policy to Mr. Jeane and his wife, filed a motion for summary judgment arguing that neither the Personal Auto Policy nor the Umbrella Liability Policy provided coverage for the accident. The trial court held a hearing on December 12, 2016 on the cross motions for summary judgment. At the conclusion of the hearing, the trial court found that the Personal Auto Policy issued by Republic did not provide coverage. The trial court further found that the Umbrella Liability Policy provided to the Jeanes by Republic did provide coverage. This oral ruling was reduced to a written judgment signed by the trial court on January 30, 2017, and certified as immediately appealable pursuant to La.Code Civ.P. art. 1915. In that judgment, the trial court specifically reserved judgment on the duty of Republic to defend the Estate of Jeane under the terms of the Umbrella Liability Policy, pending a decision by this court on the issue of coverage.

         On January 9, 2017, Republic filed notice of its intent to file a supervisory writ application seeking a review of the trial court's December 12, 2016, ruling. Republic later filed an appeal of the January 30, 2017 judgment of the trial court. This court granted the writ application for the limited purpose of consolidating it with the appeal. Barber v. La. Muni. Risk Mgmt. Agency Group Self-Insured Fund, an unpublished decision bearing docket number 17-64 (La.App. 3 Cir. 3/10/17).

         EXCEPTIONS AND MOTIONS FILED ON APPEAL

         Since this appeal and writ have been lodged in this court, the three parties involved in this appeal have filed twenty-four pleadings in this court. In addition to the answers filed by the appellants and briefs in support of all the parties' respective positions, Republic and the Estate of Jeane have filed numerous exceptions and motions in an attempt to have this court consider issues not raised in the trial court, or raised after the hearing on December 12, 2016, and the signing of the judgment on January 30, 2017. The motions were referred to the panel reviewing the merits of the appeal. Rule 1-3 of the Uniform Rules of the Courts of Appeal sets forth the scope of review in this court (emphasis added):

The scope of review in all cases within the appellate and supervisory jurisdiction of the Courts of Appeal shall be as provided by LSA-Const. Art. 5, § 10(B), and as otherwise provided by law. The Courts of Appeal will review only issues which were submitted to the trial court and which are contained in specifications or assignments of error, unless the interest of justice clearly requires otherwise.

         Most notably, the Estate of Jeane's Exceptions of No Right of Action and Mootness and Motion to Dismiss Republic's Suspensive Appeal, arguing that Republic waived its coverage defense by asserting a liability defense without providing separate counsel to the Estate, has not been argued before or ruled upon by the trial court. Further, all of the evidence that the Estate of Jeane relies on to support its exception was filed in the trial court after the signing of the January 30, 2017 judgment before us for review. The Estate of Jeane argues that the evidence appears in the record sent to this court, therefore in the interest of justice we should rule on their exception. The evidence only appears in the record before us because the parties could not agree on a designation of the record for the purposes of this appeal, and the trial court ordered the entire record be sent up following a hearing on March 27, 2017. Since the judgment before us is an interlocutory judgment, the parties have continued to litigate issues after January 30, 2017. Thus, the record contains documents related to issues presented to the trial court that have not been fully litigated below, including the issue raised in Estate of Jeane's answer to the appeal and exceptions. Because the waiver of a coverage defense has not been submitted to the trial court for a decision, we decline to rule on it in this appeal. The Exceptions of No Right of Action and Mootness filed by the Estate of Jeane is overruled, and the Motion to Dismiss the Appeal filed in the same pleading is denied.

         Furthermore, the Estate of Jeane's Answer to the Appeal raises, in part, the same issue regarding waiver of a coverage defense. It is clear that these issues were not presented to the trial court for a decision prior to the January 30, 2017 judgment. The Estate of Jeane admits as much in its answer, alleging that Republic's actions subsequent to the judgment before us on appeal constitute the basis for its answer to appeal. We therefore grant in part Republic's Motion to Dismiss and Motion to Strike Jeane's Answer to the Appeal, and will not consider the issue of the waiver of the coverage defense. To the extent that the Estate of Jeane's Answer to the Appeal seeks penalties and attorney fees for the misrepresentation of the Business Use Exclusion by Republic, we deny Republic's motion to dismiss the Estate of Jeane's answer. Further, we deny the Estate of Jeane's Alternative Motion to Remand and/or Stay the Appeal.

