Kerri A. Latour v. Allstate Ins. Co.

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

18-395

KERRI A. LATOUR, ET AL.

VERSUS

ALLSTATE INS. CO., ET AL.

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APPLICATION FOR SUPERVISORY WRITS FROM THE
FIFTEENTH JUDICIAL DISTRICT COURT
PARISH OF LAFAYETTE, NO. 2015-4132-F
HONORABLE DAVID MICHAEL SMITH, DISTRICT JUDGE

**********

SHANNON J. GREMILLION
JUDGE

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Court composed of Sylvia R. Cooks, Marc T. Amy, Elizabeth A. Pickett, Shannon
J. Gremillion, and Candyce G. Perret, Judges.

Cooks, Judge, dissents and assigns reasons.
Pickett, Judge, dissents for the reasons assigned by Judge Cooks.

REVERSED AND RENDERED.

John William Penny, Jr.
Christopher Shannon Hardy
Penny & Hardy
600 Jefferson Street, Suite 601
Lafayette, LA 70502
(337) 231-1955
COUNSEL FOR DEFENDANT/APPLICANT:
Allstate Insurance Company

Christopher Parnell Lawler
Donovan & Lawler
4640 Rye Street, Suite 100
Metairie, LA 70006
(504) 454-6808
COUNSEL FOR DEFENDANT/RESPONDENT:
Debbie Derouen

Michael A. Rainey
Attorney at Law
P. O. Box 80067
Lafayette, LA 70598
(337) 504-5558
COUNSEL FOR PLAINTIFFS/RESPONDENTS:
Stephen E. Latour, Kerri A. Latour, Individually and on behalf of
Averi G. Latour

GREMILLION, Judge.

Steven and Kerri Latour filed suit against Debbie Derouen and Allstate

Insurance Company, her homeowners’ insurer, seeking damages for bruises and bite

marks suffered by their fifteen-month-old daughter, Averi Latour, on August 25,

2014, while she was in the care of Ms. Derouen. Ms. Derouen provided daycare

services for children in her home in exchange for compensation. On the day Averi

was bitten, Ms. Derouen was caring for two of her grandchildren in addition to six

other children, including Averi. When the children were napping, Ms. Derouen

heard a child crying and went to check on the child. Upon entering the room where

the children were napping, she found Averi crying and two other children, one sitting

on either side of her. Averi had been bitten on both of her legs and her sides. One

of the children sitting by Averi was Ms. Derouen’s grandchild; the other child was

one she regularly cared for. Ms. Derouen’s testimony indicates Averi may have

been bitten by either or both of these two children.

Allstate filed a motion for summary judgment, seeking to have the Latours’

claims against it dismissed. Allstate based its motion on a provision of its policy

which excludes liability coverage for injuries “arising out of . . . business activities

of any insured.” It argues that because Ms. Derouen was providing daycare services

for Averi when Averi was injured by another child in her care, Averi’s injuries arose

out of her business activities; therefore, the Latours’ claims are excluded from the

personal liability coverage provision of its policy.

The Latours asserted to the trial court that Averi was bitten by Ms. Derouen’s

grandchild and that because Allstate’s policy definition of “business” excepts

daycare services for an insured’s relatives from the definition of business activities,

the exclusion is inapplicable. Therefore, they urged that a genuine issue of material

fact exists as to whether Averi’s injuries arose out of Ms. Derouen’s daycare

business and that this issue precludes summary judgment. They also argued that

language contained in Allstate’s premises liability exclusion confirms coverage for

Averi’s injuries or, in the alternative, creates an ambiguity which also precludes

summary judgment.

The trial court denied Allstate’s motion, finding that the difference between

the pertinent language of the personal liability exclusion as compared to the premises

liability exclusion of the policy “create[d] an issue.” Allstate filed a writ application,

seeking reversal of the trial court’s judgment and the grant of summary judgment in

its favor. We granted writs and ordered briefing. Latour v. Allstate Ins. Co., 18-395

(La.App. 3 Cir. 8/9/18) (unpublished opinion). For the reasons that follow, we grant

Allstate’s requested relief.

