Sarah Barber and Jamie Turner, Indiv. and O/B/O of Their Minor Children v. Louisiana Municipal Risk Management Agency Group

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

17-498 consolidated with 17-64

SARAH BARBER, ET AL.

VERSUS

LOUISIANA MUNICIPAL RISK MANAGEMENT

AGENCY GROUP SELF-INSURED FUND, ET AL.

**********

APPEAL FROM THE
NINTH JUDICIAL DISTRICT COURT
PARISH OF RAPIDES, NO. 251,753
HONORABLE GEORGE CLARENCE METOYER JR, DISTRICT JUDGE

**********

ELIZABETH A. PICKETT
JUDGE

**********

Court composed of Elizabeth A. Pickett, D. Kent Savoie, and Van H. Kyzar,
Judges.

ESTATE OF JEANE MOTION TO SUPPLEMENT THE RECORD
DENIED.
REPUBLIC MOTION TO DISMISS AND MOTION TO STRIKE JEANE’S
ANSWER TO THE APPEAL GRANTED IN PART AND DENIED IN PART.
REPUBLIC ALTERNATIVE MOTION TO SUPPLEMENT THE RECORD
ON APPEAL DENIED.
ESTATE OF JEANE MOTION TO REMAND AND/OR STAY THE
APPEAL DENIED.
ESTATE OF JEANE EXCEPTIONS OF NO RIGHT OF ACTION AND
MOOTNESS OVERRULED.
ESTATEOF JEANE MOTION TO DISMISS REPUBLIC’S SUSPENSIVE
APPEAL DENIED.
REPUBLIC MOTION TO DISMISS AND MOTION TO STRIKE
PLAINTIFF-APPELLEES’ “OBJECTIONS TO REPUBLIC SMJ
EXHIBITS” CONTAINED WITHIN THE PLAINTIFFS’ APPELLEE
BRIEF DENIED.

REPUBLIC MOTION TO DISMISS PLAINTIFF-APPELLEES’ ANSWER
TO THE APPEAL DENIED.
REPUBLIC MOTION TO STRIKE MISREPRESENTATIONS OF FACT
CONTAINED WITHIN THE APPELLEES BRIEFS, AND
ALTERNATIVELY, MOTION TO SUPPLEMENT THE RECORD DENIED.
REPUBLIC MOTION TO STRIKE EXHIBITS ATTACHED TO THE
ESTATE OF LARRY JEANE’S BRIEFS, OPPOSITION MEMORANDA,
AND EXCEPTION GRANTED.
REPUBLIC ALTERNATIVE MOTION TO SUPPLEMENT THE RECORD
WITH COUNTER EVIDENCE DENIED.
ESTATE OF JEANE MOTION TO STRIKE ALLEGED MAY 26, 2017
LETTER AND AFFIDAVIT OF ALICIA HAMBY DENIED AS MOOT.
WRIT GRANTED AND MADE PEREMPTORY.
JUDGMENT REVERSED.
REMANDED FOR FURTHER PROCEEDINGS.

Douglas K. Williams
Christopher A. Mason
Breazeale, Sacshe & Wilson, L.L.P.
P. O. Box 3197
Baton Rouge, LA 70821-3197
(225) 387-4000
COUNSEL FOR DEFENDANT-APPLICANT-APPELLEE:
Republic Fire & Casualty Ins. Co.

Randall B. Keiser
Jeremy C. Cedars
Keiser Law Firm, P.L.C.
P. O. Box 12358
Alexandria, LA 71315
(318) 443-6168
COUNSEL FOR DEFENDANT-RESPONDENT:
Estate of Larry Jeane, Sr.

Derrick G. Earles
David C. Laborde
Jeff D. Easley
Laborde Earles Law Firm
P. O. Box 80098
Lafayette, LA 70598
(337) 261-2617
COUNSEL FOR PLAINTIFFS-RESPONDENTS:
Sarah Barber
Elizabeth Spivey
Sarah Barber, o/b/o Abbigail Turner
Racheal Spivey
Jamie Turner
Wallace Spivey
Jamie Turner, o/b/o Abbigail Turner
Dana Spivey
1

PICKETT, Judge.

Republic Fire and Casualty Insurance Company (Republic), a defendant in

the case before us, appeals a judgment of the court denying, in part, its motion for

summary judgment, which found that the umbrella insurance policy issued to Larry

and Johanna Jeane provided liability coverage for the damages suffered by the

injured plaintiffs. The plaintiffs, Sarah Barber and Jamie Turner (individually and

on behalf of their minor daughter Abbigail Turner), Dana Spivey, Elizabeth

Spivey, Wallace Spivey, and Racheal Spivey (collectively “the Barber plaintiffs”),

have answered the appeal, seeking redaction of language from the judgment

requiring “exhaustion of the underlying LMRMA Busines Auto Agreement, …,

and any other insurance available to the Estate of Jeane.” The Estate of Larry

Jeane has filed an answer to the appeal alleging that subsequent to the January 30,

2017 judgment, Republic waived its coverage defense by contesting the liability of

Larry Jeane for the damages suffered by the Barber plaintiffs without providing

separate counsel to the Estate of Jeane.

The Estate of Jeane has also filed an Exception of No Right of Action and

Mootness, and the parties have filed numerous motions in this court.

FACTS

Larry Jeane, the elected Marshal of Pineville, Louisana, was driving his city

marshal vehicle when he crossed the center line and collided with a vehicle in

which the Barber plaintiffs were the passengers. Mr. Jeane died two days later

from injuries sustained in the collision, and the Barber plaintiffs sustained injuries.

The Barber plaintiffs sued the Louisiana Municipal Risk Management Agency

Group Self-Insured Fund (LMRMA), the City of Pineville, the Estate of Larry

Jeane, Shelter Mutual Insurance Co., the Rapides Parish Police Jury, the State of

Louisiana, the City of Pineville City Marshal’s Office, Republic, and an unnamed

insurance company. The Estate of Jeane filed a cross-claim against Republic.

