United States Court of Appeals

Fifth Circuit



## FILED

January 27, 2006

Charles R. Fulbruge III

Clerk 

## In the 

# United States Court of Appeals

for the Fifth Circuit

_______________



### m 04-11345

_______________



### EMCASCO I NSURANCE 

### C OMPANY



### ,

Plaintiff-Appellant,

VERSUS



### A MERICAN 

### I NTERNATIONAL 

### S PECIALTY 

### L INES 

### I NSURANCE 

### C OMPANY



### ,

Defendant-Appellee.

_________________________

Appeal from the United States District Court

for the Northern District of Texas

______________________________

Before G ARWOOD

, S MITH , and D E M OSS

, Circuit Judges.

J ERRY E. S MITH , Circuit Judge:

EMCASCO Insurance Comp a ny (“EMCASCO”) filed a subrog at ion suit against

American International Specialty Lines Insurance Company (“AISLI C”) to recover under

AISLIC’s commercial general liabilit y policy

for monies EMCASCO pai d in defense and

settlement of an underlying s uit against the

two insurers’ mutual insured. After limited discovery, b o t h parties moved for summary

judgment. The district court granted AISLIC’s

motion, denied EMCASCO’s, and d ismissed

the subrogation suit with prejudice. Finding the

need for further proceedings, w e vacate and

remand.

I.

A.

In February 2001, Jaime Langston was driving down a paved, public country road with her

young son when she skidded on a patch of slick

mud, clay, and/or s a nd. The car swerved off2

t he road, striking a tree. Langston suffered

serious injuries, and her son died at the scene.

B.

In April 2002, the Langstons sued Wilson-Riley, Inc. (“Wilson-Riley”), 1 the operator

of a sand pit located immediately adj acent to

the accident site, in state court on the premise

that Wilson-Riley, as part of its operatio n at

the sand pit, hauled sand from the pit in trucks

that it owned and operated. The original complaint alleged that because of heavy rains preceding the accident, Wilson-Riley’s trucks

tracked mud onto the roadway when exiting a

driveway leading away from the sand pit and

that the mud on the road was the producing

cause of the accident.

Wilson-Riley and SLS had two different

insurance po licies covering their activities at

the sand pit. Specifically, EMCASCO issued

a commercial auto l

i abilit y policy to Wilso n-Riley and SLS, and AISLIC issued both

companies a

com mercial general liability policy

(the “CGL policy”). EMCASCO’s commercial auto liabilit

y policy provides, in relevant

part:

SECTION II 

### SS

LIABILITY COVERAGE

A. COVERAGE

We will pay all sums an insured legally

must pay as damages because of bodily injury or property damage to wh ich this insurance applies, caused by an accident and

resulting from the ownership, maintenance

or use of a covered auto. AISLIC’s CGL policy , meanwhile, provides

coverage as follows:

1. Insuring Agreement

a. 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 Coverage applies. We will

have the right and duty

t o defend 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 t o which this Coverage

does not apply. We may, at our discretion,

investigate any occur rence and settle any

claim or suit that may result.

AISLIC’s pol

icy also contains the following

exclusion:

2. Exclusions

This insurance does not apply to:

. . .

g. Aircraft, Auto or Watercraft

Bodily injury or property damage arising out

of the ownership, maintenance, use or entrustment to others of any a ircraf t, auto or

watercraft owned or operated by or rente d

o r lo aned to any insured. Use includes

operation and loading or unloading.