ANALYSIS

“Since the denial of a motion for summary judgment is an interlocutory ruling
from which no appeal may be taken, the only practical remedy available to avoid a
possibly useless trial on the merits is to request that the appellate court exercise its
supervisory jurisdiction to review the propriety of this ruling.” Breaux v. Cozy
Cottages, LLC, 14-597, p. 4 (La.App. 3 Cir. 11/12/14), 151 So.3d 183, 187.
“Ordinarily, an application for supervisory writs is the appropriate vehicle for the
review of an interlocutory judgment.” McGinn v. Crescent City Connection Bridge
Auth., 15-165, p. 4 (La.App. 4 Cir. 7/22/15), 174 So.3d 145, 148.
On appeal, summary judgments are reviewed de novo. Magnon
v. Collins, 98–2822 (La.7/7/99), 739 So.2d 191. Thus, the appellate
court asks the same questions the trial court asks to determine whether
summary judgment is appropriate. Id. This inquiry seeks to determine
whether any genuine issues of material fact exist and whether the
movant is entitled to judgment as a matter of law. La.Code Civ.P. art.
966(B) and (C). This means that judgment must be rendered in favor of
the movant if the pleadings, depositions, answers to interrogatories,
admissions on file, and affidavits show a lack of factual support for an
essential element of the opposing party’s claim. Id. If the opposing
party cannot produce any evidence to suggest that he will be able to
meet his evidentiary burden at trial, no genuine issues of material fact
exist. Id.

2

Material facts are those that determine the outcome of the legal
dispute. Soileau v. D & J Tire, Inc., 97–318 (La.App. 3 Cir. 10/8/97),
702 So.2d 818, writ denied, 97–2737 (La.1/16/98), 706 So.2d 979. In
deciding whether facts are material to an action, we look to the
applicable substantive law. Id. Finally, summary judgment procedure
is favored and designed to secure the just, speedy, and inexpensive
determination of every action. La.Code Civ.P. art. 966(A)(2).

Am. Zurich Ins. Co. v. Caterpillar, Inc., 12-270, pp. 4-5 (La.App. 3 Cir. 10/3/12), 99
So.3d 739, 742-43. When considering a motion for summary judgment, the judge
should not weigh the evidence or determine the truth of the matter; instead, he must
determine whether there is a genuine issue of triable fact. Larson v. XYZ Ins. Co.,
16-745 (La. 5/3/17), 226 So.3d 412. “All doubts should be resolved in the non-
moving party’s favor.” Id. at 416.
An insurer seeking to avoid coverage through summary
judgment bears the burden of proving that some provision or exclusion
applies to preclude coverage. The issue of whether an insurance policy,
as a matter of law, provides or precludes coverage is a dispute that can
be resolved on summary judgment. However, summary judgment
declaring a lack of coverage under an insurance policy may only be
rendered if there is no reasonable interpretation of the policy when
applied to the undisputed material facts shown by the evidence
supporting the motion under which coverage could be afforded.

Chenevert v. Allstate Prop. & Cas. Ins. Co., 17-56, p. 4 (La.App. 3 Cir. 10/11/17),
229 So.3d 937, 940 (citations omitted).
Allstate’s motion for summary judgment is premised upon the following
pertinent provisions of its policy titled “Coverage X Family Liability Protection”:
Allstate will pay damages for which an insured person becomes
legally obligated to pay because of bodily injury or property
damage arising from an occurrence to which this policy applies, and
is covered by this part of the policy.

....

Losses We Do Not Cover Under Coverage X:

....

12. We do not cover bodily injury or property damage arising out of
the past or present business activities of an insured person.

Recently, in Green ex rel. Peterson v. Johnson, 14-292, p. 4 (La. 10/15/14),
149 So.3d 766, 770-71 (citation omitted), our supreme court reviewed the principles
of insurance contract interpretation and explained:
3

[C]ertain elementary legal principles apply in analyzing an insurance
policy. First and foremost is the rule that an insurance policy is a
contract between the parties and should be construed using the general
rules of interpretation of contracts set forth in the Civil Code.
According to those rules, the responsibility of the judiciary in
interpreting insurance contracts is to determine the parties’ common
intent; this analysis is begun by reviewing the words of the insurance
contract. When the words of an insurance contract are clear and explicit
and lead to no absurd consequences, no further interpretation may be
made in search of the parties’ intent, and courts must enforce the
contract as written. The determination of whether a contract is clear or
ambiguous is a question of law.

