Espinosa v. Accor N. Am., Inc.

148 So.3d 244

Jorge A. ESPINOSA

v.ACCOR NORTH AMERICA, INC., d/b/a Motel 6, et al.

No. 2014–CA–0001.

Court of Appeal of Louisiana, Fourth Circuit.

Sept. 24, 2014.

Rehearing Denied Oct. 23, 2014.

Donald F. deBoisblanc, Donald F. deBoisblanc, Jr., New Orleans, LA, John A. Leslie, Law Office of David A. Canale & Associates, P.C., Marietta, GA, for Plaintiff/Appellee.

Michael R. Sistrunk, Heather M. Nagel, McCranie Sistrunk Anzelmo Hardy McDaniel & Welch, LLC, Covington, LA, For Defendant/Appellee/Accor Franchising N.A., LLC.

Thomas C. Cowan, Leah T. Therio, Cowan & Lemmon, L.L.P., New Orleans, LA, for Defendant/Bayou Hospitality, LLC.

Celeste D. Elliott, Rachel A. Clark, Anne Elizabeth Briard, Lugenbuhl Wheaton Peck Rankin & Hubbard, New Orleans, LA, Jay R. Sever, Charlotte J. Sawyer, Phelps Dunbar LLP, New Orleans, LA, for Defendant/Appellant/Century Surety Company.

James T. Busenlener, Matthiesen, Wickert & Lehrer, S.C., New Orleans, LA, for Defendant/Appellee/ Arch Ins. Co.(Court composed of Judge MAX N. TOBIAS, JR., Judge, DANIEL L. DYSART, Judge ROSEMARY LEDET ).

Opinion

DANIEL L. DYSART, Judge.

Century Surety Company seeks review of the judgment of the trial court granting summary judgment against it. For the reasons that follow, and based upon our de novo review of the record, we find that the trial court erred in granting the motion for summary judgment. Accordingly, we reverse the trial court's judgment and remand this matter for further proceedings.

FACTUAL AND PROCEDURAL BACKGROUND

On August 13, 2010, Plaintiff, Jorge Espinosa, was robbed and shot in the parking lot of the Motel 6, located at 4200 Old Gentilly Road in New Orleans, Louisiana, where he was a guest and staying for business purposes. He survived the attack and filed the instant lawsuit on July 25, 2011, for personal injuries, including paralysis. Named as defendants are:

• Accor North America, Inc. d/b/a Motel 6; Accor Franchising North America, LLC, d/b/a Motel 6; Motel 6 Operating LP, d/b/a Motel 6, each of which is identified as foreign corporation or foreign partnership which “owned, leased and/or operated and/or managed” the motel;¹

• Bayou Hospitality, LLC (“Bayou”), alleged to be the owner of the property located at 4200 Old Gentilly Road;

• A fictitious security company;

• A yet-to-be-identified employee of defendants; and

• Several fictitious insurers.

In his suit, plaintiff alleges that the defendants “were aware of the high rate of violent and other crimes on and around the premises” and that “several known criminals frequently loitered on the premises.” However, according to plaintiff, the defendants failed to warn him of the dangers of the area, failed to provide adequate security and failed to take measures to insure the safety of their patrons.

Arch Insurance Company (“Arch”), the worker's compensation carrier for plaintiff's employer, TradeSource, Inc., intervened in the lawsuit on August 11, 2011, seeking to recover the amounts it paid in medical expenses and indemnity benefits. At the time it filed the Intervention, those sums amounted to $1,999,561.80. Arch named as defendants in intervention those parties identified in the original Petition for Damages.

A Second Petition of Intervention was filed on December 15, 2011 by Century Surety Company (“Century”), which insured Bayou at the time of the underlying incident.² In its intervention, Century sought a declaration that its policy limits coverage to $25,000 per occurrence based on an endorsement to the policy's assault and battery exclusion. It further sought a declaration that its obligation to defend and/or indemnify Bayou ended when it exhausted its $25,000 limit by virtue of a policy provision which reduces coverage by the payment of expenses incurred in investigating and defending the underlying action.³

In a first amending petition filed on May 21, 2012, plaintiff added Century and Federal Insurance Company (“Federal”), the excess and umbrella insurer of Bayou, as defendants. In a second amending petition, plaintiff added Arch as a direct defendant.

On October 30, 2012, plaintiff filed a Motion for Partial Summary Judgment seeking a determination that Century's policy affords $1 million in liability coverage to Bayou. Accor then filed its own Motion for Partial Summary Judgment, joining in plaintiff's Motion for Summary Judgment and also seeking a determination that there is $1 million of coverage under Century's policy. Bayou later joined in these motions. A hearing was held on the motions and, by judgment dated February 14, 2013, the motions were denied.⁴

On April 26, 2013, Bayou filed a Cross–Claim against Century, asserting that Century's policy provides policy limits of $1 million for the claims asserted by plaintiff. Bayou further asserted that Century owed it a defense in this litigation. Bayou then filed a Motion for Summary Judgment on June 17, 2013 against Century, asserting that, although Century had paid $25,000, it still owed Bayou a defense because of the claims asserted in the lawsuit pertaining to Bayou's alleged failure to secure its premises. It argued that, under the policy's premises liability provision, coverage is provided separate and apart from the assault and battery claims. Bayou essentially sought a reconsideration by the trial court of coverage under Century's policy.

