Mary Reaney-Gates, Wife of/and Mark Gates, Carla P. Bubacz, Wife of/and Rex Bubacz v. Teodoro Rivera Mendoza, Icm Insurance Company, and the Hanover American Insurance Company

• Court: Louisiana Court of Appeal
• Decided: February 3, 2021
• Docket: 2020-CA-0298
• Status: Published

Opinion

MARY REANEY-GATES, * NO. 2020-CA-0298 WIFE OF/AND MARK GATES, CARLA P. BUBACZ, WIFE * OF/AND REX BUBACZ COURT OF APPEAL * VERSUS FOURTH CIRCUIT * TEODORO RIVERA STATE OF LOUISIANA MENDOZA, ICM INSURANCE ******* COMPANY, AND THE HANOVER AMERICAN INSURANCE COMPANY

APPEAL FROM CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2011-10095, DIVISION “F” Honorable Christopher J. Bruno, Judge ****** JUDGE SANDRA CABRINA JENKINS ****** (Court composed of Chief Judge James F. McKay, III, Judge Daniel L. Dysart, Judge Sandra Cabrina Jenkins)

John H. Hughes ALLEN & GOOCH, A Law Corporation 2000 Kaliste Saleem Rd, Suite 400 P. O. Box 81129 Lafayette, LA 70598-1129

Jason A. Camelford LAW OFFICES OF ROBERT D. FORD 111 Veterans Blvd., Suite 1670 Metairie, LA 70005

COUNSEL FOR PLAINTIFF/APPELLEE

Kevin O'Bryon Janell McFarland-Forges O'BRYON & SCHNABEL, APLC 935 Gravier Street, Suite 900 New Orleans, LA 70112

COUNSEL FOR DEFENDANT/APPELLANT

REVERSED FEBUARY 3, 2021 SCJ

JFM

DLD

This is an insurance coverage dispute arising from a 2010 automobile

accident. Defendant/appellant Government Employees Insurance Company

(“GEICO”) appeals the trial court’s March 9, 2019 judgment granting summary

judgment in favor of defendant/appellee Hanover American Insurance Company

(“Hanover”), and denying GEICO’s motion for summary judgment. For the

reasons that follow, we reverse the trial court’s judgment and dismiss Hanover’s

claims against GEICO, with prejudice.

FACTUAL AND PROCEDURAL BACKGROUND

On July 2, 2010, GEICO issued a renewal auto insurance policy 0182-71-06-

08 to Mark F. Gates (“Mr. Gates”) and Mary Reaney-Gates (“Mrs. Gates”)

(collectively, the “Gates”), effective May 3, 2010 to November 3, 2010.

Previously, on September 30, 1998, Mr. Gates, the named insured, had executed a

UM rejection form. Mr. Gates had renewed the GEICO policy multiple times,

dating back before 1998. Each of the renewals provided $300,000 per person/per

accident limits for bodily injury liability, and rejected UM coverage. When the

GEICO renewal policy was issued in 2010, all that was required to validly reject

UM coverage was for the named insured to have rejected the coverage on a

1 commissioner-prescribed form in connection with a predecessor policy, as long as

the policy limits had not changed in the interim.1

In 2011, the Gates filed suit against the alleged at-fault driver, Teodoro

Rivera Mendoza (“Mendoza”), and his liability insurer ICM Insurance Company

(“ICM”); and Hanover, the UM insurer of Carla P. Bubacz, who was Mrs. Gates’

guest passenger. Years later, Hanover asserted that the GEICO liability policy

covering the Gates’ vehicle provided UM coverage that primed Hanover’s

coverage. In 2015, the Gates amended their petition to add a claim against

GEICO, which allegedly provided UM coverage to the Gates. When Mendoza’s

liability insurer, ICM, became insolvent, it was replaced by the Texas Property and

Casualty Insurance Guaranty Association (“Texas Property”).

