USCA11 Case: 22-10358 Document: 39-1 Date Filed: 01/31/2023 Page: 1 of 17
[DO NOT PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 22-10358
Non-Argument Calendar
____________________
FRANKENMUTH MUTUAL INSURANCE COMPANY,
Plaintiff-Appellant,
versus
BROWN'S CLEARING, INC.,
COURTNEY FORD,
BREON FORD,
Defendants-Appellees.
____________________
Appeal from the United States District Court
for the Middle District of Alabama
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2 Opinion of the Court 22-10358
D.C. Docket No. 2:20-cv-00576-ECM-JTA
____________________
Before WILSON, LUCK, and LAGOA, Circuit Judges.
LAGOA, Circuit Judge:
This is a duty to defend insurance dispute brought by the
insurer, Frankenmuth Mutual Insurance Company (“Franken-
muth”), seeking to reverse the district court’s determination that
its insured, Brown’s Clearing, Inc. (“Brown’s Clearing”), is entitled
to coverage under its policy. Frankenmuth, a Michigan corpora-
tion, appeals the district court’s order granting summary judgment
in favor of Brown’s Clearing, Courtney Ford, and Breon Ford (col-
lectively, “Appellees”). For the reasons discussed below, we affirm
the district court’s judgment.
I. FACTUAL AND PROCEDURAL HISTORY
A. The Insurance Policy
Brown’s Clearing is a land-clearing business incorporated in
Alabama and registered to do business in Georgia. Kelley Brown
and Steve Brown, a married couple, own Brown’s Clearing. Frank-
enmuth is an insurance company licensed to issue insurance poli-
cies in Alabama. On March 14, 2017, Frankenmuth issued a Com-
mercial General Liability policy to Brown’s Clearing, effective from
March 13, 2017, through March 13, 2018 (the “Policy”). On Febru-
ary 6, 2018, Frankenmuth and Brown’s Clearing renewed the Pol-
icy for another year, from March 13, 2018, through March 13, 2019.
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22-10358 Opinion of the Court 3
The Policy provided general liability coverage and additional um-
brella coverage. Pursuant to Section I of the Policy, Frankenmuth
agreed to “pay those sums that the insured becomes legally obli-
gated to pay as damages because of ‘bodily injury’ or ‘property
damage’ to which this insurance applies.” Section I also provides
that Frankenmuth has the “right and duty to defend the insured
against any ‘suit’ seeking those damages.” Further explaining those
conditions, Section IV of the Policy provides:
Section IV – Commercial General Liability Condi-
tions
2. Duties in The Event of Occurrence, Offense, Claim
Or Suit
a. You must see to it that we are notified as soon
as practicable of an “occurrence” or an offense
which may result in a claim. To the extent possi-
ble, notice should include:
(1) How, when and where the “occurrence” or
offense took place;
(2) The names and addresses of any injured
persons and witnesses; and
(3) The nature and location of any injury or
damage arising out of the “occurrence” or of-
fense.
b. If a claim is made or “suit” is brought against
any insured, you must:
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4 Opinion of the Court 22-10358
(1) Immediately record the specifics of the
claim or “suit” and the date received; and
(2) Notify us as soon as practicable.
You must see to it that we receive written no-
tice of the claim or “suit” as soon as practicable.
c. You and any other involved insured must:
(1) Immediately send us copies of any de-
mands, notices, summonses or legal papers re-
ceived in connection with the claim or “suit”;
....
The Commercial Liability Plus endorsement modifies the terms of
the Policy and provides as follows:
4. Duties in the Event of Occurrence, Claim or Suit
a. The requirement in condition 2.a. that you
must see to it that we receive notice of an “occur-
rence” applies only when an “occurrence” is
known to:
(1) You, if you are an individual;
(2) A partner, if you are a partnership; or
(3) An executive officer or insurance manager
if you are a corporation.
b. The requirement in condition 2.b. that you
must see to it that we receive notice of a claim or
“suit” will not be considered breached unless the
breach occurs after such claim or “suit” is known
to:
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22-10358 Opinion of the Court 5
(1) You, if you are an individual;
(2) A partner, if you are a partnership; or
(3) An executive officer or insurance manager,
if you are a corporation.
