Sennett v. US Fidelity and Guar. Co.

• Decision Date: 09 March 2000
• Docket Number: No. 1999-CA-00107-SCT.,1999-CA-00107-SCT.
• Citation: 757 So.2d 206
• Parties: Ralph Douglas SENNETT, Brenda H. Sennett and Brooksville Texaco Service Center a/k/a Brooksville Texaco Service Center, Inc. v. UNITED STATES FIDELITY AND GUARANTY COMPANY and Fidelity Guaranty and Insurance Underwriters, Inc.
• Court: Mississippi Supreme Court

757 So.2d 206

Ralph Douglas SENNETT, Brenda H. Sennett and Brooksville Texaco Service Center a/k/a Brooksville Texaco Service Center, Inc. v. UNITED STATES FIDELITY AND GUARANTY COMPANY and Fidelity Guaranty and Insurance Underwriters, Inc.

No. 1999-CA-00107-SCT.

Supreme Court of Mississippi.

March 9, 2000.

Kenneth M. Burns, Okolona, Attorney for Appellants.

Dewitt T. Hicks, Jr. P. Nelson Smith, Columbus, Attorneys for Appellees.

BEFORE PITTMAN AND BANKS, P.JJ., and COBB, J.

COBB, Justice, for the Court:

STATEMENT OF THE CASE

¶ 1. On June 12, 1996, Nancy Chance filed a wrongful death action in the Noxubee County Circuit Court against Ralph Douglas Sennett and Brenda H. Sennett, individually, Brooksville Texaco Center a/k/a Brooksville Texaco Service Center, Inc., and Texaco, Inc. Chance's complaint alleged that her brother, John Darren Shelton, was killed while on duty as an employee at Brooksville Texaco and demanded judgment against the defendants in the sum of one million dollars.

¶ 2. On April 16, 1998, the Sennetts filed a third-party complaint in that action pursuant to Rule 14, Mississippi Rules of Civil Procedure, against United States Fidelity and Guaranty Company (USF & G) and Fidelity Guaranty and Insurance Underwriters, Inc. (Fidelity), stating that these insurance companies had refused to provide defense and indemnification, although the Sennetts had in effect commercial general liability insurance policies to cover their business establishments, including the Brooksville Texaco Service Center at which Shelton was killed.

¶ 3. USF & G and Fidelity then filed a motion to dismiss the third-party complaint, claiming that the plain language of the policies "preclude[s] any direct action against [them]" and that "established law in Mississippi precludes the joinder of an insurer in a tort suit...." The Sennetts and Brooksville Texaco filed a response to the motion to dismiss, citing the comment to Rule 14, which mentions specifically the use of Rule 14 by a defendant to "implead his liability insurer if the insurer is disclaiming liability on the policy," to which a rebuttal was filed by USF & G and Fidelity. Circuit Court Judge John M. Montgomery conducted a hearing on the motion to dismiss and at the close of arguments requested that each side submit findings of fact and conclusions of law in support of its position. The court entered Findings of Fact and Conclusions of Law on December 1, 1998, granting dismissal of the third-party complaint filed against USF & G and Fidelity, with prejudice. A final judgment expressly determining "no just reason for delay" and directing the entry of judgment as required by Rule 54(b), was entered on January 5, 1999.

¶ 4. Aggrieved by the court's decision, the Sennetts and Brooksville Texaco filed a timely appeal to this Court. We affirm the judgment of the trial court.

STATEMENT OF THE FACTS

¶ 5. Nancy Chance brought her wrongful death action after her brother, John Darren Shelton, was shot and killed by an off-duty employee while Shelton was working as an employee at a convenience store known as Brooksville Texaco. The loaded.22 caliber handgun used to kill Shelton was kept behind the counter at the convenience store, ostensibly to provide protection for employees, and was put there by Ralph Sennett. After being sued by Chance, the Sennetts, believing that the commercial general liability insurance policy which they purchased for Brooksville Service Center and Truck Stop, Inc. should cover this action, requested assistance from USF & G and Fidelity in defending against Chance's suit. Upon being advised by the insurers that the plain language of the policy excluded injury and death of an on-duty employee from coverage and that the insurers would not defend and indemnify against the wrongful death action, the Sennetts filed a third-party complaint pursuant to Rule 14, Mississippi Rules of Civil Procedure, against USF & G and Fidelity. The complaint was filed only in the names of Ralph D. and Brenda H. Sennett and did not mention the Brooksville Texaco Service Center at all. It simply alleged that USF & G and Fidelity were required to provide defense and indemnification under the terms of "an insurance policy"; that Fidelity and USF & G should be liable for any judgment rendered against Sennetts; and that USF & G and Fidelity had refused to provide a defense and indemnification. No policy of insurance was attached to this complaint. USF & G and Fidelity filed their Motion to Dismiss, attaching copies of insurance policy number 1MP30101814600, issued to named insured Brooksville Service Center and Truck Stop, Inc. for the convenience store, and a second policy, number 1MP3003978561, virtually identical to the other, which did not include a declaration page but apparently was for another business of the Sennetts. Following argument, the trial court granted USF & G's and Fidelity's motion to dismiss the third party complaint, and a final judgment was entered on January 5, 1999.

