UNITED STATES FIDELITY AND GUARANTY COMPANY, Petitioner, v. Louis GOUDEAU, Respondent.
No. 06-0987
Supreme Court of Texas.
Decided Dec. 19, 2008.
Argued Dec. 6, 2007.
272 S.W.3d 603
Seven years after Sanchez, we observed in In re Lock that the mandatory language of the two rules should be applied according to the nature of the sentence without regards for details that would ordinarily inform a discretionary review: “An attorney guilty of an intentional crime must be either suspended or disbarred-depending solely on whether the attorney‘s criminal sentence was probated-without regard for any collateral matters, and without any consideration or inquiry into the facts of the underlying criminal case.”9
In that case we seemed to reject the view that BODA has discretion to either disbar or suspend a lawyer regardless of whether the sentence was fully probated. The Court today would allow language in Rule 8.05 concerning disbarment to confer discretion over suspension when the rule actually governing suspension leaves no room for such discretion. The more natural reading is that Rule 8.05 requires disbarment “unless” Rule 8.06 applies, at which point suspension is required. This construction comports with our analysis in Sanchez, Ament, and Lock and harmonizes the plain language of both rules.10
I understand the Court‘s desire to grant BODA flexibility, but my reading of the rules and our pertinent precedent compels me to respectfully dissent.
Ronald L. Bair, Bair Hilty, P.C., Houston, TX, for Intervenor.
Otto D. Hewitt III, Hewitt Law Firm, Alvin, and Alton C. Todd, Law Offices of Alton C. Todd, Friendswood, TX, for Respondent.
One can imagine few more sympathetic litigants than Louis Goudeau, a “Good Samaritan” who stopped his car on a Houston freeway to help a stranded motorist. After leaving his car to approach the disabled one, Goudeau was severely injured when a third driver smashed into both cars and pinned him between them and a retaining wall.
There is no question Goudeau can recover from the driver who caused this accident-he already has. But that driver had only $20,000 in insurance. The question instead is whether Goudeau can recover under his employer‘s underinsured motorist policy, which applies only if Goudeau was “occupying” his car at the time of the accident. The court of appeals found a fact question on that issue, even though Goudeau had exited his car, closed the door, and walked around the front toward the retaining wall when the accident occurred.
It is natural to sympathize with a litigant who has suffered harm caused by someone who cannot pay the consequences. But if sympathy were a rule of contract construction, there would soon be no law of contracts left. Under the insurance policy here, Goudeau was not “occupying” his car at the time of the accident, so he cannot recover under this policy.
I. The Background
Goudeau worked for Advantage BMW, and was driving one of its cars in the course of his employment. He stopped on the right shoulder of the Sam Houston Tollway to help another driver who had collided with the freeway‘s retaining wall. After getting out of his car and walking around the front toward the retaining wall, a car driven by Alex Rodriguez slammed into both parked cars, pinning Goudeau against the retaining wall and crushing his pelvis.
Advantage BMW had two policies with United States Fidelity & Guaranty Company (“USF & G“): a workers compensation policy, and an auto policy with uninsured/underinsured coverage of $1 million. USF & G paid more than $100,000 in benefits to Goudeau and his medical providers under the compensation policy, but denied benefits under the underinsured-motorist policy.
A year after Goudeau filed suit against Rodriguez, the latter tendered his policy limits of $20,000. Goudeau then amended to sue USF & G for breach of the underinsured-motorist policy. USF & G answered using one law firm, and a few days later intervened using a different law firm to assert its $100,000 statutory subrogation claim against the money Goudeau recovered in the suit.1
The trial court granted summary judgment against Goudeau on his underinsured claim. The court of appeals reversed and remanded for trial, finding a fact issue as to whether Goudeau was “occupying” his vehicle.2
II. The Policy Question
The underinsured policy here covered certain designated Advantage BMW employees, as well as any others “occupy-
Goudeau concedes he was not “in” his car when the accident occurred, nor was he in the process of “getting in, on, out, or off” of it. He asserts coverage only on the ground that he was “occupying” the car by being “upon” it when he was injured.