Similarly, the Commercial Liability Umbrella Coverage states that
Frankenmuth “will pay on behalf of the insured the ‘ultimate net
loss’ in excess of the ‘retained limit’ because of ‘bodily injury’ or
‘property damage’ to which this insurance applies.” Pursuant to
Section IV of the Umbrella Coverage, the insured must notify
Frankenmuth of occurrences that may result in a claim and of suits
brought against the insured “as soon as practicable.” The Umbrella
Coverage also states that:
c. You and any other involved insured must:
(1) Immediately send us copies of any demands,
notices, summonses or legal papers received in
connection with the claim or “suit”;
(2) Authorize us to obtain records and other infor-
mation;
(3) Cooperate with us in the investigation or set-
tlement of the claim or defense against the “suit”;
and
(4) Assist us, upon our request, in the enforcement
of any right against any person or organization
which may be liable to the insured because of in-
jury or damage to which this insurance may also
apply.
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6 Opinion of the Court 22-10358
The Commercial General Liability contains the same language.
The Policy defines “occurrence” as “an accident.” The Pol-
icy also defines “executive officer” as “a person holding any of the
officer positions created by your charter, constitution, by-laws or
any other similar governing document.”
B. The Underlying Action and Coverage Dispute
On July 20, 2018, Courtney Ford was travelling on Interstate
75 in Bartow County, Georgia. While she was driving her car,
workers were cutting trees along the side of the interstate. Sud-
denly, a tree limb struck the windshield of Courtney’s car and
pierced the vehicle, resulting in injuries. Brown’s Clearing did not
have employees cutting trees on Interstate 75, but it had hired S&S
Diesel as a subcontractor to perform those services. No one from
S&S Diesel ever told anyone from Brown’s Clearing about that ac-
cident.
Then, on January 24, 2019, Courtney and Breon Ford (“the
Fords”) sued Gunnison Tree Specialists, Inc. (“Gunnison”), and
Georgia Power in the State Court of Cobb County, Georgia, alleg-
ing that the companies’ negligence caused the tree limb to hit
Courtney’s car, resulting in injuries. The Fords sought compensa-
tory, special, and punitive damages, along with a claim brought by
Breon Ford for loss of consortium.
On February 11, 2019, during the discovery phase of the
Ford lawsuit, Andrew Horowitz, an attorney representing Gun-
nison and Georgia Power, emailed Kelley Brown about a “request
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22-10358 Opinion of the Court 7
for documents.” After Brown asked for an explanation, Horowitz
responded on February 12, 2019:
I’m defending Georgia Power and Gunnison Tree in
a suit filed by a motorist who claims that she was in-
jured on 7/20/18. I understand that Brown’s Clear-
ing had a tree crew alongside I-75 North that day, do-
ing work for GDOT around Mile Marker 294. I
wanted to give someone at Brown’s Clearing a heads-
up that I was about to serve a records request on your
company’s GA registered agent. The request gener-
ally seeks docs relating to Brown’s Clearing’s work in
that area between 7/18 and 7/20/18. When we serve
the request, I’d be happy to send you a copy. My con-
tact info is below, so feel free to call anytime if you or
another Brown’s Clearing rep wants to talk.
On February 15, 2019, Brown’s Clearing provided the requested
information, showing where their equipment was located along In-
terstate 75 on the day of the accident. Kelley Brown testified that
she “thought they wanted a witness or something, and so [she] just
sent him the log.”
On May 10, 2019, the Fords filed an amended complaint in
the underlying state court action against Gunnison and Georgia
Power that added Brown’s Clearing as a defendant. On May 16,
2019, a process server tried to serve Brown’s Clearing’s authorized
agent of process, Registered Agents, Inc. (“Registered Agents”),
with summons, the amended complaint, interrogatories, and a re-
quest for production. Registered Agents then emailed Kelley
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8 Opinion of the Court 22-10358
Brown at her email address on file with Registered Agents, notify-
ing her of a delivered service of process document and a prompt to
log into the computer system and review the document. The next
day, because the documents had not been reviewed, Registered
Agents sent another email stating that the “document we uploaded
on your company’s behalf could be really important and we want
to make sure you see it.” Two days later, another email was sent
stating the same. On May 21, 2019, Registered Agents sent another
email, stating:
It’s been 5 days and unfortunately, you haven’t
logged into your account to look at it. We’re email-
ing it to you as a PDF attached to this email. We’d
prefer you login to your online account because we
believe that’s a more secure way to deliver docu-
ments, but maybe you don’t want to do that and we
don’t want to slow you down. So here it is.
Finally, Registered Agents mailed a physical letter to Brown’s
Clearing requesting that someone open the account and view the
documents.
Brown’s Clearing was never served by hand or by mail with
a copy of the amended complaint. In 2019, Kelley Brown, who
served as a kind of office manager for the business, did not know
what the phrase “service of process” meant. She did not open any
of the four computer generated emails because she thought they
looked like all previous emails she received from that account,
which were all invoice and billing related emails. Brown had re-
ceived over one hundred other emails from the Registered Agent
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22-10358 Opinion of the Court 9
account between 2017 and 2020, almost all of which were invoices.
