Canal Ins. Co. v. Nat'l House Movers, LLC
| Decision Date | 16 September 2015 |
| Docket Number | No. 5353.,Appellate Case No. 2014–000150.,5353. |
| Citation | 414 S.C. 255,777 S.E.2d 418 |
| Parties | CANAL INSURANCE COMPANY, Appellant, v. NATIONAL HOUSE MOVERS, LLC, Kevin E. Jones, David Black, Ron Hewes, and Brent Jones, Respondents. |
| Court | South Carolina Court of Appeals |
Mark Steven Barrow and William Roberts Calhoun, Jr., of Sweeny Wingate & Barrow, P.A., of Columbia, for appellant.
George Brandt, III, of Henderson Brandt & Vieth, P.A., of Spartanburg, and Eugene C. Covington, Jr., of Covington, Patrick, Hagins, Stern & Lewis, LLC, both of Greenville, for respondents.
In this declaratory judgment action, Canal Insurance Company (Canal) appeals the circuit court's finding that National House Movers, LLC's (NHM) commercial automobile insurance policy provided indemnity coverage for injuries Kevin Jones sustained while working for NHM. Canal contends Jones was an employee, as opposed to a “temporary worker,” and as such, was excluded from indemnity coverage afforded by NHM's policy. We disagree and affirm.
At issue in this declaratory judgment action is the employment status of Kevin Jones. NHM is a small house-moving company comprised of three members: Brent Jones,1 David Black, and Ron Hewes. Hewes is the only permanent employee of NHM and conducts all of the company's operations to elevate or move houses. Hewes hires workers on a project-by-project basis, depending on the needs of a particular job. NHM has no written policies for hiring or firing workers but requires that a potential worker be interviewed by Hewes.
On February 2, 2012, David Johnson, who worked on NHM projects “off and on over the years,” contacted Jones about assisting NHM in moving a house. Prior to contacting Jones, Johnson asked Hewes whether more help was needed for this specific job, to which Hewes responded that “one more probably wouldn't hurt.” Johnson then called Jones, and Jones agreed to help. Johnson picked him up and transported Jones to the job site to assist NHM in moving a house.
For this particular job, Jones's responsibility was to facilitate the movement of non-electrical cable and telephone wires over the roof of the house to prevent the wires from getting stuck and possibly causing damage to the telephone poles or the house. Hewes instructed Jones to sit on the roof of the house, and if Jones saw a non-electrical wire that might get caught, then he was to use a piece of PVC pipe to facilitate the wire across the roof. Hewes was walking in front of the slow-moving truck when the accident occurred. While the accident had no eyewitnesses, at some point, Jones's arm either touched or came into close contact with an overhead power line, resulting in serious injuries to him.
Because NHM did not qualify for workers' compensation insurance, Jones initiated suit against NHM on June 26, 2012. NHM was insured by a commercial automobile insurance policy issued by Canal, which provided indemnity for “all sums an insured legally must pay as damages because of bodily injury ... caused by an accident resulting from ownership or use of a covered vehicle.”2 However, Canal excluded from the policy's coverage any bodily injury sustained by an employee arising out of and in the course of the employee's duties with NHM.
Pursuant to NHM's policy with Canal, The policy further defines a temporary worker as follows: Distinct from a “temporary worker,” a “leased worker” was defined under the policy as “a person leased to [the employer] by a labor leasing firm to perform duties related to the conduct of your business.”
Canal defended the lawsuit under a reservation of rights, and on September 26, 2012, Canal filed the underlying declaratory judgment action, contending the insurance policy excluded coverage for Jones's injuries. Specifically, Canal argued Jones was an employee and, thus, NHM was expressly excluded from indemnity coverage under the policy. In response, NHM argued Jones was a temporary worker who was furnished to NHM by a third party and, as such, Jones's injuries were not excluded from the policy's coverage.
The circuit court agreed with NHM, finding Jones's seasonal employment with NHM rendered him a temporary worker. Because “furnish” was not specifically defined in the policy and had yet to be construed by our courts in the context of an insurance policy, the circuit court reviewed case law from other jurisdictions in reaching its decision. In doing so, the court found the vast majority of jurisdictions concluded the phrase “furnished to you” necessarily means a third party is involved in “furnishing” the temporary worker to the employer, and third party involvement did not have to be restricted to an employment or staffing agency. As a result, the circuit court held Jones was a “temporary worker” within the meaning of the policy and NHM was, therefore, entitled to indemnity coverage. This appeal followed.