The Estate of Jeane filed a motion for summary judgment seeking a ruling

that the Umbrella Liability Policy issued by Republic provided coverage for the

accident. Republic, who issued a Personal Auto Policy and an Umbrella Liability

Policy to Mr. Jeane and his wife, filed a motion for summary judgment arguing

that neither the Personal Auto Policy nor the Umbrella Liability Policy provided

coverage for the accident. The trial court held a hearing on December 12, 2016 on

the cross motions for summary judgment. At the conclusion of the hearing, the

trial court found that the Personal Auto Policy issued by Republic did not provide

coverage. The trial court further found that the Umbrella Liability Policy provided

to the Jeanes by Republic did provide coverage. This oral ruling was reduced to a

written judgment signed by the trial court on January 30, 2017, and certified as

immediately appealable pursuant to La.Code Civ.P. art. 1915. In that judgment,

the trial court specifically reserved judgment on the duty of Republic to defend the

Estate of Jeane under the terms of the Umbrella Liability Policy, pending a

decision by this court on the issue of coverage.

On January 9, 2017, Republic filed notice of its intent to file a supervisory

writ application seeking a review of the trial court’s December 12, 2016, ruling.

Republic later filed an appeal of the January 30, 2017 judgment of the trial court.

This court granted the writ application for the limited purpose of consolidating it

with the appeal. Barber v. La. Muni. Risk Mgmt. Agency Group Self-Insured Fund,

an unpublished decision bearing docket number 17-64 (La.App. 3 Cir. 3/10/17).

EXCEPTIONS AND MOTIONS FILED ON APPEAL

Since this appeal and writ have been lodged in this court, the three parties

involved in this appeal have filed twenty-four pleadings in this court. In addition
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to the answers filed by the appellants and briefs in support of all the parties’

respective positions, Republic and the Estate of Jeane have filed numerous

exceptions and motions in an attempt to have this court consider issues not raised

in the trial court, or raised after the hearing on December 12, 2016, and the signing

of the judgment on January 30, 2017. The motions were referred to the panel

reviewing the merits of the appeal. Rule 1-3 of the Uniform Rules of the Courts of

Appeal sets forth the scope of review in this court (emphasis added):

The scope of review in all cases within the appellate and
supervisory jurisdiction of the Courts of Appeal shall be as provided
by LSA-Const. Art. 5, § 10(B), and as otherwise provided by law.
The Courts of Appeal will review only issues which were submitted
to the trial court and which are contained in specifications or
assignments of error, unless the interest of justice clearly requires
otherwise.

Most notably, the Estate of Jeane’s Exceptions of No Right of Action and

Mootness and Motion to Dismiss Republic’s Suspensive Appeal, arguing that

Republic waived its coverage defense by asserting a liability defense without

providing separate counsel to the Estate, has not been argued before or ruled upon

by the trial court. Further, all of the evidence that the Estate of Jeane relies on to

support its exception was filed in the trial court after the signing of the January 30,

2017 judgment before us for review. The Estate of Jeane argues that the evidence

appears in the record sent to this court, therefore in the interest of justice we should

rule on their exception. The evidence only appears in the record before us because

the parties could not agree on a designation of the record for the purposes of this

appeal, and the trial court ordered the entire record be sent up following a hearing

on March 27, 2017. Since the judgment before us is an interlocutory judgment, the

parties have continued to litigate issues after January 30, 2017. Thus, the record

contains documents related to issues presented to the trial court that have not been

fully litigated below, including the issue raised in Estate of Jeane’s answer to the
3

appeal and exceptions. Because the waiver of a coverage defense has not been

submitted to the trial court for a decision, we decline to rule on it in this appeal.

The Exceptions of No Right of Action and Mootness filed by the Estate of Jeane is

overruled, and the Motion to Dismiss the Appeal filed in the same pleading is

denied.

Furthermore, the Estate of Jeane’s Answer to the Appeal raises, in part, the

same issue regarding waiver of a coverage defense. It is clear that these issues

were not presented to the trial court for a decision prior to the January 30, 2017

judgment. The Estate of Jeane admits as much in its answer, alleging that

Republic’s actions subsequent to the judgment before us on appeal constitute the

basis for its answer to appeal. We therefore grant in part Republic’s Motion to

Dismiss and Motion to Strike Jeane’s Answer to the Appeal, and will not consider

the issue of the waiver of the coverage defense. To the extent that the Estate of

Jeane’s Answer to the Appeal seeks penalties and attorney fees for the

misrepresentation of the Business Use Exclusion by Republic, we deny Republic’s

motion to dismiss the Estate of Jeane’s answer. Further, we deny the Estate of

Jeane’s Alternative Motion to Remand and/or Stay the Appeal.

Both Republic and the Estate of Jeane have filed motions to supplement the

record with exhibits never presented to the trial court. Many of the exhibits were

created well after the January 30, 2017 judgment was even signed. For instance,

there is a letter dated May 26, 2017, that both parties seek to introduce. An

appellate court cannot receive new evidence. Fontana v. Landry, 09-322 (La.App.

3 Cir. 10/7/09), 20 So.3d 578. Therefore, the Estate of Jeane’s Motion to

Supplement the Record with five documents from June 2017 is denied. Republic’s

Alternative Motion to Supplement the Record on Appeal with a letter dated May

26, 2017, and an affidavit is denied. Republic’s Motion to Strike Exhibits
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Attached to the Estate of Larry Jeane’s Briefs, Opposition Memoranda and

Exception is granted, as the exhibits include four copies of the May 26, 2017 letter

and four affidavits attesting to never having received said letter. Republic’s

Alternative Motion to Supplement the Record with a March 2, 2017 letter and an

affidavit dated August 17, 2017, is denied. Finally, the Estate of Jeane’s Motion to

Strike the Alleged May 26, 2017 Letter and Affidavit of Alicia Hamby is moot, as

we have denied the motion to supplement the record with these documents.

