Baack v. McIntosh

304 So.3d 881

Martin BAACK and Brenda Baack

v.Michael MCINTOSH, et al.

19-657

Court of Appeal of Louisiana, Third Circuit.

July 29, 2020

Dorwan G. Vizzier, Broussard, Halcomb & Vizzier, P. O. Box 11875, Alexandria, LA 71315, (318) 487-4589, COUNSEL FOR PLAINTIFFS/APPELLANTS: Martin Baack, Individually and on Behalf of Estate of Allissah Baack Brenda Baack, Individually and on Behalf of Estate of Allissah Baack

Jack E. Truitt, The Truitt Law Firm, 149 North New Hampshire Street, Covington, LA 70433, (985) 327-5266, COUNSEL FOR DEFENDANT/APPELLEE: Zurich American Insurance Company

Court composed of Ulysses Gene Thibodeaux, Chief Judge, Van H. Kyzar, and Jonathan W. Perry, Judges.

KYZAR, Judge.

The plaintiffs, Martin and Brenda Baack, appeal from a jury verdict finding that an insurance policy issued by the defendant, Zurich American Insurance Company, did not provide uninsured motorist coverage for injuries Mr. Baack suffered in an automobile accident. For the following reasons, we reverse and render judgment in favor of the Baacks and remand for further proceedings.

DISCUSSION OF THE RECORD

On July 18, 2014, Mr. Baack, an employee of Pilgrim's Pride Corporation (Pilgrim's), was driving his work vehicle west on Louisiana Highway 6 near Natchitoches, Louisiana, when a vehicle, attempting to make a U-turn from the shoulder of the westbound lane, struck his vehicle. Michael McIntosh, the vehicle's driver, was determined to be solely at fault in causing the accident and pled guilty to improper lane usage, a violation of La.R.S. 32:79.

Mr. Baack was a long-time employee of Pilgrim's, and the vehicle he was operating belonged to PPC Transportation Company (PPC Transportation). Both Pilgrim's and PPC Transportation are subsidiaries of JBS USA Holdings, Inc. (JBS).¹ The defendant, Zurich American Insurance Company (Zurich), is both the workers’ compensation (WC) insurer and the auto insurer of JBS. As a result of this accident, Zurich paid WC benefits to Mr. Baack.

Pursuant to La.R.S. 23:1101,² Mr. Baack and his wife, Brenda, filed suit, individually and on behalf of their minor child, Allissah Baack, against Mr. McIntosh, his insurer, Allstate Property and Casualty Insurance Company (Allstate), and Zurich, the uninsured motorist (UM) provider for PPC Transportation's vehicle. In JBS's auto policy with Zurich, PPC Transportation Company is listed as Broad Named Insured. The Baacks sought damages under Zurich's UM coverage based on the alleged uninsured or underinsured status of Mr. McIntosh's vehicle. They also sought penalties and attorney fees pursuant to La.R.S. 22:1973 and La.R.S. 22:1892, based on Zurich's failure to timely settle his claim.

Upon Allstate's tender of Mr. McIntosh's $15,000.00 policy limits, the Baacks dismissed their claims against Allstate and Mr. McIntosh, to the extent of his policy limits, but reserved their rights against Zurich. An order of partial dismissal was rendered on May 19, 2016.

Zurich sought judgments on various issues prior to trial. It moved for summary judgment on the issue of UM coverage, on the grounds that JBS had waived UM coverage in its policy. The Baacks opposed the motion. Judgment was rendered denying the motion on April 28, 2017, and writs to both this court and the supreme court were denied. Baack v. McIntosh , 17-501 (La.App. 3 Cir. 7/31/17) (unpublished writ), writ denied , 17-1489 (La. 11/13/17), 229 So.3d 926.

Zurich also filed three motions seeking partial summary judgment. The first and second motion sought dismissal of the Baacks’ penalty and attorney fee claims. These motions were opposed by the Baacks. A December 22, 2017 judgment denied the first motion, but the record does not contain a judgment specifically addressing the second motion.

Zurich's third motion sought dismissal of Mr. Baacks’ claims for past medical expenses and lost wages based on an exclusion in its policy excluding coverage for WC claims. It further argued that because its obligations towards Mr. Baack (as WC insurer and UM provider) were solidary in nature, it was entitled to a credit for all WC benefits (past and future) that Mr. Baack received as a result of this accident. The Baacks opposed this motion. On June 25, 2018, judgment was granted in Zurich's favor, finding that because its obligations towards Mr. Baack were solidary in nature, the collateral source rule did not apply. Thus, it held that Zurich, as UM provider, was entitled to a credit for all past WC benefits paid to Mr. Baack, with the amount to be proven at trial, and a credit towards all future WC benefits he would receive as a result of the accident. However, the judgment held that because Zurich failed to plead the policy exclusion as an affirmative defense in its answer, the defense was waived.