“Exclusionary provisions in insurance contracts are strictly construed against

the insurer, and any ambiguity is construed in favor of the insured.” Ledbetter v.

Concord Gen. Corp., 95-809, p. 4 (La. 1/6/96), 665 So.2d 1166, 1169, amended, 95-

809 (La. 4/18/96), 671 So.2d 915. Nonetheless, the rule of strict construction does

not “authorize a perversion of language, or the exercise of inventive powers for the

purpose of creating an ambiguity where none exists[.]” Muse v. Metro. Life Ins. Co.,

193 La. 605, 614, 192 So. 72, 75 (1939). Moreover, insurance companies have the

right to limit coverage in any manner they choose, if the limitations imposed do not

conflict with statutory provisions or public policy. Reynolds v. Select Props., Ltd.,

93-1480 (La. 4/11/94), 634 So.2d 1180.

The Latours argue that the focus should be on the source of their child’s

injuries. Because the probable source of the child’s bite was not a child for whose

care the homeowner was compensated, the Latours argue that the injury did not

“arise out of” the operation of a daycare facility in Ms. Derouen’s home per the terms

of the Allstate policy. We disagree.

Insurance is purchased to protect the insured against exposure from liability.

This principle is embodied in the insuring agreement, which, in this case, provides,

“Subject to the terms, conditions and limitations of this policy, Allstate will pay

damages which an insured person becomes legally obligated to pay because of

4

bodily injury or property damage arising from an occurrence to which this policy

applies, and is covered by this part of the policy.” Liability insurance payment is

always predicated upon the insured’s legal liability. In this matter, the allegations

against the homeowner involve failure to supervise “the minor child,” which,

throughout the petition, refers to the injured child. The risk that a minor child would

be injured at the operator’s home is precisely the risk Allstate avoided in excluding

coverage for operating a daycare. The acts or omissions of the homeowner/insured

is the proper focus in determining whether the exclusion applies. This approach

mirrors those previously used in similar cases, and it provides a more concrete

foundation upon which subsequent homeowners and insurers can structure their

dealings in the future.

Elorza v. Massey, 00-313 (La.App. 5 Cir. 3/14/01), 783 So.2d 453, involved

a child injured at a home-based daycare facility while playing on a trampoline that

had been purchased by the homeowner for the use of her children. However, she

allowed the daycare charges to play on the trampoline. The business pursuits

exclusion was held to exclude coverage:

The accident in question occurred during the course of Massey’s [the
homeowner’s] ordinary working day, while she was performing her
customary business tasks. Kayla [the injured child] was present at
Massey’s house because Massey’s business was an “at home” business;
Kayla was at Massey’s house because it was Massey’s business to care
for a group of children. Kayla was hurt while she was tussling with
another one of the children Massey was paid to watch. And the fact that
the accident arose out of Massey’s negligence on the job does not
negate the fact that it arose out of her business or somehow render
inoperable the business exclusion contained in her homeowner’s policy.

Massey argues that because the trampoline was purchased
“primarily” for family use, it was not part of the equipment used for the
day care. This argument is unavailing, however. It is defeated by
Massey’s own testimony: Massey herself testified that the day care
charges were allowed to use the trampoline. Need we hear any more?
If the trampoline was not used as part of Massey’s business, it was
Massey’s business to make the trampoline inaccessible to her day care
children.
5

Id. at 456.

In the matter of Felder v. Despinasse, 564 So.2d 1331 (La.App. 4 Cir. 1990),

the court of appeal employed a far simpler analysis in determining whether the

exclusion should apply. In fact, other than particulars of the day-to-day operation of

the in-home daycare, the court’s only discussion of the facts was that the plaintiffs’

child had broken his arm while in the homeowner’s care. The court nevertheless

concluded:

While there remains doubt as to how Stephen broke his arm, he would
not have broken it inside the Despinasses’ home had he not been placed
there in the care and control of Mrs. Despinasse because she was
operating a day care center on the premises. We find that the operation
of a day care center for compensation is a business pursuit excluded
from coverage under the language of the Allstate policy.

