Opinion ID: 2975390
Heading Depth: 3
Heading Rank: 1

Heading: Employer’s Exclusion

Text: 5 As noted above, the CGL Policy does not require GAINSCO to defend Mandrill if the claims against Mandrill are for bodily injury to “employees” arising out of and in the course of either their employment with Mandrill or their duties in the conduct of Mandrill’s business. JA at 112-13. Mandrill does not contest that the Laborers were injured in the conduct of its business. The CGL Policy’s definition of “employee,” however, does not include “temporary workers,” JA at 119, which are defined as “person[s] furnished to [Mandrill] to substitute for a permanent ‘employee’ on leave or to meet seasonal or short-term workload conditions.” JA at 121. The district court based its entire decision denying any duty to defend on the allegations in the Laborers’ complaints that they were “employees”: The Mathis and Wheeler complaints explicitly allege the injured workers were employees. These allegations fall squarely within the employer’s liability exclusion. . . . In his amended complaint Wynn alleged he was an independent contractor rather than an employee . . .. There is no provision in the policy to prevent bodily injury to an independent contractor from being treated as bodily injury to an employee. . . . Relying on the facts as they are alleged in the underlying complaints, the Court concludes [GAINSCO] does not have a duty to defend the underlying claims against Mandrill. Dist. Ct. Mem. Op. (February 19, 2004) at 11-12; JA at 295-96. The allegation of “employee” status in a complaint, however, could potentially have a different meaning than that in the CGL Policy. For example, Laborer Robert Wynn’s original complaint alleged that he was an “employee of the defendant[ ] under the scope and meaning of the Tennessee Workers’ Compensation Statutes.” JA at 214. An employee, under those statutes, “includes every person . . . in the service of an employer,” Tenn. Code Ann. § 50-6-102(10)(A), which is a broader definition than that in the CGL Policy that could include certain “temporary workers.” In addition, and perhaps more poignantly, the district court found that there was a 6 genuine issue of material fact whether the underlying claimants were employees or temporary workers under the [CGL Policy]. Dist. Ct. Mem. Op. (February 19, 2004) at 14. That holding is inconsistent with the district court’s holding that no duty to defend was triggered by the complaints. The district court's holding – that GAINSCO could potentially be liable for the damages claimed if there were temporary employees – would necessarily trigger a duty to defend. In sum, the pleadings mere use of the word “employee” is not sufficient to invoke the employer’s exclusion under the policy if the policy is construed to cover some subclass of temporary employee in which they could fall. Therefore, the basis of the district court’s decision is flawed: To determine whether the exclusion applies it is necessary to construe what can be included in the exception to the exclusion by the words and definitions of “temporary workers.” In addition, we must examine the district court’s failure to address Laborer Robert Wynn’s amended complaint that alleged that he was an independent contractor.