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RICKY LEE GRIFFITTS, ) ) Plaintiff-Respondent, ) ) vs. ) Nos. SD32626 and SD32663 ) Consolidated JAMES M. CAMPBELL, ) Filed: February 6, 2014 ) Defendant-Respondent, ) ) and ) ) BNSF RAILWAY COMPANY ) and OLD REPUBLIC INSURANCE ) COMPANY, ) ) Intervenors-Appellants. )

APPEAL FROM THE CIRCUIT COURT OF GREENE COUNTY Honorable Mark E. Fitzsimmons, Associate Circuit Ju dge

AFFIRMED Old Republic Insurance Company (“Old Republic”) an d BNSF Railway Company (“BNSF”) appeal from the trial court’s denial of th eir post-judgment motion to intervene as a matter of right under Rule 52.12(a)(2) 1 in a personal injury and property damage lawsuit b rought

1 References to rules are to Missouri Court Rules (2 013).2

by Ricky Lee Griffitts (“Griffitts”) against James M. Campbell (“Campbell”). We conclude that Old Republic and BNSF did not have an interest in t he lawsuit sufficient to support intervention as a matter of right, and affirm the trial court’s denial of Old Republic and BNSF’s postjudgment motion to intervene as a matter of right. Facts and Procedural History Sometime before March 2009, Old Republic issued a “fronting policy” of liability

insurance to BNSF. 2 In March 2009, Campbell, who at the time was empl oyed by BNSF, was involved in a motor vehicle accident in Springfield in which his vehicle struck Griffitts’ vehicle. On December 12, 2012, Campbell requested, through counsel, that Old Republic provide

him an unconditional defense in connection with the motor vehicle accident involving Griffitts. In the request, Campbell made clear that he would “ not accept any sort of conditional defense[]” except with respect to Griffitts’ claim for punitiv e damages. Two days later on December 14, 2012, Griffitts fil ed suit against Campbell for personal injuries and property damage Griffitts allegedly su ffered in the motor vehicle accident. In the suit, Griffitts also sought punitive damages based on an allegation that Campbell was driving

while intoxicated at the time of the accident. On December 21, 2012, Old Republic and BNSF filed motions seeking to intervene as a matter of right in, and to stay, Griffitts’ lawsuit against Campbell. 3 The trial court “overruled” these motions on January 24, 2013. Old Republic an d BNSF did not appeal the ruling. On or before December 21, 2012, Old Republic and B NSF filed a complaint for declaratory judgment in federal court “seeking a de termination of no coverage” for Campbell in

2 From the parties’ briefs, we understand the policy was referred to as a “fronting policy” because BNS F’s deductible under the policy was equal to the limits of Old Republic’s liability under the policy. 3 It is unclear from the record on appeal, but the m otion to intervene also may have sought permissive intervention.3

connection with the motor vehicle accident at issue in Griffitts’ lawsuit against Campbell. 4 In a letter dated January 4, 2013, to counsel for Campbe ll, counsel for Old Republic and BNSF

stated: If . . . information [relevant to establishing Camp bell was a permissive user of the vehicle in question] is provided, we will certainly review it. BNSF and Old Republic continue to reserve its rights under the p olicy and state and federal law, and nothing in our communications shall constitute a waiver of any rights. On February 22, 2013, Griffitts and Campbell waive d a jury trial and the trial court heard evidence “on the record” and entered judgment for G riffitts against Campbell in the amount of $1,475,000. 5 In an email reply sent on March 2, 2013, to counse l for Old Republic and BNSF, counsel

for Griffitts stated: I intend to file a garnishment action against Old R epublic and Mr. Campbell’s personal insurer as provided under Missouri law. I think the only issue that concerns your clients right now is whether there is coverage or not. If there is no coverage then all the other issues are moot. On March 8, 2013, Old Republic and BNSF filed a po st-judgment motion to intervene as a matter of right pursuant to Rule 52.12(a) “for th e purpose of setting aside the [trial court’s February 22, 2013] Judgment,” 6 and also filed a motion for relief pursuant to Rul e 74.06(b) or in

the alternative Rule 75.01. The motion to interven e as a matter of right was “overruled” on March 14, 2013, and, on March 21, 2013, Old Republi c and BNSF filed a notice of appeal from the trial court’s order overruling their post-judgm ent motion to intervene as a matter of right.