ISSUE ON APPEAL

DID THE TRIAL JUDGE ERR IN DISMISSING THE THIRD PARTY COMPLAINT OF THE DEFENDANTS/THIRD PARTY PLAINTIFFS?

STANDARD OF REVIEW

¶ 6. A motion to dismiss for failure to state a claim under Mississippi Rule of Civil Procedure 12(b)(6) raises an issue of law. Tucker v. Hinds County, 558 So.2d 869, 872 (Miss.1990); Lester Eng'g Co. v. Richland Water & Sewer Dist., 504 So.2d 1185, 1187 (Miss.1987). This Court reviews questions of law de novo. Mississippi Transp. Comm'n v. Fires, 693 So.2d 917, 920 (Miss.1997). When considering a motion to dismiss, the allegations in the complaint must be taken as true, and the motion should not be granted unless it appears beyond doubt that the plaintiff will be unable to prove any set of facts in support of his claim. Butler v. Board of Supervisors, 659 So.2d 578, 581 (Miss. 1995).

ANALYSIS

¶ 7. The Sennetts, in challenging the trial court's judgment, assert that the trial court, by considering the underlying commercial general liability insurance policy, looked outside the pleadings. They further allege that the trial court treated the motion to dismiss as a motion for summary judgment without allowing the development of proof through discovery as the summary judgment rule requires. See Miss. R. Civ. P. 56.

¶ 8. In the case below, the trial court considered the Sennetts' complaint as well as the policies attached to the USF & G / Fidelity motion to dismiss, and determined that the policies were clear, plain, and unambiguous. Based on this determination, USF & G and Fidelity were dismissed with prejudice.

¶ 9. Although many federal courts of appeals have approved consideration of documents that are attached to a defendant's motion to dismiss under Rule 12(b)(6), without the necessity of converting the motion to a summary judgment¹, it appears that this Court has not previously done so. In Baldwin v. Laurel Ford Lincoln-Mercury, Inc., 32 F.Supp.2d 894, 898 (S.D.Miss.1998), a case in which the claim was based on a retail installment contract, the federal district court held that "[i]n attacking the pleadings, Ford Credit may introduce the document without converting it to a motion for summary judgment", citing Sheppard v. Texas Dep't of Transp., 158 F.R.D. 592, 595-96 (E.D.Tex.1994) and 5 C. Wright & A. Miller, Federal Practice and Procedure § 1327, at 762-63 (2d ed. 1990) ("[W]hen plaintiff fails to introduce a pertinent document as part of his pleading, defendant may introduce the exhibit as part of his motion attacking the pleading.") "Documents that a defendant attaches to a motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to her claim." Sheppard at 595-96.

¶ 10. "A major factor directing courts to look only towards the pleadings in deciding a 12(b)(6) motion is the concern that statements outside of the complaint will not provide adequate notice to a plaintiff. However, `[w]here plaintiff has actual notice of all of the information in the movant's papers and has relied upon these documents in framing the complaint, the necessity of translating a Rule 12(b)(6) motion into one under Rule 56 is largely dissipated.'" Cortec Indus. v. Sum Holding L.P., 949 F.2d 42, 48 (2d Cir.1991). ¶ 11. The Sennetts' third-party complaint against USF & G and Fidelity falls squarely within this application of the exception. "Here, the exhibit relied upon was specifically referred to in Plaintiff's complaint. Furthermore, this document is central and necessary to Plaintiff's cause of action [ ]." Sheppard at 596. "Additionally, Defendant tendered the entire document ... and this document directly refutes the complaint's assertions. Therefore, this court considers Plaintiff's complaint and Defendant's Exhibit I in determining whether Plaintiff's complaint states a claim upon which relief may be granted." Id.

¶ 12. The Sennetts urge that even if it was proper to consider the policies, there is ambiguity surrounding "who is the insured" in regard to the liability of Mr. Sennett for negligence, and in regard to the fact that there are two policies with different insureds.

¶ 13. At the time of Shelton's death, Brooksville Texaco Center a/k/a Brooksville Texaco Service Center, Inc., had in effect an insurance policy for commercial general liability coverage with Fidelity policy number 1MP30101814600. This policy was for the convenience store where the fatal shooting occurred. There also existed a commercial insurance policy with USF & G, policy number 1MP3003978561, covering the Brooksville Texaco Service Center, Inc. for the auto parts and repair facility, which the trial judge correctly found did not apply.²

¶ 14. The key provisions of the policies read as follows:

SECTION I—COVERAGES COVERAGE A. BODILY INJURY AND PROPERTY DAMAGE LIABILITY

1. Insuring Agreement.

a. We will pay those sums that the insured becomes legally obligated to pay as damages because of "bodily

...