[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

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No. 15-12540

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D.C. No. 1:14-cv-00112-JRH-BKE

GREAT AMERICAN ALLIANCE INSURANCE COMPANY,

Plaintiff-Appellee,

versus

ULYSSES ANDERSON,

Defendant-Appellant.

 

________________________

Appeal from the United States District Court

for the Southern District of Georgia

________________________

(February 8, 2017)

Before ED CARNES, Chief Judge, ANDERSON, Circuit Judge, and 

CHAPPELL,* District Judge.

CHAPPELL, District Judge:

__________ 

*Honorable Sheri Polster Chappell, United States District Judge for the Middle District of 

Florida, sitting by designation.

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The appellant was involved in a car accident with an intoxicated driver who 

was driving a company vehicle with his employer’s permission. After a jury found 

the driver liable and awarded the appellant one million dollars, the employer’s 

insurance company, the appellee, filed this suit for a declaration that the driver was 

not a permissive user – and thus not covered under the applicable insurance 

policies – because he broke internal company policies. 

Except where specifically excluded, the general purpose of an insurance 

policy is to provide coverage. The Georgia Supreme Court has held that inquiries 

into permissive use should extend only to whether a vehicle is used for an 

approved purpose. See Strickland v. Georgia Cas. & Sur. Co., 224 Ga. 487, 162 

S.E.2d 421 (Ga. 1968). A subsequent decision by the Georgia Court of Appeals, 

however, held that a company’s internal rules can govern the scope of permissive 

use, and that violations thereof can negate an individual’s status as an insured. See 

Barfield v. Royal Ins. Co. of Am. 228 Ga. App. 841, 492 S.E.2d 688 (Ga. Ct. App. 

1997). Because the district court followed Barfield, and thereby narrowed the 

scope of permissive use beyond what was permitted by Strickland, we find that it 

erred. Therefore, we reverse and remand.

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I. BACKGROUND

A. Factual Overview

In 1996, Looper Cabinet Co., Inc. (“LCC”), a Georgia company, hired Brian

Hensley to perform services auxiliary to cabinet installation. In the years that 

followed, LCC permitted Hensley to drive its 2008 Chevrolet Silverado (the 

“Looper Vehicle”) for both work and personal purposes. In addition, LCC’s owner

admitted that under the general permission granted to Hensley, he was allowed to 

drive the Looper Vehicle to and from his father’s lake house. Hensley exercised 

this privilege in early June of 2012, and stayed there for some time. 

On June 10, 2012, Hensley drank four beers before driving the Looper 

Vehicle home from the lake house. While driving, he encountered AppellantUlysses Anderson, who approached the Looper Vehicle from behind on a 

motorcycle. The parties dispute the ensuing facts, but they agree that Anderson 

attempted to pass Hensley resulting in an accident that left Anderson severely 

injured. 

Thereafter, Anderson sued Hensley and LCC, alleging that Hensley drove

the Looper Vehicle while under the influence of alcohol and caused the accident. 

Although LCC was dropped as a defendant, a jury found Hensley liable and 

awarded Anderson approximately one million dollars in damages.

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1. LCC Internal Policies

For two decades, LLC’s internal policies have banned alcoholic beverages 

on company property and prohibited employees under the influence of alcohol 

from working in the shop on and off the clock. LLC has also had a substance 

abuse policy that states, in pertinent part,

[a]n employee reporting to work visibly impaired will be 

deemed unable to properly perform required duties and 

will not be allowed to work. If, in the opinion of the 

supervisor, the employee is considered impaired, the 

employee will be sent home or to a medical facility by 

taxi or other safe transportation alternative – depending 

on the determination of the observed impairment and 

accompanied by the supervisor or another employee if 

necessary. A drug and/or alcohol test may be in order. 

An impaired employee will not be allowed to drive. 

Violating these policies may result in termination of 

employment. 

The parties agree that Hensley had acknowledged these policies during his 

employment.