About seven weeks after the accident but a

year before the Langstons sued, EMCASCO

hired defense counsel Mike Wi nchester to defend Wilson-Riley. In doing so, EMCASCO

asserted its reservation of rights in defending

the suit. In April 2002, AISLIC hired its own

defense counsel, Chad Parker, to represent Wilson-Riley’s interests in the Langston suit. 1 The Langstons amended their petition in July

2002, adding SLS Management Corp o ration

(“SLS”), the owner of the property where the sand

pit was located, as a defendant.3

AISLIC also issued Wilson-Riley a reservation

of rights letter in which AISLIC advised that,

in its view, the existence of the auto exclusion

provision in the CGL policy precl uded

coverage in the Langstons’ suit. Specifically,

AISLIC stated:

While the plaint iff’s pleadings are ambiguous, we expect that it will come out during

the course of this litigation that the only involvement of Wilson-Riley, Inc., was the

fact that its “autos,” as defined by the policy, were going into and out of the sand

pit/premises in question for some weeks

proceeding [sic] the accident, and liabilit y

for this would fall squarely under the above

exclusion

. . . . It appears that there will be

no coverage for the damages claimed by the

plaint iff by virtue of the above policy

provisions.

After hiring Parker, AISLIC agreed, in January 2003, to settle the Langstons’ claims

again st SLS for $200,000. After the settlement, counsel for EMCASCO and Wilson-Riley’ s personal counsel notified AISLIC that

they believed the claims the Langstons had

remaining against Wilson-Riley still invoked

AISLIC’s coverage.

It is at this point that the parties disagree as

to the extent of the work performed by Parker

in AISLIC’s def

ense of Wilson-Riley. EMCASCO maintains that, after the SLS se ttlement, Parker never reappeared in the suit in

Wilson-Riley’s defense. Meanwhile, AISLIC

argues that at the time it secured the settl ement between the Langstons and SLS, the discovery and pleading deadlines relating to Wilson-R iley had passed under the terms of the

docket control order. AISLIC acknowledges

that Parker did little or no work on behalf of

W ilson-Riley after that time but insists that

there was little substantive work to be done aside from actually trying the case.

EMCASCO thereafter demanded that AISLIC share equally in the cost of settling the case

on Wi l son-Riley’s behalf. AISLIC refused,

citing the Langstons’ pleadings, the evidence it

assumed would be introduced at trial, and

statements made by the Langstons’ counsel as

eliminat ing any

liability that AISLIC might be

exposed to under its CGL policy.

In effect, AISLIC maintained that Wilson-Riley only faced liabilit y stemming from

EMCASCO’s auto liabilit y policy. The last

version of the Fourth Amended Complaint,

however, circu lated after SLS settled, alleges

that the unpaved exit that Wilson-Riley created

from th e sandpit to the public road “caused a

washing of mud onto the road during rainy

weather” and that the “exit drive was not paved

until after the accident.” It also includes a separate claim for ne gligence p er se because the

defendant “ob structed the road adj acent to i ts

worksite, which is a violation of Section 42.03

of the Texas Penal Code.”

AISLIC did offer to contribute $20,000 to a

potential settlement in Wilson-Riley’s defense.

EMCASCO refused the offer because AISLIC

conditioned the mo ney on the agreement that

the parties would not later attempt to re-allocate Wilson-Riley’s settlement costs. EMCASCO advised AISLIC t h at it would settle the

claims against Wilson-Riley without AISLIC’s

participation. EMCASCO then obtained a release of all claims against Wilson-Riley by settling with the Langstons for $350,000.

EMCASCO sued AISLIC for subrogation,

seeking to recover all or part of the $350,000 it

had paid the La ngstons in settlement. After

limit ed discovery, EMCASCO and AISLIC simultaneously filed cross-motions for summary

judgment.4

The district court granted AISLIC’s motion, finding that the Langstons’ damages were

covered by EMCASCO’s auto liabilit y po licy

and w ere explicitly excluded by AISLIC’s

CGL policy. It held that the washing of the

mud from the unpaved roadway could not

have been a “separate” and “independent”

cause of t he accident, which would have indicated that AISLIC’s policy also covered the

accident. The court determined that the

mud/clay tracked onto the public road by Wilson-Riley “necessarily involved the use of motor vehicles, triggering coverage under its auto

p o licy with EMCASCO.” EMCASCO appeals.

II.

A.

We review a summary judgm ent d e novo

,

a pplying the same standard as did the district

court. Tango Transp. v. Healthcare Fin.

S ervs. LLC

, 322 F.3d 888, 890 (5th Cir.