Did the circuit court err in holding Jones was a temporary worker rather than an employee of NHM and, thus, finding Canal was required to provide indemnity coverage to NHM for Jones's injuries?
“The standard of review in a declaratory action is determined by the underlying issues.”Nationwide Mut. Ins. Co. v. Rhoden, 398 S.C. 393, 398, 728 S.E.2d 477, 479 (2012) (citation omitted). If the dispute is an action to determine whether coverage exists under an insurance policy, the action is one at law. Id. (citation omitted). In an action at law, tried without a jury, the appellate court will not disturb the circuit court's findings of fact unless they are found to be without evidence that reasonably supports those findings. Townes Assocs., Ltd. v. City of Greenville, 266 S.C. 81, 86, 221 S.E.2d 773, 775 (1976) (citation omitted). “Where the action presents a question of law, as does this declaratory action, this [c]ourt's review is plenary and without deference to the [circuit] court.” Crossmann Cmtys. of N.C., Inc. v. Harleysville Mut. Ins. Co., 395 S.C. 40, 47, 717 S.E.2d 589, 592 (2011) (citation omitted).
Canal argues the circuit court erred in concluding Jones's employment with NHM was of a temporary nature and, therefore, finding NHM was entitled to indemnity coverage for the injuries Jones sustained while working for NHM. We disagree.
An insurance policy is a contract between the insured and the insurance company, and the policy's terms are to be construed according to the law of contracts. Auto Owners Ins. Co. v. Rollison, 378 S.C. 600, 606, 663 S.E.2d 484, 487 (2008) (citation omitted). “Where the contract's language is clear and unambiguous, the language alone determines the contract's force and effect.” McGill v. Moore, 381 S.C. 179, 185, 672 S.E.2d 571, 574 (2009) (citation omitted). “Courts must enforce, not write, contracts of insurance, and their language must be given its plain, ordinary[,] and popular meaning.” Sloan Constr. Co. v. Cent. Nat'l Ins. Co. of Omaha, 269 S.C. 183, 185, 236 S.E.2d 818, 819 (1977) (citation omitted).
“It is a question of law for the court whether the language of a contract is ambiguous.” S.C. Dep't of Nat. Res. v. Town of McClellanville, 345 S.C. 617, 623, 550 S.E.2d 299, 302–03 (2001) (citation omitted). The construction of a clear and unambiguous contract is a question of law for the court to determine. Hawkins v. Greenwood Dev. Corp., 328 S.C. 585, 592, 493 S.E.2d 875, 878 (Ct.App.1997) (citation omitted). If the court decides the language is ambiguous, however, evidence may be admitted to show the intent of the parties, and the determination of the parties' intent becomes a question of fact for the factfinder. Id. at 592, 493 S.E.2d at 878–79 (citation omitted).
“Ambiguous or conflicting terms in an insurance policy must be construed liberally in favor of the insured and strictly against the insurer.” Diamond State Ins. Co. v. Homestead Indus., Inc., 318 S.C. 231, 236, 456 S.E.2d 912, 915 (1995) (citation omitted). “A contract is ambiguous when it is capable of more than one meaning when viewed objectively by a reasonably intelligent person who has examined the context of the entire integrated agreement and who is cognizant of the customs, practices, usages [,] and terminology as generally understood in the particular trade or business.” Hawkins, 328 S.C. at 592, 493 S.E.2d at 878 (quoting 17A Am. Jur. 2dContracts § 338 (1991) ).
“A contract is read as a whole document so that one may not create an ambiguity by pointing out a single sentence or clause.” McGill, 381 S.C. at 185, 672 S.E.2d at 574 (citation omitted). Whether a contract is ambiguous is to be determined from examining the entire contract, not by reviewing isolated portions of the contract. Farr v. Duke Power Co., 265 S.C. 356, 362, 218 S.E.2d 431, 433 (1975) (citation omitted).
Ascertaining whether Jones was a “temporary worker” pursuant to the terms of the policy involves a two-step analysis. We must determine (1) whether NHM hired Jones to “meet seasonal or short-term workload conditions” as required by NHM's policy; and (2) if so, whether Johnson's suggestion to hire Jones satisfied the policy's requirement that the temporary worker be “furnished to [NHM].” We find both of these requirements were satisfied in the instant case.
We first address whether Jones was hired to “meet seasonal or short-term workload conditions.”3
The insurance policy expressly defines a “temporary worker” as “a...
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