Brown’s Clearing and Steve and Kelley Brown had never been sued
before either as a business or personally.
Unsurprisingly, Brown’s Clearing did not respond to the
state court amended complaint, and the Fords filed a motion for
entry of default judgment in the underlying action on July 19, 2019.
That same day, Horowitz emailed Kelley Brown notifying her of
the motion for default judgment and suggesting that she contact
Brown’s Clearing’s liability carrier to let them know of the lawsuit.
Kelley Brown stated that this email from Horowitz was the first
time she had ever heard of the lawsuit. The Georgia state court
denied the Fords’ motion for default judgment, finding that service
was “without effect” because the process server was not properly
appointed. Several days after she received the email from Horo-
witz, Kelley Brown reported a claim online to Frankenmuth re-
garding the underlying action. Randy Eichhorn, a claim senior lit-
igation examiner with Frankenmuth, stated that Kelley Brown re-
ported a claim to Frankenmuth on July 26, 2019.
On August 7, 2020, Frankenmuth filed a complaint for de-
claratory judgment against Brown’s Clearing, seeking a judicial de-
termination about whether Frankenmuth had a duty to defend and
indemnify Brown’s Clearing in the underlying litigation before the
Georgia state court. On September 20, 2020, the Fords filed a mo-
tion for joinder as an indispensable party, which the district court
granted. The parties subsequently cross-moved for summary judg-
ment. Brown’s Clearing and the Fords argued: (1) that Brown’s
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10 Opinion of the Court 22-10358
Clearing did not know about the underlying lawsuit until July 19,
2019, notified Frankenmuth about the action as soon as practicable,
and is therefore entitled to coverage under the Policy; and (2) that
economic losses are covered under the Policy. Frankenmuth ar-
gued: (1) that Brown’s Clearing knew about the accident in Febru-
ary 2019 and the underlying action in May 2019; (2) that Brown’s
Clearing failed to notify Frankenmuth “as soon as practicable” pur-
suant to the Policy; and (3) that Brown’s Clearing failed to give
Frankenmuth “written notice” as it failed to forward the summons
and legal papers.
On January 4, 2022, the district court granted summary judg-
ment in favor of Brown’s Clearing and the Fords, agreeing with the
position of Brown’s Clearing. In reaching that conclusion, the
court interpreted the word “known” in the Policy’s notice require-
ments to require a Brown’s Clearing executive officer to have ac-
tual knowledge of the occurrence, claim, or suit. The court ex-
plained that “[v]iewing the evidence in the light most favorable to
Frankenmuth and drawing all reasonable inferences in its favor,”
no reasonable jury could conclude that the e-mail.
exchange with Horowitz or a certificate of liability insurance as to
the subcontractor demonstrated that Brown’s Clearing had actual
knowledge of the accident in February 2019. The court also found
that Brown’s Clearing provided written notice of the claim and did
so “as soon as practicable.”
Frankenmuth timely appealed.
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22-10358 Opinion of the Court 11
II. STANDARD OF REVIEW
We review de novo the resolution of cross-motions for sum-
mary judgment. Am. Bankers Ins. Grp. v. United States,
408 F.3d
1328, 1331 (11th Cir. 2005). In doing so, we apply the same stand-
ards used by the district court, assessing the evidence and all rea-
sonable inferences in the light most favorable to the non-moving
party. Ramji v. Hosp. Housekeeping Sys. LLC,
992 F.3d 1233, 1241
(11th Cir. 2021).
III. ANALYSIS
On appeal, Frankenmuth argues that Brown’s Clearing is
not entitled to coverage under the Policy based on its breach of
duties after loss, particularly because Brown’s Clearing failed to no-
tify Frankenmuth of the underlying action in a timely fashion. Ap-
pellees argue that the district court was correct in ruling that Frank-
enmuth owed a duty to defend and indemnity because Brown’s
Clearing did not have knowledge of the underlying action until July
19, 2019, after which notice was given to Frankenmuth soon
enough after to comply with the terms of the Policy.
Under the Commercial General Liability Conditions section
of the Policy, Brown’s Clearing was required to “[s]ee to it that
[Frankenmuth] is notified as soon as practicable of an ‘occurrence’
. . . which may result in a claim.” Similarly, the Policy requires
Brown’s Clearing to “[n]otify [Frankenmuth] as soon as practica-
ble” if a “claim or ‘suit’ is brought against any insured.” Those con-
ditions are breached only if Brown’s Clearing failed to provide such
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12 Opinion of the Court 22-10358
notice when “an ‘occurrence’ is known to . . . [a]n executive of-
ficer,” or when a “claim or ‘suit’ is known to . . . [a]n executive
officer.” (Emphasis added). The parties primarily dispute the
meaning of the word “known.” Before determining whether
Brown’s Clearing complied with the obligations under the Policy,
we must first resolve that dispute.
