Injury Leaving Porta-Potty not Covered by CGL for Failure of Condition

Mitchell Baudoin sued seeking recovery for personal injuries received in a construction site accident. The trial court granted a motion for summary judgment filed by defendant, Accident Insurance Company (“AIC”), and dismissed plaintiff’s claims as to it. In Mitchell Baudoin v. American Glass And Mirror Works, Inc., et al. No. 20-541, Court of Appeals of Louisiana, Third Circuit (February 2, 2022) the Court of Appeals resolved the coverage issue.

FACTS

Charles Goudeau d/b/a Charles Goudeau General Contractor (“Goudeau”) was the general contractor for a new construction project in Breaux Bridge, Louisiana. On March 6, 2017, plaintiff was installing flooring at the aforementioned construction site for Southern Tile Company, Inc. (“Southern Tile”) and was injured when he was struck by a vehicle being operated by Chad Fritz (“Fritz”) after exiting a portable restroom.

Plaintiff sued Goudeau and his insurer, AIC, among others, for personal injuries. AIC issued a commercial general liability policy (“CGL policy”) to Goudeau.

Plaintiff’s petition, in relevant part, alleged that plaintiff’s accident and attendant injuries were caused by the negligence of Goudeau.

AIC sought summary judgment alleging a lack of coverage on the basis that an endorsement within the CGL policy issued to Goudeau barred coverage for plaintiff’s claims. AIC contended there is no coverage for plaintiff’s claims because Goudeau failed to comply with conditions set forth in its Endorsement Form 3007, entitled “Contractors Special Conditions” (“Contractors Special Conditions endorsement”), which required a written indemnity agreement from the independent contractor holding the insured harmless and obtained certificates of insurance from the independent contractor indicating that the insured is named as an additional insured and that coverage is maintained with minimum limits of $500,000 per occurrence.

AIC asserted that prior to commencement of any work on the premises, its Contractors Special Conditions endorsement required Goudeau to adhere to the terms of the endorsement and obtain the requisite documents from subcontractors he obtained for the job as a condition of coverage for any claim for damage based, in whole or in part, upon work performed by independent contractors. Goudeau had not obtained any of the requisite documents and had not provided any evidence of certificate of liability insurance naming Goudeau as an additional insured from the subcontractors, which includes Southern Tile and American Glass.

At the conclusion of the hearing, the trial court accepted AIC’s contention the Contractors Special Conditions endorsement barred coverage for plaintiff’s claims against Goudeau.

LAW AND DISCUSSION

The conditions precedent to coverage requiring Goudeau to obtain particular indemnity agreements from subcontractors performing work on the construction project, as well as to obtain status as an additional insured under those subcontractors’ insurance policies.

The initial burden to establish that a claim falls within the policy coverage is on the plaintiff. If the wording of the policy is clear and expresses the parties’ intent, the policy must be enforced as written. This rule is applicable even to policy provisions that limit the insurer’s liability or place restrictions on policy obligations.. As the conditions for coverage under the liability policy clearly were not met, the trial court did not err in granting summary judgment in favor of the liability insurer.

The trial court did not err in granting AIC’s motion for summary judgment and dismissing plaintiff’s claims against it.

ZALMA OPINION

Louisiana is an interesting jurisdiction that allows a plaintiff to sue the insurer of the defendant in addition to the defendant. In this case the insurer had a mandatory condition requiring all subcontractors to obtain an indemnity agreement that names the insured as an additional insured and obtain evidence that the insurance existed.  The insured admitted his contracts with the subcontractors were oral and the conditions were not met. By so doing the insured lost the right to indemnity or defense costs from AIC.

© 2022 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders.

He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business.

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