Case Title: Dennis Maciasz et al. v. Fireman's Fund Insurance Company and Chicago Insurance Company

Citation: 

Docket Number: 1061133

State: alabama

Court: Alabama Supreme Court

Date: 2008-01-18T00:00:00Z

Document:
REL: 01/18/2008
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter.  Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334)
229-0649), of any typographical or other errors, in order that corrections may be made
before the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
 OCTOBER TERM, 2007-2008
_________________________
1061133
_________________________
Dennis Maciasz et al.
v.
Fireman's Fund Insurance Company and Chicago Insurance
Company
Appeal from St. Clair Circuit Court
(CV-03-19)
LYONS, Justice.
Dennis Maciasz and Stephanie Maciasz, as individuals, and
Dennis Maciasz, as father and next friend of Tina Maciasz, a
deceased minor, appeal from a summary judgment entered in
favor of Fireman's Fund Insurance Company ("Fireman's") and
1061133
2
Chicago Insurance Company, intervenors in an action between
the Maciaszes and Christian Cheerleaders of America, Inc.
("CCA").  We affirm.
I. Facts and Procedural History
 
On July 20, 2002, a van transporting members of the CCA
staff was involved in a single-vehicle accident in St. Clair
County.  The van was traveling from a cheerleading camp in
Texas to a cheerleading camp in North Carolina.  Tina Maciasz,
a 17-year-old member of the CCA staff and a resident of
Louisiana, died as a result of injuries she suffered in the
accident.  
In 2003, Dennis Maciasz and Stephanie Maciasz, as
individuals, and Dennis Maciasz, as Tina's father and next
friend, sued Ford Motor Company, Goodrich Corporation,
Michelin 
North 
America, 
Inc., 
and 
fictitiously 
named
defendants in the St. Clair Circuit Court, seeking to recover
damages resulting from the accident.  On July 12, 2004, the
Maciaszes amended their complaint to add claims against CCA
alleging negligence and negligent entrustment of the van.  On
December 9, 2005, the Maciaszes added a claim of negligent
1061133
3
supervision against CCA.  CCA was the only defendant remaining
when the case was set for trial.
On April 3, 2006, the trial court entered a consent
judgment against CCA in the amount of $1,500,000.  CCA, at the
time of the accident, maintained a "Sports General Liability
Policy-Occurrence 
Policy" 
("the 
sports 
liability 
policy") 
that
consisted of (1) a liability portion insured through Chicago
Insurance Company, a subsidiary of Fireman's, and (2) an
accident-medical portion insured through Hartford Insurance
Company.  CCA also maintained an automobile liability policy
with Allstate Insurance Company at the time of the accident.
The consent judgment states that Allstate agreed to pay
$150,000 in complete satisfaction of any amounts it owes on
CCA's automobile liability policy.  The consent judgment
further states:
"[The Maciaszes] shall have the right to execute and
collect said Judgement and prosecute all claims and
causes of action owned by [CCA] against any and all
Fireman's Fund Policies, including the 'Sports
General Liability Policy-Occurrence Policy' and all
addendums 
and/or amendments thereto, or other
policies 
providing 
coverage 
to 
[CCA]. 
[The
Maciaszes] cannot execute or collect on the Allstate
Policy, other than the Allstate payment."
1061133
The record is unclear as to when Chicago Insurance
1
intervened.
4
On May 22, 2006, the trial court permitted Fireman's to
intervene in the action between the Maciaszes and CCA.1
Firemen's also challenged the consent judgment by filing a
Rule 59(e), Ala. R. Civ. P., motion to alter, amend, or vacate
the consent judgment to protect itself against the enforcement
of the judgment or from prejudice in subsequent proceedings
stemming from the consent judgment and by filing a Rule 60,
Ala. R. Civ. P., motion for relief from the judgment insofar
as it related to Fireman's.  On September 26, 2006, the trial
court stayed all proceedings related to Fireman's Rule 59 and
Rule 60 motions pending resolution of the issue whether CCA's
sports liability policy provided coverage for damages arising
from the accident that gave rise to the Maciaszes' claims
against CCA.
The 
sports 
liability 
policy 
issued 
by 
Fireman's
subsidiary, Chicago Insurance, states that it is made and
accepted subject to several different forms and endorsements,
including CG 00 01 01 96; GLD-2065 (09/96); and GLE-8049
(08/99).  Form CG 00 01 01 96, titled "Commercial General
Liability Coverage Form" states:
1061133
5
"We will pay those sums that the insured becomes
legally obligated to pay as damages because of
'bodily injury' or 'property damage' to which this
insurance applies.  We will have the right and duty
to defend the insured against any 'suit' seeking
those damages.  However, we will have no duty to
defend the insured against any 'suit' seeking
damages for 'bodily injury' or 'property damage' to
which this insurance does not apply.  We may at our
discretion investigate any 'occurrence' and settle
any claim or 'suit' that may result."
This form includes an automobile exclusion, which states that
the insurance does not apply to: "'Bodily injury' or 'property
damage' arising out of the ownership, maintenance, use or
entrustment to others of any aircraft, 'auto' or watercraft
owned or operated by or rented or loaned to any insured.  Use
includes operation and 'loading' and 'unloading.'"
Form GLD-2065 (09/96), titled "Extension of Declarations"
states that "COVERAGE AFFORDED BY THIS POLICY IS SPECIFICALLY
LIMITED TO THE SPORTS OR ACTIVITIES CLASSIFICATION(S) LISTED
BELOW FOR WHICH AN ADVANCE PREMIUM IS SHOWN."  (Capitalization
in original.)  Under the "Classification" column is a
subheading "Sports Camps/Clinics."  Under that subheading are
two entries: "All approved sports activities included" and
"Participant coverage for coaches is provided for team sports,
1061133
The summary judgment in favor of Fireman's and Chicago
2
Insurance mooted Fireman's pending and stayed Rule 59 and Rule
60 motions.
6
camps/clinics only if covered by Primary Accident/Medical
Policy."
Endorsement 
GLE-8049 
(08/99), 
titled 
"Nationwide
Amendatory Endorsement for Sports Associations" states "THIS
ENDORSEMENT 
CHANGES 
THE 
POLICY." 
 