2003). Summary judgment is appropriat e if

there i s no genuine issue of material fact and

the moving party is entitled to judgment as a

matter of law. F E D

. R. C IV

. P. 56(c). We view

th e evidence in a light most favorable to the

non-movant. C

oleman v. Houston Indep. Sch.

Dist. , 113 F.3d 528, 533 (5th Cir. 1997). To

avoid summary judgmen t

, the non-movant

must go beyond the pleadings and come forward with specific facts indicating a genuine

issue for trial. C elotex

Corp. v. Catrett , 477

U.S. 317, 324 (1986). A genuine issue of material fact exists when the evidence is such that

a reasonable jury could return a verdict for the

non-movant. A nderson v. Liberty Lobby, Inc.

, 477 U.S. 242, 248 (1986 ). Summary

judgment is appropriate, howev e r, if the

non-movant “fails to make a showing sufficient

to establish the existence o f an element

essential to that party’s case.” C elotex

, 477

U.S. at 322-23. B.

EMCASCO maintains the dist r ict court

erred in interpreting the auto exclusion clause in

AISLIC’s CGL policy, which precl u des coverage fo r damages arising out of the “ownership, maintenance, use or entrustment” of any

auto owned or operated by the insured, to

el i minate AISLIC’s liabilit

y for monies recovered in the Langstons’ suit. EMCASCO argues

that the recovered damages did not arise out of

the use of a vehicle; it claims the clause is susceptible to more than one reasonable interpretati on and thus, under Texas law, should be

construed to provide coverage for any “not unreasona ble” construction. EMCASCO insists

that t he district court erred by not addressing

the coverage issue against the backdrop formed

by Texas law regarding the construction of insurance contracts.

AISLIC, meanwhile, argues that, for three

reasons, this court should not defer to the “not

unreasonable” construction of the relevant coverage provisions. First, it contends the policies

at issue contain no ambiguity that woul d implicate the method of contract construction favoring the insured. Second, it insists that EMCASCO’s proposed reading of the policies does

not favor the insured, Wilson-Riley, because

EMCASCO’s interpretation merely shifts the

coverage for the underlying sett lement from

EMC A SCO to AISLIC, yielding no benefit to

Wilson-Riley. Finally, AISLIC maintains that

EMCASCO’s interpretation of the polic ies is

unreasonable because it is inconsistent with

Texas law and relies on caselaw that is inapposite to the facts.

Under Texas law, whether an insurer has a

dut y to defend is governed by the “eight corners rule” whereby the a llegat ions in the petition filed against the insured are c ompared

against the insurance policy. K ing v. Dal l as

Fire Ins. Co.

, 85 S.W.3d 185, 187 (Tex. 2002).5

In reviewing the underlying petition, we focus

on the factual allegations that show the origin

of damages rather than on the legal theories alleged. N at’l Union Fire Ins. Co. v. Merchs.

Fast Motor Lines

, 939 S.W.2d 139, 141 (Tex.

1997) (per curiam). Any ambiguity in the coverage language should be read in favor of the

insured. T

rinity Universal Ins. Co. v. Cowan

, 945 S.W.2d 819, 825 (Tex. 1997). Importantly, in a subrogation case such as this, Texas

law recognizes the right of one insurer to seek

payment from a second insurer under the

doctrine of equitable subrogation. 2

To recover damages, the plaintiff must

show a causal relationship between the injury

and the use of the auto. N at’l Union

, 939

S.W.2d at 142. In National Union , the court

found that the facts alleged in the pleadings did

not suggest even a remote causal relationship

between the truck’s operati on and the plaint iff’s injury and concluded t hat the insurer’s

auto liabilit

y coverage was not trig gered:

“The only f

a cts alleged

. . . are that Hart was

operating a Merchants truckwhen he negligently discharged a firearm injuring Gonzalez.

G iven their most liberal interpretation, these

allegations do not suggest that Gonzalez’s injury resulted from the use of the truck.” I d. at

141-42.