After obtaining leave of court, Accor filed a Third Party Demand against Colonial Insurance Agency, Inc. (“Colonial”), in which it asserted that Colonial procured the Century policy for Bayou, but “negligently misrepresented to Accor that it was named as an additional insured under the policy.” Accor alleged that Colonial provided it with a “Certificate Holder” indicating that it was an additional insured.

On August 20, 2013, plaintiff filed two Motions for Partial Summary Judgment. The first addressed the issue of comparative fault; plaintiff maintained that defendants are not entitled to submit a comparative fault instruction to the jury, whereby the jury could allocate fault between the owner of the motel and the person who robbed and shot plaintiff. The second motion sought a determination that Century's policy provided coverage for the allegations related to the failure to maintain a safe and secure premises, claims plaintiff maintained were separate and distinct from the assault and battery claims. Accor joined in plaintiff's second Motion, as well as Bayou's June 17, 2013 Motion for Partial Summary Judgment.

A hearing was held on the Bayou's, Accor's and plaintiff's Motions for Partial Summary Judgment on September 20, 2013. By judgment dated October 10, 2013, the trial court granted summary judgment as follows: (1) in favor of Bayou as to the issue of defense costs, ordering Century to pay “past, present and future reasonable and necessary attorney's fees and costs” in representing Bayou; and (2) in favor of Bayou, Accor and plaintiff on the issue of coverage under Century's policy, finding that the policy provides coverage with limits of $1,000,000 “for the claims made by plaintiff in the Petition for Damages against Bayou Hospitality, L.L.C.” No reasons for judgment were assigned.

The trial court designated the October 10, 2013 judgment as final pursuant to La. C.C. Pr. art. 1915(B)(1).⁵ Century timely appealed that judgment.

Standard of Review

Appellate courts review judgments granting partial summary judgment under the de novo standard of review. Kimpton Hotel & Restaurant Group, Inc. v. Liberty Mut. Fire Ins. Co., 07–1118, 07–1209, 07–1310, p. 3 (La.App. 4 Cir. 12/19/07), 974 So.2d 72, 75. In this review, the appellate courts use the same criteria that govern the district court's consideration of whether summary judgment is appropriate. Ramos v. Tulane Univ. of La., 06–0487, p. 3 (La.App. 4 Cir. 1/31/07), 951 So.2d 1267, 1269, citing Smith v. Our Lady of the Lake Hosp., Inc., 93–2512, p. 26 (La.7/05/94), 639 So.2d 730, 750. Thus, a motion for summary judgment will be granted “if the pleadings, depositions, answers to interrogatories, and admissions, together with the affidavits, if any, show that there is no genuine issue of material fact, and that the mover is entitled to summary judgment as a matter of law.” La. C.C. Pr. art. 966(B). The summary judgment procedure is designed to secure the just, speedy, and inexpensive determination of actions such as this. La. C.C. Pr. art. 966(A)(2).

Summary judgment is particularly appropriate in the context of insurance coverage issues. As the courts have consistently held, the “[i]nterpretation of an insurance policy ordinarily involves a legal question that can be properly resolved by a motion for summary judgment.”Bernard v. Ellis, 11–2377, p. 9 (La.7/2/12), 111 So.3d 995, 1002 ; Bonin v. Westport Ins. Corp., 05–0886, p. 4 (La.5/17/06), 930 So.2d 906, 910.

Here, the material facts giving rise to the litigation are undisputed; the interpretation of Century's insurance policy is purely a question of law and, therefore, appropriate for summary judgment resolution.

Policy provisions

The policy at issue in this matter provides commercial general liability (“CGL”) coverage to Bayou. The policy's insuring agreement states that Century will pay “those sums that the insured becomes legally obligated to pay as damages because of ‘bodily injury’ or ‘property damage’ to which this insurance applies.” The insuring agreement further provides that Century has “the right and duty to defend the insured against any ‘suit’ seeking those damages.”

The policy contains an assault and battery exclusion, form CGL 1704, which excludes coverage for “ ‘bodily injury,’ ... arising out of or resulting from:

(a) any actual, threatened or alleged assault or battery;

(b) the failure of any insured or anyone else for whom the insured is or could be held legally liable to prevent or suppress any actual assault or battery;

(c) the failure of any insured or anyone else for whom the insured is or could be held legally liable to render or secure medical treatment necessitated by

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