Republic has also filed a Motion to Dismiss and Motion to Strike Plaintiff-

Appellees’ “Objections to Republic SMJ [sic] Exhibits” Contained within the

Plaintiffs’ Appellee Briefs. Republic claims the Barber plaintiffs should not be

allowed to renew objections to exhibits attached to Republic’s motion for summary

judgment because they did not raise these objections in their answer to the appeal.

In opposition, the Barber plaintiffs point out that an answer is not required in

opposition to Republic’s application for supervisory writs, which is consolidated

with the appeal in this case. Furthermore, contemporaneous objections to the

attachments were raised in the trial court. Finally, the Barber plaintiffs argue that

the objection to the exhibits does not amount to a request for a modification of the

judgment on appeal, so it is unnecessary to raise the objection in an answer to the

appeal. We review motions for summary judgment de novo, applying the same

criteria as the trial court to determine whether summary judgment is appropriate.

Wright v. La. Power & Light, 06-1181 (La.3/9/07), 951 So.2d 1058. Given that the

Barber plaintiffs raised an objection to the exhibit in conformity with La.Code

Civ.P. art. 966, we deny Republic’s motion to strike and motions to dismiss the

arguments advanced regarding the admissibility of the documents at issue.

Republic has also filed a Motion to Dismiss Plaintiff-Appellee’s Answer to

the Appeal, arguing that the issue raised in the Barber plaintiffs’ answer was not
5

properly raised in the trial court. Further, they argue the answer to the appeal is

without merit. In their answer to the appeal, the Barber plaintiffs argue that there

was language inserted into the judgment prepared by Republic referring to the

“exhaustion” of coverage that was never raised in the trial court. The pleadings

before us indicate there is disagreement among the parties about the import of

certain language used by the trial court in its oral ruling on December 12, 2016.

Further, there was extensive discussion among the parties about the wording of the

judgment, evidenced by the proposed judgment drafted by the Estate of Jeane that

was presented to the trial court and is in the record. We find the issue raised by the

Barber plaintiffs is ripe for review on appeal, and deny Republic’s Motion to

Dismiss the Barber plaintiffs’ answer to the appeal.

The final motion we must address is Republic’s Motion to Strike

Misrepresentation of Fact Contained within the Appellees Briefs, and

Alternatively, Motion to Supplement the Record. Republic argues that both the

Estate of Jeane and the Barber plaintiffs misrepresent the negotiations among the

parties regarding the submission of a judgment to the trial court for signature.

Further, they argue that these misrepresentations and the language used in the

Estate of Jeane’s brief violates the Uniform Rules of Court, Courts of Appeal, Rule

2-12.2(C). Alternatively, Republic seeks to introduce into the record on appeal

letters among the parties regarding the negotiations in drafting the judgment. In

response, the Barber plaintiffs oppose the motion to strike, and alternatively seek

to supplement the record.

For reasons previously discussed, the alternative motions of Republic and

the Estate of Jeane to supplement the record are denied. We have reviewed the

briefs submitted and find no language that merits the harsh penalty of being

stricken. Thus, Republic’s motion to strike is denied. We note that regardless of
6

the process by which the judgment was submitted to the trial court, the task of this

court is to review the merits of the actual judgment signed by the trial court.

ASSIGNMENTS OF ERROR

Proceeding to the merits of this appeal, Republic asserts six assignments of

error:

1. The trial court erred in failing to find that coverage was excluded
under the Umbrella policy which followed form and thereby adopted
the “regular use exclusion contained within the underlying Personal
Auto policy as a matter of law.

2. The trial court erred when it failed to find that the “retained limit”
necessary to trigger coverage under the umbrella policy was not
present.

3. The trial court erred in failing to apply the exclusions contained
within the Follow-Form Endorsement of the Umbrella policy, which
unambiguously excludes these claims from coverage.

4. The trial court erred in failing to find that the parties and the trial court
were judicially estopped from considering whether the LMRMA
indemnity agreement could meet the definition of “underlying
insurance,” after the trial court was presented with and signed a
Judgment dismissing the claims against the LMRMA based upon a
judicial confession that LMRMA is not an insurance company and its
indemnity agreement is not insurance.

5. The trial court erred by finding that the LMRMA Business Auto
indemnity agreement meets the definition of “underlying insurance”
within the Republic Personal Umbrella policy thereby triggering
coverage under the Umbrella policy.

6. The trial court erred by failing to find that the LMRMA Business
Auto indemnity agreement does not insure the same type of liabilities
as the Personal Auto policy, and therefore cannot meet the definition
of “underlying insurance” to trigger coverage under the Umbrella
policy.

Answering the appeal, the Barber plaintiffs assert four assignments of error:

1. Louisiana law does not require the exhaustion of underlying insurance
for the exposure of an umbrella or excess policy;

2. It was legal error to require exhaustion of or declare the
ranking/priority of unknown phantom hypothetical insurance policies
that may not exist because no mover requested such a judicial
declaration;
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3. It was legal error to require exhaustion of or declare the
ranking/priority of unknown phantom hypothetical insurance policies
that may not exist because the evidence was insufficient to show that
any other policies exist;

4. It was legal error to require exhaustion of or declare the
ranking/priority of unknown phantom hypothetical insurance policies
that may not exist because the “other insurance clauses” in those
policies are required to reach such a legal determination.

Given our dismissal of a part of the Estate of Jeane’s answer to the appeal, the first,

second, and fourth assignments of error raised in its brief are pretermitted. There

remains one issue raised by the Estate that we consider in this appeal:

3. Is the Estate entitled to penalties and attorneys’ fees as a result of
Republic’s repeated misrepresentation of its Umbrella Policy when (in
declination letters and pleadings) the trial court found the BUE
inapplicable and Republic did not appeal that finding?

DISCUSSION

Standard of Review

The supreme court explained the appropriate standard for an appellate court

to apply in reviewing a judgment on a motion for summary judgment in Robinson

v. Heard, 2001-1697, pp. 3-4 (La. 2/26/02), 809 So.2d 943, 945:

A reviewing court examines summary judgments de novo under
the same criteria that govern the district court’s consideration of
whether summary judgment is appropriate. Smith v. Our Lady of the
Lake Hospital, Inc., 93-2512 (La.7/5/94), 639 So.2d 730, 750. A
reviewing court thus asks the same questions as does the trial court in
determining whether summary judgment is appropriate: whether there
is any genuine issue of material fact, and whether the mover is entitled
to judgment as a matter of law. Smith, 639 So.2d at 750.