(Capitalization 
in
original.)  The endorsement further states under the coverage-
limitation heading:
"Liability coverage afforded by this policy is
specifically limited to the Sports Classification(s)
which have been scheduled, with an advance premium,
on the EXTENSION OF DECLARATIONS of this policy and
applies ONLY while covered, sponsored and supervised
activities of the NAMED INSURED are taking place.
Coverage 
also 
applies 
directly 
prior 
to 
and
following 
such 
activities, 
provided 
that
'participants' are under the direct supervision of
the NAMED INSURED." 
(Capitalization in original.)
On February 23, 2007, Fireman's and Chicago Insurance,
jointly, and the Maciaszes moved for a summary judgment on the
question 
whether 
the 
sports liability policy provided
insurance coverage.  After a hearing, the trial court entered
a summary judgment in favor of Fireman's and Chicago
Insurance.   The trial court's order states that North
2
1061133
7
Carolina law should apply to determine the insurance-coverage
question.  The order then specifically states:
"5. ... [T]he central issue in the case [is] whether
or not the sports general liability policy covers
travel to and from camp [sites].  
"6.  That it is the ruling of this court that it
does not.  
"7.  That the Sports General Liability Policy
clearly sets out those activities covered under the
policy, one of which is cheerleading 'youth only.'
"8.  The Court finds that this language is explicit,
the coverage is explicit, the policy is not
ambiguous."
The Maciaszes then appealed to this Court.
II. Standard of Review
"The standard by which this Court will review a
motion for summary judgment is well established:
"'The principles of law applicable to
a motion for summary judgment are well
settled.  To grant such a motion, the trial
court must determine that the evidence does
not create a genuine issue of material fact
and that the movant is entitled to a
judgment as a matter of law.  Rule
56(c)(3), Ala. R. Civ. P.  When the movant
makes a prima facie showing that those two
conditions are satisfied, the burden shifts
to the nonmovant to present "substantial
evidence" creating a genuine issue of
material fact.  Bass v. SouthTrust Bank of
Baldwin County, 538 So. 2d 794, 797-98
(Ala. 1989); § 12-21-12(d)[,] Ala. Code
1975.  Evidence is "substantial" if it is
1061133
Neither party challenges the trial court's conclusion
3
that North Carolina law governs the construction of the sports
liability policy. 
8
of 
"such 
weight 
and 
quality 
that
fair-minded persons in the exercise of
impartial judgment can reasonably infer the
existence of the fact sought to be proved."
West v. Founders Life Assur. Co. of
Florida, 547 So. 2d 870, 871 (Ala. 1989).
"'In our review of a summary judgment,
we apply the same standard as the trial
court.  Ex parte Lumpkin, 702 So. 2d 462,
465 (Ala. 1997).  Our review is subject to
the caveat that we must review the record
in a light most favorable to the nonmovant
and must resolve all reasonable doubts
against the movant.  Hanners v. Balfour
Guthrie, Inc., 564 So. 2d 412 (Ala.
1990).'"
Payton v. Monsanto Co., 801 So. 2d 829, 832-33 (Ala. 2001)
(quoting Ex parte Alfa Mut. Gen. Ins. Co., 742 So. 2d 182, 184
(Ala. 1999)). 
III. Analysis
We apply North Carolina law  in determining whether the
3
trial court properly ruled, as a matter of law, that the
sports liability policy does not cover damages resulting from
the vehicle accident that gave rise to the Maciaszes' claims
against CCA. 
1061133
9
The Maciaszes argue that the trial court incorrectly
interpreted and applied North Carolina law to conclude that
the sports liability policy was explicit and unambiguous.  The
Maciaszes assert that under North Carolina law, an insurance
policy is ambiguous when "[a] reasonable reading of the
insurance policy could produce either the reading offered by