Id. at 1332.

In MVG v. Lucas, 590 So.2d 1322 (La.App. 1 Cir. 1991), the homeowner

operated a daycare from her home. One of her charges was sexually molested by

the homeowner’s major son, and the parents sued, alleging that the homeowner

failed to properly supervise the child entrusted to her care—the same allegations

present in the matter at bar. The homeowner’s insurer filed a motion for summary

judgment, which was, of course, decided under the former standards governing

summary judgment. The court held:

It is undisputed that Delores Lucas operated a day care center for
compensation in her home. Baby-sitting was her business. Supervising
CEG was Delores Lucas’ job. The act which Delores Lucas failed to do,
properly supervise CEG, was pursuant to the business. The business
was run in Delores Lucas’ home and injuries arising out of the business
were excluded from her homeowner's coverage.

The act of failing to supervise CEG was not a non-business
activity and cannot be compared, as argued by MVG, to activities
ordinarily incidental to non-business pursuits such as playing a
practical joke or preparing coffee for a social guest. The exception to
the exclusion does not apply.

6

Id. at 1324 (footnotes omitted). The agency of injury is irrelevant to the inquiry into

coverage in this case. What is relevant are the alleged actions or omissions of the

insured upon which liability is asserted and whether those actions further the

operation of the daycare. In the context of the present case, the omission for which

the Latours seek to impose liability on Ms. Derouen is her negligent supervision of

their minor daughter. Regardless of whether the child was bitten by Ms. Derouen’s

grandchild or another child, it is beyond dispute that if Ms. Derouen were not

operating a daycare from her home, the Latours’ child would not have been bitten.

The ruling of the trial court denying Allstate Insurance Company’s motion for

summary judgment is reversed. Judgment in favor of Allstate Insurance Company

is rendered, dismissing the demands of Stephen E. Latour and Kerri A. Latour,

individually and on behalf of their minor child, Averi G. Latour. All costs of these

proceedings are taxed as costs to Stephen E. Latour and Kerri A. Latour, individually

and on behalf of their minor child, Averi G. Latour.

REVERSED AND RENDERED.

7

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT
18-395
KERRI A. LATOUR, ET AL.
VERSUS
ALLSTATE INS. CO., ET AL.

COOKS, J., dissents.
Steven and Keri Latour (Plaintiffs) sued Debbie Derouen (Defendant) and

Allstate Insurance Company (Allstate) as her homeowner’s insurer. Plaintiffs allege

their child, Averi, was injured while in daycare at Defendant’s residence. It is

undisputed that Defendant operates a daycare business out of her home and was

being paid by Plaintiffs to keep their child daily. It is also undisputed that Defendant

was watching over two of her grandchildren on the day of the alleged incident and

they were not there as paying customers of her daycare business. Though it is not

disputed that Averi had bite marks on her body, it is in dispute as to which child or

children inflicted the bites on Averi. Defendant testified in deposition she did not

see which child bit Averi but when she came into the room in response to hearing a

child crying she observed one of her grandchildren sitting next to Averi and that

grandchild was laughing while Averi was crying. She therefore assumed her

grandchild bit Averi. She also said another child was near Averi on the opposite

side.

Allstate filed a motion for summary judgment asserting its homeowner policy

contains a specific business exclusion which states: “We do not cover bodily injury

or property damage arising out of the past or present business activities of an insured

person.” (emphasis added) Allstate asserts this language in the policy applies to the

situation at hand regardless of whether the child who bit Averi is one of Defendant’s

grandchildren, who by definition in the Allstate policy were not part of her day care

business, or one of the other daycare customers’ children. Allstate maintains
1

Defendant had a duty to protect Averi from harm and she breached that duty, and

that such “arises out of” the operation of her daycare business. The trial court denied

Allstate’s motion for summary judgment because it found there are competing

provisions in the insurance policy regarding coverage, the application of which is

affected by whether Averi was bitten by one of Defendant’s grandchildren or one of

the daycare customers or both. This, said the trial judge, “creates an issue” and

thereby denied summary judgment. I agree with the trial judge and for the reasons

that follow I respectfully dissent from the majority opinion reversing the trial court

judgment.