4 The complaint is not part of the record on appeal. 5 Based on the parties’ written filings, it appears Griffitts and Campbell entered into an agreement pu rsuant to section 537.065, RSMo 2000, prior to the trial on F ebruary 22, 2013. 6 Old Republic and BNSF’s motion to intervene also s ought permissive intervention pursuant to Rule 52.1 2(b).4 Standard of Review In reviewing a trial court’s denial of a motion to intervene as a matter of right under Rule 52.12(a), we will affirm the . . . denial of [the] motion . . . unless there is no substantial evidence to support it, it is against the weight of the evidence, or it erroneously declares or applies the law. State ex rel. Nixon v. American Tobacco Co., Inc. , 34 S.W.3d 122, 126 (Mo. banc 2000). In reviewing the denial of intervention, we consider the facts in the light most favorable to t he trial court’s judgment. Kinney v. Schneider Nat. Carriers, Inc. , 200 S.W.3d 607, 610 (Mo.App. W.D.2006). Lawrence F. Behymer, Sr. Marital Trust v. City of B allwin (In re Creation of Clarkson Kehrs Mill Transportation Development District) , 308 S.W.3d 748, 752 (Mo.App. E.D. 2010). Analysis In their sole point relied on, Old Republic and BN SF claim that the trial court “erroneously . . . applied the law” in denying thei r post-judgment motion to intervene as a matter of right under Rule 52.12(a)(2) in Griffitts’ suit for personal injuries and property damage against Campbell. 7 We disagree because an “actual” claim by Griffitt s against Old Republic and BNSF was necessary to support Old Republic and BNSF ’s intervention as a matter of right under Rule 52.12(a)(2), and Griffitts’ claim against Old Republic and BNSF was not an actual claim at the time the trial court denied Old Republic and BN SF’s post-judgment motion to intervene as a matter of right. Griffitts’ claim against Old Repu blic and BNSF was not an actual claim for at least two reasons: (1) Old Republic and BNSF were seeking a declaratory judgment that Campbell’s conduct and Griffitts’ subsequent injuri es, were not covered by the “fronting” liability insurance policy Old Republic issued to B NSF, and (2) Griffitts had not demanded that Old Republic or BNSF pay Griffitts’ judgment agains t Campbell.

7 BNSF asserts no interest in Griffitts’ suit agains t Campbell other than through BNSF’s potential liab ility for a deductible under the fronting policy of liability i nsurance issued by Old Republic to BNSF. As a resu lt, we treat BNSF as having had no greater right to intervene as a matter of right in Griffitts’ suit against Campb ell than Old Republic had, and apply the same legal principles t o BNSF as we do to Old Republic.5

Rule 52.12(a) provides: Upon timely application anyone shall be permitted t o intervene in an action: (1) when a statute of this state confers an uncondi tional right to intervene or (2) when the applicant claims an interest relating to the property or transaction that is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or i mpede the applicant’s ability to protect that interest, unless the applicant’s inter est is adequately represented by existing parties.

As the text of the rule indicates: To intervene as a matter of right under Rule 52.12( a)(2), the intervenor must show: (1) an interest in the subject matter; (2) d isposition of the action may impede its ability to protect that interest; and (3 ) the applicant’s interest is not adequately represented by the existing parties. Ru le 52.12(a)(2); Ring v. Metropolitan St. Louis Sewer Dist. , 41 S.W.3d 487, 491–92 (Mo.App. E.D.2000). The trial court may deny the applicant’s motion to intervene if any one of these requirements is not met. LeChien v. St. Louis Concessions, Inc. , 33 S.W.3d 602, 603–04 (Mo.App. E.D. 2000). However, if the interv enor meets all of the requirements, the right to intervene is absolute. Borgard v. Integrated Nat. Life Ins. Co. , 954 S.W.2d 532, 535 (Mo.App. E.D. 1997). Behymer Marital Trust , 308 S.W.3d at 752-53. A liability insurer whose alleged insured is an al leged tortfeasor does not have an “interest” in an action by an injured person agains t the alleged insured-tortfeasor that would support the insurer’s intervention in the action as a matter of right under Rule 52.12(a)(2), unless the injured person’s “potential” claim against the insurer for indemnity has become an “actual” claim for indemnity. Augspurger v. MFA Oil Co. , 940 S.W.2d 934, 937, 937-38 (Mo.App. W.D. 1997). A potential claim for indemnity does n ot become an actual claim for indemnity until at least any judicially pending “question of coverage” has been resolved, and the injured person has obtained a judgment against the tortfeas or and demanded the insurer pay the6