plaintiff or the reading offered by defendants ...."
Scottsdale Ins. Co. v. Travelers Indem. Co., 152 N.C. App.
231, 234, 566 S.E.2d 748, 750 (2002).  The Maciaszes rely on
Scottsdale Insurance to argue that the sports liability policy
is ambiguous because, they say, the automobile exclusion and
the extension of declarations can reasonably be read so as to
be in direct conflict.    
In Scottsdale Insurance, several baseball players were
injured in an automobile accident while traveling between
baseball games.  152 N.C. App. at 232, 566 S.E.2d at 748.  The
insurer of the baseball team's sponsor sought a judgment
declaring that the sponsor's commercial general liability
policy did not cover damages arising from the automobile
accident.  Id.  The policy  contained an automobile exception
and an endorsement that provided coverage for "activities
1061133
10
necessary 
or 
incidental 
to 
the 
conduct 
of 
practice,
exhibitions, scheduled or postseason games."  152 N.C. App. at
233, 566 S.E.2d at 749.  The Court of Appeals of North
Carolina noted that "this endorsement expands the policy's
coverage.  The endorsement contains the clause 'THIS
ENDORSEMENT CHANGES THE POLICY.'"  Id. (capitalization in
original) (emphasis added). 
The court found that the policy was ambiguous because the
endorsement that expanded coverage to "activities necessary or
incidental to the conduct of" a scheduled game could
reasonably be read as covering travel between games and
therefore to directly conflict with the automobile exclusion
in the policy.  152 N.C. App. at 233-34, 566 S.E.2d 749-50.
Because an ambiguous policy must be construed in favor of the
insured, the court held that the policy covered damages
arising from the automobile accident.  Id.  The Maciaszes
assert that Scottsdale Insurance is nearly indistinguishable
from the present case and that it requires reversal of the
summary judgment in favor of Fireman's and Chicago Insurance.
Fireman's and Chicago Insurance contend that the phrase
"[a]ll approved sports activities included" in the extension
1061133
11
of declarations, CGL-2065 (09/96), in CCA's policy is
critically different from the endorsement in Scottsdale
Insurance providing coverage for "activities necessary or
incidental to the conduct of [a scheduled activity]."
(Emphasis added.)  Fireman's and Chicago Insurance contend
that the extension of declarations does not expand the scope
of CCA's coverage but merely extends the same coverage -- for
injuries occurring while covered athletic programs are taking
place -- to campers and coaches who would not have otherwise
been covered by the initial deposit premium paid by CCA for
cheerleading camps. The agent who sold CCA the policy
explained that because there was uncertainty as to the number
of people attending camps, a "deposit" premium is collected,
and the camp is thereafter required to inform the insurer of
the number of attendees at the camp.  An additional premium is
then collected based on the number of attendees; therefore,
the "extension of declarations" merely adds the participants
in the camp to the policy.  Thus, Fireman's and Chicago
Insurance argue that the extension of declarations for "[a]ll
approved sports activities" in the sports liability policy,
unlike the endorsement in Scottsdale Insurance, does not
1061133
12
expand coverage so as to bring it into conflict with the
automobile exclusion in the policy.
We agree that Scottsdale Insurance is distinguishable
from the present case.  The Maciaszes improperly treat the
coverage provided for in the extension of declarations as an
endorsement expanding the scope of covered activities.  Unlike
the 
endorsement 
in 
Scottsdale Insurance, however, the
extension of declarations in the sports liability policy does
not state that it expands coverage; it does not even use the
word 
"endorsement." 
 