Appellate courts review a judgment granting or denying a motion
for summary judgment de novo. Bonin v. Westport Ins. Corp., 05–
0886, p. 4 (La.5/17/06), 930 So.2d 906, 910. Thus, appellate courts
must ask the same questions the trial court does 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. Hood v. Cotter, 08–0215, 08–0237, p. 9 (La.12/2/08), 5
So.3d 819, 824.

C & C Energy, L.L.C. v. Cody Investments, L.L.C., 09-2160 p. (La. 7/6/10),

41 So. 3d 1134, 1137.

Additionally, the Louisiana State Supreme Court has also held:

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 motion, under
which coverage could be afforded. Westerfield v. LaFleur, 493 So.2d
600, 605 (la.1986). . .

The purpose of liability insurance is to afford the insured protection
from damage claims. Policies therefore should be construed to effect,
and not to deny, coverage. Thus, a provision which seeks to narrow
the insurer’s obligation is strictly construed against the insurer, and,
if the language of the exclusion is subject to two or more reasonable
interpretations, the interpretation which favors coverage must be
applied. Garcia v. St. Bernard School Bd., 576 So.2d 975, 976
(La.1991); Breland v. Schilling, 550 So.2d 609, 610 (La.1989).

Reynolds v. Select Properties, Ltd., 93-1480 (La. 4/11/94), 634 So. 2d 1180,

1183 (emphasis added).

2

Reviewing this record de novo I do not believe this court can conclude that

Allstate is entitled to judgment as a matter of law. I also believe there are several

unresolved genuine issues of fact that cannot be determined on summary judgment.

First and foremost, we must understand from the outset that by the very terms of

Allstate’s policy language (“arising out of”) the exclusion on which Allstate relies

does not turn on Defendant’s duty owed to Averi as a day care customer, as the

majority finds, but, rather, turns on the “source of the injury” to Averi. See Lucas

v. Deville, 385 So.2d 804, 820 (La.App. 1979), writ refused, 386 So.2d 357

(La.1980), and writ refused, 386 So.2d 359 (La.1980) (emphasis added). As one

sister circuit court has noted “[t]he phrase ‘arising out of’ implies an element of

causality…” Elorza v. Massey, 00-313 (La.App. 5 Cir. 3/14/01), 783 So.2d 453,

456. Section X of the policy excludes coverage for any bodily injury or damage to

property “arising out of” the business activities of its insured. By definition in

Allstate’s policy, taking care of a grandchild is not a business activity. The majority

acknowledges this fact. As Defendant asserts, the “source” of Averi’s injuries was

likely Defendant’s grandchild, thus the injuries to Averi did not “arise out of”

Defendant’s business activities. The evidence presented in support of the motion for

summary judgment as to who bit Averi is equivocal. But more importantly, there is

no evidence in support of Allstate’s motion for summary judgment that Averi was

only bit by another paying customer’s child. Without that evidence Allstate fails to

show that Averi’s injuries arose out of Defendant’s day care business and are thus

subject to the policy exclusion. The majority finds it is the breach of Defendant’s

duty to Averi as her daycare client that determines whether the injury to Averi “arose

out of” Defendant’s business activities. This finding is incorrect. By use of the

phrase “arising out of” Allstate’s policy bases liability for Averi’s injuries on the

source of Averi’s injuries, not on the grandmother’s duty owed to either child. If the

source of Averi’s injuries is one of Defendant’s grandchildren, who by definition in

3

the Allstate policy are not part of Defendant’s business activities, then the Allstate

exclusion relied on does not apply. The injuries would not “arise out of” the daycare

business. I reiterate that neither the trial court, nor this court on de novo review, can

determine from the evidence submitted on summary judgment who bit Averi, or

whether Defendant failed to meet any legal duty, without making credibility

determinations and resolving competing factual allegations.

Allstate’s argument is belied by its own policy provisions.

