Alwyn J. Boutte, Sr. v. Fireman's Fund County Mutual Ins. Co.

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

06-34

ALWYN J. BOUTTE, SR.

VERSUS

FIREMAN’S FUND COUNTY MUTUAL INS. CO., ET AL.

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APPEAL FROM THE
FIFTEENTH JUDICIAL DISTRICT COURT
PARISH OF LAFAYETTE, NO. 20014596
HONORABLE JOHN DAMIAN TRAHAN, DISTRICT JUDGE

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ULYSSES GENE THIBODEAUX
CHIEF JUDGE

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Court composed of Ulysses Gene Thibodeaux, Chief Judge, Jimmie C. Peters, and J.
David Painter, Judges.

REVERSED AND REMANDED.

Lawrence N. Curtis
Curtis & Lambert
P. O. Box 80247
Lafayette, LA 70598-0247
Telephone: (337) 235-1825
COUNSEL FOR:
Plaintiff/Appellant - Alwyn J. Boutte, Sr.

Michael Paul Bienvenu
Seale, Smith, Zuber & Barnette
8550 United Plaza Boulevard - #200
Baton Rouge, LA 70809
Telephone: (225) 924-1600
COUNSEL FOR:
Defendants/Appellees - Eva Bernal and Fireman’s Fund County
Mutual Insurance Company

James Paul Doherty
Voorhies & Labbe’
700 St. John Street
Lafayette, LA 70502-3527
Telephone: (337) 232-9700
COUNSEL FOR:
Defendant/Appellee - Eva Bernal

THIBODEAUX, Chief Judge.

Plaintiff, Alwyn J. Boutte, Sr., was injured and his guest passenger was

killed when Boutte’s vehicle was hit from behind and burst into flames. Boutte sued

the lessee, Eva Bernal, a Texas resident, and the insurer of the Ford van that hit him,

Fireman’s Fund County Mutual Insurance Company (“Fireman’s Fund”). Boutte

subsequently amended his petition to add the driver and the passenger of the van,

both Texas residents. Both defendants filed motions for summary judgment, arguing

that they had no liability because the driver of the van was not driving the van with

Bernal’s permission, the driver was not an employee of Bernal at the time of the

accident, and the driver was an excluded driver under Texas law. The trial court first

granted the motion for summary judgment of Bernal in 2003, and in 2005 the trial

court granted the motion for summary judgment of Fireman’s Fund. Boutte filed this

appeal. For the following reasons, we reverse the judgments of the trial court. There

are genuine issues of material fact which remain unresolved. Further, Louisiana, not

Texas, law applies which invalidates the named-driver exclusion under this

commercial automobile liability policy.

I.

ISSUES

We must decide:

(1) whether the appeal of the summary judgment in
favor of Eva Bernal is properly before this court;

(2) whether the law of Louisiana or the law of Texas
applies in determining insurance coverage in this
case; and,

(3) whether the trial court erred in granting summary
judgment in favor of Eva Bernal and Fireman’s Fund
County Mutual Insurance Company.

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II.

FACTS AND PROCEDURAL HISTORY

On the afternoon of March 26, 2001, Alwyn J. Boutte, Sr., a sixty-year-

old Louisiana resident, was driving a 1987 Dodge van on Interstate 10 near Lafayette.

Boutte stopped behind a Mitsubishi that had stopped due to construction along the

highway. While stopped, Boutte was rear-ended by a 1998 Ford van, and Boutte’s

vehicle burst into flames. Boutte was injured, and his guest passenger was burned to

death. The 1998 Ford van (hereinafter “the van”) was allegedly being driven by

Texas resident Juan Lara who was traveling with Ruben Lara. At the time of the

accident, the van was being leased by Eva Bernal, a twenty-three-year-old single

mother of four from El Salvador.

Bernal had purchased commercial coverage on the van from Fireman’s

Fund in Texas. The effective dates of the policy were October 9, 2000 through

October 9, 2001, and the liability limit was $100,000.00. Bernal testified that she did

not have a driver’s license at the time of the accident on March 26, 2001, because she

could not read or write English. She testified that she had driven without a license

in the past. However, she also testified that she had had a Texas driver’s license at

one point.

Bernal further testified that, at the time of the accident on March 26,

2001, she had been in business with her brother, Jose Bernal, for about a month,

installing and repairing floors and concrete. She testified that they needed help and

had to hire people to help them. Then she testified that they hired people only to

drive for them. Bernal testified that they had hired Juan Lara and Ruben Lara to drive

for them because the Laras could read. However, she testified that she did not know

whether they knew any English; she had heard them speak only Spanish.

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On September 10, 2001, Boutte filed suit against Eva Bernal and

Fireman’s Fund, alleging that Juan Lara was driving the van with the permission of

Eva Bernal and while in the scope of his employment with Eva Bernal.

Eva Bernal filed a motion for summary judgment, attaching an expired

work permit card, portions of her deposition, and the insurance policy which

contained an endorsement excluding Juan Lara from coverage under the policy. In

her motion for summary judgment, Eva Bernal asserted that Boutte’s theory of

recovery against her was based upon respondeat superior, or the vicarious liability

of an employer for an employee, and that Juan Lara did not work for her at the time

of the accident. At one point in her deposition, Bernal stated that Juan Lara had

worked for her for the last time about two weeks before the accident. At another

point, she testified that Juan Lara was not her employee at the time of the accident

and that he had not worked for her from the time he was taken off of her insurance.

However, when he actually worked for her and when or whether he was removed

from insurance coverage by Eva Bernal is not clear, as the record contains numerous

instances of conflicting information and testimony.

Eva Bernal ostensibly kept no business records whatsoever. In her

motion for summary judgment, Bernal stated, “A named driver exclusion removing

Juan Lara from Eva Bernal’s automobile liability policy was signed by Bernal on

October 30, 2000.” However, in her deposition, Bernal testified that she and her

brother started the business of repairing and installing floors and pouring concrete to

repair parking lots in 2001 about a month before the accident on March 26, 2001.

She also testified that Juan Lara started working for her about a month before the

accident and that he worked for her for about a month. Therefore, the business for

which Bernal hired Juan Lara did not exist on October 30, 2000, at the time she

alleges to have excluded him from coverage. Additionally, according to Bernal’s
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testimony, Juan Lara did not work for her at the time she alleges to have signed the

exclusion naming him as an excluded driver. As the record will reveal, the exclusion

itself contains conflicting information and does not contain date information next to

the signature line.

The record contains an endorsement wherein Bernal was notified that an

additional premium of $624.00 would be added as a 33% surcharge “for drivers Juan

Lara and Eva Bernal, due to age and driving record.” This endorsement was made

effective retroactive to the effective date of the policy, October 9, 2000. However the

date typed at the bottom of the form is January 3, 2001. We note again that the

January 3, 2001 notification lists the driver, Juan Lara, whom Bernal testified that she

hired a month before the accident on March 26, 2001. Yet, Juan Lara was the subject

of a surcharge almost three months before the accident.