Under the traditional canon of construction noscitur a sociis (“a word is known by the company it keeps“), each of the words used here must be construed in context.3 In this context, a person sitting in the back of a pickup at the time of an accident might be “occupying” the vehicle by being “upon” it.
But a driver who has exited the car, closed the door, walked around the front, and then has the vehicle smashed into him cannot be said to be “occupying” the vehicle at the time of the collision, even if afterwards he ends up partly “upon” it. We cannot ignore the context by focusing solely on “upon” and ignoring “occupying.” Construing “upon” to include the situation here would “ascrib[e] to one word a meaning so broad that it is inconsistent with its accompanying words.”4
The court of appeals adopted a test requiring claimants to show only “a causal connection between the incident that caused the injury and the covered vehicle.”5 We have required such a causal connection when deciding whether an uninsured motorist claim “arises out of” the use of a motor vehicle,6 but that is not the same question as whether a person was “occupying” a covered car. The court of appeals cited several cases denying coverage to non-occupants when a covered car had no causal connection to an accident,7 but that does not imply the opposite: that if a covered car has a causal connection to an accident, then everyone injured must have been “occupying” the covered car. Bystanders, pedestrians, and occupants of other vehicles are not “occupying” a covered car merely because it was somehow involved.
Neither party asks us to look to the law of other states on this question, and a brief review shows why. In deciding whether a person was “occupying” a covered vehicle under an uninsured/underinsured policy, the states have employed a multitude of surrogate tests, including:
- a four-pronged test;8
- a three-pronged test;9
- a position-of-safety test;10
- a severed-relationship test;11
- a chain-of-events test;12
- a substantial-nexus test;13
- a reasonable-relationship test;14
- a close-proximity test;15
- a vehicle-orientation test;16
- a close-proximity or vehicle-use test;17
- a close-proximity and vehicle-use test;18 and last but not least,
- a plain-and-ordinary-meaning test.19
Under Texas law, we are required to construe insurance policies according to their plain language,20 using “the ordinary, everyday meaning of the words to the general public.”21 While we strive for uniform construction when policy language is
III. The Request for Admission
Alternatively, Goudeau argues (and the dissent agrees) that USF & G admitted coverage in response to a request for admission. But as the court of appeals correctly recognized, the carrier appeared in two different capacities, and a request sent to it in one capacity cannot be used against it in another.23
The plaintiffs requested that USF & G admit Goudeau was covered under the underinsured motorist policy. But they did not send the request to the lawyer representing USF & G on that policy; they sent it instead to the lawyer representing USF & G as intervenor under the worker‘s compensation policy. In the latter capacity, USF & G stood “in the shoes of the insured,” asserting only claims that belonged to Goudeau.24 By contrast, USF & G in its capacity defending the underinsured policy stood in the shoes of the underinsured motorist.25 The plaintiffs already knew that intervenor USF & G asserted coverage and that defendant USF & G denied it, as that is what each of their pleadings said.
Any admission made by a party under this rule may be used solely in the pending action and not in any other proceeding. A matter admitted under this rule is conclusively established as to the party making the admission unless the court permits the party to withdraw or amend the admission.26
The question here is how that rule applies when a party appears in two different capacities.