In Reynolds, our state supreme court explained:

An insurance policy is a contract between the parties and should
be construed employing the general rules of interpretation of contracts
set forth in the Louisiana Civil Code. Smith v. Matthews, 611 So.2d
1377, 1379 (La.1993). The parties’ intent, as reflected by the words of
the policy, determine the extent of coverage. La.Civ.Code art.
2045; Louisiana Ins. Guar. Ass’n v. Interstate Fire & Casualty Co., 93–
0911, p. 5, 630 So.2d 759, 763 (La.1994). Words and phrases used in
a policy are to be construed using their plain, ordinary and generally
prevailing meaning, unless the words have acquired a technical
meaning. Interstate, 630 So.2d at 763; La.Civ.Code art. 2047.
An insurance policy should not be interpreted in an unreasonable or a
strained manner so as to enlarge or to restrict its provisions beyond what
is reasonably contemplated by its terms or so as to achieve an absurd
conclusion. Interstate, 630 So.2d at 763. Where the language in
the policy is clear, unambiguous, and expressive of the intent of the
parties, the agreement must be enforced as written. Central La. Elec.
Co. v. Westinghouse Elec. Corp., 579 So.2d 981, 985 (La.1991).
However, if after applying the other rules of construction an ambiguity
remains, the ambiguous provision is to be construed against the drafter
and in favor of the insured. Interstate, 630 So.2d at 763–64.

Reynolds, 634 So.2d at 1183.

Allstate’s policy submitted in evidence in support of its motion for summary

judgment provides in pertinent parts (emphasis added):

“Business” means:

a) Any full or part-time activity of any kind engaged in for economic
gain including the use of any part of any premises for such purposes.
The providing of home day care services to other than an insured
person or relative of an insured person for economic gain is also a
business.

4

Section II-Family Liability and Guest Medical Protection

Coverage X

Family Liability Protection

Losses We Cover Under Coverage X:

Subject to the terms, conditions and limitations of this policy, Allstate
will pay damages which an insured person becomes legally obligated
to pay because of bodily injury or property damage arising from an
occurrence to which this policy applies, and is covered by this part of
the policy.

Losses We Do Not Cover Under Coverage X:

1. We do not cover any bodily injury or property damage intended
by, or which may reasonably be expected to result from the
intentional or criminal acts or omissions of the insured person…

12. We do not cover bodily injury or property damage arising out of
the past or present business activities of an insured person.

15. We do not cover any liability an insured person assumes arising
out of any contract or agreement.

16. We do not cover bodily injury or property damage caused by war
or warlike acts, including, but not limited to insurrection, rebellion or
revolution.

Coverage Y
Guest Medical Protection

Losses We Cover Under Coverage Y:

Allstate will pay the reasonable expenses incurred for necessary
medical, surgical, x-ray and dental services, ambulance, hospital,
licensed nursing and funeral services…

Each person who sustains bodily injury is entitled to this protection
when that person is:

1. On the insured premises with the permission of an insured person,
or

2. Off the insured premises, if the bodily injury:

a) arises out of a condition on the insured premises;
b) is caused by the activities of an insured person or a residence
employee;
c) is caused by an animal owned by or in the care of an insured
person; or
d) is sustained by a residence employee.

5

Losses We Do Not Cover Under Coverage Y:

1. We do not cover any bodily injury intended by or which may
reasonably be expected to result from the intentional or criminal
acts or omissions of the insured person…

10. We do not cover bodily injury arising out of the past or present
business activities of the insured person.

14. We do not cover bodily injury which, in whole or in part, arises
out of, is aggravated by or results from mold, fungus, wet rot or dry
rot.

The policy language indicates that it is the “providing of home day care

services to other than an insured person or relative of an insured person for

economic gain” that constitutes a business. Thus, Defendant’s taking care of her

own grandchildren at her home does not constitute operating a day care business, i.e.

it is not a business activity. Allstate does not argue otherwise and the majority

agrees. Defendant’s grandchild was placed under her care and supervision and she

was responsible for that grandchild’s actions. Any failure in Defendant’s duty to

supervise her grandchild1 (if such failure is factually established) makes her legally