Interpretation of an insurance contract is usually a legal
question that can be properly resolved in the framework of a motion
for summary judgment. Sanchez v. Callegan, 99-0137 (La.App. 1 Cir.
2/18/00), 753 So.2d 403, 405. When the language of an insurance
policy is clear and unambiguous, a reasonable interpretation
consistent with the obvious meaning and intent of the policy must be
given. Sanchez, 753 So.2d at 405.

8

In Succession of Fannaly v. Lafayette Insurance Co., 01-1144, 01-1343, 01-1355,

01-1360, pp. 3-4 (La. 1/15/02), 805 So.2d 1134, 1137 (citations omitted), the

supreme court explained the framework for evaluating insurance coverage

questions:

An insurance policy is an aleatory, nominate contract subject to
the general rules of contract interpretation as set forth in our civil
code. The extent of coverage under an insurance contract is
dependent on the common intent of the insured and insurer. Thus,
when interpreting an insurance contract, courts must attempt to
discern the common intent of the insured and insurer.

In ascertaining the common intent of the insured and insurer,
courts begin their analysis with a review of the words in the insurance
contract. Words in an insurance contract must be ascribed their
generally prevailing meaning, unless the words have acquired a
technical meaning, in which case the words must be ascribed their
technical meaning. Moreover, an insurance contract is construed as a
whole and each provision in the contract must be interpreted in light
of the other provisions. One provision of the contract should not be
construed separately at the expense of disregarding other provisions.

In order to prevail on its motion for summary judgment, the Estate of Jeane

bears the burden of proving that the incident in question falls within the policy’s

terms. Jessop v. City of Alexandria, 03-1500 (La.App. 3 Cir. 3/31/04), 871 So.2d

1140, writ denied, 04-1529 (La. 10/1/04), 883 So.2d 991 (citing Miller v. Superior

Shipyard and Fabrication, Inc., 01-2907 (La.App. 1 Cir. 8/20/03), 859 So.2d 159).

In order for Republic to prevail on its motion for summary judgment, it bears the

burden of showing that there is no reasonable interpretation of the policy that

would afford coverage when applied to the undisputed material facts. Id.

Admissibility of Summary Judgment and Supervisory Writ Exhibits

The Barber plaintiffs objected to the inclusion of Miller’s Standard

Insurance Policy Forms in the materials provided to the court by Republic in their

motion for summary judgment. Louisiana Code of Civil Procedure article 966(4)

states:

9

The only documents that may be filed in support of or in
opposition to the motion are pleadings, memoranda, affidavits,
depositions, answers to interrogatories, certified medical records,
written stipulations, and admissions.

The Barber plaintiffs point out that these forms, printed from Westlaw, are not a

type of document listed. We agree. Republic’s argument that these documents are

secondary sources, and thus admissible, is without merit. Furthermore, we are

charged with interpreting the insurance contract between Republic and the Jeanes,

not a standard form, so the documents are irrelevant to our inquiry.

The Barber plaintiffs objected to the inclusion in the supervisory writ

application of the stipulated judgment granting a Peremptory Exception of No

Cause of Action filed by LMRMA and dismissing LMRMA from the suit. That

judgment was presented to the trial court at the beginning of the hearing on the

motions for summary judgment on December 12, 2016, and signed on that date.

Given that this judgment forms part of the record on the appeal now consolidated

with the supervisory writ application, we find no merit in the contention that it

should not be considered.

Language of the Umbrella Policy

It is undisputed that Republic issued three separate policies to the Jeanes: a

homeowner’s policy, a personal automobile policy, and an umbrella policy. The

homeowner’s policy is not at issue in this case. The trial court granted partial

summary judgment in favor of Republic finding that the personal auto policy did

not provide coverage for the incident. That finding has not been appealed to this

court. The only issue is whether the umbrella policy affords coverage. Republic

filed a motion for summary judgment asserting that it does not, while the Estate of

Jeane, joined by the Barber plaintiffs, filed a motion for summary judgment

asserting that the umbrella policy does provide coverage. Ultimately, the trial

10

court found that the umbrella policy did provide coverage for the incident, and

granted the Estate of Jeane’s motion for summary judgment while denying the

Republic’s motion for summary judgment.

The relevant language in the Republic Personal Umbrella Liability Policy

which provides coverage, subject to certain exclusions, appears, in relevant part, in

Section II.A., as amended by the provisions of the Personal Umbrella Liability

Policy Amendment of Policy Provisions – Louisiana endorsement:

A. Insuring Agreement

We will pay damages, in excess of the “retained limit”, for:

1. “Bodily injury” or “property damage” for which an
“insured” becomes legally liable due to an “occurrence”
to which this insurance applies[.]

As with any insurance contract, definitions form a significant part of the

agreement. There is no dispute that Mr. Jeane is an “insured” under the terms of

the Republic Umbrella policy, or that the collision of Mr. Jeane’s vehicle and the

Barber plaintiffs’ vehicle is an “occurrence.” “Retained limit” is defined in the

Republic umbrella policy as follows:

“Retained limit” means:

1. The total limits of any “underlying insurance” and any other
insurance that applies to an “occurrence” or offense which:
a. Are available to an “insured”, or
b. Would have been available except for the
bankruptcy or insolvency of an insurer providing
“underlying insurance”;

or

2. The deductible, if any, as stated in the Declarations, if the
“occurrence” or offense:

a. Is covered by this policy; and
b. Is not covered by “underlying insurance” or any
other insurance.