Although requests for admissions have been in use for more than 60 years, there appears to be only a single case directly answering this question. In Krasa v. Derrico, decided five years after requests for admission were first adopted,27 the plaintiffs sent requests for admission to Mabel Krasa, which she failed to answer. The Fourth Court of Appeals held the deemed requests could support judgment against Krasa individually, but not against her as executor of her husband‘s estate, as the requests were not directed to her in that capacity.28
We think Krasa is correct. We have repeatedly held in other contexts that a party appears only in the capacity in which it is named. Thus:
- a suit against a government official in an official capacity is not a suit against the official individually;29
a suit against a partnership is not binding on a partner who was served but not named in his individual capacity;30 - a suit is binding against a parent and a minor for whom they appear as next friend only if the parent was named in both capacities;31 and
- a judgment cannot be entered against a trust when the trustee appeared solely in her individual capacity.32
Similarly, while a compulsory counterclaim must be brought against an “opposing party,”33 the latter term does not include claims against the same party acting in a different capacity.34
We think this rule must be applied to an insurer who stands in different “shoes.” Insurers issue many policies to people with many conflicting interests. A carrier may represent both parties in an auto accident, stand as both primary and excess insurer,35 or defend an insured while at the same time denying coverage.36 As a result, carriers must sometimes assert conflicting positions through different counsel. If they can be bound by an admission in one capacity that was sent to them in another, they can be made to forfeit every case regardless of the merits.
We agree of course with the dissent that no person may sue himself. But if that rule applies here, USF & G‘s intervention should be dismissed; deeming its admission binding on defendant USF & G has exactly the opposite result. Certainly Goudeau has never raised such an objection. Even if he had, Texas law requires that the first money recovered in this suit go to USF & G as his compensation carrier.37 Texas law also requires USF & G to provide underinsured coverage,38 and pay Goudeau if he proves his case. Which of these statutes should USF & G have ignored to meet the dissent‘s hypothetical objection?
It is true that USF & G may have had other ways to avoid this situation. Perhaps it could have intervened in Goudeau‘s name,39 thus removing any confusion about who was admitting what. Perhaps it could have brought its subrogation suit separately, in which case its responses in one suit could not be used against it in the other.40 Or perhaps it could have qualified its response,41 denying UM coverage
Requests for admission are a tool, not a trapdoor.43 Goudeau‘s attorneys knew perfectly well that defendant USF & G was denying underinsured coverage. Accordingly, they are not entitled to use a response against it when they sent it to the law firm representing it in a different capacity.
IV. The Evidentiary Objection
Goudeau also objected to the summary judgment on the ground that USF & G‘s evidence was not authenticated. The trial court overruled the objection, and the court of appeals did not reach the issue.44
Contrary to Goudeau‘s objection, the underinsured policy (which showed the policy language) was authenticated by a USF & G records custodian.45 Similarly, the accident report from the Department of Public Safety (which showed the relative positions of Goudeau and the cars at the time of the accident) was authenticated by its records custodian.46 As these documents provide all that is necessary to decide the policy construction issue here, the trial court did not err in overruling Goudeau‘s objections.
V. The Conclusion
Accordingly, we reverse that part of the court of appeals’ judgment concerning Goudeau‘s underinsured motorist claim, and render judgment that he take nothing on that claim.
Justice GREEN filed a dissenting opinion in which Chief Justice JEFFERSON and Justice JOHNSON joined.
Justice GREEN, joined by Chief Justice JEFFERSON and Justice JOHNSON, dissenting.
Because I would not reach the issue of whether Louis Goudeau was occupying the vehicle when the accident occurred, I dissent. In the trial court, the insurer admitted to the claimant that he was insured under the policy. That admission binds the insurer even in an unusual case like this where the insurer made the admission while purporting to act not as defendant, but as intervenor. Because such an admission relieves the claimant‘s burden of proving insured status, and prevents the insurer from arguing otherwise, I would hold that the insurer‘s motion for summary judgment should have been denied.