The Langstons’ t hird amended petition

states t hat “[a]s to Defendant Wilson-Riley,

Inc., it is specifically alleged that the bodily injury, wrongful death, and property damage

was cause d by an accident resulting from the ownership, maintenance and use [of] the trucks

ha uling sand from the worksite in question.”

This language sug gests that based on the

pleadings alone, it cannot be said that a causal

relationship was not alleged between the use of

the trucks and the injury. Therefore, unlike the

auto insurer in National Union

, EMCASCO is

not entitled, based on the pleadings alone, to a

determination that there was no coverage.

Rather, the pleadings show that EMCASCO

had a duty to defend.

The duties to defend and to in demnify are

distin ct and separate, however. S ee Farmers

Tex. Co. M u t. Ins. Co. v. Griffin

, 955 S.W.2d

81, 82 (Tex. 1997). An insurer may initially

have a duty to defend but, eventually, no duty

to indemnify. Id. Therefore, we must determine

whether there is a duty to indemnify.

In deciding whether such a duty to indemnify

exists, Texas courts use the “complete operation” theory, Travelers Ins. Co. v. Employers Cas. Co.

, 380 S.W.2d 610, 612 (Tex.

1964), under which “the provision for use coverage exte nds to foreseeable consequences of

what was do ne in connection with the use of

the car, .

. . so long as the act or thing done by

the insured’s employee whi ch causes the accident arises out of the use of the insured’s car,”

Red Ball Motor Freight v. Emp loyers Mut.

Liab. Ins. Co. , 189 F.2d 374, 377 (5th Cir.

1951). Further, “‘[a]rising out of’ are words of

much broader significance than ‘caused by.’

They are ordinarily

understood to mean ‘originat ing from’ ‘having its origin in,’ ‘growing

out of’ or ‘flowing from,’ or in short, ‘incident

to, or having connection with,’ the use of the

car.” Id. at 378.

In Red Ball

, we held that the act of the driver of a tra ct o r in not closing the fueling valve,

which proximately caused an explosion, was an

a ct that arose out of the use of the t ruck 2 Gen’l Star Indem. Co. v. Vesta Fire Ins. Co.

, 173 F.3d 946, 949 (5th Cir. 1999) (citation omitted) (defining equitable subrogation as “the legal

fiction through which a person or entity, the subrogee, is substituted, or subrogated, to the rights and

remedies of another by virtue of having fulfilled an

obligation for which the other was responsible”).6

because it was incident to, and having a connection with, the use of the truck. Id. In doing so, we emphasized that “fueling a truck for

the journey was just as much a ‘use’ of it as

maki ng t he journey would be.” I d. I n sum,

the “complete operation” test has two distinct

inquiries: (1) whether the insured’s act was an

act incident to, and having a connection with,

the use of the truck 3 and (2) whether that act

proximately caused plaintiff’s injury. 4

With respect to the first inquiry, Te xas

courts have read business auto policies to cover loading and unloading of the covered vehicle even if that is not specifically mentioned in

the text of the policy. 5 Further, loading and

unloading has been interpreted to cover acts

incident to making a commercial delivery; this

includes “the enti

re process involved in the

movement of the articles from the place where

insured’s employees find the articles which are to be moved by truck, to the pl ace where the

employees of insured turn them over to the

party to whom they are to make delivery.” A m.

Employers’ Ins. Co. v. Brock

, 215 S.W.2d 370

(Tex. Civ. App. 1948, writ ref’d n.r.e.); Travelers , 380 S.W.2d at 612.

Under this expansive v iew of what constitutes an auto “use,” an insurer was liable for injuries sustained by a pedestrian who fell into an

open sidewalk elevator shaft when employees in

charge of the insured truck left the shaft doors

open while obtaining cross bars to guard the

shaft, no t withstanding that nothing had been

loaded ont o or unloaded from the truck at the

time of the fall. A m. Employers’ , 215 S.W.2d

at 370. Therefore, for insurance coverage to

exist, the vehicle itself need not be in “operation” or “in motion” or an “active participant”

in the plaintiff’s injuries:

[The auto insurer] also relies on the rule that

there must be a causal relation or connection

between the accident or injury and the ownership, maintenance or use o f t he vehicle.

