Opinion ID: 3209138
Heading Depth: 4
Heading Rank: 2

Heading: The Exclusion’s Language

Text: The policy also excludes coverage for injuries arising from the employees’ employment. Peerless contends the exclusion applies here. 3 (...continued) 653 P.2d at 1380–83 (citing multiple cases that involved “employee of the insured exclusions” rather than “fellow-employee exclusions” to support its holding). We agree that the Barnette majority’s holding seems to rest on inapplicable case law insofar as it relies on decisions about “employee of the insured” exclusions. We also have difficulty understanding how a clause that explicitly refers to “bodily injury to any fellow employee,” id. at 1377 (emphasis added), does not cover a situation where one employee injures another. And the parties’ inclusion of the clause in the policy seems to show some intent to preclude coverage in these situations. But we are not in a position to disregard the ruling. Sitting in diversity we must defer to Wyoming law as determined by its highest court. 4 Peerless argues that Cloud Peak has waived any argument regarding Barnette and the severability clause because they did not file a cross-appeal from the district court’s order. That order did not address whether Barnette controlled the outcome. Rather, the district court based its holding on its finding that the passengers’ injuries did not arise out of and in the course of their employment, as required by the exclusion. So the district court did not find against the appellees on the Barnette issue, as Peerless argues, but instead cabined its analysis to only one justification. “[W]e may affirm on any basis supported by the record, even if it requires ruling on arguments not reached by the district court or even presented to us on appeal.” Richison v. Ernest Grp., Inc., 634 F.3d 1123, 1130 (10th Cir. 2011); see also Wyoming v. U.S. Dep’t of Agric., 661 F.3d 1209, 1254 n.33 (10th Cir. 2011) (“[A]n appellee is generally permitted to ‘defend the judgment won below on any ground supported by the record without filing a cross appeal.’”). The appellees have not waived their Barnette argument and we address it on appeal. -9- The policy generally excludes coverage for injuries that “aris[e] out of and in the course of the fellow ‘employee’s’ employment or while performing duties related to the conduct of [Cloud Peak’s] business.” Aplt. App. Vol. I at 53–54. The district court held that the injuries did not “arise out of” the injured employees’ employment, and therefore the exclusion did not apply. Peerless argues the district court erred when it failed to import the “employer conveyance rule” from the Wyoming worker’s compensation statute into the insurance policy, which covers injuries occurring during travel to or from the place of employment while riding in an employer-owned conveyance. See Wyo. Stat. § 27-14102(a)(xi)(D). Applying the employee conveyance rule, Peerless contends, would place the injuries within the “course of employment” and preclude coverage under the exclusion. We agree with the district court that established principles of Wyoming law call for a straightforward interpretation of the policy’s language. This interpretation should look only to the clause’s language and plain meaning, and not rules or definitions taken from other sources, such as the worker’s compensation statute. See Shaffer v. WINhealth Partners, 261 P.3d 708, 711 (Wyo. 2011). Had the contracting parties—Peerless and Cloud Peak—wished to include the limitation contained in the employer conveyance rule in the policy they easily could have. But they did not, and we will not alter the unambiguous contractual terms they actually chose. -10- Peerless argues that even without the employer conveyance rule the exclusion applies because the injured employees were acting within the course of their employment at the time the accident occurred. After analyzing the undisputed facts, and giving the exclusion its plain meaning, we agree with the district court that the passengers’ injuries did not “aris[e] out of and in the course of” their employment. First, the employees were neither on the clock nor performing any duties related to their employment at the time of the accident. In addition, the employees were not required to travel in the van as part of their employment at the Holiday Inn. Rather, the hotel gratuitously offered the shuttle rides for the convenience of its employees. This fact distinguishes the case from some of those cited by Peerless in support of its argument. For example, Peerless cites to Garrett v. New Hampshire Insurance Co., 860 F. Supp. 2d 1203, 1212 (D. Or. 2012), where the court found a logging employee’s injury while riding in his employer’s shuttle arose out of and in the course of his employment. But in that case the employee “understood that if he wanted to stay employed with [the employer], he had to ride in the company truck” due to the dangerous nature of the logging roads. Id. at 1211. In other words, the job required transportation in the employer’s conveyance. By contrast, the passengers here rode in the Holiday Inn shuttle for their own convenience because they did not own vehicles. Nothing about their jobs dictated how they traveled to or from work. -11- Thus, we agree with the district court’s conclusion that “[t]here is no nexus between their injuries and their courses of employment.” Aplt. App. Vol. I at 61. We stress that even were we to agree with Peerless’s argument here, however, we would still hold that the Barnette decision forecloses a finding that the exclusion applies.