Opinion ID: 788569
Heading Depth: 2
Heading Rank: 1

Heading: PL vs. CGL Coverage

Text: 7 The district court correctly applied PL provisions to the underlying action. 8 To determine which coverage provision applies, we must liberally construe the allegations as set forth in the complaint without reference to their truth or falsity, [ ] to what the parties know or believe to be the true facts, [ ] to a legal determination of the true facts, or to the specific legal theories advanced by the parties. See Duncanville Diagnostic Ctr., Inc. v. Atl. Lloyd's Ins. Co. of Texas, 875 S.W.2d 788, 789 (Tex.App.1994, writ denied) (citing Heyden Newport Chem. Corp. v. S. Gen. Ins. Co., 387 S.W.2d 22, 24-25 (Tex.1965)). 3 9 In the underlying suit, the Amended Complaint alleged: 10 Defendants failed to properly and timely render appropriate medical and nursing care by among other things ... allowing infections, skin ulcers and other disease process[es] to continue without medical intervention ... failing to meet minimum diet standards for its residents ... failing to timely transfer Lawrence Knutson to a higher level care facility when appropriate. 11 Defendants were negligent and grossly negligent in management, budgeting, and in hiring practices ... orientation and training practices, and in supervision of employees.... 12 ... [breach] of the Contract to Provide Nursing Facility Services Under the Texas Medical Assistance Program ... by depriving and failing to provide Lawrence Knutson with the care specified under the terms of the contract ... [and by]... various acts and/or omissions.... 13 The gravamen of the plaintiffs' allegations is negligent medical care; but-for the alleged negligence, none of the other claims would have been brought. Hartford's contention that this or any other interpretation that results in double coverage would improperly render the PL coverage duplicative is unavailing. Hartford's argument would read certain terms out of the contract, violating the principle that every term of a contract must be given meaning. Transitional Learning Community, Inc. v. United States Office of Personnel Management, 220 F.3d 427, 431 (5th Cir.2000). 14 Here, liberally construing the terms of Hartford's policy, we find it most plausible that Riverside paid additional, higher premiums for PL coverage precisely to cover incidents like this case, where the lawsuit alleges negligence arising out of the rendering of medical services. This construction gives the most meaning to the terms of Hartford's policy and supports the view that Riverside's CGL coverage protected it, for instance, against claims by someone slipping and falling in the waiting room, while its PL coverage protected it from lawsuits by residents harmed by treatment (or lack thereof) received at the facility. This view is consistent with state and federal courts in this circuit that have interpreted insurance policies containing both comprehensive and professional liability provisions. See Harris Methodist Health Sys. v. Employers Reinsurance Corp., No. 3:96-CV-0054-R, 1997 WL 446459, - (N.D.Tex. July 25, 1997) ; Duncanville Diagnostic, 875 S.W.2d at 791; Guar. Nat'l, 909 F.2d at 135-36; Utica Nat'l Ins. Co. of Texas v. Texas Property & Cas. Ins. Guar. Ass'n, 110 S.W.3d 450, 455-57 (Tex.App.-Austin 2001). Thus, we agree with the district court that the underlying lawsuit implicated the PL provisions.