Construction of an insurance contract is a question of law
we review de novo. Tech. Coating Applicators, Inc. v. U.S. Fid. &
Guar. Co.,
157 F.3d 843, 844 (11th Cir. 1998). The construction of
insurance contracts is governed by substantive state law. Dempsey
v. Auto Owners Ins. Co.,
717 F.2d 556, 559 (11th Cir. 1983); see also
Tech. Coating, 157 F.3d at 844–45. In this case, the parties have
agreed that Alabama substantive law applies. Insurance policies are
contracts, and like other contracts, they are “governed by the gen-
eral rules of contracts.” Twin City Fire Ins. Co. v. Alfa Mut. Ins.
Co.,
817 So. 2d 687, 691 (Ala. 2001). We must construe the policy
to give effect to the intention of the parties.
Id. Under Alabama
law, “[i]f a word or phrase is not defined in [an insurance] policy,
then the court should construe the word or phrase according to the
meaning a person of ordinary intelligence would reasonably give
it.” Travelers Cas. & Sur. Co. v. Alabama Gas Corp.,
117 So. 3d
695, 700 (Ala. 2012) (alteration in original) (quoting Safeway Ins.
Co. of Ala., Inc. v. Herrera,
912 So. 2d 1140, 1143 (Ala. 2005)). “The
court should not define words it is construing based on technical
or legal terms.” Safeway Ins. Co.,
912 So. 2d at 1143.
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22-10358 Opinion of the Court 13
In the Policy, the notice requirement is triggered when a suit
is “known” to an executive officer or insurance manager. “Known”
is used as a verb in the past tense of “know”, which is defined as
“[t]o recognize, acknowledge, perceive.” Know, Oxford English
Dictionary (3d ed. 2010); see also Known, Oxford English Diction-
ary (3d ed. 2010) (“That has become an object of knowledge; that
is or has been apprehended mentally; learned; familiar;”). Frank-
enmuth urges us to adopt a Merriam-Webster definition of
“known” to mean “generally recognized”. Such a definition im-
plies not whether information is known to an individual but rather
whether information is widely known among a certain population.
Certainly, the Policy addresses whether an occurrence is specifi-
cally recognized by an individual or partner, not whether it is gen-
erally recognized. Instead, we agree with the district court’s deter-
mination that, to an ordinary person, the word “known” means
“actually known.” If a fact is “known” to a person, it is reasonable
to assume that person has actual knowledge of the fact.
As the district court noted, Frankenmuth and Brown’s
Clearing were free to contract with the phrases “should have
known,” “had reason to know,” or “would be likely to have
known,” but they did not––rather, they chose the term, “known.”
We will not change the language of their agreement now. Addi-
tionally, while we find none, even if there existed a genuine ambi-
guity around the meaning of “known” in this contract, we would
be directed to construe such ambiguity “liberally in respect to per-
sons insured and strictly with respect to the insurer.” Crossett v.
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14 Opinion of the Court 22-10358
St. Lous Fire & Marine Ins. Co.,
269 So. 2d 869, 873 (Ala. 1972). For
purposes of evaluating Brown’s Clearing’s compliance with the
Policy, we will construe “known” to mean that an executive officer
must have had actual knowledge of the occurrence, claim, or suit.
When did an executive officer of Brown’s Clearing have ac-
tual knowledge of the underlying occurrence and action? Appel-
lees contend that no executive officer at Brown’s Clearing had ac-
tual knowledge of the underlying action before July 19, 2019, when
Horowitz emailed Kelley Brown about the motion for default judg-
ment. Frankenmuth argues that Brown’s Clearing knew of the suit
on May 16, 2019, when its authorized agent, Registered Agents,
was served with process. According to Frankenmuth, because Reg-
istered Agents was served with process, Brown’s Clearing “knew”
of the lawsuit at the same time. Instead of wading into questions
of agency law and constructive knowledge, as Frankenmuth sug-
gests, we need only look at the language of the parties’ agreement.
The Policy does not state that a suit being “known” to a registered
agent is imputed to an executive officer. In fact, the Policy explic-
itly states that the notice requirement is triggered “only” when a
suit is “known” to certain individuals––“[a]n executive officer or
insurance manager.” Again, the parties could have added “regis-
tered agent” to that list, but they did not. Given the language of
the Policy and the record, the district court was correct in finding
that the date triggering Brown’s Clearing’s duty to provide notice
to Frankenmuth was July 19, 2019.