The named driver exclusion itself, which purports to exclude the driver

Juan Lara, is a preprinted form with blanks filled in by hand. All names were

handwritten. The top of the form showed an effective date of 10/30/00 that was

handwritten, not typed. It contained a date stamp at the bottom bearing the following

information on three lines, “Austin Mar 08 2001 Surplus.” Handwritten beneath the

stamp with an arrow pointing to the stamp was the following, “Re-averaged surcharge

eff. 2-8-01, due to receipt date of exclusion. (Back 30 days[)].” Also handwritten on

the form was the dollar amount of “$127.00” and the following information: “Endt

#5.” As previously indicated, there is no date line anywhere near the signature line

for the insured to actually date the document that he or she is signing.

The record contains another endorsement made effective on February 8,

2001, which decreases the surcharge from 33% to 23% and indicates a return

premium of $127.00 “due to receipt of signed exclusion for Juan Lara.” A typed line

at the bottom of the form states as follows: “ENDT #5/HWM 05-07-01.”
4

The policy contains yet another endorsement in the record indicating an

additional premium and surcharge for driver Philipe Castro, “due to driving record.”

It has an effective date of March 7, 2001, and contains the typed line “ENDT

#6/HWM 05-07-01.” All of the various endorsements and policy changes regarding

the different drivers and different vehicles being covered appear to have effective

dates and processing dates, rather than actual dates, and back-dating is evident as

well. Therefore, it is impossible to ascertain actual dates with regard to when the

changes were requested. However, all of the date information in the policy conflicts

with the testimony in Eva Bernal’s deposition, which conflicts with itself, regarding

when Juan Lara worked for Bernal.

Eva Bernal further testified in her deposition that she could not read,

because she had never been to school, but that she could sign her name. The copy of

her expired work permit card in the record contains what appears to be her signature.

There, the name, EVA BERNAL, is scrawled in capital letters across the card beneath

her typed name; it is hand printed, and the letters are unevenly spaced. Bernal at one

point in her deposition answered with reference to the exclusion that, “Yes, I signed

it.” However, the policy exclusion in the record did not contain a signature similar

to the one printed in capital letters on the permit card; it did not contain any signature.

Rather, the exclusion contained a line with a large “X” that had been

traced over several times. On the line next to the “X” were the handwritten cursive

initials “EBE,” which were connected and written in script, not printed, and there

were no spaces between the lettering. Since Bernal testified that she had never been

married and that all five of her children had the last name of “Bernal,” it is not known

why the initials ended in “E.” Moreover, it is significant that in her deposition,

Bernal specifically testified that she never signed her name using her initials.

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Bernal further testified that she talked to Miss Gutierrez, apparently the

insurance agent sometimes referred to by Bernal as the notary, at the insurance

company about removing Juan Lara after Miss Gutierrez informed her that he had

many traffic violations, which would cause her coverage to go up. However, Bernal

stated that she did not know whether Juan Lara was actually ever removed. Bernal

also testified that she signed a document but, since she could not read, she did not

know whether that document was adding or removing Juan Lara from her insurance.

She further testified that, “I recall that I signed a document and another one that I

gave to him.” When questioned about this other document, Bernal testified, “Well

the notary called me and told me that it was for him to be able to pay all of the traffic

violations [sic] tickets that he had.”

In her deposition, Bernal also indicated that she advised Juan Lara that

he was not insured and was not to drive any vehicle owned or leased by her. She

testified that she did not see Juan Lara or anyone with Ruben when Ruben picked up

the van. Bernal testified that Ruben Lara wanted to borrow the vehicle “because there

was an automobile he wanted to come look [sic] that he was interested in buying. He

wanted to come see it. If I like it, well, I’ll bring it back, but he did not tell me that

he was coming with someone else.” In response to the question about how Ruben

planned to get the car back to Texas, she testified, “He was not bringing the money

to buy it.” Bernal further testified that she did not do business in Louisiana and that

neither Juan nor Ruben Lara was in the scope of his employment when the accident

occurred. She testified that her brother Jose usually went out and got the customers

for their business, using business cards and calling cards. When asked to show a

card, she said that she did not have any.

In addition to the numerous instances of conflicting testimony above, in

response to a question about when Juan last worked for her before the accident,
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Bernal stated, “Two weeks before and then I did not see him again. I don’t know

where he is.” However, she later stated that the last time she saw Juan Lara was after

the accident. She specifically stated, “When he had the accident, he came over to the

house and said what happened. . . . That Ruben Lara had had an accident.” Bernal

vacillated as to whether Juan told her about the accident on the day of, or the day

after, the accident, and at one point she gave the specific date of March 29th. At one

point, she seemed to be unsure whether Ruben was with Juan when Juan told her

about the accident, yet later she was positive that they came together. She testified

that the first time she learned of the accident Ruben was the one who told her. She

also testified that after they told her about the accident, she never saw either of them

again.

Bernal testified that she did not learn that Juan Lara was the driver until

the insurance company informed her of the fact. She stated, “I only called the

insurance company and that’s when I found out this man was driving.” When asked

what day she had called the insurance company and had this conversation, Bernal

stated, “I do not remember. They called me.” She then testified that she did not

remember the date and guessed that it was fifteen days or a month after the accident,

and she stated, “And I was not the one that called.” Bernal testified that she did not

know whether Juan and Ruben Lara were related to each other or where they could

be located. She testified that they hung out together. She denied that she had ever

lived with either of them.

Bernal testified that she stopped installing floors with her brother Jose

about two weeks after the accident. Therefore, the business was apparently in

existence for about six weeks, since it began about a month before the accident and

ended two weeks after the accident. Interestingly, Bernal also testified that Ruben

Lara had been employed by her as a driver for about three months. There were other
7

vehicles insured under the subject policy, and Bernal testified that she and her brother

had tried to start a previous home repair business but they could not start a company

because they did not have a state license or social security numbers, even though Eva

Bernal had been working in the United States since 1995. She testified that she had

always been paid in cash and always paid her employees in cash. There were no

affidavits, depositions or statements of any witnesses attached to Bernal’s motion for

summary judgment. It referenced her response to an interrogatory, but did not attach

the responses.

Boutte argued that Bernal’s motion for summary judgment was

unsupported except for her own self-serving, conflicting testimony and that the party

opposing the motion must have his allegations taken as true and must receive the

benefit of the doubt when his assertions conflict with the movant. He pointed out the

conflicts in Bernal’s own testimony and that there were genuine issues of material

fact regarding the employment of Juan Lara. Boutte alleged that Bernal’s credibility

was at issue and that the trial court was prohibited from making credibility

determinations at the summary judgment level.

