Farmers Texas County Mut. Ins. Co. v. Griffin, 96-0898

Decision Date13 November 1997
Docket NumberNo. 96-0898,96-0898
Citation41 Tex. Sup.Ct. J. 103,955 S.W.2d 81
Parties41 Tex. Sup. Ct. J. 103 FARMERS TEXAS COUNTY MUTUAL INSURANCE COMPANY, Petitioner, v. Robert GRIFFIN, Respondent.
CourtTexas Supreme Court

Craig Randal Lively, Beaumont, for Petitioner.

John Andrew Cowan, Beaumont, for Respondent.

PER CURIAM.

This is a declaratory judgment action. Farmers Texas County Mutual Insurance Company sought a declaration that it had no duty to defend or indemnify its insured, James Royal III, in a suit brought by Robert Griffin. The trial court granted summary judgment for Farmers. The court of appeals reversed, holding that Farmers has a duty to defend Royal but not to indemnify him. We hold that, under the facts alleged against Royal, Farmers has no duty to defend Royal in the underlying suit. We further hold that Farmers' duty to indemnify Royal constituted a justiciable controversy properly reached and decided by the trial court. Accordingly, we reverse the judgment of the court of appeals and render judgment for Farmers.

After issuing our original opinion, we recognized an issue regarding the justiciability of the duty to indemnify, which we must raise sua sponte. Central Sur. & Ins. Corp. v. Anderson, 445 S.W.2d 514, 515 (Tex.1969). We requested further briefing from the parties on this question, and now withdraw our former opinion and substitute this one in its stead.

On October 22, 1991, gunshots from a passing vehicle hit and injured Robert Griffin as he walked down the street in Beaumont, Texas. Griffin sued the driver of the vehicle, James Royal III, and others for negligence and gross negligence resulting in injury to his right leg. 1 Griffin alleged that Royal drove the vehicle while his two passengers fired the shots. Royal invoked Farmers' duty to defend him under his personal automobile liability insurance policy. Farmers defended Royal subject to a reservation of rights and then filed this declaratory judgment action to challenge its duty to defend and indemnify Royal. The record shows that the suit between Griffin and Royal remains pending.

Farmers' policy provides that Farmers "will pay damages for bodily injury or property damage for which any covered person becomes legally responsible because of an auto accident. ... We will settle or defend, as we consider appropriate, any claim or suit asking for these damages." (Emphasis added.) The policy defines a "covered person" as "you or any family member for the ownership, maintenance, or use of any auto or trailer." (Emphasis added.) The policy excludes coverage for any person "[w]ho intentionally causes bodily injury or property damage."

An insurer's duty to defend and duty to indemnify are distinct and separate duties. Trinity Universal Ins. Co. v. Cowan, 945 S.W.2d 819, 821-22 (Tex.1997). Thus, an insurer may have a duty to defend but, eventually, no duty to indemnify. For example, a plaintiff pleading both negligent and intentional conduct may trigger an insurer's duty to defend, but a finding that the insured acted intentionally and not negligently may negate the insurer's duty to indemnify. We therefore address these two duties separately.

In National Union Fire Insurance Co. v. Merchants Fast Motor Lines, Inc., 939 S.W.2d 139 (Tex.1997), we reiterated that the petition's allegations and the policy's language determine the insurer's duty to defend. Id. at 141; see also Fidelity & Guar. Ins. Underwriters, Inc. v. McManus, 633 S.W.2d 787, 788 (Tex.1982). A court must focus on the factual allegations rather than the legal theories asserted in reviewing the underlying petition. National Union, 939 S.W.2d at 141. In determining whether Farmers has a duty to defend Royal, then, we must decide whether Griffin has alleged an auto accident that does not involve intentional acts.

Griffin's petition alleges that "[s]uddenly and without warning, a vehicle driven by [Royal] approached Mr. Griffin. Several rounds of gunfire were discharged from the vehicle in the direction of the Plaintiff." It continues: "This drive-by shooting was a random act of violence which has permanently injured and scarred the plaintiff." Thus although Griffin seeks relief on legal theories of negligence and gross negligence, he alleged facts indicating that the origin of his damages was intentional behavior. He made no factual contention that could constitute negligent behavior by Royal. See National Union, 939 S.W.2d at 141. Griffin's claim is within the policy's exclusion of intentional acts. Farmers therefore has no duty to defend Royal.

Farmers is not required to defend Royal for another reason: Griffin's petition does not allege that his injuries resulted from an auto accident. "The term 'auto accident' refers to situations where one or more vehicles are involved with another vehicle, object, or person." State Farm Mut. Ins. Co. v. Peck, 900 S.W.2d 910, 913 (Tex.App.--Amarillo 1995, no writ). The term "auto accident" is not ambiguous so that a court must look to the parties' intent or a construction in favor of coverage. State Farm Life Ins. Co. v. Beaston, 907 S.W.2d 430, 433 (Tex.1995). To read Griffin's petition as alleging an "auto accident" would strain that term beyond any reasonable meaning.

Before determining whether Farmers has a duty to indemnify Griffin, we must first address whether this duty is properly justiciable by declaratory judgment before the rendition of a judgment in the underlying suit. Bonham State Bank v. Beadle, 907 S.W.2d 465, 467 (Tex.1995). In Firemen's Insurance Co. v. Burch, 442 S.W.2d 331 (Tex.1968), we held that there was no justiciable controversy regarding the insurer's duty to indemnify before a judgment has been rendered against an insured. Thus, a declaratory judgment to determine whether the insurer had a duty was premature. Based in part on the amended language of Article V, Section 8 of the Texas Constitution and our decision in State Farm Fire & Cas. Co. v. Gandy, 925 S.W.2d 696 (Tex.1996), we now hold that parties may secure a declaratory judgment on the insurer's duty to indemnify before the underlying tort suit proceeds to judgment.

In Burch, Dorothy Burch was injured in a collision between the car in which she was riding and a car driven by Sarah Buttler. At the time, Sarah was separated from her husband, Larry Buttler, and they afterward divorced. Before the accident, when the Buttlers were still living together, they purchased a family automobile policy, but only Larry Buttler was listed as a named insured. Firemen's Insurance took the position that since the Buttlers had separated, Sarah was not covered. The trial court ruled that Firemen's Insurance was obliged to defend Larry Buttler and pay any judgment rendered against him, but that it was not obliged to defend Sarah Buttler or pay any judgment rendered against her. The court of appeals affirmed. 426 S.W.2d 306 (Tex.Civ.App.--Austin 1968). This Court held that whether Firemen's Insurance was obliged to defend the Buttlers was a justiciable issue, but whether it was obliged to indemnify the Buttlers was not justiciable until judgment was rendered against them in favor of the Burches. Burch, 442 S.W.2d at 332-34.

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