NATIONAL INSURANCE COMPANY, Plaintiff, v. ISRAEL MARTINEZ, JR., et al., Defendants.
Civil Action No. 7:16CV00075 7:15CV00665 2015 2016 1980 2016 2006 1993 2000 2010 2011 2008 1995 2003 22nd Civil Action No. 7:16CV00075
UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF VIRGINIA, ROANOKE DIVISION
2016 U.S. Dist. LEXIS 177853
December 22, 2016, Decided
OPINION
Chief United States District Judge , another commercial motor carrier based in Texas. The disabled tractor had been left in the parking lot of a rest stop adjacent to the interstate., and Eddie Lozano used the SMC Tractor to tow a third tractor (the “Lozano Tractor”) to Virginia, so that Lozano could deliver the goods that remained in the trailer attached to the disabled Salinas Express Tractor. Upon arriving at the rest stop, the Lozano Tractor was unhooked from the SMC Tractor and then used to deliver the remaining goods. The Salinas Express Tractor was then hooked up to the SMC Tractor, so that it could be towed back to Texas.Martinez and Roy attempted to leave the rest stop in the SMC Tractor with the Salinas Express Tractor in tow. To do so, Martinez drove north, on the entrance ramp to the rest stop, so that he could make a U-turn onto southbound I-81. In attempting to make the U-turn, Martinez caused the SMC Tractor, towing the Salinas Express Tractor, to block at least the right lane of travel.Lester approached the entrance ramp to the rest stop while traveling in the right lane. He was unable to stop or maneuver his vehicle in time to avoid hitting the SMC Tractor. A second [*2] vehicle, operated by Anthony Shifflett, then struck Lester’s vehicle., under which the Salinas Express Tractor was a “covered ‘auto.'” The Falls Lake Policy obligates Falls Lake to “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.'” Falls Lake Motor Carrier Coverage Form § II(A), Docket No. 1-2. Section II(A)(1) of the Falls Lake Policy defines “Who Is An Insured.” That section provides, in pertinent part, as follows:hire or borrow except: The owner or any “employee”, agent or driver of the owner, or anyone else from whom you hire or borrow a covered “auto”. Your “employee” or agent if the covered “auto” is owned by that “employee” or agent or a member of his or her household.none of the following is an “insured”: Any “motor carrier” for hire or his or her agents or “employees”, other than you and your “employees”: If the “motor carrier” is subject to motor carrier insurance requirements and meets them by a means other than “auto” liability insurance . . . .(1).. Those vehicles include “Temporary Substitute [*3] Autos,”(3).SMC was insured under a motor carrier liability policy. It is undisputed, however, that theand, thus, that it was not insured under that policy. Accordingly, there is noin pertinent part, as follows:all terms, conditions, and limitations in the policy to which the endorsement is attached shall remain in full force and effect as binding between the insured and the company. The insured agrees to reimburse the company for any payment made by the company on account of any accident, claim, or suit involving a breach of the terms of the policy, and for any payment that the company would not have been obligated to make under the provisions of the policy except for the agreement contained in this endorsement . . . .Docket No. 65-8.Falls Lakejudgment that it does not have a duty to indemnifyMartinez, or SMC with respect to any claims asserted against them as a result ofjudgment action is now before the court on cross-motions forjudgment filed by Lester, United Specialty, and Falls Lake. Lester urges the court to conclude that Salinas Express is entitled to liability coverage under the Falls Lake Policy. United Specialty urges the court to conclude that its insured, SMC, is entitled [*4] to liability coverage under the Falls Lake Policy. Falls Lake, on the other hand, moves the court to conclude that coverage is not owed to Salinas Express, SMC, Martinez, or Roy.2which the parties agree applies in the instant case, the interpretation of an insurance policy presents a question of law. Seahawk Liquidating Trust v. Certain (“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’.”). For the following reasons, the court disagrees with Falls Lake and concludes, as matter of law, that Salinas Express is entitled to coverage.the Texas Supreme Court articulated a three-part test for determining whether an injury arises from the use of a motor vehicle for purposes of liability insurance coverage: the accident must have arisen out of the inherent nature of the automobile, as such, the accident must have arisen within the natural territorial limits of an automobile, and the actual use must not have terminated, [and] (3) the automobile must not merely contribute to cause the condition which produces [*5] the injury, but must itself produce the injury.345 S.W.3d at 55.decision in Lindsey “demonstrates just how broadly its test for ‘use’ is interpreted.” Lincoln Gen. Ins., 468 F.3d at 859. That case involved a child who997 S.W.2d at 154. In so doing, the child accidentally touched a loaded shotgun resting in a gun rack mounted over the rear window, causing the gun to discharge and injure a passenger in another vehicle. Id. On these facts, the Supreme Court concluded that the passenger’s injury “arose out of the use of the . . . truck as a matter of law.” Id. at 158. The Court reasoned that the child’s sole purpose was to gain entry into the truck, that his unorthodox method of entry was not an unexpected or unnatural use of the vehicle, and that it was the child’s efforts to enter the