353 So.3d 823
La. Ct. App.2022Background
- The Hills own undivided interests in a tract in Section 93, T7S, R10E; a horizontally drilled well (originally permitted as directional) had its bottom hole penetrate beneath their property, and oil was allegedly produced from under their land beginning in 2008.
- TMR operated the well until July 1, 2010; Park became operator on that date. Chaucer issued Park a CGL policy effective June 1, 2010–June 1, 2011.
- The Hills allege Park produced oil beneath their land without leases (no leases between Park/TMR and many Hills before 2012) and sought damages and rescission of leases entered in 2012.
- Chaucer moved for summary judgment asserting (1) Park knew of the property damage prior to the policy period (relying largely on Park’s unanswered requests for admission), (2) the expected/intended-injury exclusion applies, and (3) the dishonesty/infidelity exclusion applies.
- The trial court granted Chaucer’s motion, relying on the deemed admissions; on appeal the First Circuit reversed, holding genuine issues of material fact exist about when Park knew the bottom-hole location and that Chaucer had not proved the exclusions apply as a matter of law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Were Park’s 2015 requests for admission deemed admitted and controlling on the question of Park’s knowledge before the policy period? | Hills: the RFAs were not deemed admitted (no proof served) and even if deemed, they conflict with Park’s interrogatory answers, creating a fact issue. | Chaucer: RFAs were unanswered and thus admitted, proving Park knew by Feb 2010. | The court held RFAs and Park’s interrogatories conflict; summary judgment cannot favor unanswered RFAs where interrogatory responses create a genuine factual dispute. |
| Does the policy’s expected/intended-injury exclusion bar coverage because Park knew of the damage before the policy? | Hills: disputed timing of knowledge (Park’s interrogatories show knowledge in fall 2011), so exclusion not established. | Chaucer: Park had knowledge before July 1, 2010, so the exclusion applies. | The court held Chaucer failed to prove the exclusion applies as a matter of law because knowledge timing is genuinely disputed. |
| Does the dishonesty/infidelity exclusion bar coverage based on the Hills’ allegations of willful trespass and fraud? | Hills: allegations are contested facts and insufficient to trigger the exclusion at summary judgment. | Chaucer: the Hills’ pleadings and claims allege dishonesty, triggering the exclusion. | The court held Chaucer did not meet its burden to establish the exclusion applies; factual issues remain. |
| Are the Hills bound by judicial confession or judicial estoppel as to Park’s knowledge because of their prior motion to cancel leases? | Hills: prior allegations were factual pleadings, not judicial confessions; the prior judgment cancelled leases for fraud but did not adjudicate that Park knew of the well location pre-policy. | Chaucer: Hills previously asserted Park knew by Feb 2010 and are estopped from taking a contrary position. | The court held the prior filings/judgment did not amount to a binding judicial confession/estoppel on the precise timing of Park’s knowledge. |
Key Cases Cited
- Chevis v. Rivera, 329 So. 3d 831 (La. App. 1st Cir. 2021) (summary judgment standard and doubts resolved against mover)
- Ellis v. Circle L Trucking, L.L.C., 340 So. 3d 985 (La. App. 1st Cir. 2021) (burden rules on insurer to prove exclusions and on insured to prove coverage)
- Apache Corp. v. Talens Marine & Fuel, LLC, 242 So. 3d 619 (La. App. 1st Cir. 2017) (requests for admission deemed admitted absent proper response)
- Mizell v. Willis, 290 So. 3d 247 (La. App. 1st Cir. 2019) (requirement that judgments name parties to be enforceable)
- Wells Fargo Bank, N.A. v. Seltoon, 120 So. 3d 757 (La. App. 1st Cir. 2012) (distinguishing judicial admissions from allegations that must be proven)