         Both Republic and the Estate of Jeane have filed motions to supplement the record with exhibits never presented to the trial court. Many of the exhibits were created well after the January 30, 2017 judgment was even signed. For instance, there is a letter dated May 26, 2017, that both parties seek to introduce. An appellate court cannot receive new evidence. Fontana v. Landry, 09-322 (La.App. 3 Cir. 10/7/09), 20 So.3d 578. Therefore, the Estate of Jeane's Motion to Supplement the Record with five documents from June 2017 is denied. Republic's Alternative Motion to Supplement the Record on Appeal with a letter dated May 26, 2017, and an affidavit is denied. Republic's Motion to Strike Exhibits Attached to the Estate of Larry Jeane's Briefs, Opposition Memoranda and Exception is granted, as the exhibits include four copies of the May 26, 2017 letter and four affidavits attesting to never having received said letter. Republic's Alternative Motion to Supplement the Record with a March 2, 2017 letter and an affidavit dated August 17, 2017, is denied. Finally, the Estate of Jeane's Motion to Strike the Alleged May 26, 2017 Letter and Affidavit of Alicia Hamby is moot, as we have denied the motion to supplement the record with these documents.

         Republic has also filed a Motion to Dismiss and Motion to Strike Plaintiff-Appellees' "Objections to Republic SMJ [sic] Exhibits" Contained within the Plaintiffs' Appellee Briefs. Republic claims the Barber plaintiffs should not be allowed to renew objections to exhibits attached to Republic's motion for summary judgment because they did not raise these objections in their answer to the appeal. In opposition, the Barber plaintiffs point out that an answer is not required in opposition to Republic's application for supervisory writs, which is consolidated with the appeal in this case. Furthermore, contemporaneous objections to the attachments were raised in the trial court. Finally, the Barber plaintiffs argue that the objection to the exhibits does not amount to a request for a modification of the judgment on appeal, so it is unnecessary to raise the objection in an answer to the appeal. We review motions for summary judgment de novo, applying the same criteria as the trial court to determine whether summary judgment is appropriate. Wright v. La. Power & Light, 06-1181 (La.3/9/07), 951 So.2d 1058. Given that the Barber plaintiffs raised an objection to the exhibit in conformity with La.Code Civ.P. art. 966, we deny Republic's motion to strike and motions to dismiss the arguments advanced regarding the admissibility of the documents at issue.

         Republic has also filed a Motion to Dismiss Plaintiff-Appellee's Answer to the Appeal, arguing that the issue raised in the Barber plaintiffs' answer was not properly raised in the trial court. Further, they argue the answer to the appeal is without merit. In their answer to the appeal, the Barber plaintiffs argue that there was language inserted into the judgment prepared by Republic referring to the "exhaustion" of coverage that was never raised in the trial court. The pleadings before us indicate there is disagreement among the parties about the import of certain language used by the trial court in its oral ruling on December 12, 2016. Further, there was extensive discussion among the parties about the wording of the judgment, evidenced by the proposed judgment drafted by the Estate of Jeane that was presented to the trial court and is in the record. We find the issue raised by the Barber plaintiffs is ripe for review on appeal, and deny Republic's Motion to Dismiss the Barber plaintiffs' answer to the appeal.

         The final motion we must address is Republic's Motion to Strike Misrepresentation of Fact Contained within the Appellees Briefs, and Alternatively, Motion to Supplement the Record. Republic argues that both the Estate of Jeane and the Barber plaintiffs misrepresent the negotiations among the parties regarding the submission of a judgment to the trial court for signature. Further, they argue that these misrepresentations and the language used in the Estate of Jeane's brief violates the Uniform Rules of Court, Courts of Appeal, Rule 2-12.2(C). Alternatively, Republic seeks to introduce into the record on appeal letters among the parties regarding the negotiations in drafting the judgment. In response, the Barber plaintiffs oppose the motion to strike, and alternatively seek to supplement the record.