In 2019, GEICO and Hanover filed cross motions for summary judgment

regarding the existence of UM coverage. Texas Property joined in Hanover’s

motion for summary judgment and opposed GEICO’s motion for summary

judgment. After a hearing on the cross-motions, the trial court signed a March 9,

2020 judgment granting Hanover’s motion for summary judgment and denying

GEICO’s motion for summary judgment. In the judgment, the trial court reformed

the automobile policy issued by GEICO to provide the plaintiffs with uninsured

motorist (“UM”) bodily injury coverage in an amount equal to the limits of liability

for bodily injury arising from the September 27, 2010 auto accident. The trial

court further decreed that the GEICO insurance policy provided the primary layer

1 See La. R.S. 22:1295(1)(a)(ii): “Such rejection, selection of lower limits, or selection of economic-only coverage shall be made on a form prescribed by the commissioner of insurance . . . Any changes to an existing policy, regardless of whether these changes create new coverage, except changes in the limits of liability, do not create a new policy and do not require the completion of new uninsured motorist selection forms.”

2 of uninsured motorist coverage in connection with the plaintiffs’ claims. GEICO

appealed the judgment.

DISCUSSION

Standard of Review

We apply a de novo standard of review in examining a trial court’s ruling on

summary judgment. Carrero v. Mandina’s, 19-0158, p. 2 (La. App. 4 Cir. 8/7/19,

-- So.3d --, 2019 WL 3719552, *3, writ denied, 19-01554 (La. 11/25/19).

Accordingly, we use the same criteria that govern a trial court’s consideration of

whether summary judgment is appropriate. Id.

“[A] motion for summary judgment shall be granted if the motion,

memorandum, and supporting documents show that there is no genuine issue as to

material fact and that the mover is entitled to judgment as a matter of law.” La.

C.C.P. art. 966(A)(3).

Burden of Proof

La. C.C.P. art. 966(D)(1) governs the mover’s burden on a motion for

summary judgment:

The burden of proof rests with the mover. Nevertheless, if the mover will not bear the burden of proof at trial on the issue that is before the court on the motion for summary judgment, the mover's burden on the motion does not require him to negate all essential elements of the adverse party's claim, action, or defense, but rather to point out to the court the absence of factual support for one or more elements essential to the adverse party's claim, action, or defense. The burden is on the adverse party to produce factual support sufficient to establish the existence of a genuine issue of material fact or that the mover is not entitled to judgment as a matter of law.

In GEICO’s motion for summary judgment, it concedes that it issued a

policy to the Gates that was in full force and effect on September 27, 2010.

GEICO contends that the policy was continuously renewed through 2010 without

3 any changes to the bodily injury limits. According to GEICO, the policy was

issued with UM coverage rejected on all renewals beginning on or after November

30, 1998 based on the UM rejection form executed by Mr. Gates on September 30,

1998. GEICO contends that the law in effect at the time of the accident was La.

R.S. 22:1406(D)(1)(a)(ii)2, which provided that a UM waiver form is only required

when the named insured changes the limits of liability, and that there had been no

such change. GEICO argues that because there had not been a change in the limits

of liability, the UM waiver signed by Mr. Gates was valid on September 27, 2010.

It follows, GEICO avers, that the Gates had no UM coverage under the GEICO

policy at the time of the accident.

Texas Property argues that the rejection of uninsured motorist coverage in

September 1998 did not remain valid after the UM laws were later amended.

