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Matt v. Safeway Insurance Company of Louisiana

Court of Appeals of Louisiana, Third Circuit

March 13, 2019



          Holli K. Yandle Tracy L. Oakley Angelique P. Provenzano-Walgamotte W. Brett Cain Michael W. Landry COUNSEL FOR DEFENDANT/APPELLANT: Safeway Insurance Company of Louisiana

          Taylor J. Bassett Jeffrey Michael Bassett Kathleen E. Ryan Morrow, Morrow, Ryan, Bassett & Haik COUNSEL FOR PLAINTIFFS/APPELLEES: Brandon Matt Cathy West

          Gregory John Laborde Amy E. Boudreaux Daigle Rayburn LLC COUNSEL FOR DEFENDANT/APPELLEE: Justin Semien

          Court composed of Ulysses Gene Thibodeaux, Chief Judge, John D. Saunders, and D. Kent Savoie, Judges.


         Safeway Insurance Company ("Safeway") appeals the trial court's judgment rendered in favor of Plaintiffs for damages caused by Justin Semien in connection with an auto accident that occurred on February 27, 2016. It specifically challenges the trial court's finding that an insurance policy issued to Demetrius Rubin by Safeway provided liability coverage for the subject accident. For the following reasons, we affirm.


         On August 13, 2015, Safeway issued a policy of automobile insurance to Demetrius Rubin and his wife Dedra that provided coverage with respect to a 2002 Ford Expedition. The policy had a six-month term. During the first six months, a 1997 Buick LeSabre was added and then deleted from the policy, and a 2000 Lincoln Town Car was also added. The policy was renewed on February 13, 2016, and remained effective through August 13, 2016.

         On February 16, 2016, a 1993 Lincoln Town Car was added to the Rubins' policy. Subsequently, on February 26, 2016, Defendant Justin Semien approached Mr. Rubin and/or Mr. Rubin's son, Demetrius Coleman, to purchase the 1993 Town Car. Late afternoon on Friday, February 26, 2016, Mr. Semien paid Mr. Rubin and/or Mr. Coleman $2, 000 in cash for the vehicle and indicated he would pay an additional $300 at a later date. The parties dispute whether the transaction constituted a completed sale of the vehicle and whether it was Mr. Rubin or Mr. Coleman who owned the 1993 Town Car at the time of the transaction. According to Mr. Rubin, the transaction was not yet completed because Mr. Semien still needed to transfer the title and plates to his name, register the vehicle, and pay the remaining $300 balance. Mr. Rubin further noted that because those events had not yet taken place, he had authority to tell Mr. Semien whether he could drive the vehicle that weekend. Mr. Rubin ultimately gave Mr. Semien the keys to the vehicle and allowed him to leave with it.

         The following day, February 27, 2016, Mr. Semien drove the 1993 Town Car and was involved in an auto accident with Plaintiffs Brandon Matt and Cathy West. On February 29, 2016, following the Rubins' call to their insurance agent, the 1993 Town Car was deleted from the policy, as reflected by a policy endorsement dated the same day. Following the deletion of the 1993 Town Car from the policy, the policy covered only the Rubins' 2000 Lincoln Town Car.

         On April 14, 2016, Mr. Matt and Ms. West filed a Petition against Mr. Semien and Safeway seeking damages arising out of the February 27, 2016 auto accident. Safeway filed an Answer on May 16, 2016. Therein, it denied coverage, alleging that while it had previously issued a policy to Mr. Rubin covering the 1993 Town Car, Mr. Rubin "did not have an insurable interest at the time of the accident" because the vehicle had been sold to Mr. Semien on February 26, 2016. Safeway also alleged that coverage was not available under the policy because Mr. Rubin failed to seek or obtain consent from Safeway to transfer or assign his interest under the policy to Mr. Semien, as required by the policy.

         The Safeway policy issued to Mr. Rubin was renewed again in August 2016 for an additional six-month term through February 2017. At the time of renewal, it provided coverage only with respect to the Rubins' 2000 Lincoln Town Car. Pursuant to policy endorsements, on January 12, 2017, a 1997 Buick LeSabre was added to the policy, and on January 17, 2017, it was deleted from the policy.

         On November 7, 2016, Safeway filed a Supplemental and Amended Answer, asserting an additional coverage defense based on alleged material misrepresentations made in connection with Mr. Rubin acquiring insurance from Safeway. Specifically, Safeway asserted that Mr. Rubin intentionally failed to disclose that his son, Demetrius Coleman, was an unlicensed resident of Mr. Rubin's household and a driver of the vehicles insured under the policy. In addition, Safeway alleged that Mr. Rubin misrepresented on the endorsement application that sought to add the 1993 Town Car to the policy that he owned the Town Car, when it was actually Mr. Coleman who was the owner. Therefore, according to Safeway, the policy issued to Mr. Rubin should be considered void ab initio because of the material misrepresentations made by Mr. Rubin.

         The Safeway policy was renewed again on February 16, 2017, for an additional six-month term through August 16, 2017. At the time, it provided coverage for the 2000 Lincoln Town Car. Endorsements to the policy reflect that a 1993 Buick Roadmaster was added on March 6, 2017, and then deleted on March 20, 2017. Also in March 2017, the policy was set not to renew at the end of the term. Applicable premiums were collected through the end of the policy, and no premium payments have been returned to the Rubins.

         A bench trial was held March 26, 2018. The trial judge ultimately rendered a $17, 250.15 judgment against Safeway and Mr. Semien, finding Mr. Semien solely at fault and that the Safeway policy provided coverage to the 1993 Town Car at the time of the accident. In its reasons for ruling, the trial judge found that Safeway had waived the coverage defenses it asserted, noting

[T]he agent was aware at that time that there was another gentlemen named Demetrius Coleman who may have also gone by Demetrius Rubin . . . but the real Mr. Rubin signed that acknowledging that there was at least a Demetrius Coleman in his household. And even after that they issued and delivered the policy, accepted the premium. This accident happened, they continued to issue the policy, continued to accept premiums and continued to renew it even despite what obviously had to be a red flag with the number of vehicles that were added and deleted throughout the course of the policy. . . .
I'll note too . . . not even two months after the accident there was a lawsuit. Claims should have known this was in litigation, claims should have had an opportunity to investigate this thing and if they had not discovered before that there were potentially . . . some problems with the policy . . . they certainly should have known a lot ...

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