Merchants Fast Motor Lines, Inc. v. National Union Fire Ins. Co. of Pittsburgh, Pa.

• Decision Date: 11 April 1996
• Docket Number: No. 11-95-225-CV,11-95-225-CV
• Citation: 919 S.W.2d 903
• Parties: MERCHANTS FAST MOTOR LINES, INC., Merchants of Texas, Inc., Merchants Truckload Company, Inc., and Gordon D. Hart, Appellants, v. NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA, Appellee.
• Court: Texas Court of Appeals

Page 903

919 S.W.2d 903

MERCHANTS FAST MOTOR LINES, INC., Merchants of Texas, Inc.,

Merchants Truckload Company, Inc., and Gordon D.

Hart, Appellants, v. NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA, Appellee.

No. 11-95-225-CV.

Court of Appeals of Texas,

Eastland.

April 11, 1996.

Rehearing Overruled May 9, 1996.

Malcolm Schulz, Schulz & Robertson, Abilene, Arlen D. "Spider" Bynum, Dallas, for appellants.

Susan Abbott Schwartz, Robin Foret, Landau, Omahana & Kopka, Ltd., Dallas, for appellee.

James L. Post, Corpus Christi.

Before ARNOT, C.J., and DICKENSON and FARRIS ¹, JJ.

ARNOT, Chief Justice.

At issue in this declaratory judgment case is National Union Fire Insurance Company of Pittsburgh, PA's duty to defend its insured, Merchants Fast Motor Lines, Inc., Merchants of Texas, Inc., Merchants Truckload Company, Inc., and a driver, Gordon D. Hart, under two policies in a wrongful death action.

While operating a Merchants' truck, Hart shot Casimiro Gonzalez, who was a passenger in a van. Gonzalez subsequently died from the gunshot wound. These are the only facts concerning the shooting contained in the pleadings. Gonzalez' parents and children brought a wrongful death action in Hidalgo County alleging that Hart was negligent in handling a firearm and that Merchants was negligent in hiring Hart and in failing to provide proper supervision of its driver. Merchants requested coverage under either of two policies, a commercial general liability policy and a truckers coverage policy, both issued by National Union.

National Union acknowledges that it has a duty to defend Merchants in the underlying suit under the commercial general liability policy. National Union has reserved its right to question its duty to indemnify Merchants under this policy. National Union brought this declaratory action in Taylor County, Merchants' principal place of business, seeking determination of its remaining duties to defend appellants under either policy. ² The trial court entered a summary judgment holding that National Union has no duty to defend Merchants against any claims alleged in the underlying suit under the truckers policy and that National Union has no duty to defend Hart under either policy. Merchants and Hart appeal, bringing two points of error complaining that the trial court erred in granting National Union's motion for summary judgment. ³ We reverse the judgment of the trial court.

To determine whether an insurer has a duty to defend its insured in a lawsuit, the allegations in the underlying suit must be considered in light of the provisions of the insurance policy. Heyden Newport Chemical Corporation v. Southern General Insurance Company, 387 S.W.2d 22 (Tex.1965); Duncanville Diagnostic Center, Inc. v. Atlantic Lloyd's Insurance Company of Texas, 875 S.W.2d 788 (Tex.App.--Eastland 1994, writ den'd). This rule is sometimes referred to as the "eight corners" rule. The allegations will be considered without reference to their truth or falsity, to what the parties know or believe to be the true facts, or to a legal determination of the true facts; and the allegations must be given a liberal interpretation, resolving all doubts in favor of the insured. Heyden Newport Chemical Corporation v. Southern General Insurance Company, supra. In reviewing the underlying pleadings, the court must focus on the factual allegations that show the origin of the damages rather than on the legal theories alleged. Adamo v. State Farm Lloyds Company, 853 S.W.2d 673 (Tex.App.--Houston [14th Dist.] 1993, writ den'd); Continental Casualty Co. v. Hall, 761 S.W.2d 54 (Tex.App.--Houston [14th Dist.] 1988, writ den'd), cert. den'd, 495 U.S. 932, 110 S.Ct. 2174, 109 L.Ed.2d 503 (1990).

The duty to defend is not affected by facts ascertained before suit, by facts developed in the process of litigation, or by the ultimate outcome of the suit. Fidelity & Guaranty Insurance Underwriters, Inc. v. McManus, 633 S.W.2d 787 (Tex.1982); Argonaut Southwest Insurance Company v. Maupin, 500 S.W.2d 633 (Tex.1973). In contrast, the duty to indemnify is based not upon the pleadings but upon the actual underlying facts which result in liability. Cullen/Frost Bank of Dallas, N.A. v. Commonwealth Lloyd's Insurance Company, 852 S.W.2d 252 (Tex.App.--Dallas 1993), writ den'd, 889 S.W.2d 266 (Tex.1994); American Alliance Insurance Company v. Frito-Lay, Inc., 788 S.W.2d 152 (Tex.App.--Dallas 1990, writ dism'd).

The factual allegations of the pleadings recite:

V.

Defendant GORDON D. HART was operating a tractor-trailer rig, owned by the Defendant MERCHANTS ... under the auspices of, and/or in furtherance of the business of the Defendant MERCHANTS ... and/or in the alternative, in the course and scope of his employment....Plaintiffs would assert and allege that ... HART was operating the tractor-trailer in a westerly direction on U.S. Highway 107. Decedent CASIMIRO GONZALEZ was a passenger in a ... van, also westbound....While the ... van was alongside the tractor rig driven by ... HART ... HART negligently discharged a firearm and caused a bullet to strike ... GONZALEZ. As a consequence ... GONZALEZ sustained severe bodily injuries ultimately resulting in his death.

VI.

Plaintiffs allege and aver that, in the events giving rise to this suit ... HART ... and MERCHANTS ... were each negligent, and that such negligence was the proximate cause of the injury to and death of ... GONZALEZ and all of the losses, damages, and injuries sustained by the Plaintiffs and made the basis of this suit. Pleading more specifically, Plaintiffs aver that ... MERCHANTS ... [was] negligent in selecting and hiring ... HART, and in failing to properly supervise ... HART, and that such negligence was the proximate cause of the injuries and damages made the basis of this suit. Further, Plaintiffs aver that ... HART was negligent in failing to properly handle and control the firearm in question, and that such negligence was the proximate cause of the injuries and damages made the basis of this suit.

The truckers policy provides:

A. COVERAGE

We will pay all sums an insured legally must pay as damages because of bodily injury or property damage to which this insurance applies, caused by an accident and resulting from the ownership, maintenance or use of a covered auto. (Emphasis added)

National Union contends that it does not owe a duty to defend either Hart or Merchants under the truckers policy because the injuries suffered by Gonzalez as alleged in the underlying suit did not result from the "ownership, maintenance or use" of the vehicle operated by Hart. National Union urges that there must be a causal connection between the use of the automobile and the accident. Because the discharging of a firearm is not causally connected to the driving of the truck, National Union argues that there is no liability and, therefore, that it has no duty to defend Merchants or Hart under the truckers policy.

As authority for its position, National Union cites Collier v. Employers National Insurance Company, 861 S.W.2d 286 (Tex.App.--Houston [14th Dist.] 1993, writ den'd). In Collier, Collier was driving a friend's vehicle when an unidentified vehicle pulled alongside and fired two shots. Collier was injured and sought to recover under the uninsured motorist provision of the policy that his friend had on the vehicle. The two vehicles never collided, and Collier's injuries resulted solely from the gunshots.

In Collier, the uninsured motorist coverage provided:

We will pay damages which a covered person is legally entitled to recover from the owner or operator of an uninsured motor...