This does not mean that the accident must

be caused by negligent operation of the vehicle or some defect therein. When a vehicle

is being unlo aded it is being used to the

same extent as if it were being d riven, and

the person doing the unloading is entitled to

t he same protecti on as the owner or op

erator.

Travelers

, 380 S.W.2d at 614.

It appears that Texas courts have never decided whether mud, clay, sand, or other debris

tracked by a truck’s tires or fallen from its cargo is incident to its use. We conclude, from the

broad interpretation Texas courts have given to

what is incide nt to the use of an automobile,

that such debris is indeed incident to the use of

the vehicle. Debris falling from a car’s cargo is

incident to the transportation of that cargo: It 3 Red Ball

, 189 F.2d at 377 (noting that coverage extends “so long as the act or thing done by

the insured’s employee which c auses the accident

arises out of the

use of the insured’s car”); i d

. at

378 (“That this act of the driver of the tractor, in

not closi ng the valve, was an act incident to, and

having a conne ction with, the ownership, maintenance, or use o f the truck, we think may not be

questioned.”).

4 Id. at 377 (emphasis added) (stating that “the

provision for use coverage extends to foreseeable

consequences of what was done in connection with

the use of the car”); id. at 378 (“That the cause of

the escape of the gasoline, which in unbroken

sequence proximately caused the explosion was the

neg ligent act of the driver of the truck in failing

properly to close the v a lve after he had finished

fueling his truck from the tank, was not disputed”).

5 Panhandle Steel Prods. Co. v. Fidelity Union

Cas. Co.

, 23 S.W.2d 799 (Tex. Civ. App. 1929,

no writ).7

is inherent in th e transportati on of cargo that

some of it may spill or fal l unto the road. 6

Similarly, the tracking of debris by the tires is

incident to the operati on o f a vehicle on

unpaved roads: It is inherent in driving on

unpaved roads that some sand, mud, or clay

may attach to the tires. 7

Further, because the plaint iff’s injuries need not be caused by the negligent operati on of the

vehicle, but instead by an act incident to its use,

it is not nec essary that the plaintiff’s injuries

occur at the time of or immediately after the

tracking of debris on the highway. 8 We thus reject EMCASCO’s content io n that the “causal

standard mandated by the phrase ‘arising out

of,’ however broad, appears at least to require

the contemporaneous use of the insured’s vehicle.” 9 The accident need not be contempo raneous with the use of the vehicle so long as it

is a foreseeable consequence of an act incidental to the use of the vehicle, such as the tracking

of debris.

This ta kes us to the second test for determining whether a duty to indemnify exists:

whether the tracking of mud onto the highway

was the proximate cause of the injuries. The

reasoning for this inquiry is plain: If the factfinder determines that the insured’s act in connection with the use of the vehicle did not proximately cause the injuries, the insured is not

liable, and th e insurer has no duty to

indemnify. 10 6 Naturally, not every act in connection with a

vehicle is “use.” For instance, a drive-by shooting

from a vehicle is not an act incident to its “use.”

See, e.g., Collier v. Employers Nat'l Ins. Co.

, 861

S.W.2d 286, 289-90 (Tex. App.– H ouston [14th

Dist.] 1993, writ denied) (holding that a drive-by

shooting does not involve the use of a motor vehicle

“simply because an automobile provided the site

for a criminal assault or provided transportation to

the location of a criminal act”).

This is because “[t]he use required is of the vehicle qua vehicle, rather than simply as an article

of property.” Mid-Century Ins. Co. v. Lindsey

, 997

S.W.2d 153 (Tex

. 1999). Unlike the unloading,

which is a use of the vehicle qua vehicle (because

it is necessary to the delivery/transpo r tation of

goods), a drive-by shooting is not “incident” to the

use of the vehicle because transportation of people

or goods does not necessarily involve a shooting.