On August 22, 2003, the trial court signed a judgment granting the

motion for summary judgment of Eva Bernal. The record does not contain written

reasons for the judgment. The dismissal of Eva Bernal appears to have been based

upon the named-driver exclusion and the deposition testimony of Eva Bernal alone

wherein she denies the employment of Juan Lara and denies giving him permission

to drive the covered automobile. The trial court marked through the paragraph in the

judgment that sought to designate it as a final judgment.

Fireman’s Fund filed a motion for summary judgment asserting that no

coverage existed under the policy issued to Eva Bernal. The motion referenced

Exhibit C, an affidavit stating that only one policy was issued to Eva Bernal with
8

effective dates of October 9, 2000 to October 9, 2001. However the affidavit marked

as Exhibit C, which purports to be that of the underwriter, is completely blank with

regard to affiant and notary names and dates; it is not signed, not dated, and not

notarized. Moreover, every reference in the motion to the affidavit contains a blank

line where the affiant-underwriter’s name should be.

The motion for summary judgment points to language in the policy and

states that Fireman’s Fund is liable only if an “insured” is legally condemned to pay

damages for bodily injury and property damage caused directly by the insured or for

which the insured is vicariously liable. Fireman’s Fund argued that the court had

already determined that Eva Bernal was not vicariously liable and that the only

remaining theory for coverage required that Juan Lara qualify as an insured.

Fireman’s Fund then pointed to the named-driver exclusion in its policy and argued

that the exclusion was enforceable under Texas law, which governed the insurance

policy.

The motion for summary judgment of Fireman’s Fund relied solely on

the exclusion and the deposition of Eva Bernal. It attached no depositions or

affidavits or statements of witnesses or police officers in Louisiana, it attached no

statement by the Fireman’s Fund agent in Texas or the neighbors or relatives of the

defendants in Texas, and the record is completely void of any such supporting

evidence. While the affidavit referenced as Exhibit C and purporting to be that of the

Fireman’s Fund underwriter was blank, we were able to locate an unmarked affidavit

received by the clerk of court on August 15, 2005, two months after Fireman’s Fund

filed its motion for summary judgment on June 14, 2005. The affidavit was signed

by Darin Freebern in Cook County Illinois, identifying the subject policy and stating

that no other policy was issued to Eva Bernal by Fireman’s Fund “applicable to any

9

occurence on March 26, 2001.” However, the notary block, while signed, contains

the following date information: “this 22 day of 2005 2005.”

On August 31, 2005, the trial court signed a judgment granting the

motion for summary judgment filed by Fireman’s Fund and dismissed Boutte’s case.

Boutte filed this timely appeal. Finding various issues of fact and law in this case,

we reverse both summary judgments by the trial court.

III.

LAW AND DISCUSSION

Standard of Review

Appellate courts review grants of summary judgment
de novo, using the same criteria that govern the trial court’s
consideration of whether summary judgment is appropriate,
i.e., whether there is a genuine issue of material fact and
whether the mover is entitled to judgment as a matter of
law. Ocean Energy, Inc. v. Plaquemines Parish Gov’t,
04-0066 (La. 7/6/04), 880 So.2d 1. The movant bears the
burden of proof. La. C.C.P. art. 966(C)(2). If the movant
meets this initial burden, the burden then shifts to plaintiff
to present factual support adequate to establish that he will
be able to satisfy the evidentiary burden at trial. Richard
v. Hall, 03-1488 (La. 4/23/04), 874 So.2d 131, 137.
Thereafter, if plaintiff fails to meet this burden, there is no
genuine issue of material fact and defendant is entitled to
summary judgment as a matter of law. Id. This court has
recognized that a “genuine issue” is a “triable issue,” an
issue in which reasonable persons could disagree. Jones v.
Estate of Santiago, 03-1424 (La. 4/14/04), 870 So.2d 1002,
1006 (citing Smith v. Our Lady of the Lake Hosp., 93-2512
(La. 7/5/94), 639 So.2d 730, 751). Further, this court has
defined a “material fact” to be one in which “its existence
or nonexistence may be essential to plaintiff’s cause of
action under the applicable theory of recovery.” Id.

Champagne v. Ward, 03-3211, pp. 4-5 (La. 1/19/05), 893 So.2d 773, 776-77.

“Summary judgment declaring a lack of coverage under an insurance

policy may not be rendered unless there is no reasonable interpretation of the policy,

when applied to the undisputed material facts shown by the evidence supporting the

10

motion, under which coverage could be afforded.” Adams v. Thomason, 32,728, p.

4 (La.App. 2 Cir. 3/1/00), 753 So.2d 416, 420, writ denied, 00-1221 (La. 6/16/00),

746 So.2d 965.

Whether the Dismissal of Eva Bernal is Properly Before the Court

The judgment appealed from dismissed Fireman’s Fund via final

judgment signed on August 31, 2005. Prior to signing the final judgment, the trial

court also signed a judgment on August 22, 2003, granting summary judgment in

favor of Eva Bernal and dismissing her from the case. The court specifically declined

to designate the judgment dismissing Bernal as a final judgment by marking out the

paragraph inserted by her in the judgment for that purpose. Eva Bernal now contends

that the interlocutory judgment dismissing her pursuant to her motion for summary

judgment is not appealable because that interlocutory ruling is not sufficiently related

to the final judgment dismissing Fireman’s Fund. She further argues that her

dismissal had no impact on Boutte’s cause of action against Fireman’s Fund. We

disagree.

Pursuant to its written policy, Fireman’s Fund has argued that it is liable

only for “sums an insured legally must pay as damages.” Therefore, under the theory

of defense asserted by Fireman’s Fund, the dismissal of the insured, Eva Bernal, is

directly related to the dismissal of Fireman’s Fund and does impact Boutte’s cause

of action against Fireman’s Fund. The general principle is that when, an unrestricted

appeal is taken from a final judgment, the appellant is entitled to seek review of

adverse interlocutory rulings prejudicial to him in addition to the review of the final

judgment on appeal. Landry v. Leonard J. Chabert Med. Ctr., 02-1559 (La.App. 1

Cir. 5/14/03), 858 So.2d 454, writs denied, 03-1748, 03-1752 (La. 10/17/03), 855

So.2d 761.

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Our courts have held that there are exceptions to this general rule,

particularly where writs have been taken and decided and where the doctrine of law

of the case applies. However, there is no evidence of a writ application on the

dismissal of Eva Bernal, and we find no exception to the general rule in this case.

Accordingly, we will review Boutte’s assignment of error regarding the dismissal of

Eva Bernal in the interlocutory judgment of August 22, 2003.

The Summary Judgment Dismissals of Eva Bernal and Fireman’s Fund

The Fireman’s Fund commercial policy issued to Eva Burnal defined its

insureds under the heading of WHO IS AN INSURED as follows:

The following are insureds:

a. You for any covered auto.

b. Anyone else while using with your permission a
covered auto you own, hire or borrow . . . .

c. Anyone liable for the conduct of an insured
described above . . . .

