State Farm Lloyds v. Scott Marshall ( 2015 )


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  •      Case: 15-10302      Document: 00513171931         Page: 1    Date Filed: 08/27/2015
    IN THE UNITED STATES COURT OF APPEALS
    FOR THE FIFTH CIRCUIT
    No. 15-10302                         United States Court of Appeals
    Summary Calendar                                Fifth Circuit
    FILED
    August 27, 2015
    STATE FARM LLOYDS,                                                         Lyle W. Cayce
    Clerk
    Plaintiff - Appellee
    v.
    DONNA COWEY, as representative of the Estate of Staci Michelle
    Montgomery, and on behalf of all those entitled to recover under the Texas
    Wrongful Death and Survival Acts for the death of Staci Michelle
    Montgomery,
    Defendant - Appellant
    Appeal from the United States District Court
    for the Northern District of Texas
    USDC No. 3:13-CV-2994
    Before WIENER, HIGGINSON, and COSTA, Circuit Judges.
    STEPHEN A. HIGGINSON, Circuit Judge:*
    Scott Matthew Marshall pleaded guilty to murdering Staci Montgomery
    and was sentenced to forty years in prison. He signed a judicial confession
    stating that he “intentionally and knowingly” caused Montgomery’s death, and
    * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
    be published and is not precedent except under the limited circumstances set forth in 5TH
    CIR. R. 47.5.4.
    Case: 15-10302    Document: 00513171931     Page: 2   Date Filed: 08/27/2015
    No. 15-10302
    that he “intentionally and knowingly” committed aggravated assault with a
    deadly weapon by threatening her with imminent bodily injury.
    Donna Cowey, Montgomery’s mother, then sued Marshall and others
    under the Texas Wrongful Death and Survival Acts. State Farm Lloyds (“State
    Farm”) agreed to defend Marshall under a renters’ insurance policy, subject to
    a reservation of rights to deny indemnity for any judgment against him. Cowey
    obtained a judgment of $700,633.44 against Marshall in February 2014. In
    particular, the jury awarded $190,000 for past and future loss of
    companionship and society, $150,000 for past and future mental anguish
    suffered by Cowey, $250,000 for pain and mental anguish experienced by
    Montgomery “before her death,” $19,587 in funeral and burial expenses, and
    $75,000 in exemplary damages, awarded “as a penalty or by way of
    punishment.” Meanwhile, State Farm sued Marshall and Cowey, seeking a
    declaratory judgment that it had no duty to indemnify Marshall or pay a
    judgment against him for damages arising out of Montgomery’s death. The
    district court granted State Farm’s motion for summary judgment and entered
    a declaratory judgment against Marshall and Cowey. Cowey filed a timely
    notice of appeal.
    We review de novo a district court’s grant of summary judgment, viewing
    “all facts and evidence in the light most favorable to the non-moving party.”
    Juino v. Livingston Parish Fire Dist. No. 5, 
    717 F.3d 431
    , 433 (5th Cir. 2013).
    Summary judgment is appropriate “if the movant shows that there is no
    genuine dispute as to any material fact and the movant is entitled to judgment
    as a matter of law.” Fed. R. Civ. P. 56(a). A genuine dispute of material fact
    exists when the “evidence is such that a reasonable jury could return a verdict
    for the nonmoving party.” Royal v. CCC & R Tres Arboles, L.L.C., 
    736 F.3d 396
    ,
    400 (5th Cir. 2013) (quoting Anderson v. Liberty Lobby, Inc., 
    477 U.S. 242
    , 248,
    (1986)).
    2
    Case: 15-10302    Document: 00513171931     Page: 3   Date Filed: 08/27/2015
    No. 15-10302
    Texas law applies to this diversity lawsuit. Under Texas law, an
    “insurer’s duty to indemnify depends on the facts proven and whether the
    damages caused by the actions or omissions proven are covered by the terms
    of the policy.” D.R. Horton-Tex., Ltd. v. Markel Int’l Ins. Co., 
    300 S.W.3d 740
    ,
    744 (Tex. 2009). “In Texas, the insured carries the burden to establish the
    insurer’s duty to indemnify by presenting facts sufficient to demonstrate
    coverage.” Nat’l Union Fire Ins. Co. of Pittsburgh, Pa. v. Puget Plastics Corp.,
    
