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Richard v. USAA Casualty Insurance Co.

United States District Court, M.D. Louisiana

January 8, 2019




         Before the Court is Defendant Garrison Property and Casualty Insurance Company's ("Garrison")[1] Motion for Summary Judgment (Doc. 19). For the following reasons, the Court DENIES Garrison's motion.


         Brian Ross Richard ("Plaintiff) was a passenger in a vehicle owned and being operated by Lance Boudreaux ("Boudreaux")[2]. (Doc. 1-2 at ¶ 2). On or about May 16, 2012, when Boudreaux was attempting to make a left turn, the vehicle was struck by another vehicle driven by Patrick Gisler ("Gisler")- (Id.). Plaintiff then sued Gisler, Gisler's insurance company[3], Boudreaux, and Garrison, which issued an auto insurance policy to Boudreaux, in state district court in Baton Rouge. (Doc. 8-1). On January 29, 2016, the jury returned a verdict finding Boudreaux completely liable for the accident, and a judgment was entered against him in the amount of $434, 000.00. (Id.). Boudreaux's insurance policy limit with Garrison was $100, 000.00. (Doc. 1 at ¶ 3). Garrison appealed the judgement on its own behalf, but not on behalf of Boudreaux. (Doc. 20 at p. 1). Boudreaux, through a "Compromise Agreement" executed on September 9, 2016, assigned to Plaintiff the right to pursue a bad faith action against Garrison for improperly proceeding to trial as opposed to settling within policy limits in return for being absolved of personal liability for the judgment. (Doc. 8-3 at Exhibit C).

         Plaintiff now brings this action against Garrison to recover from Garrison the value of the excess judgement entered against Boudreaux. (Doc. 1-2). Plaintiff alleges that he suffered significant injuries as a result of Boudreaux's negligence. (Id. at ¶ 2). Plaintiff claims that Garrison failed to meet its statutory obligation to settle within the policy limits. (Id. at ¶ 3). Plaintiff alleges that this caused Boudreaux to be subjected to excess judgement. (Id.).

         Plaintiff claims that Garrison further abrogated its duties by filing an appeal of the excess judgment on its own behalf and not appealing the verdict for its insured, thereby failing to provide counsel to Boudreaux pursuant to its contractual obligation to do so. (Id. at ¶ 4). As such, Plaintiff argues that the judgment against Boudreaux is final and enforceable. (Id.). Plaintiff asserts violations of La. R. S. 22:1973 and La.R.S. 22:1892 as well as breach of contract for failure to provide counsel. (Id. at ¶ 5).

         This matter was removed to this Court on March 23, 2017. On June 1, 2018, Garrison filed the instant motion. (Doc. 19). Plaintiff filed his opposition on July 3, 2018. (Doc. 20).

         II. ARGUMENTS

         Garrison asserts that it was entitled to litigate the underlying case rather than settle for its $100, 00.00 policy limit. (Id.). Garrison argues that it insured only Boudreaux, not Plaintiff, and that both Plaintiff and his attorney previously claimed that Boudreaux was not at fault for the accident. (Id. at ¶ 1). Garrison claims that because Plaintiff assured it that Boudreaux was not at fault for the accident, it was not obligated to settle within policy limits. (Id. at ¶ 2). Garrison cites Smith v. Audubon Ins. Co., 95-2075 (La. 9/5/96), 679 So.2d. 372, 377 for the proposition that after an insurer has made a thorough investigation into the cause of an accident, if reasonable minds may differ about who is at fault, the insurer no longer is obligated to settle within its policy limits and may choose to litigate.

         Specifically, Garrison alleges that Plaintiffs original Petition for Damages primarily focused on Gisler's alleged negligence and raised claims against Boudreaux only in the alternative. (Doc. 19-1 at p. 2). Garrison also alleges that no facts were provided to support a claim of negligence against Boudreaux in the initial Petition for Damages. (Id.).

         Garrison claims that Baton Rouge City Police Officer Gabriel Walters ("Officer Walters") testified that Gisler was at fault for the accident due to "improper passing." (Id. at p. 3). Further, Garrison alleges that Plaintiff gave deposition testimony wherein he asserted that Boudreaux was not at fault for the accident.[4] Garrison also cites the opening statement prepared by Plaintiffs attorney, wherein he stated:

. . . My client will testify that Lance Boudreaux was not at fault in this accident. Did everything right, didn't see anything he did wrong, and wasn't at fault. That's what Brian is going to testify. The police officer is going to testify. . .That officer is going to say Lance wasn't at fault. . .

(Doc. 19 at Exhibit H). Garrison cites to numerous other portions of trial and deposition testimony to reinforce its argument that at every turn, all parties involved with the accident, save for Gisler, held the opinion that Boudreaux was not at fault for the accident. Garrison also cites the Compromise Agreement between Plaintiff and Boudreaux as further evidence that neither party believed that Boudreaux was at fault for the accident. (Doc. 19-1 at p. 5).

         In his opposition to Garrison's Motion for Summary Judgment, Plaintiff argues that he sued both Boudreaux and Gisler, both of their insurers, and demanded settlements within both of their policy limits. (Doc. 20 at p. 1). Plaintiff challenges Gaivrison's claim that it was entitled to try the case. Plaintiff contends that Garrison was not forthcoming in its motion sub judice regarding the information that was available to it and what it knew when making the decision to litigate the matter as opposed to settle. (Id. at p. 2). Specifically, Plaintiff argues that:

1. Garrison failed to inform Boudreaux that Gissler's insurance company offered to settle for the liability policy limits and release Boudreaux ...

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