7 See also Jackson v. Daley , 739 So.2d 1031,

1041 (Miss. 1999) (holding that injuries resulted

from the ownership, maintenance, or use of an automobile because plaintiff was injured after colliding with a pile of dirt dumped on the side of a road

by one of the insured’s dump trucks, notwithstanding subsequent failure to clean up the dirt); M er

chants Co. v. Hartf

ord Accident & Indem. Co.

, 188 So. 571, 571 (Miss. 1939) (holding that injuries arose out of the ownership, maintenance or use

of automobile where motorist’s car struck poles

that another driver had left lying i n the roadway

after using them to extricate his truck from a roadside ditch hours earlier). 8 EMCASCO argues that the language of the

insurance contracts at issue is ambiguous and thus

maintains we should construe any such ambiguity in

the contract to favor coverage. Because we see no

ambiguity, we d ecline to apply the “not unreasonable” contract interpretatio n urged by

EMCASCO.

9 For that reas on, Lindsey , 997 S.W.2d 153,

does not support the arguments advanced by EMCASCO. That is, even if the Appleman-Couch test

were to apply, it would not dictatethe result EMCASCO urges, namely that the use of the vehicle

has to be contemporary with the injury.

10 An act incident to the use of a vehicle need not

always be the proximate cause of the i njury. For

instance, if a defendant left debris on a road but

(continued...)8

In this regard, the operat io n or driving of

the vehicle need not be the proximate cause of

the injuries. 11 This observation merely restates

the notion we discussed earlier, i.e., t hat a

vehicle n eed not be in active operation (such

as in a collision) for insurance coverage to

exist. Rather, as this court has interpreted

Texas law in Red Ball

, 189 F.3d at 378, only

the act incident to , or in connection with, the

use of the vehicle must be the proximate cause

of the injuries.

Although it was foreseeable that debris left

on the road could cause an accident, we do not

know whether the accident would not have occurred without the tracking of the debris. 12 The washing of mud and sand off the unpaved

ro a d leading to the public, paved road could

have independently produced the accident: The

amount of mud accumulated from the rain

could have been sufficient to cause the accident

even if no mud had been tracked by the trucks.

Further, the washing of mud off the unpaved

road way wo uld be a separate cause of the accident. That is, the washing of mud off the

unpaved roadway is not derivative of the act of

tracking mud by trucks; it could have occurred

regardless of the presence of the trucks. 13

AISLIC’s policy covers the allegations with

r espect to the washing of the mud by the rain,

which are allegations unrelated to the use of the

trucks, and covers the separate claim for negligence p er se b ased on the obstruction of “the

road adjacent to [Wilson-Riley’s] worksite,

which is a violation of Section 42.03 of the

Texas Penal Code.” 14 Although AISLIC’s 10 (...continued)

accompanied it with sufficient warning signs, and

a plaintiff, driving drunk and without required

corrective lenses, ignor ed the signs, it cannot be

said that the debris on the highway proximately

caused the injury if the law regarded such negligent

conduct sufficiently unforeseeable and superseding

so as to interrupt the chain of causation.

11 Cf. Panhandle Steel , 23 S.W.2d at 802:

The act of unloading the automobile was not an

act separate and independent of the use of the

truc k, but was a step i ncident to the use and

necessary to accomplish the purpose thereof.

And, since it followed in a natural and continual

sequence from the use, it would seem to follow

logically that the act of unloading would not

preclude a holding that the use of the truck was

the pr oximate cause of the injury, if, indeed,

such a holding be necess ary to support a

recovery by the plaintiff against the defendant.

(Emphasis added.)

12 Cf. id. (“The proximate cause of an event

must be understood to be that which, in a natural

(continued...) 12 (...continued)

a nd continual sequence, unbroken by any new, i n

dependent cause, produces that event, and without

which that e v ent would not have occurred .”) (emphasis added).

13 AISLIC argues tha t EMCASCO has waived

the argument that AISLIC’s policy applied despite

the exclusion because of separate and independent

causation. EMCASCO raised that issue in the district court, however, and argues on appeal that AISLIC’s policy covers the claim. Thus, the argument

was preserved, albeit weakly.