judgment. Id. ; see also Borgard v. Integrated Nat. Life Ins. Co. , 954 S.W.2d 532, 536, 536-37 (Mo.App. E.D. 1997) (“We choose to follow Augspurger . . . .”). 8 In this case, Old Republic and BNSF’s declaratory judgment action raised a question of coverage that prevented Griffitts’ potential claim for indemnity against Old Republic from becoming an actual claim that would support interve ntion as a matter of right under Rule 52.12(a)(2). Old Republic and BNSF criticize the r ule set forth in Augspurger because the rule places liability insurers in an “impossible situati on” when the “putative insured” “demand[s] . . . an unconditional defense” and a “question of covera ge remains an ‘open question.’” In the language of Borgard , the answer to Old Republic and BNSF’s criticism i s [t]he [third-party defendants’] refusal to allow [t heir liability insurer] to defend under reservation of rights properly excluded [the insurer] from the underlying actions. See State ex rel. Rimco, Inc. v. Dowd , 858 S.W.2d 307, 308 (Mo.App.1993). [The insurer] had an opportunity to control the litigation by accepting the defense without reservation. By elec ting some other course it forfeited its right to participate in the litigatio n and control the lawsuit. Estate of Langhorn v. Laws , 905 S.W.2d 908, 911 (Mo.App.1995). An insurer mu st make a hard decision in determining whether to defend wh en a coverage issue exists. Id . If the decision concerning coverage is wrong the insurance company should be bound by its decision. Id

. Borgard , 954 S.W.2d at 535. In addition, at the time the trial court denied Ol d Republic and BNSF’s post-judgment motion to intervene as a matter of right, Griffitts had not demanded that Old Republic or BNSF pay the judgment against Campbell. Old Republic an d BNSF argue that Griffitts’ counsel’s statement in his reply email to counsel for Old Rep ublic and BNSF that “I intend to file a garnishment action against Old Republic and Mr. Cam pbell’s personal insurer as provided under Missouri law” was a demand to pay the judgment. We do not believe that a statement of a

8 The rule is different where the alleged insured is the injured person, and potentially seeking indemn ity pursuant to the insured’s own insurance policy (e.g., under the uninsured/underinsured provisions of the insured’s policy). Charles v. Consumers Insurance , 371 S.W.3d 892 (Mo.App. W.D. 2012).7

present intent to seek garnishment in the future is the substantive equivalent of a demand for payment of the judgment against Campbell. See LeChien v. St. Louis Concessions, Inc. , 33 S.W.3d 602, 603, 604, 604-05 (Mo.App. E.D. 2000) (I n an action on a promissory note, an attorney who drafted the note sought to intervene b ecause the plaintiff in the action had “notified [the attorney] of its ‘intent to file suit against [him] for professional negligence’”; the Eastern

District affirmed the trial court’s denial of the a ttorney’s request to intervene because the “threat of a [future] malpractice action . . . was merely s peculative” and “[a]ny interest [the attorney] had in the underlying litigation was conjectural an d did not justify intervention as a matter of right.”); see also Flippin v. Coleman Trucking, Inc. , 18 S.W.3d 17, 20-21 (Mo.App. E.D. 2000) (the lack of a demand for payment precluded a liabi lity insurer’s intervention as a matter of right in a wrongful death lawsuit against its insured). 9 We deny Old Republic and BNSF’s point relied on, a nd affirm the trial court’s denial of Old Republic and BNSF’s post-judgment motion to int ervene as a matter of right under Rule 52.12(a)(2). 10 Nancy Steffen Rahmeyer, P.J. – Opinion Author Daniel E. Scott, J. – Concurs William W. Francis, Jr., C.J. – Concurs

9 Old Republic and BNSF encourage us to distinguish between the “fronting policy” at issue in this case and a traditional liability insurance policy, but never a sserted before the trial court that the “fronting p olicy” in question here was distinguishable from a traditional liabili ty insurance policy. Rather, Old Republic and BNSF treated the fronting policy as a liability insurance policy bef ore the trial court. For example, in their Rule 74 .06(b) and Rule 75.01 motion, Old Republic and BNSF argued that “[t he failure of the judgment to specify the amount of damages allocable to compensatory and to punitive damages] is . . . critical because the fronting policy at is sue does not provide coverage for one who is not a permissive us er, and also excludes coverage for punitive damages , and for injuries which are expected or intended.” An issue that was not presented to the trial court is not p reserved for appellate review. In re S.R.J., Jr. , 250 S.W.3d 402, 405 n.2 and related text (Mo.App. E.D. 2008). In addition, the “fronting policy” at issue here is not part of the record on appeal, and at least some “fronting polic ies” are treated as insurance policies in Missouri. Fireman’s Fund Insurance Co. v. TIG Insurance Co. , 14 S.W.3d 230 (Mo.App. W.D. 2000) (treating a “fronting policy” as a polic y of insurance under the facts in that case). Old Republic and BNSF had the responsibility to prepare a record suf ficient to permit us to evaluate their arguments. Augspurger , 940 S.W.2d at 936. As a result, we decline to revi ew Old Republic and BNSF’s contention that the “fro nting policy” in question here should be treated differen tly than a traditional liability insurance policy. 10 In a motion taken with the case, Griffitts request ed that Old Republic and BNSF’s appeal be dismissed or that portions of their brief be stricken. In view of ou r disposition of this appeal, we deny Griffitts’ mo tion as moot.