Boutte’s petition alleged that Juan Lara was operating the 1998 Ford van

with the permission of Eva Bernal and within the scope of his employment with Eva

Bernal at the time of the accident. As previously indicated, Eva Bernal denied both

allegations and moved for summary judgment, which was granted in August 2003.

Based upon Bernal’s deposition testimony and her dismissal in 2003 and based upon

the exclusion in the policy, Fireman’s Fund moved for summary judgment, which was

granted in August 2005. Boutte asserts that it was error for the trial court to grant

summary judgment because the defendants failed to carry their burden of

demonstrating that there were no material issues of fact regarding the circumstances

of Juan Lara’s and Ruben Lara’s trip to Louisiana and Juan Lara’s employment with

Bernal at the time of the accident and because, under a choice-of-law analysis, the

12

exclusion relied upon in the policy is unenforceable. Boutte argues that Bernal’s only

support for her assertions was her own conflicting, self-serving testimony. We agree.

Our jurisprudence provides that a motion for summary judgment is

properly granted only if the pleadings, depositions, answers to interrogatories, and

admissions on file, together with the affidavits, if any, show that there is no genuine

issue of material fact and that the mover is entitled to judgment as a matter of law.

Because the movant has the burden of establishing that no material factual issue

exists, inferences to be drawn from the underlying facts contained in the materials

before the court must be viewed in the light most favorable to the party opposing the

motion. “The party who defends against the motion for summary judgment must have

his properly filed allegations taken as true and must receive the benefit of the doubt

when his assertions conflict with those of the movant.” Schroeder v. Bd. of Sup'rs of

La. State Univ., 591 So.2d 342, 345 (La.1991) (citations omitted).

In the present case, in support of her motion for summary judgment, Eva

Bernal attached Boutte’s original petition, her own deposition testimony, her expired

work permit, and the Fireman’s Fund insurance policy with the endorsement

excluding Juan A. Lara as a covered driver. As indicated in the factual section above,

the deposition of Eva Bernal was riddled with discrepancies and self-conflicting

testimony. She contradicted herself repeatedly. She argues that, while her testimony

varied as to exactly when Juan Lara stopped working for her, she clearly testified that

he was not working for her at the time of the accident. We found nothing clear about

her testimony.

Because we are reviewing this case de novo, we are not bound by the

trial court’s discretion. Without supporting testimony or business records or evidence

of any kind, we find that numerous issues of material fact exist as to what the

relationship was between Eva Bernal and Juan Lara and Ruben Lara; whether Eva
13

Bernal was the employer of Juan Lara at the time of the accident; whether Juan and

Ruben Lara’s trip to Louisiana was in any way connected to repairing homes or

installing flooring here; and whether Eva Bernal otherwise gave Juan express or

implied permission as a friend or acquaintance to drive the van at the time of the

accident.

In fact, there are no police reports or copies of drivers’ licenses in the

record at all to indicate who was driving the insured vehicle, who was licensed or not

licensed and how many Louisiana violations occurred on the date of the accident.

The only solid identification in the record is Boutte’s chauffeur’s license and his

medical records. The testimony of Eva Bernal created more factual issues than it

resolved. Moreover, as will be discussed below, Eva Bernal was not entitled to

summary judgment as a matter of law. Because Fireman’s Fund relied solely on the

testimony of Eva Bernal and the exclusion in the policy, our position regarding

Fireman’s Fund is the same.

The Fireman’s Fund Exclusion and Choice-of-Law Analysis

Boutte argues that the trial court’s reliance on Texas law is misplaced

and that the named-driver exclusion in the Fireman’s Fund policy is not enforceable

because it violates the public policy of Louisiana.

The exclusion in the Fireman’s Fund policy indicates that it is a

“Business Auto Coverage Form” and contains the following language:

You agree that none of the Insurance coverage afforded by
this policy shall apply while Juan A Lara (The Excluded
Driver) is operating a covered auto or any other motor
vehicle. You further agree that this endorsement will also
serve as a rejection of uninsured/underinsured motorists
coverage and personal injury protection coverage while a
covered auto or any other motor vehicle is operated by the
excluded driver.

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Boutte argues that Louisiana’s public policy regarding liability insurance

holds that liability policies are issued “for the benefit of all injured persons” pursuant

to La.R.S. 22:655(D). He further argues that, in keeping with that public policy, La.

R.S. 32:900(B)(2)(d) limits the circumstances under which coverage may be excluded

in a commercial automobile liability policy such as the one at issue in this case.

Louisiana Revised Statutes 32:900 addresses named-driver exclusions

in two instances, as follows:

La.R.S. 32:900(L)(1) provides in pertinent part as follows:

Notwithstanding the provisions of Paragraph (B)(2)
of this Section, an insurer and an insured may by written
agreement exclude from coverage the named insured and
the spouse of the named insured. The insurer and an
insured may also exclude from coverage any other named
person who is a resident of the same household as the
named insured at the time that the written agreement is
entered into, and the exclusion shall be effective,
regardless of whether the excluded person continues to
remain a resident of the same household subsequent to the
execution of the written agreement. It shall not be
necessary for the person being excluded from coverage to
execute or be a party to the written agreement.

(Emphasis added).

La.R.S. 32:900(B)(2)(d) provides:

An owner may exclude a named person as an insured
under a commercial policy if the owner obtains and
maintains in force another policy of motor vehicle
insurance which provides coverage for the person so
excluded which is equal to that coverage provided in the
policy for which the person was excluded. The alternative
coverage is required for both primary and excess insurance.

(Emphasis added).

In the present case, the policy is a commercial or business policy.

Therefore the applicable statute addressing the exclusion is La.R.S. 32:900(B)(2)(d).

Accordingly, under Louisiana law governing named-driver exclusions, the exclusion

in the Fireman’s Fund policy issued in Texas would not be enforceable in Louisiana
15

because no other coverage was maintained for Juan Lara, pursuant to the affidavit

filed in evidence in August 2005. Based upon the clear language in the two

subsections above, the Louisiana legislature intended to specifically limit named-

driver exclusions for the protection of persons injured on Louisiana highways. In

individual policies, the named-driver exclusion is limited to members of the

household. In commercial or business policies, the limitation is more severe where

the intent is to ensure that excluded drivers are nevertheless covered in another policy

of insurance. On the other hand, Texas law differs somewhat.

For example, Texas courts have held that the family member exclusion

contravenes the public policy underlying the Texas Motor Vehicle Safety-

Responsibility Act to protect all potential claimants from damages because it creates

an inequity by stripping family members of coverage while allowing coverage for

everyone else. Accordingly, the Texas courts have determined that the even broader

named-driver exclusion, which focuses on the risk presented by any individual driver,

does not create the same inequitable effects as the family member exclusion. See

Zamora v. Dairyland County Mut. Ins. Co., 930 S.W.2d 739 (Tex.App. 13th Dist.

