Great American Assurance Co. v. Thorson

United States Court of Appeals
Fifth Circuit
F I L E D
UNITED STATES COURT OF APPEALS
June 29, 2007
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
Clerk
No. 06-31179
Summary Calendar
GREAT AMERICAN ASSURANCE CO.,
Plaintiff-Appellee,
v.
JACK THORSON and CHARLENE THORSON,
Defendants-Appellants.
Appeal from the United States District Court for the
Eastern District of Louisiana
2:05-CV-2195
Before DAVIS, BARKSDALE, and BENAVIDES, Circuit Judges.
PER CURIAM:*
In November, 2002, Jack and Charlene Thorson (“the Thorsons”)
purchased a thoroughbred racehorse, Kimberlite Pipe, for breeding
mares. They purchased a policy from Great American Assurance
Company to insure against death and infertility from November,
2002, to November, 2003 (“Original Policy”). They renewed this
policy, with some alterations, providing coverage from November,
*
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that this opinion should not be published and is not precedent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.
2003, to November, 2004 (“Renewal Policy”).
After receiving medical reports that Kimberlite Pipe suffered
some congenital abnormalities suggesting infertility, the Thorsons
filed a claim against Great American in 2004. Great American
denied the claim and filed a declaratory action seeking relief from
coverage, and the Thorsons counterclaimed arguing that their claim
was denied in bad faith. The district court granted summary
judgment in favor of Great American, and we AFFIRM that judgment.
We review the district court’s summary judgment de novo.
Terrebonne Parish Sch. Bd. v. Mobile Oil Corp., 310 F.3d 870, 877
(5th Cir. 2002). Summary judgment is appropriate when no genuine
issue of material fact exists, and one party is therefore entitled
to judgment as a matter of law. Id.It is undisputed that the Thorsons are not covered under the
Original Policy. That policy contained a “Stallion First Season
Infertility” endorsement (“SFSI”), which protected against
infertility due to congenital abnormalities which result “in the
failure of the insured stallion to achieve a fertility percentage
of 60% or more during its first season at stud.” Kimberlite Pipe
had a 66% fertility rate during its first season, so the Thorsons
had no claim under this provision.
In Kimberlite Pipe’s second season at stud, its fertility rate
fell below 60%. However, the Renewal Policy applicable to that
season did not contain an SFSI, but only an “Accident, Illness,
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Disease, Infertility” Endorsement (“AIDI”). As opposed to the
SFSI, which explicitly covered congenital defects, the AIDI applied
only if infertility resulted “from an accident, illness or disease
which occurs after the effective date of this endorsement.” The
Thorsons do not allege that Kimberlite Pipe’s infertility resulted
from any accident, illness or disease occurring after the effective
date of the Renewal Policy (November, 2003). They allege only a
congenital defect as the cause of infertility. This falls outside
the scope of the plain language in the Renewal Policy’s AIDI.
The Thorsons respond that Kimberlite Pipe’s infertility did
not occur until after the effective date of the Renewal Policy.
The Thorsons claim that the AIDI “plainly states that coverage is
provided if Kimberlite Pipe becomes ‘infertile’ after the inception
of the Renewal Policy.” But that is not what the AIDI says,
plainly or otherwise. It states that the accident, illness or
disease causing infertility must occur after the Renewal Policy
takes effect, and the congenital defect was present long before the
Renewal Policy’s effective date. Infertility resulting from
congenital defects is only covered under the SFSI in the Original
Policy, which did not apply to the second season.
Because we find that the explicit terms of the Renewal Policy
do not cover infertility caused by congenital defects, we do not
address the district court’s alternative grounds for its judgment,
which relate to the Thorsons failure to timely notify Great
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American upon first learning of Kimberlite Pipe’s potential
infertility.
We AFFIRM the district court’s judgment.
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