1
Although a person who undertakes control and supervision of a child is not
an insurer of the safety of the child, he is required to use reasonable care
commensurate with the reasonably foreseeable risk of harm to which the child
might be subjected while under his control and supervision. Blackledge v.
Font, 2006–1092, p. 10 (La.App. 1 Cir. 3/23/07), 960 So.2d 99, 104; Freeman v.
Wilcox, 303 So.2d 840, 842 (La.App. 1 Cir.1974), writ denied, 307 So.2d 630
(La.1975)…

The level of supervision “required is reasonable, competent supervision
appropriate to the age of the children and the attendant circumstances.”
Wallmuth, 2001–1779, 2001–1780 at p. 8, 813 So.2d at 346; Pierce, 2002–0139 at
p. 4, 836 So.2d at 331. “Constant supervision of all [children or] students is not
possible nor required ... to discharge [the] duty to provide adequate
supervision.” Id. To show that a duty to supervise has been breached, the plaintiff
must prove that the risk of unreasonable injury was foreseeable, constructively or
actually known, and preventable by the exercise of the required level of
supervision. Pierce, 2002–0139 at p. 5, 836 So.2d at 332. If the alleged act of
negligent supervision was unforeseeable, that is, it occurred suddenly and without
prior warning, the “vast majority” of courts have refused to attribute fault to the
accused defendant. Wallmuth, 2001–1779, 2001–1780 pp. 9–12, 813 So.2d at 347–
49 (and cases cited therein); Blackledge, 2006–1092 at pp. 9–12, 960 So.2d at 104–
05.

Gordon v. Cornerstone Assembly of God Church, 07-1488 pps. 4-5 (La. App. 1 Cir.
3/26/08), 985 So. 2d 762, 765.

6

responsible for her actions unless otherwise exempted from such responsibility by

contract.2 But the question of Defendant’s duty to Averi and/or her grandchild is not

determinative of liability for Averi’s injuries. It is the source of the injury, i.e. who

bit Averi, that determines liability and a fortiori whether such liability is excluded

from coverage.

It is alleged that the source of Averi’s injury is Defendant’s grandchild. If this

proves to be true at trial then the business exclusion relied on by Allstate will not

apply, otherwise the recited policy provision exempting Defendant’s grandchildren

from inclusion in her business activity would have no meaning. Such an application

would also render meaningless the phrase “arising out of” the business activity as

such phrase turns on the source of the injury which would not be related to

Defendant’s business activities if that source, i.e. the biter, is Defendant’s

grandchild. The policy provides coverage for Averi’s injuries, as recited above,

under Coverage Y because she is a person “on the insured premises with the

permission of [the] insured person.”

I have included certain provisions of Allstate’s policy in this discussion even

though they have no direct relation to this case because the language in these

provisions demonstrate that Allstate knows how to, and could have, written its

business exclusion provision differently if it desired to. If Allstate intended for its

business exclusion to reach the actions of Defendant’s non-business related invitee

(like her grandchild) it could have used language like it used elsewhere in the policy

such as the phrase “caused by” used in relation to acts of war, or such as “reasonably

expected to result from” like it used in the context of intentional or criminal acts. In

2
I note that a copy of the one-page contractual agreement signed by the Latours for Aviri’s
care with Mrs. Derouen states: “I will not hold Debbie Derouen legally responsible for any
“accidents/injuries” that my child incurs while in her care.” Both parents admit in deposition
they signed this agreement.

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each instance in the policy where Allstate employs the phrase “arises out of” it is

clear this reflects the notion of the source of the “bodily injury or property damage.”

For example, under Coverage X, item 7, Allstate does not provide coverage for

injury or damage “arising out of the negligent supervision by an insured person of

any person, or any liability statutorily imposed on any insured person, arising from

the ownership, maintenance, use, occupancy, renting, loaning, entrusting, loading or

unloading of any aircraft, watercraft…” Thus, the source of such responsibility is

the negligent supervision of any person loading or unloading a watercraft. Likewise,

another example is found under Coverage X, item 15, in which Allstate’s policy does

not cover “any liability an insured person assumes arising out of any contract or

agreement,” clearly making the contract or agreement the source of such liability. If

we accept Allstate’s argument that the source of Averi’s injury is Defendant’s failure

to perform her duty to supervise Averi implicitly required in her contract with the

Latours, this provision would be applicable, yet Allstate does not maintain such an

assertion. The only interpretation of this provision and the business exclusion

provision that renders both meaningful is that “arising out of” in both instances

means causality, i.e. the phrase speaks to the source of the injury. In the one

provision the source of the injury must be the business activity to be excluded and

in the other example from the policy the source must be the contract or agreement.