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The definition of “retained limit” is further modified in the Personal Umbrella

Liability Policy Auto Liability Following Form Endorsement as follows:

With respect to “bodily injury” or “property damage” arising
out of the ownership, maintenance, occupancy, operation, use, loading
or unloading of any “auto”, the definition of “retained limit” is
replaced by the following:

“Retained limit” means:

1. The retained policy limits for auto liability coverage shown in
the Declarations; and

2. The total limits of any other coverage provided by “underlying
insurance” and any other insurance that applies to an “occurrence”
which:

a. Are available to an “insured”; or
b. Would have been available except for the
bankruptcy or insolvency of an insurer providing
“underlying insurance”.

“Underlying insurance” is defined in the Republic umbrella policy as follows:

“Underlying insurance” means any policy providing the “insured”
with primary liability insurance covering one or more of the types of
liability listed in the Declarations and at limits no less than the
retained policy limits shown for those types of liability listed in the
Declarations.

12

Following Form Endorsement

Republic argues that the trial court erred in failing to find that the Personal

Umbrella Liability Auto Liability Following Form Endorsement adopted all the

terms and conditions of the auto liability policy issued by Republic. Given that the

auto liability policy contained a “regular use” exclusion that was the basis for

denying coverage for this incident, Republic argues that the same exclusion bars

coverage by its umbrella policy. To support its claim, Republic cites Evins v.

Louisiana Farm Bureau Mutual Insurance Company, 04-282 (La.App. 1 Cir.

2/11/05), 907 So.2d 733.

In Evins, the plaintiff was a pedestrian who was injured when she was struck

by a Ford Expedition owned by Alton Landry and driven by his son Brandon

Landry. Farm Bureau had issued an auto policy and an umbrella policy to Alton,

but because of an increase in premium, Alton had removed the Expedition from

those policies and purchased a separate policy through Progressive Security

Insurance Company to cover the Expedition. The plaintiff conceded that the Farm

Bureau auto policy did not cover the incident. The court found that there was an

“Auto Liability Following Form” endorsement to the Farm Bureau umbrella policy

which contained the following language:

Except to the extent that coverage is available to the insured in
the underlying policies as stated in the schedule of underlying
insurance, this policy does not apply to the ownership, maintenance,
operation, use, loading or unloading of any automobile while away
from premises owned by, rented to, or controlled by the insured.

Evins, 907 So.2d at 735-6. The Evins court noted that the schedule of underlying

insurance prepared for the Farm Bureau umbrella policy did not include the

Progressive policy. Therefore, the court found that the umbrella policy did not

provide coverage.

13

The Republic umbrella policy includes an endorsement that contains the title

“Following Form.” We must examine the terms of that endorsement, rather than

merely the title, to determine the effect of that endorsement. As cited above, this

endorsement changed the definition of the term “retained limit” to mean not only

the limits of the policies listed in the declarations page, but also any “underlying

insurance” that is available to the “insured” for an “occurrence.” The endorsement

further includes an additional exclusion:

The following exclusion is added:

The coverages provided by this policy do not apply to “bodily injury”
or “property damage” arising out of:

a. The ownership of any “auto” by an “insured”;
b. The maintenance, occupancy, operation, use,
loading or unloading of any “auto” by any person;
c. The entrustment of any “auto” by an “insured” to
any person;
d. The failure to supervise or negligent supervision of
any person involving any “auto” by an “insured”; or
e. Vicarious liability, whether or not imposed by law,
for the actions of a child or minor involving any “auto”.

However, this exclusion does not apply to the extent that auto liability
coverage is provided by “underlying insurance” at the time of the
occurrence.

Nothing in this endorsement states that the umbrella policy adopts the same

coverages and exclusions as the Republic auto policy. Further, this endorsement

does not provide that the umbrella policy covers only those occurrences covered by

the Republic auto policy. In fact, it does just the opposite, in that it excludes

coverage for use of an automobile unless there is “underlying insurance.” The

definition of “underlying insurance” in this policy is broader than just those

policies listed in the declarations, as it includes “primary liability insurance

covering one or more of the types of liability listed in the Declarations and at limits

no less than the retained policy limits shown for those types of liability listed in the

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Declarations.” Thus, we find that despite the language of the title of the

endorsement, this case is clearly distinguishable from Evins, and the endorsement

at issue does not preclude coverage under the Republic umbrella policy simply

because the Republic auto policy precludes coverage.

In so finding, we explicitly reject the argument raised in in Republic’s brief

that “Louisiana courts have held that when there is a ‘follow-form’ endorsement in

an umbrella policy, an express designation that it adopts the terms, conditions, and

exclusions of the underlying liability policy is not required to have that effect.” To

support this argument, Republic cites Evins and Edwards v. Louisiana Farm

Bureau Mutual Insurance Company, an unpublished opinion bearing docket

number 02-1495 (La.App. 1 Cir. 4/26/13), writ denied, 13-1175 (La. 8/30/13), 120

So.3d 269. Edwards contained the same follow form clause as Evins, and is thus

distinguishable from the case before us. Further, while the court in Edwards

makes a reference to the caption of the endorsement (“Automobile Liability

Following Form”) in that case, its analysis depends on the actual language of the

endorsement, as do the cases cited by the Edwards court. See State rel. Div. of

Admin., Office of Risk Mgmt. v. Nat’l Union Fire Ins. Co. of La., 10-689 (La.App.

1 Cir. 2/11/11), 56 So.3d 1236, writ denied, 11-849 (La. 6/3/11), 63 So.3d 1023;

and Rivere v. Heroman, 96-1568 (La.App. 1 Cir. 2/5/97), 688 So.2d 1293.

The LMRMA Indemnity Agreement as “Underlying Insurance”

Even if coverage under the Republic auto policy for this occurrence is not

required, the exclusion in the Personal Umbrella Liability Auto Liability Following

Form Endorsement would exclude coverage for use of an auto unless “auto

liability coverage is provided by ‘underlying insurance’[.]” Republic argues that

the LMRMA indemnity contract is not “underlying insurance,” therefore the use of

an auto is excluded from coverage.
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Republic argues that the LMRMA is not an insurer. LMRMA is an inter-

agency risk pool created pursuant to the Local Governmental Subdivision Self

Insurance Act of 1979. La.R.S. 33:1341, et seq. Louisiana Revised Statutes

33:1345 states:

An interlocal risk management agency is not an insurance
company or an insurer under the laws of this state and the
development and administration by such agency of one or more group
self insurance funds shall not constitute doing an insurance business.
Intergovernmental agreements providing for the creation and
maintenance of an interlocal risk management agency shall not be
deemed to constitute insurance as defined by R.S. 22:46, nor shall the
interlocal risk management agency or the development of a group self
insurance fund be subject to the provisions of Title 22, Chapter 1, of
the Louisiana Revised Statutes of 1950.