    532 F.3d 398
    , 401 (5th Cir. 2008). Given that “[t]he underlying case often does
    not resolve all the factual issues necessary to determine coverage,” “courts are
    not precluded from making factual findings in coverage actions.” 
    Id. at 404.
          In construing an insurance policy under Texas law, we apply general
    principles of contract law. Gilbert Tex. Constr., L.P. v. Underwriters at Lloyd’s
    London, 
    327 S.W.3d 118
    , 126 (Tex. 2010). To determine the parties’ intent, we
    first look to the language of the policy, seeking to harmonize and give effect to
    all provisions. 
    Id. “Policy terms
    are given their ordinary and commonly
    understood meaning unless the policy itself shows the parties intended a
    different, technical meaning.” Don’s Bldg. Supply, Inc. v. OneBeacon Ins. Co.,
    
    267 S.W.3d 20
    , 23 (Tex. 2008).
    The policy at issue indemnifies Marshall for a suit brought against him
    “for damages because of bodily injury or property damage to which this
    coverage applies, caused by an occurrence.” An “occurrence” is defined as “an
    accident, including exposure to conditions, which results in: (a) bodily injury;
    or (b) property damage.” “Bodily injury” is defined as “physical harm to a
    person,” and does not include “emotional distress, mental anguish . . . or
    similar injury unless it arises out of actual physical injury to some person.”
    Although the term “accident” is not defined in the policy, the Texas Supreme
    Court has defined an “accident” in the insurance context as “a fortuitous,
    unexpected, and unintended event.” Lamar Homes, Inc. v. Mid-Continent Cas.
    3
    Case: 15-10302     Document: 00513171931     Page: 4   Date Filed: 08/27/2015
    No. 15-10302
    Co., 
    242 S.W.3d 1
    , 8 (Tex. 2007). “In Texas, deliberate acts may constitute an
    accident unless: (1) the resulting damage was ‘highly probable’ because it was
    ‘the natural and expected result of the insured’s actions,’ (2) ‘the insured
    intended the injury,’ or (3) the insured’s acts constitute an intentional tort, in
    which case, the insured is presumed to have intended the injury.” Nat’l Union
    Fire Ins. Co. of Pittsburgh, 
    Pa., 532 F.3d at 402
    (quoting Lamar Homes, 
    Inc., 242 S.W.3d at 8
    ).
    Cowey concedes that Montgomery’s murder was not an “occurrence” and
    therefore was excluded from policy coverage. Instead, Cowey argues that the
    policy covers damages resulting from Marshall’s actions before the murder.
    However, under the policy, damages are recoverable only if they arise from
    “bodily injury or property damage.” “Bodily injury” is defined as “physical
    harm,” and Cowey does not identify any physical harm separate from the
    injuries caused by the murder. While Cowey points to the award for mental
    anguish suffered by Montgomery before she died, mental anguish is a “bodily
    injury” only if it “arises out of actual physical injury.” In the civil lawsuit,
    Marshall stipulated that after he shot Montgomery, she did not die
    immediately, but rather attempted to leave the residence while bleeding
    profusely. To the extent that the award was based on Montgomery’s mental
    anguish during that time, the anguish was caused by her murder, which Cowey
    concedes is not an accident. To the extent the award was based on
    Montgomery’s mental anguish before the shooting, Cowey does not identify any
    physical injury from which that anguish arose. In addition, the record compels
    the conclusion that Marshall’s actions before the murder either were
    intentional or had a high probability of causing damage. See 
    id. No reasonable
    jury could find that State Farm had a duty to indemnify
    Marshall or pay a judgment against him for damages. We therefore AFFIRM
    the district court’s grant of summary judgment in favor of State Farm.
    4