1996). In so doing, Texas has actually increased allowable exclusions in individual

policies. With regard to the commercial policy at issue herein, Fireman’s Fund argues

that the exclusion is enforceable, and we are not aware of any statute in Texas

providing otherwise.

The Louisiana Supreme Court in Champagne, 893 So.2d 773, concluded

that the appropriate starting point in a multistate case is to conduct a choice-of-law

analysis pursuant to La.Civ.Code arts. 3515 and 3537 to determine which state’s law

applies to the interpretation of the policy. The choice-of-law articles provide as

follows:

La.Civ.Code art. 3515
16

Except as otherwise provided in this Book, an issue
in a case having contacts with other states is governed by
the law of the state whose policies would be most seriously
impaired if its law were not applied to that issue.

That state is determined by evaluating the strength
and pertinence of the relevant policies of all involved states
in the light of: (1) the relationship of each state to the
parties and the dispute; and (2) the policies and needs of
the interstate and international systems, including the
policies of upholding the justified expectations of parties
and of minimizing the adverse consequences that might
follow from subjecting a party to the law of more than one
state.

La.Civ.Code art. 3537. General rule

Except as otherwise provided in this Title, an issue
of conventional obligations is governed by the law of the
state whose policies would be most seriously impaired if its
law were not applied to that issue.

That state is determined by evaluating the strength
and pertinence of the relevant policies of the involved
states in the light of: (1) the pertinent contacts of each
state to the parties and the transaction, including the place
of negotiation, formation, and performance of the contract,
the location of the object of the contract, and the place of
domicile, habitual residence, or business of the parties; (2)
the nature, type, and purpose of the contract; and (3) the
policies referred to in Article 3515, as well as the policies
of facilitating the orderly planning of transactions, of
promoting multistate commercial intercourse, and of
protecting one party from undue imposition by the other.

Fireman’s Fund argues that under choice-of-law analysis in cases

deciding insurance issues, e.g., Zuviceh v. Nationwide Ins. Co., 00-773 (La.App. 1

Cir. 5/11/01), 786 So.2d 340, writ denied, 01-2141 (La. 11/9/01), 801 So.2d 373, and

its progeny, have applied the foreign state’s laws and not abrogated the insurance

contract. Fireman’s Fund argues repeatedly that “the exact same factors at play in

Zuviceh are present and overwhelmingly weigh in favor [of] not abrogating the

Fireman’s Fund contract issued and delivered in Texas to Ms. Bernal.” We disagree.

At the outset, we note that the injured plaintiff in Zuviceh was a resident of the

17

foreign state, not a resident of Louisiana where the accident occurred, and that the

insurance issue in Zuviceh was the plaintiff’s own UM policy provision.

More specifically, in Zuviceh, the plaintiff was a Mississippi resident

involved in a head-on collision with a Louisiana resident in Slidell, Louisiana. At the

time of the accident, Zuviceh had in force a UM insurance policy that was issued to

her by Nationwide Insurance Company. The UM policy was negotiated and issued

in Mississippi and covered Zuviceh’s vehicle, which was registered in Mississippi.

Zuviceh petitioned the court for a judgment declaring which state’s law governed the

interpretation of the UM policy, Mississippi or Louisiana. The trial court conducted

a choice-of-law analysis and ruled that Mississippi law should apply. In making its

ruling, the trial court determined that Mississippi law applied to interpret the terms

of the Nationwide policy because Mississippi had a more substantial interest in the

uniform application of its laws than Louisiana had in providing an insurance remedy

to an out-of-state resident who sustained an injury while temporarily within

Louisiana’s borders.

Fireman’s Fund also cites Dreisel v. Metropolitan Property & Cas.

Insurance Co., 01-2705 (La.App. 1 Cir. 12/20/02), 836 So.2d 347, writ denied,

03-199 (La. 3/28/03), 840 So.2d 575, which applied Massachusetts law. There, the

plaintiff was a Massachusetts resident and guest passenger in a vehicle owned and

operated by a Louisiana resident. At the time of the accident, Dreisel had in effect

a UM policy issued to her by Metropolitan in Massachusetts, and the vehicle was

registered in Massachusetts. Dreisel sought to collect under the Metropolitan UM

policy. She was denied coverage based on a reduction clause in the policy providing

for a dollar-for-dollar reduction in Metropolitan’s liability based on money that the

insured collected from the tortfeasor. Metropolitan argued that it had no liability

under the UM policy since the tortfeasor’s insurance company had already tendered
18

to Dreisel the per person policy limit of $100,000, plus $5,000 in medical payments,

an amount which exceeded Dreisel’s $50,000 per person UM limit. As a result,

Dreisel filed suit against Metropolitan in Louisiana.

The trial court applied Louisiana law and granted Dreisel’s partial

motion for summary judgment. Metropolitan appealed the trial court’s ruling,

maintaining that Massachusetts law should be applied to a Massachusetts insurance

contract that expressly provided that the policy would be governed by Massachusetts

law. The first circuit reversed, finding that Louisiana’s uninsured motorist statutes

do not automatically apply to foreign state policies, but rather a choice-of-law

analysis must be employed to obtain the appropriate balancing of competing interests

between states. The court cited articles 3515 and 3537 and stated that “[t]he objective

is to identify the state whose policies would be most seriously impaired if its law were

not applied to the issue at hand.” Dreisel, 836 So.2d at 350. In that case, the first

circuit found that Massachusetts law applied to the issue at hand. In both Zuviceh and

Dreisel, the injured plaintiffs were residents of the foreign state, seeking an

interpretation of their own foreign policies.

Fireman’s Fund also cites Norfolk Southern Corp. v. California Union

Insurance Co., 02-369 (La.App. 1 Cir. 9/12/03), 859 So.2d 167, writ denied, 03-2742

(La. 12/19/03), 861 So.2d 579, which applied Virginia law. In Norfolk, the plaintiff

was a Virginia corporation. Norfolk sought a declaration that it had coverage under

several excess comprehensive general liability policies and sought indemnification

for the costs of cleaning up various polluted sites around the United States, including

three sites located in St. Tammany Parish, Louisiana. After citing the choice-of-law

articles, La.Civ.Code arts. 3515 and 3537, the first circuit conducted a lengthy

analysis demonstrative of the reasoning used in the other cited cases involving UM

conflicts. In reviewing the relevant law of Virginia and Louisiana, the Norfolk court
19

found a genuine conflict between the laws of the two states concerning the issue of

the effect of late notice to the insurance company. In determining that Virginia law

should govern certain issues, the first circuit articulated as follows:

Virginia clearly has the more significant contacts
with the parties and the transactions at issue in this case.
The London Insurers issued the insurance policies in favor
of Southern Railway Company and Norfolk Southern
Corporation. Southern Railway Company was organized
under the laws of Virginia in 1894, and Norfolk Southern
Corporation was incorporated in Virginia in 1982. Norfolk
and Western Railway Company, which merged with
Southern Railway to form Norfolk Southern Corporation,
is also a Virginia corporation. All of these companies do
business in Virginia. In addition, Norfolk’s main casualty
and insurance claims offices are located in Virginia, and
Norfolk provided notice of its claims regarding these
insurance policies from its offices in Virginia. The
remaining plaintiffs are all subsidiaries or controlled
companies of Norfolk Southern Corporation incorporated
in various places throughout the United States. Although
some of these parties conduct business in Louisiana, none
is incorporated in Louisiana or has its principal place of
business in the state.