In important ways, LMRMA has historically been treated differently than

insurance companies governed by Title 22 of the Louisiana Revised Statutes.

LMRMA is not subject to direct action. See La.R.S. 22:1269(B); Logan v. Hollier,

424 So.2d 1279 (La.App. 3 Cir. 1982); and Hunt v. Louisiana Muni. Risk Mgmt.

Agency, 14-456 (La.App. 3 Cir. 4/22/15), 176 So.3d 1110, writ denied, 15-949 (La.

8/28/15), 176 So.3d 404. In this case, the trial court issued a judgment on the day

of the hearing dismissing LMRMA from this suit pursuant to an exception of no

cause of action for just this reason. LMRMA is also not required to comply with

the uninsured motorist statute. See Senegal v. Faul, 598 So.2d 686 (La.App. 3

Cir.1992).

Republic further cites Louisiana Safety Association of Timbermen Self-

Insurers Fund v. Louisiana Insurance Guaranty Association, 09-23 (La. 6/26/09),

17 So.3d 350, for the proposition that the LMRMA agreement is not insurance. In

that case, a trade group, the Louisiana Safety Association of Timbermen (LSAT)

organized a self-insured fund pursuant to La.R.S. 1195 in order to satisfy its

members’ workers’ compensation obligations. LSAT members paid into the Fund
16

and agreed to be liable jointly and solidarily for any workers’ compensation award.

To ensure that it could fulfill its obligations, the LSAT Fund also purchased a

policy excess insurance, as required by law, from Reliance Indemnity Company.

When Reliance went into liquidation in Pennsylvania, the LSAT Fund filed a claim

against the Louisiana Insurance Guaranty Association (LIGA). LIGA denied the

claim because it determined that the LSAT Fund was an insurer, the Reliance

policy was a policy of reinsurance, and LIGA does not cover claims of insurers.

On summary judgment, the trial court and the second circuit determined that the

LSAT Fund was not an insurer for the purposes of LIGA. Louisiana Safety Assoc.

of Timbermen Self-Insurers Fund v. Louisiana Ins. Guaranty Assoc., 43,615

(La.App. 2 Cir. 12/3/08), 998 So.2d 817. The supreme court granted an

application for a writ of certiorari to determine the correctness of the lower courts’

decision. Louisiana Safety Assoc. of Timbermen Self-Insurers Fund v. Louisiana

Ins. Guaranty Assoc., 09-23 (La. 3/6/09), 3 So.3d 493.

Reversing the lower courts, the supreme court analyzed the issue of whether

the LSAT fund was an insurer:

From the outset, LIGA contends the Fund’s claims against it are
disallowed because the Fund is an insurer as provided in La.Rev.Stat.
§ 22:1379(3)(b) and, at least for LIGA purposes, it was as an insurer
that the Fund obtained a policy of reinsurance from Reliance. To the
contrary, the Fund admits it is a workers’ compensation group self-
insurance entity, but contends the appellate court did not err when it
determined the Legislature specified in La.Rev.Stat. § 23:1195(A)(1)
that this funding arrangement for purposes of workers’ compensation
is not insurance. Thus, our first task is to ascertain the meaning of
La.Rev.Stat. § 23:1195(A)(1).

Turning to general rules of statutory construction, courts should
remember the following axioms. Legislation is the solemn
expression of the legislative will; thus, the interpretation of legislation
is primarily the search for the legislative intent. Cat’s Meow, Inc. v.
City of New Orleans Through Dept. of Finance, 98-0601
(La.10/20/98), 720 So.2d 1186, 1198; Hutchinson v. Patel, 93-2156
(La.5/23/94); 637 So.2d 415. When a law is clear and unambiguous,
and its application does not lead to absurd consequences, it shall be
17

applied as written, with no further interpretation made in search of the
legislative intent. La. Civ.Code art. 9; Cat’s Meow, 720 So.2d at
1198. The starting point for interpretation of any statute is the
language of the statute itself. Touchard v. Williams, 617 So.2d 885
(La.1993).

La.Rev.Stat. § 23:1195(A)(1) provides:

(1) Any five or more Louisiana employers who are
not public entities, each of whom has a positive net
worth, is financially solvent, and is capable of assuming
the obligations set forth under this Chapter, and who are
all members of the same bona fide trade or professional
association may agree to pool their liabilities to their
employees on account of personal injury and
occupational disease arising out of or incurred during the
course and scope of the employment relationship. This
arrangement shall not be deemed to be insurance and
shall not be subject to the provisions of Chapter 1 of Title
22 of the Louisiana Revised Statutes of 1950. (Emphasis
added).

Examining that statutory language, the appellate court stated “[t]he
logical conclusion arising from the pronouncement that the
arrangement shall not be deemed insurance is that a self-insurer fund
... is not an insurer ... and is not an insurer whose claims are excluded
from LIGA coverage....” Louisiana Safety Association of Timbermen-
Self Insurers Fund, 998 So.2d at 822. After carefully examining the
language of La.Rev.Stat. § 23:1195(A)(1) and related statutes, we
determine otherwise.

It is presumed every word, sentence or provision in the statute
was intended to serve some useful purpose, that some effect is to be
given to each such provision, and that no unnecessary words or
provisions were used. Sultana Corp. v. Jewelers Mut. Ins. Co., 03-
0360 (La.12/3/03), 860 So.2d 1112. It is presumed the Legislature
understands the effect and meaning of the words it uses in a statute.
Spragio v. Board of Trustees, 468 So.2d 1323 (La.App. 1 Cir.), writ
denied, 472 So.2d 32 (La.1985). The Legislature is presumed to
have enacted each statute with deliberation and with full knowledge of
all existing laws on the same subject. Theriot v. Midland Risk Ins.
Co., 694 So.2d 184 (La.1997).

