Edwards v. La. Farm Bureau Mut. Ins. Co.
| Decision Date | 26 April 2013 |
| Docket Number | NO. 2012 CA 1495,2012 CA 1495 |
| Parties | BYARD EDWARDS, JR. v. LOUISIANA FARM BUREAU MUTUAL INSURANCE COMPANY |
| Court | Court of Appeal of Louisiana — District of US |
NOT DESIGNATED FOR PUBLICATION
State of Louisiana
Louisiana Farm Bureau
Mutual Ins. Co.
Byard Edwards, Jr.
BEFORE: GUIDRY, CRAIN, AND THERIOT, JJ.
Louisiana Farm Bureau Mutual Insurance Company appeals a summary judgment finding insurance coverage for exemplary damages and a subsequent judgment based on a jury verdict rendered in favor of Byard Edwards, Jr. Edwards answered the appeal and seeks an increase in the award of general damages and a reversal of the trial court's denial of a bad faith claim against Farm Bureau. For the following reasons, we reverse and render on the summary judgment, vacate the award of exemplary damages, and affirm in all other respects.
Edwards was involved in an automobile accident on June 5, 2006 with a vehicle operated by Kellie Dean. Edwards sustained injuries, and Dean admitted she was driving under the influence of cocaine. Dean was proceeding south on Pontchartrain Drive in Slidell, Louisiana, when her vehicle left the roadway, crossed a parking lot, struck a tree and hit two other automobiles before coming to rest upside down against a telephone pole. Edwards was a guest passenger in the second automobile impacted in the collision, and his ex-wife, Stephanie Kraemer, was the driver.
Dean's negligence was the sole and proximate cause of the accident, as determined by a summary judgment that was not appealed. Neither Dean nor the owner of the vehicle she was driving had automobile liability insurance. Farm Bureau provided uninsured/underinsured motorist insurance (UM) to Edwards through three polices: an automobile policy issued to him, an automobile policy issued to Kraemer and covering the vehicle occupied by Edwards, and an umbrella policy issued to Edwards. Prior to this litigation, Farm Bureau tendered $400,000.00 in UM benefits and $10,000.00 in medical payments coverage to Edwards, which exhausted the combined limits of the two automobile policies.
Edwards then filed suit against Farm Bureau seeking additional UM benefits under the umbrella policy. Edwards amended his petition to also seek exemplary damages under the umbrella policy pursuant to Louisiana Civil Code article 2315.4 based upon allegations that the accident and injuries were caused by Dean's operation of a motor vehicle while under the influence of an illicit substance.1
Farm Bureau denied coverage for exemplary damages under the umbrella policy, and both parties filed summary judgment motions on that issue. The trial court found coverage for exemplary damages and granted a summary judgment in favor of Edwards.
The case proceeded to a jury trial that resulted in a verdict for Edwards in the amount of $820,000.00, consisting of the following awards: $100,000.00 in medical expenses, $200,000.00 in past loss of wages, $160,000.00 in future loss of wages and/or earnings capacity, $160,000.00 in general damages, and $200,000.00 in exemplary damages. The general damage award was itemized as $20,000.00 for past and future physical pain and suffering, $40,000.00 in past mental anguish, $50,000.00 for "disability," and $50,000.00 for loss of enjoyment of life. The jury did not award damages for future mental anguish. Edwards filed a motion for judgment notwithstanding the verdict (JNOV) seeking an award for that item, which the trial court denied.
Pursuant to a pre-trial stipulation, Edward's bad faith claim was tried separately to the trial court, who found in favor of Farm Bureau. A single judgment was signed that set forth the judgment on the jury verdict, the denial of the JNOV, and the denial of the bad faith claim. After deducting the pre-suit tender, the net amount of the judgment in favor of Edwards and against Farm Bureau was $410,000.00, plus legal interest.
Farm Bureau appealed and asserted five assignments of error: (1) the trial court erred in granting Edwards' motion for summary judgment and denying Farm Bureau's motion for summary judgment based upon a finding that the umbrella policy covered exemplary damages; (2) the award of exemplary damages was manifestly erroneous because Edwards failed to satisfy his burden of proof; (3) the award of exemplary damages was abusively high; (4) the award for past lost wages was manifestly erroneous and not supported by the evidence; and (5) the award for future lost wages and loss of earning capacity was manifestly erroneous and not supported by the evidence.
