Assumption Parish Police Jury v. Texas Brine Company, LLC

STATE OF LOUISIANA
COURT OF APPEAL, FIRST CIRCUIT

ASSUMPTION PARISH POLICE NO. 2021 CW 1353

JURY, ET AL
PAGE 1 OF 2

VERSUS

TEXAS BRINE COMPANY, LLC, ET
AL

CONSOLIDATED WITH

STATE OF LOUISIANA
VERSUS

TEXAS BRINE COMPANY, LLC, ET
AL

CONSOLIDATED WITH

ASSUMPTION PARISH SHERIFF
MIKE WAGUESPACK

VERSUS

TEXAS BRINE COMPANY, LLC, ET JUNE 21, 2022

AL

In Re: National Union Fire Insurance Company of Pittsburgh,
PA and AIG Specialty Insurance Company, applying for
supervisory writs, 23rd Judicial District Court,
Parish of Assumption, No. 34386 c/w 34389 c/w 34391.

BEFORE: McDONALD, WELCH, LANIER, WOLFE, AND HESTER, JJ.

WRIT DENIED.

EW

CHH
Welch, J., concurs. An insurer is obligated to furnish a
defense unless it is clear from the petition that the policy
unambiguously excludes coverage. Arceneaux v. Amstar Corp.,
2010-2329 (La. 7/1/11), 66 So.3d 438, 450. The court must

liberally interpret the factual allegations of the petition in
determining whether they bring the plaintiff’s claim within the
scope of the insurer’s duty to defend. Maldonado v. Kiewit
Louisiana Co., 2013-0756 (La. App. lst Cir. 3/24/14), 146 So.3d
210, 219. The allegations of the petition filed by the State of
Louisiana against Texas Brine Company include an allegation that
the conduct and operations of the defendants resulted in the
brine mining of the salt cavern to the point that the cavern
became structurally unstable, thereby causing the collapse of
the cavern and damage to the State’s waters, natural resources
and coastal zone. I do not find that the petition unambiguously
excluded coverage, applying a liberal construction to the
allegations.

STATE OF LOUISIANA
COURT OF APPEAL, FIRST CIRCUIT

NO. 2021 CW 1353
PAGE 2 OF 2

McDonald and Lanier, JJ., dissent and would grant the writ.
The duty to defend is determined by application of the “eight
corners rule”, in which an insurer looks to the “four corners”
of the plaintiff’s petition and the “four corners” of the
insurance policy to determine whether it owes that duty.
Maldonado v. Kiewit Louisiana Co., 2013-0756 (La. App. ist Cir.
3/24/14), 146 So.3d 210, 218. The insurer is obligated to
furnish a defense unless it is clear from the petition that the
policy unambiguously excludes coverage. Arceneaux v. Amstar
Corp., 2010-2329 (La. 7/1/11), 66 So.3d 438, 450. Thus,
assuming the. factual allegations of the petition are true, if
there could be both coverage under the policy and liability to
the plaintiff, the insurer must defend the insured regardless of
the outcome of the suit. Id.

The court must liberally interpret the factual allegations
of the petition in determining whether they bring the
plaintiff’s claim within the scope of the insurer’s duty to
defend. If a petition does not allege facts within the scope of
coverage, an insurer is not legally required to defend a suit
against its insured. Maldonado, 146 So.3d at 219.

There appears to be no dispute that National Union Fire
Insurance Company of Pittsburg, Pa and AIG Specialty Insurance
Company (collectively “AIG”’) issued commercial general liability
policies to Texas Brine Company, LLC covering various periods
between 3/1/1991 and 3/1/2009. None of the policies at issue
were in effect after 3/1/2009. These policies provided for
coverage for property damage, but only if the property damage
occurred during the policy period. In reviewing the allegations
of the petition filed by the State of Louisiana and liberally
construing such allegations, we find such allegations do not
bring the claims of the State of Louisiana within the scope of
AIG’s duty to defend herein. There is no allegation in the
petition of any damages occurring at any time during the policy
periods, where the petition asserts that the State of
Louisiana’s action initially arose from activity that began on
or around May 31, 2012, which is more than three years after the
last of these pre-2012 policies expired.

Moreover, this court has found similarly in other cases
arising from the sinkhole with regard to the AIG policies and
policies of another insurer with substantially the same
language. see Crosstex Energy Services, LP v. Texas Brine
Co., LLC, 2017-0863 (La. App. Ist Cir. 12/21/17), 240 So.3d
1024, writ denied, 2018-0144 (La. 3/23/18), 238 So.3d 962;
Crosstex Energy Services., LP v. Texas Brine Co., LLC, 2017-0895
(La. App. ist Cir. 12/21/17), 240 So.3d 932, writ denied, 2018-
0145 (La. 3/23/18), 238 So.3d 963. For the foregoing reasons,
we would grant the remainder of the motion for summary judgment
filed by AIG and dismiss the remaining claims of Texas Brine
Company, LLC against AIG seeking defense of the claims asserted
by the State of Louisiana.

COURT OF APPEAL, FIRST CIRCUIT

A.Gonf

DEPUTY CLERK OF COURT
FOR THE COURT