2. GAAIC Insurance Policies

Appellee-Great American Insurance Company (“GAAIC”) issued two 

insurance policies that covered the Looper Vehicle. The primary policy covered

LCC as a named insured, as well as “anyone else while using with [its] permission 

a covered auto . . . .” The umbrella policy also listed LCC as the named insured

and covered “[a]ny person . . . with respect to any ‘auto’ owned by [LCC], loaned 

to [it], or hired by [it] or on [its] behalf, and used by that person or organization 

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with [its] permission.” Under the umbrella policy, GAAIC would pay obligations 

imposed by law or assumed by the insured that exceeded the limits of the primary 

policy in the event of “‘bodily injury’ or ‘property damage’ that takes place[ ] or 

‘personal injury’ . . . arising from an offense committed.” 

B. Procedural History 

On May 5, 2014, GAAIC filed this action against Hensley and Anderson in 

the United States District Court for the Southern District of Georgia, seeking a

declaration of its rights and responsibilities for the damages arising out of the car 

accident. Specifically, GAAIC sought a declaration that Hensley exceeded the 

scope of the permissive use granted by LCC at the time of the accident because he 

drove the Looper Vehicle while intoxicated. Alternatively, it sought a declaration 

that Hensley’s conduct fell under a policy-coverage exclusion. Finally, GAAIC

sought a declaration that the language in its policies prevented the assessment of 

punitive damages awarded in the underlying trial. 

At the close of discovery, GAAIC and Anderson each moved for summary 

judgment. The district court granted GAAIC’s motion, relying on Barfield to find 

that Hensley violated LCC’s internal policies by driving the Looper Vehicle while 

intoxicated, and, therefore, exceeded the scope of his permissive use at the time of 

the accident. As a result, the district court found that Hensley was not an insured 

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at the time of the accident, and that GAAIC owed no duty to cover the damages 

awarded at the trial of the underlying action. Anderson now appeals.

II. STANDARD OF REVIEW

We review de novo a district court’s grant of summary judgment and draw 

“all reasonable inferences and review[ ] all evidence in light most favorable to the 

non-moving party.” Moton v. Cowart, 631 F.3d 1337, 1341 (11th Cir. 2011). 

Summary judgment is appropriate only if the “movant shows that there is no 

genuine dispute as to any material fact and the movant is entitled to judgment as a 

matter of law.” Fed. R. Civ. P. 56(a). An issue is genuine if there is sufficient 

evidence such that a reasonable jury could return a verdict for either party. See 

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 2510, 91 L. 

Ed. 2d 202 (1986). Similarly, an issue is material if it may affect the outcome of 

the suit under governing law. Id. The moving party bears the burden of showing 

the absence of any genuine issue of material fact. See Celotex Corp. v. Catrett, 

477 U.S. 317, 323, 106 S. Ct. 2548, 2553, 91 L. Ed. 2d 265 (1986). 

III. DISCUSSION

Anderson urges us to reverse the district court’s decision to grant summary 

judgment in GAAIC’s favor. He argues that the district court improperly deviated 

from the bright-line permissive use standard set forth by the Georgia Supreme 

Court in Strickland. GAAIC wants us to affirm the district court’s decision 

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because it maintains that Barfield, a decision from the Georgia Court of Appeals, 

controls the Eleventh Circuit’s calculus and allows internal company rules to 

narrow the scope of an automobile’s permissive use. We thus must decide the 

scope of a permissive use clause under Georgia law. 

For the purposes of insurance coverage, an individual using an automobile 

with the express permission of an insured is a permissive user. In the event of an 

accident, the permissive user is generally covered under the named insured’s

insurance policy as a third-party beneficiary. Once permission is given, whether 

liability coverage is provided to the third-party hinges on whether the individual

exceeded the scope of permission granted by the owner. 

Where, as here, an action is based on diversity, Georgia’s substantive law 

governs the interpretation of an insurance policy. SCI Liquidating Corp. v. 

Hartford Fire Ins. Co., 181 F.3d 1210, 1214 (11th Cir. 1999), certified question 

answered sub nom. SCI Liquidating Corp. v. Hartford Ins. Co., 272 Ga. 293, 526 

S.E.2d 555 (2000). In Georgia, insurance policies are interpreted by ordinary rules 

of contract construction. See Boardman Petroleum, Inc. v. Federated Mut. Ins. 