         For reasons previously discussed, the alternative motions of Republic and the Estate of Jeane to supplement the record are denied. We have reviewed the briefs submitted and find no language that merits the harsh penalty of being stricken. Thus, Republic's motion to strike is denied. We note that regardless of the process by which the judgment was submitted to the trial court, the task of this court is to review the merits of the actual judgment signed by the trial court.

         ASSIGNMENTS OF ERROR

         Proceeding to the merits of this appeal, Republic asserts six assignments of error:

1. The trial court erred in failing to find that coverage was excluded under the Umbrella policy which followed form and thereby adopted the "regular use exclusion contained within the underlying Personal Auto policy as a matter of law.
2. The trial court erred when it failed to find that the "retained limit" necessary to trigger coverage under the umbrella policy was not present.
3. The trial court erred in failing to apply the exclusions contained within the Follow-Form Endorsement of the Umbrella policy, which unambiguously excludes these claims from coverage.
4. The trial court erred in failing to find that the parties and the trial court were judicially estopped from considering whether the LMRMA indemnity agreement could meet the definition of "underlying insurance, " after the trial court was presented with and signed a Judgment dismissing the claims against the LMRMA based upon a judicial confession that LMRMA is not an insurance company and its indemnity agreement is not insurance.
5. The trial court erred by finding that the LMRMA Business Auto indemnity agreement meets the definition of "underlying insurance" within the Republic Personal Umbrella policy thereby triggering coverage under the Umbrella policy.
6. The trial court erred by failing to find that the LMRMA Business Auto indemnity agreement does not insure the same type of liabilities as the Personal Auto policy, and therefore cannot meet the definition of "underlying insurance" to trigger coverage under the Umbrella policy.

         Answering the appeal, the Barber plaintiffs assert four assignments of error:

1. Louisiana law does not require the exhaustion of underlying insurance for the exposure of an umbrella or excess policy;
2. It was legal error to require exhaustion of or declare the ranking/priority of unknown phantom hypothetical insurance policies that may not exist because no mover requested such a judicial declaration;
3. It was legal error to require exhaustion of or declare the ranking/priority of unknown phantom hypothetical insurance policies that may not exist because the evidence was insufficient to show that any other policies exist;
4. It was legal error to require exhaustion of or declare the ranking/priority of unknown phantom hypothetical insurance policies that may not exist because the "other insurance clauses" in those policies are required to reach such a legal determination.

         Given our dismissal of a part of the Estate of Jeane's answer to the appeal, the first, second, and fourth assignments of error raised in its brief are pretermitted. There remains one issue raised by the Estate that we consider in this appeal:

3. Is the Estate entitled to penalties and attorneys' fees as a result of Republic's repeated misrepresentation of its Umbrella Policy when (in declination letters and pleadings) the trial court found the BUE inapplicable and Republic did not appeal that finding?

         DISCUSSION

         Standard of Review

         The supreme court explained the appropriate standard for an appellate court to apply in reviewing a judgment on a motion for summary judgment in Robinson v. Heard, 2001-1697, pp. 3-4 (La. 2/26/02), 809 So.2d 943, 945:

A reviewing court examines summary judgments de novo under the same criteria that govern the district court's consideration of whether summary judgment is appropriate. Smith v. Our Lady of the Lake Hospital, Inc., 93-2512 (La.7/5/94), 639 So.2d 730, 750. A reviewing 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 is entitled to judgment as a matter of law. Smith, 639 So.2d at 750.
Interpretation of an insurance contract is usually a legal question that can be properly resolved in the framework of a motion for summary judgment. Sanchez v. Callegan, 99-0137 (La.App. 1 Cir. 2/18/00), 753 So.2d 403, 405. When the language of an insurance policy is clear and unambiguous, a reasonable interpretation consistent with the ...

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