Moreover, Virginia was the site of the negotiation
and delivery of many of the policies at issue here. Norfolk
was represented in the negotiations concerning these
policies by its brokers in Virginia, Missouri, and London.
All of the policies were delivered to Norfolk in either
Virginia or Washington, D.C. No negotiations took place
in Louisiana, and no policies were delivered to Norfolk in
Louisiana.

Virginia has a compelling interest in the regulation
of its insurance industry and in the contractual obligations
that are inherent parts thereof. The integrity of the contract
is a substantial and real interest. The fact that Congress
has allowed fifty states to have their own uniform system
of regulations governing insurance strongly suggests that
this is a legitimate public purpose. Zuviceh v. Nationwide
Insurance Company, 00-0773, p. 7 (La.App. 1st Cir.
5/11/01), 786 So.2d 340, 346, writ denied, 01-2141 (La.
11/9/01), 801 So.2d 373.

In addition, we note that the circumstances of this
case are entirely distinguishable from those of In re
Combustion, Inc., 960 F.Supp. 1056 (W.D.La. 1/15/97), on
which Norfolk relies. That suit involved a class action by
20

several thousand individuals seeking damages for both
personal injury and property damage arising out of the
operations of a CERCLA Superfund hazardous waste site
in Livingston Parish. The plaintiffs filed suit against
numerous generators and transporters allegedly responsible
for the contamination at the site and their insurers. The
defendants also filed cross-claims against their insurers.

The court determined that the public policy of
Louisiana and the circumstances of the case required that
Louisiana law apply to all actions brought pursuant to the
Direct Action Statute. In re Combustion, Inc., 960 F.Supp.
at 1057. Specifically, the court focused on La.R.S.
30:2002, which declares the maintenance of a healthy and
safe environment for the people of Louisiana “a matter of
critical state concern.” In addition, the court considered
certain circumstances of the case to be crucial to the
analysis, including the direct effect the contamination had
on Livingston Parish and its citizens. In re Combustion,
Inc., 960 F.Supp. at 1068.

The case before this court, however, does not involve
a direct action by injured Louisiana residents against the
insurance companies. The only plaintiffs in this suit are
the insureds themselves, and the court is only called on to
decide issues concerning the interpretation of contracts
between the parties to those contracts. We note that the In
re Combustion, Inc. court itself distinguished cases such as
this one involving a dispute only between insureds and
insurers from those involving direct actions by injured
parties. In re Combustion, Inc., 960 F.Supp. at 1070-1071.

Moreover, the insurance policies at issue here are
comprehensive general liability policies intended to
provide indemnity to Norfolk for liability arising out of the
conduct of its business, regardless of the location of the
risk. It is true that Norfolk’s losses at issue in these
appeals occurred in Louisiana and that Louisiana has an
interest in ensuring that its environmental sites are
remediated; however, no private actions have been filed
against Norfolk with respect to any of the Louisiana sites.
There is no evidence that any Louisiana resident would be
affected by a denial of coverage in this suit, since Norfolk
is simply seeking reimbursement for costs it has already
paid as response costs ordered by a governmental entity.
There is also no evidence that any Louisiana resident has
been injured by the contamination at the sites. Therefore,
Louisiana’s interest in this case only arises because a
Virginia corporation, along with certain of its subsidiaries
and controlled companies, has filed suit in Louisiana
seeking indemnity under insurance policies delivered
21

entirely outside of Louisiana (and primarily in Virginia) to
recover payments it has already made as compensation for
damage caused to property located in Louisiana. Such an
interest is not sufficient to override the compelling interest
Virginia has in regulating its insurance contracts. See Shell
Oil Company v. Hollywood Marine, Inc., 97-106, 97-611,
p. 8 (La.App. 5th Cir. 10/15/97), 701 So.2d 1038, 1041.

Norfolk, 859 So.2d at 180-82 (emphasis added) (footnotes omitted).

Similarly, in Holcomb v. Universal Insurance Co., 93-1424 (La.App. 3

Cir. 6/1/94), 640 So.2d 718, writ denied, 94-1740 (La. 10/7/94), 644 So.2d 643, a

panel of this court applied Arkansas law to an interpretation of a policy issued and

delivered in Arkansas after conducting a conflict-of-law analysis. There, the accident

occurred in Louisiana, but the Louisiana residents involved had settled out of the suit.

Accordingly, the panel articulated:

The action under consideration herein is likewise a
matter of contract interpretation. The insurance policy
herein was entered into between an Arkansas insurance
company . . . and an Arkansas resident/domiciliary . . . to
provide coverage on a vehicle registered, titled and garaged
in Arkansas. That policy is being sued on by other
Arkansas residents/domiciliaries seeking coverage under
that contract (policy) for damages they allegedly sustained.
The only Louisiana contacts are the heretofore released
tortfeasor and the site of the accident. Neither is relevant
to the issues to be decided herein. No Louisiana resident
or company is a party to this action; and, inasmuch as a
complete release has been executed in favor of all
Louisiana parties, the outcome of this action will not affect
any policy of or party in this state.

....

. . . In this case, although the accident occurred here
and involved a Louisiana resident, the latter is totally
unaffected by our decision. Were the circumstances
otherwise, i.e., if a Louisiana resident were directly
affected, this fact would not necessarily dictate the
application of Louisiana law but would be pertinent to a
determination of the choice of law to be applied.

Id. at 722 (emphasis added).

22

In Adams v. Thomason, 32,728 (La.App. 2 Cir. 3/1/00), 753 So.2d 416,

writ denied, 00-1221 (La. 6/16/00), 764 So.2d 965, the plaintiff was struck by a

cotton trailer in Richland Parish, Louisiana, while he was leaning on a parked truck

occupied and operated by a Wisconsin resident. The Wisconsin resident had in force

a UM policy that was negotiated and issued to him in Wisconsin by State Farm. The

plaintiff and his wife filed suit in Louisiana, seeking damages for his injuries. State

Farm, the defendant’s insurer, was one of numerous named defendants. The trial

court ruled that the State Farm UM policy provided coverage for the accident but

applied Louisiana law to the State Farm policy. Other Louisiana residents were

involved in and affected by the accident, and the insured was working in Louisiana

at the time of the accident. Accordingly, the court articulated that:

Louisiana had compelling interests that superseded those
of Wisconsin and would be adversely affected if Louisiana
law were not applied. Louisiana has a substantial interest
in regulating awards to victims injured on its highways and
in protecting those persons from uninsured and
underinsured motorists. Consequently, we find that
Louisiana law is applicable to the State Farm policy.