14 In paragraph 36 of its first original amended

answer, AISLIC admitted that if the facts alleged in

the last version of t he complaint were proved,

AISLIC’s policy could hav e pr ovided coverage:

“Recognizing that this [Third Version of the Fourth

Amended Complaint] might theoretically invoke its

coverage (which would actually occur only if

plaintiff offered pr oof of facts which she had

(continued...)9

CGL policy excluding coverage and EMCASCO’s auto policy providing coverage are nearly identical, 15 the polices are mutually exclusive

only with res pect to which policy covers the

tracking of mud by the tires, which is the only

issue with respect to the use of an auto.

The non-exclude d event, the washing of

mud from the unpaved roadway, howe v er, is

covered by the general liabilit y policy, because

it could have independently caused the injuries. When two separate events 

### SS o ne that is

excluded and one t hat is covered by the general liabilit

y policy 

### SS

may independently have

caused the accident, Texas law mandates that

the general liabilit

y policy also provide coverage despite the exclusion. 16

We question the district court’s assertion

that the washing of the mud off the unpaved

roadway could not have been a “separate” and

“independent” cause of the accident, but rather

a “classic example of concurrent c a usation”

because mud and clay are “by their very nature

fungible,” rendering it “impossible to distinguish” the part of the debris that was tracked by

the trucks or that was washed off the road. In

fact, precise ly because it is “impossible to distinguish,” once the mud merges, the part of the

mud t racked by the tires from that washed by

the rain, the prope r inquiry is whether the

amount of mud washed by the rain could have

been sufficiently large to cause an accident by

itself. 17

There is at least a genuine issue of material

fact as t o this question. The district court acknowled ged that some mud and clay “could

have been washed by the rain.” This mud from

the rain could have i ndependently caused the

accident. Therefore, summary judgment for

AISLIC was improper. On remand, the court

should determine whether there is sufficient evidence to declare as a matter of law t hat the

heavy rain in the se veral hours before the accident could have produced sufficient mud that

would have independently caused the accident,

or wh et her t hat issue should be sent to a

factfinder.

C.

We are mindful that the district court has not

addressed AISLIC’s contention that it does not

have a duty to reimburse EMCASC O because

it did not a gree to the settl em ent. The court

must confront this issue o n remand if it finds

that the washing of mud from the unpaved

roadway could have independently caused the 14 (...continued)

previously denied), AISLIC agreed to participate in

negotiations to obtain a rele ase for [WilsonRiley].” Paragraph 35 explained that the Langstons included, in this last version of the complaint,

alle ga tions of washing of mud onto the roadway

during rainy weather, despite having removed such

allegations from prior ver sions of the amended

complaint after SLS had settled.

15 In such ins tances, coverage is usually not

read to implicate both policies; they are mutually

exclusive. See Travelers Indem. Co. v. Citgo Petroleum Corp. , 166 F.3d 761 (5th Cir. 1999).

16 See Utica Nations Ins. Co. v. Am. Indem.

Co.

, 141 S.W.3d 198, 204 (Tex. 2004), and cases

cited therein. 17 This inquiry is basically the same as that for

determining joint and several liability in cases where

two fungible causes merge. For instance, where two

independent fires combine to destroy a piece of

property, if either fir e could have destroyed the

property by itself, there is joint and several liability.

Se e

, e.g., Anderson v. Minneapolis, St. Paul &

Sault Ste. Marie Ry. , 179 N.W. 45 (Minn. 1920),

overruled in part on other grounds by Borsheim v.

Great N. R.R. , 183 N.W. 519 (Minn. 1921).10

accident. S e e Liberty Mutual Ins. Co. v.

Mid-Continent Ins. Co.

, 405 F.3d 296 (5th

Cir.), modified

, 407 F.3d 683 (5th Cir. 2005).

The judgment is VACATED, and this matter is REMANDED for further proceedings.