Co., 269 Ga. 326, 327, 498 S.E.2d 492, 494 (1998). Questions of contract

construction are matters of law and are properly handled by the court. See

Claussen v. Aetna Cas. & Sur. Co., 259 Ga. 333, 334, 380 S.E.2d 686, 687 (1989). 

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“To determine whether an insurer owes its insured a duty to defend a 

particular lawsuit, Georgia law directs us to compare the allegations of the 

complaint, as well as the facts supporting those allegations, against the provisions 

of the insurance contract.” Elan Pharm. Research Corp. v. Employers Ins. of 

Wausau, 144 F.3d 1372, 1375 (11th Cir. 1998); see also Great Am. Ins. Co. v. 

McKemie, 244 Ga. 84, 85-86, 259 S.E.2d 39, 41 (1979). An insurance policy is 

“considered as a whole and each provision is to be given effect and interpreted so 

as to harmonize with the others.” Boardman Petroleum, 269 Ga. at 328, 498 

S.E.2d at 494.

Moreover, “[e]xclusions from coverage sought to be invoked must be strictly 

construed.” SCI Liquidating, 181 F.3d at 1214-15 (quoting Tifton Mach. Works, 

Inc. v. Colony Ins. Co., 224 Ga. App. 19, 20, 480 S.E.2d 37 (1996)). In this vein, 

all ambiguities as to policy exclusions are interpreted in favor of coverage because 

“the insurer, having affirmatively expressed coverage through broad promises, 

assumes a duty to define any limitations on that coverage in clear and explicit 

terms.” York Ins. Co. v. Williams Seafood of Albany, Inc., 223 F.3d 1253, 1255 

(11th Cir. 2000), certified question answered, 273 Ga. 710, 544 S.E.2d 156 (2001).

In 1968, the Georgia Supreme Court issued its seminal decision on the scope 

of permissive use in the context of an employee’s violation of company policy. In 

Strickland, an insured company allowed its employee, Carter, to use a company

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vehicle to drive himself and coworkers to and from work. 224 Ga. at 488, 162 

S.E.2d 421 at 423. The company also let Carter keep the vehicle overnight at his 

home. Id. Yet, the company strictly prohibited another employee, Williams, from 

driving the vehicle. Id. Despite that express prohibition, Carter let Williams drive

the vehicle along the normal route to Carter’s home, and an accident ensued. The 

company’s insurer later filed suit seeking a declaration that it had no duty to 

defend Williams or Carter, or to pay any judgment entered against them. Id. at 

487-88, 162 S.E.2d at 422.

The insurance policy’s permissive use provision provided coverage for the 

company and “any person while using the automobile and any person or 

organization legally responsible for the use thereof, provided the actual use of the 

automobile is by the named insured or such spouse or with the permission of 

either.” Id. at 488, 162 S.E.2d at 423. The Georgia Supreme Court found no 

distinction between the terms “actual use” and “use.” Id. at 489, 162 S.E.2d at 

423-24. It noted, however, that the term “use” had two meanings – first, as it 

related to the operation of the vehicle, and second as to the purpose served by the 

vehicle. See id. Under that lens, the court held that a finding of permissive use 

under the policy only required permission for the purpose served by the vehicle, 

and that the operational aspects were unimportant. See id. at 492, 162 S.E.2d at 

425. Pertinently, the court found

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[t]he policy, among other things, insures against 

obligations arising from the negligent or unlawful 

operation of the described vehicle. Under appellee’s 

contention if the named insured permitted the use of the 

vehicle and at the same time prohibited its negligent or 

unlawful operation, it would defeat the very purpose of 

the policy. Therefore, the ‘actual use’ of the vehicle 

within the meaning of the policy cannot reasonably relate 

to the particular manner of its operation. At most it could 

relate only to whether or not permission to operate the 

vehicle had been given. And even this would have no 

application to the first permittee who had been given 

permission to use the vehicle for a particular purpose 

since such authorization necessarily implies permission 

to operate the vehicle. Furthermore, the policy provides: 

‘The purposes for which the automobile is to be used are 

‘business and pleasure.’ This indicates to us that the 

policy is concerned with the purpose to be served by the 

vehicle and not its operation. If the policy intended that 

‘actual use’ included the operation of the vehicle, it could 

have stated so plainly.