Had the Legislature simply stated, “This arrangement shall not
be deemed to be insurance,” we might agree with the lower courts’
holding that the Fund was not an insurer. However, as quoted above
La.Rev.Stat. § 23:1195(A)(1) further states the arrangement “shall not
be subject to the provisions of Chapter 1 of Title 22 of the Louisiana
Revised Statutes of 1950.” Aware that every word, sentence or
provision in the statute was intended to serve some useful purpose, we

18

find it necessary to delve farther to ascertain the full import of La.
Rev. Stat § 23:1195(A)(1).

An examination of the Insurance Code shows it is divided into
eight chapters. As applicable to our analysis, Chapter 3 addresses
self-insurers. There, La.Rev.Stat. § 22:3001(A) provides: “This
Chapter shall be applicable to and shall regulate self-insurers and self-
insurance plans, as defined in this Chapter, which are subject to the
jurisdiction of the commissioner of insurance under Chapter 1 of this
Title. This Chapter shall not be applicable to any worker's
compensation plan, ...”(Emphasis added). The inclusion of this
language in La.Rev.Stat. § 22:3001(A) indicates the Legislature
contemplated that there are self-insurers who are subject to the
provisions of Chapter 1 of the Insurance Code and demonstrates that
the Legislature emphasized in La.Rev.Stat. § 23:1195(A)(1) the fact
that workers’ compensation self-insurers are differentiated from other
self-insurers, particularly by exclusion from the provisions of Chapter
1 of the Insurance Code.

When we read La.Rev.Stat. § 23:1195(A)(1) in pari materiae
with La.Rev.Stat. § 22:3001(A), it is evident the Legislature sought
only to exclude workers’ compensation self-insurers from the
regulatory provisions of Chapter 1 of Title 22 of the Insurance Code
when it adopted the language of La.Rev.Stat. § 23:1195(A)(1). Thus,
its designation in La.Rev.Stat. § 23:1195(A)(1) that self-insurance is
not deemed insurance has a circumscribed and limited meaning, not
the broad pronouncement the Fund urges. Having so concluded, we
must further examine the Fund’s formative documents and its contract
with Reliance to determine the true character of the legal relationship
between these entities.

Louisiana’s Insurance Guaranty Association Law does not
define the term “insurer.” Notwithstanding, the Louisiana Insurance
Code provides a general definition for the term “insurer”:

[E]very person engaged in the business of making
contracts of insurance, other than a fraternal benefit
society. A reciprocal, an inter-insurance exchange,
insurance exchange syndicate, or a Lloyds organization is
an “insurer”. Any person who provides an employee
benefit trust as specified in Subparagraph (9)(a) of this
Section is an insurer. A health maintenance organization
is an insurer but only for the purposes enumerated in R.S.
22:242(7).

La.Rev.Stat. § 22:5(10).

Also, as defined in the Louisiana Insurance Code, insurance is
“a contract whereby one undertakes to indemnify another or pay a
specified amount upon determinable contingencies.” La.Rev.Stat. §
22:5(9)(a). Moreover, the Insurance Guaranty Association Law
19

defines an “insurance policy” as “an insurance contract as defined in
R.S.22:624.”

As the court of appeal noted, self-insurance is one of the means
of securing workers’ compensation to employees as provided in
La.Rev.Stat. § 23:1168. It was this vehicle LSAT chose to meet its
members' workers’ compensation obligations when it established the
Fund. In conjunction with the formation of the Fund, LSAT’s
members executed an indemnity agreement which specified each
member agreed to be held liable jointly and in solido for any workers’
compensation award, to promptly pay membership premiums, and to
pay all assessments the Fund lawfully levied. Utilizing the definitions
referenced above, it is clear, at least for purposes of LIGA, the Fund
was an insurer – the Fund undertook to indemnify its members for the
full amount of workers’ compensation claims allowed under the
Louisiana Workers’ Compensation Act and the members agreed to
pay premiums and assessments to the Fund for that purpose. In
reaching the conclusion the Fund was an insurer, we find our
determination buttressed by the characterization the Fund and
Reliance ascribed to their contractual relationship.

Louisiana Safety Assoc. of Timbermen Self-Insurers Fund, 17 So.3d at 355-358.

The supreme court went on to determine that the LSAT Fund contracted for a

policy of reinsurance, not excess insurance, from Reliance. The court stated:

The Fund is liable, or at risk, for the full amount of any workers’
compensation claim allowed under the Workers’ Compensation Act.
In order to reduce its exposure as an insurer, it bought a policy of
reinsurance that limited its exposure on any claim in excess of
$200,000.

Id. at 359.

It would seem, then, that the supreme court’s holding favors the arguments

of the Estate of Jeane and the Barber plaintiffs, and not Republic, in that it found

that the LSAT Fund, which is analogous to LMRMA, was an insurer for the

purposes of LIGA. But, in dicta, the supreme court also stated:

In contrast, an excess policy provides additional coverage to an
insured on their property or business, or to cover a potential property
damage or liability claim. The excess policy does not insure another
party, but rather, the excess policy only comes into play if the
damages to the covered property or a judgment for damages, exceeds
the coverage of the primary policy. Notably, an excess policy
assumes the existence of an underlying policy. In this present matter,
there is no underlying policy because the Fund does not issue policies;
20

it issues certificates of membership. If the claims paid exceed the
income from membership dues, the shortfall is covered by assessment
to its members, not by liquidation of the Fund.

Id. at 359-60. This language supports the position of Republic, which argues that

the indemnity agreement between the city of Pineville and LMRMA is not an

underlying policy for the purpose of excess insurance.

The supreme court used the definition in the insurance code at La.R.S.