vehicle that directly caused the gun to discharge and the nearby passenger to become injured. Id. Although the case was a “close” one, the Court ultimately held that the “truck ‘produced’ . . . the injury,” and “was not merely the situs of activity, unrelated to any use of the truck that resulted in the accident.”3 Id. at 159.997 S.W.2d at 157. Because the accident occurred on a roadway, while the Salinas Express Tractor was being towed by the SMC Tractor, the courtfungible with any other situs, it is not [*6] being ‘used.'” Lincoln Gen. Ins ., 468 F.3d 857, 860 n.2. For instance, in Lancer Insurance Company v. Garcia Holiday Tours, the Texas Supreme Court ruled that the transmission of tuberculosis from a bus driver to his passengers “did not result from the vehicle’s use but rather from the bus company’s use of an unhealthy driver.” 345 S.W.3d at 59. The Court reasoned that “the bus was the mere physical situs of the exposure to the infected person, which could have occurred anywhere.” Id. at 58.the court concludes that the Salinas Express Tractor produced the injuries at issue. The underlying accident would not have occurred if the Salinas Express Tractor had not broken down along the interstate and needed to be towed from the rest stop. The Salinas Express Tractor was connected to the SMC Tractor at the time of the accident, and the presence and positioning of the Salinas Express Tractor at the rest stop resulted in the effort to make a U-Turn from the entrance ramp onto southbound I-81. While Falls Lake emphasizes that Lester’s vehicle only made contact with the SMC Tractor and that the Salinas Express Tractor sustained no damage, the court finds these facts to be of no consequence, especially in light of Lindsey. In Lindsey, even though a shotgun [*7] inflicted the injury, the Texas Supreme Court found that the insured truck “produced” the injury, since the accident would not have occurred but for the child’s efforts to gain entry to the truck. Lindsey, 997 S.W.2d at 160 [*1] . Likewise, in this case, while Lester’s vehicle struck the SMC Tractor, the disabled Salinassince the accident would not have occurred but for the actions undertaken to remove the disabled truck from the rest stop.judgment on this issue, and grant Lester’s motion for partial summary judgment.4SMC’s insurer, argues that SMC is an additional “insured” under the Falls Lake Policy, and that the SMC Tractor is a “covered ‘auto'” under that policy. For the following reasons, the court disagrees with United Specialty and concludes, as a matter of law, that SMC is not entitled to coverage under the Falls Lake Policy. of § II(A)(1), which provides that the following are “insureds”: “Anyone liable for the conduct of an ‘insured’ described above but only to the extent of that liability.” Falls Lake Motor Carrier Coverage Form § II(A)(1)(e), Docket No. 1-2. SMC contends that its “only exposure in the underlying suit is based on vicarious liability,” and that “it is very probable that . . . any vicarious [*8] liability would have to flow through the named insured Salinas Express.” United Specialty’s Br. in Response to Falls Lake’s Mot. for Partial Summ. J. 10, Docket No. 67. In response, Falls Lake and Lester dispute this assertion and argue that evenproceedings., the subsequent “motor carrier” exclusion precludes coverage for SMC. The court agrees with Falls Lake and Lester.the policy provides that “none of the following is an ‘insured'”: Any “motor carrier” for hire or his or her agents or “employees”, other than you and your “employees”: If the “motor carrier” is subject to motor carrier insurance requirements and meets them by a means other than “auto” liability insurance. of the Falls Lake Policy, which provides that the following types of vehicles are “also covered ‘autos’ for Covered Autos Liability Coverage”:. United Specialty emphasizes that it is undisputed that the Salinas Express Tractor was “broken down,” and that its “broken down condition was the sole reason for Martinez, Roy Salinas, Eddie Lozano . . . and Salinas Express to be using the SMC truck.” United Specialty’s Br. in Response to Falls Lake’s Mot. for Partial Summ. J. 8-9, Docket No. 67.the court fails to see how [*9] the SMC Tractor could be deemed a “temporary substitute” for the Salinas Express Tractor. Instead, the only “temporary substitute” was the tractor used by Eddie Lozano to complete the delivery of goods that the Salinas Express Tractor was supposed to make. By completing the interstate job in question, the Lozano Tractor took the place of the disabled Salinas Express Tractor and performed the function that itwhich was merely used as a tow truck. Accordingly, the SMC Tractor is not a “covered ‘auto'” and SMC is not entitled to coverage under the Falls Lake Policy. ORDER Chief United States District Judge This case is before the court on motions for partial summary judgment filed by Falls Lake
National Insurance Company (“Falls Lake”), Brandon Lester, and United Specialty Insurance
Company (“United Specialty”). For the reasons stated in the accompanying memorandum
opinion, it is now
ORDERED
as follows:
- Falls Lake’s motion for partial summary judgment (Docket No. 65) is
GRANTED IN PART AND DENIED IN PART;
- Lester’s motion for partial summary judgment (Docket No. 63) is GRANTED; and
- United Specialty’s motion for partial summary judgment (Docket No. 71) is
DENIED.
The Clerk is directed to [*10] send copies of this order and the accompanying memorandum
opinion to all counsel of record.
DATED: This 22nd day of December, 2016.
/s/ Glen E. Conrad
Chief United States District Judge