Id. at 489-90, 162 S.E.2d at 424. 

As to Carter and Williams, the Georgia Supreme Court found that, even in 

scenarios where employees violated express prohibitions, insurers had been found 

liable “where the use to which the car was being put was within the scope of the 

initial permission and the first permittee was riding in the car or its operation by 

the second permittee was for his benefit or advantage.” Id. at 491-92, 162 S.E.2d 

at 424. Given the possibility that the vehicle’s progression to Carter’s home would 

have been in the scope of the permission originally granted by his employer, and to 

Carter’s advantage, the court held that there were genuine issues of material fact 

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that precluded summary judgment on whether the company had expressly or 

impliedly granted permission to operate the vehicle at the time of the accident. See 

id. at 492, 162 S.E.2d at 425. 

Twenty-nine years later, a Georgia Court of Appeal broke with Strickland by 

finding that a company’s internal rules could govern the scope of permissive use. 

In Barfield, an insurance company and its named insured brought an action seeking 

a declaration of their liability for damages arising from an accident involving the

insured’s employee, who drove a company vehicle while intoxicated. 228 Ga. 

App. at 841-42, 492 S.E.2d at 690. The insurance policy covered the company and 

“anyone else while using with [the company’s] permission a covered auto [the 

company] owns.” Id. at 843, 492 S.E.2d at 690. The company also had an internal

policy that prohibited “possession and consumption of alcoholic beverages . . . in 

company vehicles . . . .” Id.

Tellingly, the appellate court failed to even mention Strickland in its 

opinion, finding that permissive use clauses in Georgia could be narrowed by 

“instructions, rules or regulations.” Id., 492 S.E.2d at 691. The court continued 

that “where a driver uses a vehicle with permission, but violates the scope of the 

permission granted by engaging in activity the named insured has expressly 

forbidden, the driver is not an ‘insured’ under the permissive use clause . . . for any 

collision occurring during the driver’s unauthorized use.” Id. As such, the 

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appellate court held, because the company “told [the driver] he could not drive the 

vehicle when he was drinking, his use of the vehicle at a time he was admittedly 

under the influence of alcohol was unauthorized and nonpermissive.” Id.

We find Strickland and Barfield to be irreconcilable because they represent 

mutually exclusive premises. Strickland holds that the only inquiry relevant to 

determining the scope of a generic permissive use clause is whether a vehicle is 

used for an approved purpose. See 224 Ga. at 492, 162 S.E.2d at 425. In so doing, 

the Georgia Supreme Court found that where a vehicle is used for an approved

purpose, an employee’s violations of explicit company policies do not foreclose 

status as a permissive user. See id. at 492, 162 S.E.2d at 425. This does not square 

with Barfield, which allowed an insurer to look beyond the purpose and to a 

company’s internal rules to discern the scope of permissive use. See 228 Ga. App. 

at 843, 492 S.E.2d at 690.

An assessment of the jurisprudence of Georgia reveals that Strickland has 

not been overruled. When interpreting matters of state law, we “must follow the 

decision of the state’s highest court . . . .” Flintkote Co. v. Dravo Corp., 678 F.2d 

942, 945 (11th Cir. 1982). Hence, the Strickland decision requires us to hold that 

Hensley did not exceed the scope of his permission, despite his intoxication. 

Notably, we are not alone in following this rule. See Scott v. Government 

Employees Insurance Co., 305 Ga. App. 153, 158, 700 S.E.2d 198, 202 (Ga. Ct. 

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App. 2010) (“[t]he permission to use contained in [the] omnibus clause refers to 

the purpose for which the permission was given and not to the operation of the 

vehicle.”); see also Allstate Ins. Co. v. Spillers, 252 Ga. App. 26, 28, 555 S.E.2d 

489, 491 (Ga. Ct. App. 2001) (“[T]he permission to use contained in [the] omnibus 

clause refers to the purpose for which [the] permission was given and not to the 

operation of the vehicle.”) (quoting Ga. Farm & Ins. Co. v. Allstate Ins. Co., 190 

Ga. App. 593, 594, 379 S.E.2d 619, 620 (Ga. Ct. App. 1989)); Auto-Owners Ins. 