22:5(10) to determine that the LSAT Fund was an insurer. But La.R.S. 22:5 was

renumbered as La.R.S. 22:46 by 2008 La.Acts No. 415, § 1. Louisiana Revised

Statute 33:1345 states, “Intergovernmental agreements providing for the creation

and maintenance of an interlocal risk management agency shall not be deemed to

constitute insurance as defined by R.S. 22:46.” Therefore, it is not insurance

pursuant to the insurance code. The definition of “underlying insurance” in the

Republic umbrella policy is “any policy providing the ‘insured’ with primary

liability insurance. . .” According to the reasoning of the supreme court, LMRMA

does not issue insurance policies. We find that the LMRMA indemnity agreement

is not “any policy” for the purpose of the Republic umbrella policy, and does not

meet the requirements of “underlying insurance” for the purpose of the Personal

Umbrella Liability Auto Liability Following Form Endorsement. Therefore, the

Republic umbrella policy does not cover the occurrence at issue in this case.

We therefore reverse the trial court’s denial of Republic’s motion for

summary judgment which argued that the Republic umbrella policy did not provide

coverage, and likewise reverse the trial court’s granting of the Estate of Jeane’s

motion for summary judgment which argued that the Republic umbrella policy did

afford coverage. Because we find merit in this assignment of error, we pretermit

discussion of Republic’s remaining assignments of error.

Barber Plaintiffs Answer to the Appeal
21

In its answer to the appeal, the Barber plaintiffs argue it was error for the

trial court to include language in the judgment requiring “exhaustion . . . of any

other insurance available to the Estate of Larry Jeane, Sr.” In full, that portion of

the judgment states:

IT IS FURTHER ORDERED, ADJUDGED AND DECREED
that the Republic Personal Umbrella Policy, policy number UI2
6281082 00, does provide umbrella insurance coverage to the Estate of
Larry Jeane, Sr., up to the limits of said policy for the claims of
Plaintiffs herein and subject to the exhaustion of the underlying
LRMRA Business Auto Agreement, policy number 100-0419-15005,
and any other insurance available to the Estate of Larry Jeane, Sr., that
the Cross Claim Plaintiff’s Motion for Summary Judgment on this issue
is hereby granted and Republic’s Motion for Summary Judgment on
this issue is hereby denied, and that these Judgments on both the grant
and denial of the Motions regarding insurance coverage under the
Republic Personal Umbrella policy are partial final judgments pursuant
to La.C.C.P. art. 1915, which are immediately appealable, and that the
Court expressly finds that there is no just reason to delay an appeal of
this matter.

The Barber plaintiffs argue that no other insurance policies have been raised by the

parties as applicable to this occurrence. Thus, it was improper for the trial court to

make coverage under the umbrella policy contingent on the existence of a

hypothetical insurance policy.

Our determination that the Republic umbrella policy does not afford

coverage and that we must reverse the trial court’s judgment renders the Barber

plaintiffs’ answer to the appeal moot.

Estate of Jeane’s Answer to the Appeal

In its answer to the appeal, the only issue remaining for us to decide is

whether the trial court erred in failing to sanction Republic by awarding penalties

and attorney fees for arguing that the Republic umbrella policy contained a

Business Use Exclusion. The Estate of Jeane argues that Republic misrepresented

its policy in both the initial declination letter and in its answer to the Estate of

Jeane’s cross-claim by claiming the policy included a Business Use Exclusion.
22

The Republic policy does not contain a Business Use Exclusion, as Republic later

conceded, and the trial court’s judgment held. The trial court, though, failed to

determine whether penalties and attorney fees were warranted because of a

violation of La.R.S. 22:1973. As we must remand this case for further proceedings,

we leave that decision to the trial court in the first instance.

CONCLUSION

The application for supervisory writs filed by Republic is granted and made

peremptory, and the trial court’s judgment is reversed insofar as it found that the

Republic umbrella policy provided coverage for the occurrence at issue in this

appeal. The case is remanded to the trial court for further proceedings.

ESTATE OF JEANE MOTION TO SUPPLEMENT THE RECORD
DENIED.
REPUBLIC MOTION TO DISMISS AND MOTION TO STRIKE JEANE’S
ANSWER TO THE APPEAL GRANTED IN PART AND DENIED IN PART.
REPUBLIC ALTERNATIVE MOTION TO SUPPLEMENT THE RECORD
ON APPEAL DENIED.

ESTATE OF JEANE MOTION TO REMAND AND/OR STAY THE
APPEAL DENIED.

ESTATE OF JEANE EXCEPTIONS OF NO RIGHT OF ACTION AND
MOOTNESS OVERRULED.

ESTATE OF JEANE MOTION TO DISMISS REPUBLIC’S SUSPENSIVE
APPEAL DENIED.

REPUBLIC MOTION TO DISMISS AND MOTION TO STRIKE
PLAINTIFF-APPELLEES’ “OBJECTIONS TO REPUBLIC SMJ
EXHIBITS” CONTAINED WITHIN THE PLAINTIFFS’ APPELLEE
BRIEF DENIED.

REPUBLIC MOTION TO DISMISS PLAINTIFF-APPELLEES’ ANSWER
TO THE APPEAL DENIED.

REPUBLIC MOTION TO STRIKE MISREPRESENTATIONS OF FACT
CONTAINED WITHIN THE APPELLEES BRIEFS, AND
ALTERNATIVELY, MOTION TO SUPPLEMENT THE RECORD DENIED.

REPUBLIC MOTION TO STRIKE EXHIBITS ATTACHED TO THE
ESTATE OF LARRY JEANE’S BRIEFS, OPPOSITION MEMORANDA,
AND EXCEPTION GRANTED.
23

REPUBLIC ALTERNATIVE MOTION TO SUPPLEMENT THE RECORD
WITH COUNTER EVIDENCE DENIED.

ESTATE OF JEANE MOTION TO STRIKE ALLEGED MAY 26, 2017
LETTER AND AFFIDAVIT OF ALICIA HAMBY DENIED AS MOOT.

WRIT GRANTED AND MADE PEREMPTORY.

JUDGMENT REVERSED.

REMANDED FOR FURTHER PROCEEDINGS.

24