Zurich also moved to bifurcate the coverage issue from the liability and damage issues. The Baacks opposed this motion, and judgment denying the motion was rendered on July 27, 2018.

Prior to trial, the Baacks filed a motion in limine seeking to prevent Zurich from mentioning or referencing to the jury any funds that they had obtained from a collateral source independent of Zurich. On August 24, 2018, judgment was rendered, granting the motion, in part, holding that any evidence pertaining to Mr. Baack's WC claim would only be admissible to the trial court outside of the jury's presence.

This matter proceeded to a jury trial, which lasted five days. After the Baacks rested their case, Zurich moved for a directed verdict on the issue of UM coverage, which was denied. The Baacks, in turn, moved for a directed verdict on this issue after Zurich rested, which was also denied. Following deliberations, the jury reached a verdict finding that Zurich's policy did not provide UM coverage for Mr. Baack's claims because JBS had rejected coverage. A judgment in conformance with the jury's verdict was rendered on September 25, 2018, dismissing the Baacks’ claims against Zurich, with prejudice, and casting them with all costs. The Baacks then moved for a judgment notwithstanding the verdict or, in the alternative, for new trial on the issues of UM coverage and damages. Judgment denying both motions was rendered on December 21, 2018.

Thereafter, the Baacks perfected this appeal.

On appeal, the Baacks assert six assignments of error:

1. The jury committed both an error of law and manifest error when on the undisputed facts and evidence, it failed to find that underinsured motorist coverage was provided by the Zurich policy by statute.

2. The trial court committed an error of law when it overruled plaintiffs’ Motion for Directed Verdict on the issue of underinsured motorist coverage at the close of defendant's case.

3. The trial court committed an error of law when it denied plaintiff's Motion for Judgment Notwithstanding the Verdict or In the Alternative Motion for New Trial.

4. The trial court committed [an] error of law in ruling on defendant, Zurich's[,] Motion for Partial Summary Judgment by ordering that Zurich was entitled to a credit for past and future workers’ compensation payments of indemnity and medical expenses. [Record citation omitted.]

5. The jury and trial court committed legal error and manifest error in failing to find uninsured motorist coverage under Zurich's policy, and thereby failing to address the remaining issues of liability[,] damages, penalties and attorney's fees. This Court should determine these facts de novo on the entire record and render judgment on the merits. Rosell v. ESCO, [549 So.2d 840, 844 (La.1989) ].

6. The trial court erred as a matter of law and abused its discretion when it cast plaintiff for all costs for these proceedings for reasons that plaintiffs should have prevailed on the merits and the defendant should have been cast with all costs of these proceedings. [Record citation omitted.]

The appellate standard of review applicable in this matter was set out by this court in Stelly v. Bergeron , 19-102, pp. 13-14 (La.App. 3 Cir. 10/30/19), 283 So.3d 536, 545-46 (alteration in original):

The applicable standard of review as to the merits of this case is set forth in Monlezun v. Lyon Interests, Inc. , 11-576, pp. 4-5 (La.App. 3 Cir. 11/2/11), 76 So.3d 628, 632-633 :

Louisiana appellate courts review both law and facts. S.J. v. Lafayette Parish Sch. Bd. , 09-2195 (La. 7/6/10), 41 So.3d 1119. Factual findings are reviewed under the "manifestly erroneous or clearly wrong" standard. Id. at 1127. In order to reverse a factual determination of the trial court, the appellate court must first find that a reasonable factual basis does not exist for the finding and that the record establishes that the finding is clearly wrong. Id. In cases where there are two permissible views of the evidence, the fact finder's choice between them cannot be manifestly erroneous. Id. "However, where documents or objective evidence so contradict a witness's story, or the story itself is so internally inconsistent or implausible on its face that a reasonable fact finder would not credit the witness's story, a reviewing court may well find manifest error." Id. at 1127.

If the court of appeal finds that the trial court committed a manifest error of fact or a reversible error of law, the appellate court must then conduct a de novo review of the record and render a judgment on the merits.

Siverd v. Permanent Gen. Ins. Co. , 05-973 (La. 2/22/06), 922 So.2d 497. In making such a finding, the appellate court "must do more than simply review the record for some evidence which supports or controverts the trial court's findings; it must instead review the record in its entirety to determine whether the trial court's finding was clearly wrong or manifestly erroneous." Id. at 499. Thus, the appellate court may not reverse if the trial court's findings are reasonable in light of the record as a whole, even if the appellate court is convinced that it would have weighed the evidence differently if sitting as the trier of fact. Id.

We further keep in mind the

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