Furthermore, 
the 
extension 
of
declarations states that "COVERAGE AFFORDED BY THIS POLICY IS
SPECIFICALLY 
LIMITED 
TO 
THE 
SPORTS 
OR 
ACTIVITIES
CLASSIFICATION(S) LISTED BELOW ...." (Capitalization in
original.) (Emphasis added.)  Absent from CCA's policy is any
language analogous to the reference to "activities necessary
or incidental to the conduct of [a scheduled activity]"
present in Scottsdale Insurance, thereby justifying the
Scottsdale Insurance court's inclusion of transportation to or
from the activity as within the scope of coverage of the
policy.   
1061133
13
Fireman's and Chicago Insurance contend that the present
case is analogous to Builders Mutual Insurance Co. v. North
Main Construction, Ltd., 176 N.C. App. 83, 625 S.E.2d 622
(2006).  In Builders Mutual Insurance, an insurer sought a
judgment declaring that the automobile exclusion, identical to
that found in the sports liability policy, in an employer's
commercial general liability policy excluded coverage for
claims of negligent hiring, supervision, and/or retention of
a driver who was involved in an automobile accident.  176 N.C.
App. 85-86, 625 S.E.2d at 623-24.  The Court of Appeals of
North Carolina noted that "[i]n determining whether an
automobile exception applies, this Court looks to the actual
causes of a given injury and considers whether a cause
separate from the use of a vehicle resulted in those
particular injuries."  176 N.C. App. at 89, 625 S.E.2d at 625.
The court held that because the "injuries could not have
occurred in the absence of the use of the automobile," the
automobile exclusion precluded coverage under the policy.  Id.
In the present case, the injuries to Tina Maciasz, giving
rise to the Maciaszes' claims, were clearly caused by the use
of an automobile: therefore, the automobile exclusion in the
1061133
14
sports liability policy precludes coverage under the policy.
We further find no conflict between the automobile exclusion
in the sports liability policy and the extension of
declarations, which limits coverage to "[a]ll approved sports
activities."  The trial court correctly found that there was
no coverage under the policy for damages arising from the
automobile accident.
The Maciaszes also argue that the trial court erred in
concluding that the sports liability policy was explicit and
unambiguous because, they say, the lack of a definition in the
policy of the phrase "[a]ll approved sports activities"
creates an ambiguity that must be construed against Fireman's
and Chicago Insurance, as drafters of the sports liability
policy.  Fireman's and Chicago Insurance contend that a
definition of "[a]ll approved sports activities" is not needed
because a plain reading of the terms "sport" and "activity"
reveal that the phrase "approved sports activities" is not
capable of more than one meaning.  The Court of Appeals of
North Carolina has held that "[i]nsurance contracts are
construed according to the intent of the parties, and in the
absence of ambiguity, we construe them by the plain, ordinary
1061133
15
and accepted meaning of the language used." Integon Gen. Ins.
Corp. v. Universal Underwriters Ins. Co., 100 N.C. App. 64,
68, 394 S.E.2d 209, 211 (1990).   We hold that the lack of a
definition of "[a]ll approved sports activities" in the sports
liability policy does not render the policy ambiguous.  We
reject the contention that travel to or from a venue for a
sports activity reasonably constitutes "sports activities."
As previously noted, coverage for travel could have been
afforded by the use of a term such as "activities necessary or
incidental to the conduct of [a scheduled activity]," as was
present in the policy before the North Carolina Court of
Appeals in Scottsdale Insurance.
The Maciaszes further contend that the trial court's
stated reasoning for entering a summary judgment in favor of
Fireman's and Chicago Insurance was not based upon the
automobile 
exclusion 
in 
the 
sports 
liability 
policy.
Fireman's and Chicago Insurance dispute this contention.  Even
assuming that the summary judgment was not based on the
automobile exclusion, as we explained in Liberty National Life
Insurance Co. v. University of Alabama Health Services
Foundation, P.C., 881 So. 2d 1013, 1020 (Ala. 2003), "this
1061133
16
Court will affirm the trial court on any valid legal ground
presented by the record, regardless of whether that ground was
considered, or even if it was rejected, by the trial court."
The Maciaszes also argue that the summary judgment in
favor of Fireman's and Chicago Insurance is due to be reversed
because the court solely relied on the insurers' underwriting
manual, which was not part of the insurance policy, to
conclude that "covered activities" were defined in the policy
as "cheerleading (youth only)."  Fireman's and Chicago
Insurance contend that this issue is not reviewable on appeal
because the Maciaszes neither objected to the trial court's
reference to the underwriting manual at the hearing on the
motions for a summary judgment nor filed a Rule 59, Ala. R.
Civ. P., motion raising the issue.  Even assuming this issue
is before us, the trial court's consideration of the
underwriting policy, if error, is harmless because the
unambiguous applicability of the automobile exclusion affords
a separate and independent basis for affirmance of the summary
judgment.  See Rule 45, Ala. R. App. P. 
IV. Conclusion 
1061133
17
The automobile exclusion in the sports liability policy
issued by Chicago Insurance precludes coverage for damages
from the automobile accident that gave rise to the Maciaszes'
claims against CCA.  We affirm the summary judgment in favor
of Fireman's and Chicago Insurance.
AFFIRMED.
Cobb, C.J., and Stuart, Bolin, and Murdock, JJ., concur.