Co. v. Smith, 178 Ga. App. 420, 422, 343 S.E.2d 129, 131 (Ga. Ct. App. 1986) 

(“[T]he ‘actual use’ contemplated and intended by the policy refers only to the 

purpose to be served and not the operation of the vehicle.”) (quoting Strickland, 

162 S.E.2d at 425).

Turning to this appeal, the district court cited Strickland for the proposition

that the scope of permissive use was limited “to whether or not permission to 

operate the vehicle had been given.” In the end, however, the court employed a 

Barfield analysis. In doing so, it found that Hensley did not have permission to use

the Looper Vehicle in violation of LCC’s company rules – namely, while 

intoxicated. Because Hensley was under the influence at the time of the accident, 

the court held he was not a covered insured. This interpretation of permissive use 

contravenes Strickland. See 224 Ga. at 492, 162 S.E.2d at 425.

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Had the district court properly applied Strickland, its analysis would have 

been limited to whether LCC approved of the purpose for which Hensley was 

using the Looper Vehicle at the time of the accident. See id. Under the objective 

standard employed for determining permissive use, see Allstate Ins. Co. v. Spillers, 

252 Ga. App. 26, 28, 555 S.E.2d 489, 491 (2001), the undisputed record shows that

Hensley was permitted to drive the Looper Vehicle for the purpose it was used on 

the day of the accident – to drive home from his father’s lake house.

1

 As such, we 

find that Hensley is an insured for purposes of the underlying action.

Notwithstanding the Georgia Supreme Court’s clear precedent, GAAIC

urges us to distinguish Strickland. It maintains that its policies contain different 

language than the corresponding policy in Strickland, and that Strickland involved 

a decision implicating the second permittee doctrine while the instant matter 

presents no such issue. These arguments are nonstarters. 

Although the Strickland policy involved the phrase “actual use,” the court 

there found it to be functionally equivalent to the term “use.” 224 Ga. at 489, 162 

S.E.2d at 423-424. The policies here also include the term “use” or variants 

thereof, and as such, they offer no meaningful difference to their counterpart in 

Strickland. To the extent that GAAIC argues that the Strickland policy differed 

 1 Because the GAAIC policies contained only general permissive use clauses, it is 

inconsequential for purposes of coverage whether Hensley was violating LCC company rules at 

the time of the accident.

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because it included the term “purpose,” the actual phrase there extended coverage 

for “[t]he purposes . . . [of] ‘business and pleasure.’’’ Id. at 490, 162 S.E.2d at 

424. Although Strickland implied that the language was important in determining 

that the policy concerned the purpose, rather than the manner of operation, the 

court also narrowed its findings by holding that “[i]f the policy intended that 

‘actual use’ included the operation of the vehicle, it could have stated so plainly.” 

Id. As it was in Strickland, so it is here. If GAAIC had intended to bar coverage 

for violations of LCC’s internal rules, it could have included such language in its 

policies to the extent permitted under Georgia law. Moreover, that Strickland

addressed the second permittee doctrine is of no consequence here. Strickland

defined the scope of permissive use to include only the purpose of a third-party’s 

use of a vehicle. And merely because that case involved an additional level of 

analysis as to whether the proffered purpose was satisfied by a second permittee 

does not alone distinguish this case. See, e.g., Scott, 700 S.E.2d at 202–03 (a first 

permittee case).

In conclusion, the purpose test set forth in Strickland controls our inquiry 

into permissive use. Because the district court extended its analysis further, we 

reverse.

2 Although this opinion disposes of the question of permissive use, the 

 2 GAAIC also argues that Hensley is not an insured because he either expected or intended to 

injure Anderson at the time of the accident. Although the district court did not decide this issue, 

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district court did not decide GAAIC’s argument that the provisions of its policies

preclude the punitive damages awarded in the underlying trial. Accordingly, we 

remand the proceedings for a decision on that issue.

REVERSED AND REMANDED.

 

a review of the record reveals this argument to be meritless. Consequently, we summarily reject 

this argument on appeal.

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