Id. at 427.

As we previously indicated, while not determinative, the residence of the

injured plaintiff is pertinent and is a factor in determining choice-of-law issues. In

the much-cited case of Champagne, the Louisiana Supreme Court found that, under

the facts of that case, Mississippi had a more substantial interest in the uniform

application of its laws governing insurance contracts than Louisiana had in providing

an insurance remedy to an out-of-state resident who was injured while transitorily

within the borders of Louisiana. Champagne, 893 So.2d at 773. Such is not the case

here. In this case, the injured plaintiff, Boutte, was a resident of New Iberia,

Louisiana. He was rear-ended in nearby Lafayette, and he clearly has expectations

of protection from and by the laws of Louisiana.
23

In Dunlap v. Hartford Insurance Co. of Midwest, 04-725, p. 6 (La.App.

1 Cir. 3/24/05), 907 So.2d 122, 125, where the plaintiff was a Louisiana resident who

had been run off of the roadway by a phantom driver, the court found that, where the

accident occurred in Louisiana, and all of the plaintiff’s medical treatment related to

the accident had been and probably would continue to be provided by doctors and

hospitals in Louisiana, the plaintiff “would expect to be protected by its laws,

including Louisiana’s strong public policy to promote full recovery for innocent

accident victims.”

In the present case, Fireman’s Fund has argued that a determination of

whether Texas or Louisiana law is applicable to the enforcement of the insurance

contract is not dependent upon the relationship of the parties in this case to the

insurance contract but to the relationship of the parties in the contract. That is to say,

the injured parties not involved in the contract, whether they be plaintiffs or

defendants, are not factors for consideration. If that were true, then there would be

no balancing of competing interests; every contract between an insured and an insurer

would simply be upheld under the laws of the foreign state, no matter how severe the

injury done in Louisiana to a Louisiana resident and no matter how invasive and

violative of Louisiana policy the foreign contract is. We strongly disagree with this

contention that the choice of law must be based only upon the relationship of the

parties contracting for the insurance. Jurisprudence has held that La.Civ.Code arts.

3515 and 3537 must be read together, as do the articles themselves. In Dunlap, the

court articulated as follows:

Zurich contends the focus of the court’s analysis should be
on the parties to the contract, Zurich and Iafrate, rather than
the parties to the lawsuit or occurrence, which would
include Dunlap. We disagree with this contention, noting
first that Article 3515 instructs the court to examine the
relationship of each state to the parties and the dispute,
and Article 3537 invites analysis of the nature, type, and
24

purpose of the contract, as well as the policies referred to
in Article 3515.

Dunlap, 907 So.2d at 124 (emphasis in original).

We will proceed accordingly. In the present case, Fireman’s Fund

argues that the relevant facts require a finding that Texas law be applied in this case

because the policy containing the named-driver exclusion was issued and delivered

to Eva Bernal, who is a Texas resident; the insured vehicle is owned by a Texas

resident, Modesto Paredes, and was leased to Bernal; the insured vehicle was

licensed, registered and garaged in Texas; and the vehicle was allegedly being driven

by a Texas resident, Juan Lara, and not a Louisiana resident. On the other hand, our

de novo review of the record reveals the following:

The contacts with Louisiana are as follows:

Boutte was a sixty-year-old citizen of Louisiana at the time
of the accident and has been a resident of New Iberia,
Louisiana and Lafayette, Louisiana.

Boutte had a social security number, and he had a valid
Louisiana chauffeur’s license that was not to expire until
September 2005.

Boutte had also worked as a cook on off-shore boats and
was described by his Louisiana physicians as a quiet
gentleman with a limp.

At the time of the accident, Boutte was in his vehicle in
Lafayette, Louisiana, stopped behind another vehicle that
had stopped for construction.

Boutte’s vehicle was owned, garaged and licensed in
Louisiana.

Boutte’s vehicle was violently struck from behind in
Louisiana, pushed into another vehicle, and burst into
flames near his city of residence.

Boutte suffered the loss of his guest passenger in
Louisiana.

25

Boutte suffered various injuries including injuries to his
back, shoulder, and pelvis and was disabled and
hospitalized in Louisiana.

Boutte was treated by physicians in New Iberia and
Lafayette, Louisiana.

The investigating police officers are Louisiana residents.

The fire department and ambulances are Louisiana
residents.

The coroner is a Louisiana resident.

The accident was in view of Louisiana residents and
affected Louisiana residents.

Almost all of the witnesses are residents of Louisiana.

The medical experts are Louisiana owned.

Defendant driver was allegedly in Louisiana to avail
himself of Louisiana’s prices on vehicles being sold in
Louisiana.

Defendants in the accident are believed to have received
medical treatment in Louisiana.

Defendant Fireman’s Fund has offices and does business in
Louisiana.

In contrast to the numerous contacts of plaintiff and defendants with

Louisiana as listed above, the contacts with Texas are minimal.

The contacts with Texas are as follows:

Defendants Bernal and the Laras resided and worked in
Houston, Texas.

Eva Bernal leased, insured, and garaged the subject vehicle
in Texas.

Defendant Fireman’s Fund issued and delivered the
insurance policy in Texas.

The driver of the Misubishi is believed to reside in Texas.

However, the negatives outweigh the positives with regard to the

defendants’ contacts with Texas:
26

Defendant Bernal was not a citizen of Texas or any other
state.

Defendant Bernal has never incorporated a business in
Texas.

Defendant Bernal never received or issued a check for
wages in Texas.

Defendant Bernal kept no business records in Texas.

There is no evidence in the record of Texas licenses of any
kind for any of the individual defendants in this case.

Defendant Eva Bernal did not obtain a social security
number in Texas and testified to not having a social
security number.

Defendant Bernal did not have a Texas driver’s license at
the time of the accident or for the majority of the time she
resided in Texas; and the record contains no evidence of
one.

Defendant Bernal has no Texas identification in the record
except possibly an expired work permit card possibly
issued in Texas; the card is stamped “not valid for reentry
to U.S.”

Defendant Bernal’s “business” at the time of the accident
existed for about one month and no longer exists, having
dissolved two weeks after the accident.

Defendant Bernal did not own real property in Texas.

Defendant Bernal allegedly has no contact in Texas with
the men who were driving her vehicle in Louisiana.