Edwards answered the appeal and asserted four assignments of error: (1) the trial court erred in ruling in favor of Farm Bureau on the bad faith claim; (2) the trial court abused its discretion by refusing to permit an expert witness to testify about the damages sustained by Edwards as a result of Farm Bureau's alleged bad faith; (3) the trial court abused its discretion by failing to grant the JNOV; and (4) the jury's award of general damages was an abuse of discretion.
Farm Bureau argues that the trial court improperly granted a summary judgment finding coverage for exemplary damages under the umbrella policy. Summary judgment is properly granted if the pleadings, depositions, answers to interrogatories, and admissions, together with affidavits, if any, show that there is no genuine issue of material fact and that the mover is entitled to judgment as a matter of law. La. Code Civ. Pro. art. 966B(2). Appellate courts review evidence de novo under the same criteria that govern the trial court's determination of whether a summary judgment is appropriate. All Crane Rental of Georgia, Inc. v. Vincent, 10-0116 (La. App. 1 Cir. 9/10/10), 47 So. 3d 1024, 1027, writ denied, 10-2227 (La. 11/19/10), 49 So. 3d 387.
A summary judgment may be rendered on the issue of insurance coverage alone, although there is a genuine issue as to liability or damages. McMath Const. Co., Inc. v. Dupuy, 03-1413 (La, App. 1 Cir. 11/17/04), 897 So. 2d 677, 680-81 writ denied, 04-3085 (La. 2/18/0:5), 896 So. 2d 40. Interpretation of an insurance policy usually involves a legal question which can be resolved properly in the framework of a motion for summary judgment Bonin v Westport Ins. Corp., 05-0886 (La. 5/17/06), 930 So. 2d 906, 910. Summary judgment declaring a lack of coverage under an insurance policy may not be rendered unless there is no reasonable interpretation of the policy, when applied to the undisputed material facts shown by the evidence supporting the motion, under which coverage could be afforded. McMath Const. Co., Inc., 897 So. 2d at 681.
An insurance policy is a contract between the parties and should be construed using the general rules of interpretation of contracts set forth in the Civil Code. The judicial responsibility in interpreting insurance contracts is to determine the parties' common intent. Words and phrases used in an insurance policy are to be construed using their plain, ordinary and generally prevailing meaning, unless the words have acquired a technical meaning. La. Civ. Code arts. 2045 and 2047; Bonin, 930 So. 2d at 910.
An insurance policy should not be interpreted in an unreasonable or a strained manner so as to enlarge or to restrict its provisions beyond what is reasonably contemplated by its terms or so as to achieve an absurd conclusion. Bonin, 930 So. 2d at 910-911. Unless a policy conflicts with statutory provisions or public policy, it may limit an insurer's liability and impose and enforce reasonable conditions upon the policy obligations the insurer contractually assumes. Bonin, 930 So. 2d at 910-911. If an ambiguity remains after applying the other general rules of construction, the ambiguous contractual provision is to be construed against the insurer and in favor of coverage. However, for this rule ofstrict construction to apply, the insurance policy must be susceptible to two or more reasonable interpretations, Bonin, 930 So. 2d at 911.
The parties do not dispute that the underlying automobile policy provides UM coverage but excludes exemplary damages from the coverage.2 The automobile policy sets forth the UM coverage in "PART IV," which is captioned "PROTECTION AGAINST UNINSURED/UNDERINSURED MOTORIST" and consists of eight pages of terms, conditions and definitions that specify and define the extent of the UM coverage provided by the policy. The UM section begins with an insuring agreement whereby Farm Bureau agrees to "pay all sums, except punitive and/or exemplary damages, which the insured or his legal representative shall be legally entitled to recover as damages from the owner or operator of an uninsured or underinsured automobile . . . The ensuing pages define numerous key terms, impose exclusions, set limits of liability, and provide other coverage-related conditions, all pertaining to the UM coverage.
In contrast, the umbrella policy contains no terms and conditions in the basic policy that set forth any UM coverage. The insuring agreement provides for indemnity for liability to others, with Farm Bureau agreeing to indemnify Edwards for the "ultimate net loss in excess of the applicable underlying or retained limit" which Edwards may sustain "by reason of liability imposed . . . for damages" because of personal injury or property damage. The umbrella policy contains no corresponding insuring agreement providing UM coverage in the policy. Thus the only source of UM coverage in the umbrella policy is found in the language of an endorsement, "Endorsement #13," which provides:
To continue reading
Request your trial