77 So. 3d 83
La. Ct. App.2011Background
- On Jan 17, 2008, an accident occurred between a 2002 Lincoln Town Car driven by Lewis Jurey and a 2001 Peterbilt tractor pulling a 50' flatbed trailer driven by Harry Kemp, who had just left Baker Metal Works.
- Kemp was an independent contractor for Dallas & Mavis Specialized Carrier Co., LLC (D&M); D&M carried a Liberty Mutual policy for Kemp’s tractor, and Great American issued a bobtail policy for Kemp’s operation outside D&M’s transportation services.
- Plaintiffs (including Lewis Jurey and his guests) sued Kemp, D&M, Liberty Mutual, and Great American among others for bodily injuries.
- Liberty Mutual sought declaratory relief or summary judgment arguing Kemp was not performing transportation services for D&M at the time, thus no coverage; D&M moved for summary judgment; Great American cross-moved for summary judgment asserting coverage under its bobtail policy.
- The trial court granted Liberty Mutual and D&M summary judgment, finding Kemp off-duty and not in the course of performing D&M’s transportation services, and that Great American’s bobtail policy did not apply.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Liberty Mutual provides coverage where Kemp was not performing transportation duties | Great American argues Kemp’s activities were in the business of D&M as maintenance-related and within lease duties. | Liberty Mutual contends Kemp was off-duty and not performing transportation services for D&M, so the standard liability policy applies only to a covered auto used in business. | Affirmed that Kemp was not in the course of business; Liberty Mutual coverage maintained. |
| Whether the trial court properly denied Great American’s cross-motion for summary judgment | Great American asserts bobtail policy excludes coverage only when not in D&M’s business; the lease and maintenance activities were business-related. | Liberty Mutual and D&M contend no coverage under bobtail due to off-duty status and lack of business use. | Denied Great American’s cross-motion; coverage not found under bobtail. |
| Whether Liberty Mutual or Great American provides liability coverage for the accident given the lease terms | Great American argues bobtail exclusion applies; Liberty Mutual argues their policy covers usage as part of D&M’s business. | Liberty Mutual asserts tractor use at the time was not in D&M’s business; Great American contends the maintenance trip falls within business use. | Affirmed and held Liberty Mutual provides coverage; Great American’s policy exclusion applicable as to this accident. |
Key Cases Cited
- LeBlanc v. Bailey, 700 So.2d 1311 (La.App. 4 Cir. 1997) (drive home after deliveries may be personal; bobtail coverage preferred when not in service)
- Mahaffey v. General Sec. Ins. Co., 543 F.3d 738 (5th Cir. 2008) (bobtail did not cover when driver remained near carrier for load; work-related use)
- National Continental Ins. Co. v. Empire Fire & Marine Ins. Co., 157 F.3d 610 (8th Cir. 1998) (whether service/maintenance duties fall within carrier's business)
- Empire Fire & Marine Ins. Co. v. Liberty Mut. Ins. Co., 699 A.2d 488 (Md. App. 1997) (maintenance obligations and business use in lease context)
- Branson v. MGA Ins. Co., Inc., 673 So.2d 89 (La. App. 5 Cir. 1996) (FMCSA endorsements and interstate applicability considerations)