I
United States Fidelity and Guaranty Company (USF & G) provided Advantage Motor, Inc.‘s commercial auto insurance policy, which included underinsured motorist coverage for Advantage‘s automobiles and persons “occupying a covered auto,” and also served as Advantage‘s workers’ compensation insurer, which paid Goudeau more than $100,000 under the workers’ compensation policy‘s indemnity provisions. After Goudeau and his wife filed lawsuits against Alex Rodriguez and USF & G, USF & G answered and denied that Goudeau was an insured under the auto policy. Then, through separate counsel,
The Goudeaus appealed, arguing that defendant USF & G‘s summary judgment evidence failed to prove that Goudeau was not “occupying” the covered vehicle, that defendant USF & G failed to properly authenticate its summary judgment evidence, and that intervenor USF & G‘s responses to the requests for admission defeated defendant USF & G‘s motion. Defendant USF & G reurged its insured-status argument, as well as the policy exclusion argument. With respect to Louis Goudeau, the court of appeals reversed, concluding that, “[v]iewing the evidence in the light most favorable to Louis, USF & G-Defendant did not establish conclusively that Louis was not occupying a covered vehicle.” 243 S.W.3d at 9-10.2
II
The operation of the relatively simple admissions rule is complicated by the fact that USF & G was named as both the
No person may sue himself. United States v. Interstate Commerce Comm‘n, 337 U.S. 426, 430, 69 S.Ct. 1410, 93 L.Ed. 1451 (1949).
There is much argument with citation of many cases to establish the long-recognized general principle that no person may sue himself. Properly understood the general principle is sound, for courts only adjudicate justiciable controversies. They do not engage in the academic pastime of rendering judgments in favor of persons against themselves.
Id. This rule stems from the well-established standing requirement of concrete adversity. See United States v. Nixon, 418 U.S. 683, 692-97, 94 S.Ct. 3090, 41 L.Ed.2d 1039 (1974); United States v. Fed. Mar. Comm‘n, 694 F.2d 793, 810 (D.C.Cir.1982).5 As a result, “courts must look behind names that symbolize the parties to determine whether a justiciable case or controversy is presented.” Interstate Commerce Comm‘n, 337 U.S. at 430; accord United States v. Providence Journal Co., 485 U.S. 693, 708 n. 11, 108 S.Ct. 1502, 99 L.Ed.2d 785 (1988); Nixon, 418 U.S. at 693. Although our admissions rule speaks in terms of each “party,” see
For the same reason that courts must “look behind names” to establish justiciability, Interstate Commerce Comm‘n, 337 U.S. at 430; accord Providence Journal Co., 485 U.S. at 708 n. 11; Nixon, 418 U.S. at 693, the trial court here should have looked behind the party designations of “defendant” and “intervenor” when it applied the admissions rule. We have consistently applied our rules of procedure to
The record here reflects just such a case. The pleadings of both the intervenor and the defendant are consistently attributed to USF & G, and there is no indication of any real separation between the USF & G that administers the auto policy and the USF & G that administers the workers’ compensation policy. Although, as the Court points out, insurers may stand in different shoes or act in different capacities, there is no indication that USF & G in this case is anything but a single entity with the power to sue and be sued only in the name of USF & G. USF & G never made any attempt to distinguish the identity or capacity of USF & G as defendant from USF & G as intervenor, even after the Goudeaus specifically argued that the defendant and intervenor are the same company and that the
admissions of one bind the other. As a result, the only conclusion to be had is that behind this intervenor and defendant lies only one person with one interest: USF & G.6 Whatever dispute there is between these two USF & G factions lies entirely within USF & G, and is not deserving of individualized adjudication in our courts. The principles of fairness inherent in our rules would not be promoted by allowing USF & G to litigate on summary judgment a question that it had unequivocally admitted eleven months earlier, albeit under a different fictional label. Thus, the admission extracted by the Goudeaus should bind USF & G as both intervenor and defendant. Having admitted that Goudeau was insured under the auto policy, I would affirm the judgment of the court of appeals and hold that USF & G could not succeed on its motion for summary judgment. See Marshall, 767 S.W.2d at 700; Mendoza, 606 S.W.2d at 694; Carr, 242 S.W.2d at 228-29.
III
Because USF & G is bound by its admission of Louis Goudeau‘s insured status, I would not reach the issue of whether Goudeau was “occupying” the vehicle within the meaning of the USF & G policy. I therefore dissent from the Court‘s judgment.