Court Opinion

ID: 17271
Source: CourtListenerOpinion
Date Created: 2010-04-25 07:02:45+00
Date Added: 2024-06-11T15:04:08.723832
License: Public Domain

IN THE UNITED STATES COURT OF APPEALS

                      FOR THE FIFTH CIRCUIT
                         _______________

                            No. 98-30837
                         Summary Calendar
                          _______________

                       CINDY L. EHRLICHER,

                                                 Plaintiff-Appellee,

                              VERSUS

              STATE FARM INSURANCE COMPANY, et al.,

                                                 Defendants,

                 NEW HAMPSHIRE INSURANCE COMPANY,

                                                 Defendant-Appellant.

                    _________________________

          Appeal from the United States District Court
              for the Eastern District of Louisiana
                    _________________________

                          March 15, 1999

Before JOLLY, SMITH, and WIENER, Circuit Judges.

JERRY E. SMITH, Circuit Judge:

     Defendant New Hampshire Insurance Company (“New Hampshire”)

appeals the denial of its motion for summary judgment and the grant

of plaintiff Cindy Ehrlicher’s motion for summary judgment seeking

uninsured motorist insurance coverage for an accident incurred

during the course and scope of her employment.    Concluding that the
district court erred in its application of Louisiana law, we

reverse and render summary judgment in favor of New Hampshire.

                                         I.

      We review a summary judgment de novo, employing the same

standards as did the district court.                       See Urbano v. Continental

Airlines,    Inc.,    138 F.3d 204,       205    (5th    Cir.),     cert.   denied,

119 S. Ct. 509 (1998).              Summary judgment is appropriate when,

viewing the evidence in the light most favorable to the nonmoving

party, there is no genuine issue of material fact and the moving

party is entitled to judgment as a matter of law.                           See Celotex

Corp. v. Catrett, 477 U.S. 317, 322-24 (1986); see also FED. R. CIV.

P. 56(c).

                                        II.

      Ehrlicher,      an     employee        of       American      Healthcare,        Inc.

(“American”), collided with an underinsured motorist while driving

her   own   car,    allegedly       during      the        course   and   scope   of   her

employment.        She recovered up to the limit of the underinsured

motorist’s coverage as well as under her employer’s workers'

compensation policy.           She now seeks benefits from American’s

insurance policy with New Hampshire.

                                        III.

      The   district        court    focused          on     interpreting    American’s

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insurance policy with New Hampshire, concluding that a signed

endorsement    modified           the    main    policy       so    as    to     provide

underinsured/uninsured motorist ("UM") coverage to employees of

American    driving       their    own    vehicles     in     the   scope      of   their

employment.    Specifically, the court found that the section of the

endorsement entitled “Who is an Insured” extends the contractual

scope of the UM coverage to employees in Ehrlicher’s situation.

Section B(5) of the endorsement defines “Who is an Insured” as

"[a]nyone else “occupying” an “auto” you do not own and that is a

covered “auto” under this coverage part for Liability Insurance and

is licensed and principally garaged in Louisiana."

      Because the main policy defines a “covered auto” as “any

auto,” and because Ehrlicher’s car is “licensed and principally

garaged in Louisiana,” the court found that Ehrlicher can properly

claim coverage under this provision.              The court relied on a similar

interpretation of a nearly identical provision in Bays v. Estate of

Zeringue,   584 So. 2d     715   (La.    App.   5th    Cir.),     writ    denied,

590 So. 2d 79 (La. 1991), writ denied, 590 So. 2d 576 (La. 1992).

      New Hampshire protests that this reading of § B(5) would lead

to the absurd result of extending coverage to “any auto” that is

“licensed and principally garaged in Louisiana.”                            As another

Louisiana court of appeal noted, the district court’s reading could

allow “even the members of this court [to] claim UM coverage under

the   policy   as     literally         construed.”          Ratcliff    v.     Theriot,

                                            3
634 So. 2d 1234, 1236 (La. App. 3d Cir.), writ denied, 637 So. 2d
1048 (La. 1994).1

      The district court reasoned that extending UM coverage to an

employee driving her own car in the course of her employment is

hardly an absurd result.           We agree with the Ratcliff court,

however, that the reading urged by the plaintiffs and adopted by

the district court provides no basis for limiting coverage to

employees driving their own cars in the scope of their employment.

Reading “covered auto” to mean “any auto” would lead to absurd

consequences, even if the particular application in this case does

not seem so absurd.      “Even if the words are fairly explicit, it is

our duty to refrain from construing them in such a manner as to

lead to absurd consequences.”        Cashio v. Shoriak, 481 So. 2d 1013,

1015 (La. 1986).

      New Hampshire has offered a reasonable reading of § B(5) that

limits UM coverage to vehicles owned by American.           It relies on the

phrase “under this coverage part” to limit the scope of “covered

autos” to those vehicles specified as covered in the UM coverage

section of the policy.        Because the declaration page for the UM

coverage section states that only vehicles owned by American are

     1
       Bays and Ratcliff represent a circuit split within Louisiana between the
Fifth and Third Circuits. Unfortunately, the Louisiana Supreme Court denied
writs for certiorari in both cases without explanation. This leaves us with no
binding authority to resolve the question, because “a denial of a writ of
certiorari neither constitutes an approval of the court of appeal’s decision nor
does it create precedent.” Stewart v. Robinson, 521 So. 2d 1241, 1248 (La. App.
3d Cir. 1988).

                                       4
UM-covered vehicles, New Hampshire avers that § B(5) is intended to

provide UM coverage only to “anyone” occupying a vehicle owned by

American.    We agree.

                                         IV.

     Because the district court found that the endorsement extended

the policy’s contractual coverage to Ehrlicher, it did not reach

the question whether UM coverage is statutorily mandated under

Louisiana law, which requires UM coverage for any person insured

under a liability policy unless such coverage is waived. See LA.

REV. STAT. ANN. § 22:1406(d)(1)(a)(I).            Therefore, we cannot grant

summary judgment to New Hampshire unless we conclude that Ehrlicher

is not a “liability insured” under the American policy.

     Ehrlicher     concedes     that     the    original   policy    specifically

excludes     her   and    all    other     American    employees      from     being

“liability    insured[s]”       and    would     constitute   a     waiver     under

Louisiana law.         She nevertheless argues that the endorsement

replaces the original policy and broadens the group of “liability

insured”     persons     to   include     any    person    driving    a      vehicle

principally licensed and garaged in Louisiana.

     We agree with New Hampshire that the endorsements can be read

to   avoid    conflicting       with     the    original   policy’s       liability

provisions (as well as avoiding another absurd result). Nothing in

the language of the UM coverage endorsement purports to change the

                                          5
group of “liability insureds” covered generally under the policy.

Rather, the UM coverage endorsement focuses on defining who is

contractually afforded UM coverage.   This reading seems especially

reasonable in light of the “Louisiana Changes” endorsement, which

specifically states how it modifies the original policy’s group of

“liability insureds.”    Therefore, we reject Ehrlicher’s claim of

statutory UM coverage.

     For the foregoing reasons, we REVERSE the summary judgment in

favor of Ehrlicher and RENDER summary judgment for New Hampshire.

                                 6