The reason neither applies to Defendant’s grandchild must be because the policy

defines Defendant’s care of her grandchild as not part of her day care business and

the actions of her grandchild in biting Averi would not arise out of any contract or

agreement.

Yet another example is found in Item 14 of the policy regarding mold, fungus,

wet rot or dry rot. The policy specifically excludes coverage for bodily injury which

“arises out of,” in whole or in part, or “results from mold, fungus, wet rot or dry rot.”

But, as all of us in Louisiana are too well aware, hurricanes can cause much interior

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water damage which results in a great deal of mold, fungus or wet rot. Such damage

is covered by the homeowner policy despite this typical mold exclusion because the

hurricane is the source of the mold damage, thus the hurricane related mold damage

does not arise out of mold caused by other means.

The majority’s reliance on Elorza v. Massey, 00-313 (La.App. 5 Cir. 3/14/01),

783 So.2d 453, the trampoline case, is misplaced. In Elorza, the source of the injury

was the defendant’s day care business activity. In that case, Mrs. Massey testified

she allowed her day care children to use her trampoline and was well aware the two

children were on the trampoline together at the time of the accident. Clearly, the

source of the plaintiff’s injury in Elorza was the insured’s business activity.

Notably, in Elorza, the Louisiana Fifth Circuit found Jackson v. Frisard, 96-547

(La.App. 1 Cir. 12/20/96) not applicable because “in Jackson, application or not of

the business exclusion depended on a determination of whether the insured’s

horseplay activities were business related.” Elorza 783 So.2d at 456. The majority

ignores this discussion in Elorza and ignores the impact of Jackson on this case. In

Jackson the court found the business exclusion policy provision not applicable to

Defendant’s liability for injuries caused by his horseplay with the plaintiff because

the horseplay was not business related even though it occurred during a required

training session:

We construe the policy language in question to provide coverage
for acts which by their nature are not associated with the insured’s
business pursuits, but which are only casually related to the business
activities. See New Jersey Property Liability Guaranty Assoc., 174
N.J.Super. at 632, 417 A.2d at 119; State Farm Fire and Casualty Co.
v. National Union Fire Ins. Co., 87 Ill.App.2d 15, 230 N.E.2d 513, 516
(Ill.App.1967). The testimony was undisputed that none of the training
maneuvers practiced during the session involved striking the back in
any manner. Thus, we find Frisard’s action of striking Jackson’s back
was not an activity associated with the defensive training session, but
was in this instance only casually related to the business activity of the
training session, and ordinarily incident to non-business pursuits. The
trial court properly found the ‘business pursuits’ exclusion of the State
Farm policy did not exclude coverage for Jackson’s injuries resulting
from the incident. We find no inconsistency in the trial court’s findings

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on the issues of vicarious liability and insurance coverage.

Jackson v. Frisard, 96-0547 p. 18 (La. App. 1 Cir. 12/20/96), 685 So. 2d 622,

631, writ denied, 97-0193 (La. 3/14/97), 689 So. 2d 1386, and writ denied, 97-0201

(La. 3/14/97), 689 So. 2d 1387. There was additional language in the Farm Bureau

policy in Jackson that modified the business exclusion which made it clear that the

business activities exclusion did not apply to actions “incident to non-business

pursuits.” Though that provision is not part of the current Allstate policy, it does

contain a provision which amounts to the same thing, i.e., it provides that the

business activities exclusion does not apply to Defendant and her relatives, which

includes her grandchildren. Thus, under the rationale of Jackson, and Elorza when

properly applied, Allstate’s business activity exclusion does not apply to injuries

caused by Defendant’s grandchild while in her care because the Allstate policy

defines such as a non-business activity.

For the reasons stated, Allstate is not entitled to summary judgment either as

a matter of law or fact. I, therefore, respectfully dissent.

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