Texas Property contends that the amendment to La. R.S. 22:1406(D)(1)(a)(ii),

effective August 15, 1999, which was repealed in 2003, provided that any waiver

form executed before the effective date of the amendment would be valid only

until the policy’s renewal date. The statute provided that new rejection forms must

be executed after its effective date of August 15, 1999. Thus, all otherwise valid

UM rejection forms would be valid only until the first policy renewal following the

effective date of Act 732, and then new UM rejection forms were required to be

executed. See Stewart v. Hare, 42,972, p. 4 (La. App. 2 Cir. 2/20/08), 976 So.2d

856, 858. According to Texas Property, because Mr. Gates did not sign a new

waiver of the renewal on November 3, 1999, the Gates had UM coverage to the

2 The original UM statute was originally numbered La. R.S. 22:1406(D). It was redesignated as La. R.S. 22:680 by 2003 La. Acts No. 456, § 3. It has since been renumbered to its present iteration, La. R.S. 22:1295, by 2008 La. Acts No. 415, § 1, eff. Jan. 1, 2009. Barras v. Cardinal Servs., LLC, 19-530, p. 9 n.2 (La. App. 3 Cir. 4/1/20), 297 So.3d 877, 883.

4 limits of liability of their policy at every renewal thereafter, and were provided UM

coverage at the time of the automobile accident on September 27, 2010.

Likewise, Hanover contends that the legislature required, in its 1999

amendment, that all policy holders execute a new valid UM rejection upon renewal

of their policies. Hanover asserts that GEICO had no valid UM rejection attached

to the policy in effect when the accident occurred in September 2010. In essence,

Hanover argues that Mr. Gates’ 1998 rejection of UM coverage was invalidated by

the 1999 law, and that once invalid, it remained invalid even though the legislature

repealed the 1999 law in 2003. Hanover cites no legal authority for its “once

invalid, always invalid” contention.

We reject Hanover’s contention that once an initially valid UM rejection

became invalid due to a change in the law, it was forever invalid even though the

law was changed to restore the validity of the rejection.

Based on our de novo review of the facts and the law, we conclude that

under the law in effect at the time of the accident, all that was required to validly

reject UM coverage was for the named insured to have rejected the coverage on a

commissioner-prescribed form in connection with a predecessor policy, as long as

the limits of liability had not changed in the interim. Mr. Gates had no UM

coverage from GEICO in 2010 because he executed a rejection of UM coverage

form in 1998, and the GEICO policy was continuously renewed thereafter without

a change in the limits of bodily injury.

In an alternative argument, Hanover contends that the 1999 listing of the

Gates’ teenage daughter as a driver on the GEICO policy constituted a change that

created a “new” policy, which required a “new” UM rejection form. We disagree.

The GEICO policy defines “insured” to include resident relatives of the named

5 insured. In Daigle v. Allstate Ins. Co., 96-1352 (La. App. 4 Cir. 3/5/97), 690 So.2d

261, this Court found that the addition of an insured person under the original

policy was not a significant enough change to convert the renewal policy into a

new policy because the insured person had already been insured under the policy

as a passenger. Here, because the Gates’ teenage daughter was already a resident

relative who had insured status under the GEICO policy, listing her as an

additional driver on the Policy did not expand the policy’s coverage. As stated in

Daigle:

Although the addition of another insured person to a policy can constitute a truly material change, Edgar Daigle, III was already an insured person under the original policy. The alteration of his status, from an insured passenger to a driver is not significant enough to convert the renewal policy into a new policy.

Id., 96-1352, p. 3, 690 So.2d at 262-63.

This alternative argument has no merit.

Accordingly, we find that the trial court erred when it granted Hanover’s

motion for summary judgment, reformed the GEICO policy to provide UM

coverage for the Gates’ September 2010 automobile accident, and declared that the

GEICO policy provided the primary layer of uninsured motorist coverage. The

trial court also erred when it denied GEICO’s motion for summary judgment.

CONCLUSION

No UM coverage was in effect under the Gates’ GEICO policy on

September 27, 2010, the date of the accident. The UM waiver executed by Mr.

Gates in 1998 was still valid on that date. Further, the alteration of the Gates’

daughter’s status from an insured passenger to a driver does not create a “new”

policy that requires a new UM waiver form. Accordingly, we reverse the judgment

granting Hanover’s motion for summary judgment, and we reverse the judgment

6 denying GEICO’s motion for summary judgment. Hanover’s claims against

GEICO are dismissed with prejudice.

REVERSED