Is employee’s father an insured?
Micah Boudreaux worked for AES Drilling Fluids, LLC, and was given a truck to use as part of his job. On April 2, 2015, Micah was working on the water well at his house. His father, Randal, was living with him at the time, so he asked his father to take the truck and go to Lowe’s to get some parts he needed. While at Lowe’s, Randal ran into a friend who needed a ride home. Randal was on his way to drop the friend off when he stopped south of an intersection and was rear-ended by a vehicle driven by Keigan Hanks.
Randal alleged that he sustained injuries because of the accident. He filed suit against Hanks and her insurer, State Farm Mutual Automobile Insurance Company. He also filed suit against Commerce and Industry Insurance Company, whose policy provided uninsured motorist coverage to AES. Subsequently AES filed a motion for summary judgment seeking dismissal of the lawsuit. Randal then filed a partial motion for summary judgment, claiming that he was an insured under the Commerce policy as a permissive driver.
Denying Commerce’s motion for summary judgment and granting Randal’s partial motion for summary judgment, the court held that Randal was a permissive user under the Commerce policy. Commerce appealed.
On appeal, Commerce argued that the trial court had erred in finding that Randal had permission to use the truck and that he was an insured under the AES policy. Randal argued that he was an insured for contractual uninsured motorist coverage as he had express or implied permission to “occupy” the truck.
The Louisiana endorsement to the Commerce policy provided:
- Who Is An Insured
If the Named Insured is designated in the Declarations as:
….
- A partnership, limited liability company, corporation or any other form of organization, then the following are “insureds”:
- Anyone “occupying” with the Named Insured’s express or implied permission a covered “auto” or a temporary substitute for a covered “auto”. The covered “auto” must be out of service because of its breakdown, repair, servicing, “loss” or destruction.
….
- “Occupying” means in, upon, getting in, on, out or off.
The court noted that Micah had signed the AES Drilling Fluids, LLC, Driving Rules and Guidelines Policy, which stated in part:
It is the policy of AES Drilling Fluids;[sic] LLC that only authorized operators or drivers are allowed to drive company owned or leased vehicles.
All vehicles are primarily for business use. Vehicles are provided for expressed business purposes and can only be operated by the assigned driver, or another approved driver of the company. Any deviation from the above policy by a driver is subject to disciplinary action and/or termination.
Micah also signed an Authorization for Payroll Deduction for Company Vehicles, which stated:
“I, Micah Boudreaux, hereby acknowledge that I have read AES Drilling Fluids, LLC’s Company Vehicle Use Policy, and understand its provisions. Furthermore, I declare that I choose to use a company vehicle and allow AES Drilling Fluids, LLC to deduct $80.77 per paycheck, for personal use of the vehicle.”
When deposed, Micah agreed that he signed these documents at the training facility in Houston. At the time of his employment with AES, Micah was given the option of receiving $900 a month in extra pay for using his personal vehicle for work travel. Micah explained that he instead opted for a deduction of $80.77 from his paycheck every two weeks for insurance so he could have personal use of a company truck. He then sold his personal truck. Micah testified that he understood that the AES truck was his to use as he pleased on his time off. Although Micah agreed that AES was not aware that his father would drive his truck, he did not think he had to get AES’s permission for someone to drive his truck when he was not working because he was paying for insurance to use AES’s truck personally. After the accident, Micah’s employment with AES was terminated for a policy violation of the driving rules.
The court found it was reasonably foreseeable that Micah would allow his father to drive the truck and pointed out that the AES rules stated that company vehicles were “primarily” for business use. The judgment of the trial court was affirmed.
Boudreaux v. Commerce and Industry Insurance Company et al.-Court of Appeal of Louisiana, Third Circuit-November 7, 20128-No. CA 18-322.