While it is true that Texas has an interest in enforcing and protecting the

integrity of its contracts in Texas, Louisiana clearly has the more significant contacts

with the parties and all of the transactions at issue in this case. In fact, Louisiana has

numerous contacts with Fireman’s Fund, which has offices and agents and a very

visible presence in Louisiana. Louisiana clearly has more compelling interests that

supersede those of Texas and would be adversely affected if Louisiana law were not

applied. Louisiana has a more substantial interest in regulating awards to Louisiana

27

citizens injured on Louisiana highways, than Texas has in this case in enforcing a

temporary contract with a non-citizen of its state. Given the facts and circumstances

of this case, the issues herein are a matter of critical state concern and Louisiana

public policy.

The legislature has enunciated public policy
concerning the purpose of liability insurance in La.R.S.
22:655(D) which provides, in pertinent part, that “all
liability policies . . . are executed for the benefit of all
injured persons and their survivors or heirs to whom the
insured is liable; and, that it is the purpose of all liability
policies to give protection and coverage to all insureds,
whether they are named insured or additional insureds
under the omnibus clause, for any legal liability said
insured may have as or for a tort-feasor within the terms
and limits of said policy.” The purpose of the compulsory
automobile liability insurance law is not to protect the
owner or operator against liability but to provide
compensation for persons injured by the operation of
insured vehicles. Couch, Cyclopedia Of Insurance Law,
Vol. 12A, § 45:682 (2d ed.1981); Cormier v. American
Deposit Ins. Co., 95-865 (La.App. 3d Cir. 12/6/95), 664
So.2d 807; Fields v. Western Preferred Casualty Co., 437
So.2d 344 (La.App. 2d Cir.), writ[s] denied, 440 So.2d
[528,] 754 (La.1983).

Adams v. Thomas, 98-2003, 98-2005 (La. 4/13/99), 729 So.2d 1041, 1043.

It is also important to note that Fireman’s Fund anticipated contacts with

Louisiana and other states where the language in its contract with Eva Bernal stated:

b. Out of State Coverage Extensions.

While a covered auto is away from the state where it is
licensed we will:

(1) Increase the Limit of Insurance for
Liability Coverage to meet the limit or
limits specified by a compulsory or
financial responsibility law in the
jurisdiction where the covered auto is
being used.

Fireman’s Fund writes insurance in numerous states, including

Louisiana. By its own terms, it anticipated that the insured vehicle would be driven

28

in other states and that the policy would be susceptible to enforcement in other states

under the laws of other states. In Zuviceh, so heavily relied upon by Fireman’s Fund,

the court articulated that an out-of-state coverage provision such as the one above is

a significant factor that distinguishes the application of foreign law in Zuviceh from

other cases wherein no such language exists. The court stated as follows:

In conducting our analysis, we are guided by our
previous decision of Francis [ v. Travelers Insurance Co.,
581 So.2d 1036, (La.App. 1 Cir.), writs denied, 588 So.2d
1114, 1121 (La.1991)]. However, we are mindful that
Francis was decided before the enactment of LSA-C.C.
arts. 3515 and 3537. Moreover, we find the fact that the
policy at issue in Francis contained a provision regarding
consideration of other states’ laws to be crucial to the
finding that Louisiana’s law applied. As previously noted,
Nationwide’s policy contains no such provision.

Zuviceh, 786 So.2d at 348 (emphasis added).

We also note that, even though Francis, as referenced above in Zuviceh,

was decided before the choice-of-law analysis was codified in La.Civ.Code arts. 3515

and 3537, the first circuit in that case performed an “interest analysis” to determine

whether Louisiana or Ohio law applied to a UM policy. In Francis, the plaintiffs

were Louisiana residents who had been injured in Louisiana while they were guest

passengers in a car owned and driven by Ohio residents. The owner of the car had

an Ohio policy with a UM limitation on liability different from Louisiana’s but also

had an out-of-state coverage provision similar to the one at issue herein. After

conducting the “interest analysis” to determine the choice-of-law state, the court

concluded as follows:

Initially, we note that the Motorists policy does not
state that it shall be governed by Ohio law. On the
contrary, the policy contains provisions relative to “out of
state coverage,” wherein it states that if accidents occur in
other states, the policy will be interpreted to provide at
least the minimum amounts and types of coverage required
by the laws of such other states.

29

Clearly, Ohio has an interest in the uninsured
motorist coverage issue. However, Motorists simply could
not have contemplated its insured driving only in Ohio and
the policy being governed solely by Ohio law. In fact, the
territorial provision of the policy includes all of the United
States. The contracting parties were surely aware then that
the law of any state, including Louisiana, might be
applicable to a particular claim.

Louisiana, on the other hand, has a great interest in
regulating awards to victims injured on its highways and in
protecting its citizens from uninsured or underinsured
motorists.

After weighing the interests of both states, we
conclude the interest of Louisiana outweighs the interest of
Ohio. As such, we hold Louisiana law is applicable in this
case.

Francis, 581 So.2d at 1042.

Accordingly, we find that, as a matter of law, Louisiana law applies to

the coverage in this case and that the named-driver exclusion which is against

Louisiana policy is invalid and does not apply to prohibit coverage.

Fireman’s Fund further argues that, even if its named-driver exclusion

were found invalid, the policy can only be reformed to provide minimum coverage

of $10,000/$20,000 pursuant to Marcus v. Hanover Insurance Co., 98-2040 (La.

6/4/99), 740 So.2d 603. We disagree. In Marcus, the court determined that a

business use exclusion contravened the purpose of the Louisiana Motor Vehicle

Safety Responsibility Law and La.R.S. 22:655(D) and reformed the policy to provide

the minimum coverage set forth in our compulsory financial responsibility laws, not

the coverage amount set forth in the policy therein. In the present case, the named-

driver exclusion contravenes Louisiana public policy to protect injured victims in

La.R.S. 22:655(D) and contravenes La.R.S. 32:900(B)(2)(d), which specifically

provides that coverage for the excluded driver in a commercial policy must be

provided in another policy in an amount “equal to that coverage provided in the

30

policy for which the person was excluded.” Accordingly, the Fireman’s Fund policy

in this case will be reformed to provide coverage in the full amount stated in the

policy.

IV.

CONCLUSION

Based upon the foregoing, we reverse the judgments of the trial court

which granted summary judgment to Eva Bernal and to Fireman’s Fund. Our de novo

review of the record reveals that genuine issues of fact prohibit summary judgment

in favor of Eva Bernal ad that Fireman’s Fund is not entitled to summary judgment

as a matter of law. Accordingly, we reverse the summary judgment dismissals of Eva

Bernal and Fireman’s Fund and remand the case for a trial on the merits in accordance

with the coverage determinations made herein. All costs of this appeal are assessed

to the defendants in this case.

REVERSED AND REMANDED.

31