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22-10358 Opinion of the Court 15
The next question before us is whether Brown’s Clearing
notified Frankenmuth “as soon as practicable,” as required by the
Policy. Kelley Brown gave notice of the underlying action to
Frankenmuth seven days after learning about the suit, on July 26,
2019. Because Frankenmuth focuses on the reasonableness of the
delay assuming Brown’s Clearing had the obligation to notify start-
ing May 16, 2019, Frankenmuth makes no argument that a seven-
day delay would fail to meet the Policy’s requirements. Thus, the
delay between when Brown’s Clearing triggered the notice re-
quirement and when Brown’s Clearing provided notice did not
constitute breach of duty under the Policy.1
Frankenmuth also argues that Brown’s Clearing violated the
cooperation clauses in the Policy, referring to the provisions
1 Frankenmuth also argues two points that may not have been properly pre-
served for appeal. See Access Now, Inc. v. Southwest Airlines Co.,
385 F.3d
1324, 1331 (11th Cir. 2004) First, Frankenmuth argues for the first time, be-
yond a footnote in its summary judgment briefing, that the mailbox rule ap-
plies to the letter sent by Registered Agents to Brown’s Clearing, implying re-
ceipt. Even applying the mailbox rule, the letter only repeated the language
from the emails and did not contain the actual complaint. So receipt of the
letter would not impute knowledge on Brown’s Clearing any more than the
emails did. Second, Frankenmuth argues for the first time that willful blind-
ness supports a finding of actual knowledge. Aside from arguing that Brown’s
Clearing cannot “wear ‘blinders’” and claim ignorance, nowhere below did
Frankenmuth argue that Brown’s Clearing was engaged in willful blindness so
as to impute actual knowledge. Thus, this argument is not properly before
this Court. Even if it were, the record does not support an inference that Kel-
ley Brown was deliberately ignoring occurrences and claim notices. Rather,
she testified that she thought they were invoices.
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16 Opinion of the Court 22-10358
requiring that the involved insured must “send us copies of any de-
mands, notices, summonses or legal papers received in connection
with the claim or ‘suit.’” Because Brown’s Clearing was provided
a copy of the summons and complaint via email on May 21, 2019,
but did not send it to its insurer, Frankenmuth contends that
Brown’s Clearing breached these provisions and is therefore not
entitled to defense or indemnification. That argument fails. First,
even though the cooperation clauses do not explicitly mention a
knowledge requirement, Frankenmuth’s reading of the contract
would imply a duty to provide information of which Brown’s
Clearing has no actual knowledge. Instead, a more logical under-
standing of the Policy as a whole reads the requirement that the
insured send copies of any demands, notices, summonses or legal
papers as an instruction on cooperation after a notice of an under-
lying occurrence or suit has been sent. Indeed, interpreting the
Policy in a way to find that the parties agreed to require coopera-
tion on a suit of which neither Frankenmuth nor Brown’s Clearing
had any awareness would be a bizarre conclusion. Second, the rec-
ord shows that the summons and complaint were served in a failed
attempt to effect proper service and were thus “without effect.” If
the summons and complaint were not properly received by
Brown’s Clearing, they could not have had a duty to send them to
Frankenmuth.
Frankenmuth’s final argument, made in one paragraph at
the end of its brief, is that Brown’s Clearing violated the Policy’s
mandate that “[y]ou must see to it that we receive written notice
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22-10358 Opinion of the Court 17
of the claim or ‘suit’ as soon as possible.” According to Franken-
muth, Brown’s Clearing violated this provision because it “pro-
vided no evidence that it provided written notice to Frankenmuth–
–i.e. never provided a copy of the written notice of proof.” Frank-
enmuth appears to argue that because Kelley Brown’s testified that
she submitted the claim “online,” it was not “written notice” pur-
suant to the policy. Frankenmuth points to no evidence that
Brown’s Clearing’s notice was not in writing nor in the incorrect
format. Thus, there is no genuine dispute about whether Brown’s
Clearing provided written notice and no violation of the Policy.
Thus, this argument must fail.
Accordingly, the district court did not err in finding that
Brown’s Clearing did not violate any provisions of the Policy and
was thus entitled to coverage under that Policy with Frankenmuth.
IV. CONCLUSION
For all these reasons, we affirm the district court’s order
granting summary judgment for Brown’s Clearing and the Fords.
AFFIRMED.
