Summary
holding that, under Georgia case law, a professional-services exemption in policy applied to negligence claim that arose out of injury
Summary of this case from Travelers Cas. Ins. Co. of Am. v. BozovichOpinion
CIVIL ACTION NO. 4:19-cv-00045
08-04-2020
Hal JENKINS, Individually and as Administrator of the Estate of April Jenkins, Plaintiff, v. CLJ HEALTHCARE, LLC, d/b/a Opulence Aesthetic Medicine, Judgment Debtor. Owners Insurance Company, Garnishee.
Brent J. Savage, Kathryn Hughes Pinckney, Savage & Turner, PC, Steven E. Scheer, Steven E. Scheer, PC, Savannah, GA, for Plaintiff.
Brent J. Savage, Kathryn Hughes Pinckney, Savage & Turner, PC, Steven E. Scheer, Steven E. Scheer, PC, Savannah, GA, for Plaintiff.
ORDER
R. STAN BAKER, UNITED STATES DISTRICT JUDGE
This garnishment action was filed to enforce a judgment awarded to the Plaintiff in a prior separate civil lawsuit for the wrongful death of April Jenkins. (Doc. 1-2, pp. 6–10.) Plaintiff Hal Jenkins brought the wrongful death suit against CLJ Healthcare, LLC, d/b/a Opulence Aesthetic Medicine ("CLJ"), the judgment debtor herein, in the State Court of Cobb County, Georgia, and won a jury verdict. (Doc. 32, pp. 5, 11; see also doc. 1-4, pp. 19–34; doc. 1-5, pp. 5, 7.) He now seeks to collect the judgment from that suit against Owners Insurance Company ("Owners"), which had issued a general liability insurance policy ("the policy") to CLJ. (Doc. 1-2, pp. 4–5, 9–10.) Presently, before the Court is Owners’ Motion for Summary Judgment, which argues that the "policy does not afford coverage for the [wrongful death] claims or judgment ... and therefore [it] is not holding policy proceeds subject to garnishment." (Doc. 20, p. 2.) Plaintiff filed a Response, (doc. 31), to which Owners filed a Reply, (doc. 38). The Court finds as a matter of law that the policy does not require Owners to indemnify Plaintiff's judgment against CLJ. Accordingly, the Court GRANTS Owners’ Motion for Summary Judgment. (Doc. 20.)
Owners also filed a Motion to Exclude Testimony by Plaintiff's Proposed Expert Mark D. Johnson, arguing that Johnson offers inadmissible legal opinions. (Doc. 18.) In response, Plaintiff asserts that Johnson's opinions are not just legal in nature and that his opinions "shed[ ] light on" whether Owners properly evaluated the claim, whether the claim fell within the policy's terms, and whether Owners had a duty to defend CLJ. (Doc. 27, p. 8.) As the admissibility of this expert testimony could impact the present Motion for Summary Judgment, the Court first addresses the Motion to Exclude. See Rudd v. Gen. Motors Corp., 127 F. Supp. 2d 1330, 1334 n.3 (M.D. Ala. 2001) ("For purposes of the present summary-judgment motion, ... this court will make the [expert testimony] admissibility decisions necessary for this decision on the basis of the record already before it."). "Determinations of the admissibility of evidence are left to the broad discretion of the district court ...." Montgomery v. Aetna Cas. & Sur. Co., 898 F.2d 1537, 1541 (11th Cir. 1990). While "[a]n expert may testify as to his opinion on an ultimate issue of fact," the witness "may not testify to the legal implications of conduct." Id.; see also U.S. v. Frazier, 387 F.3d 1244, 1262–63 (11th Cir. 2004) ("Proffered expert testimony generally will not help the trier of fact when it offers nothing more than what lawyers for the parties can argue in closing arguments."). Here, Johnson, who is an attorney, intends to testify about his interpretation of the insurance policy and whether the policy obligated Owners to defend CLJ. (Doc. 19-1, pp. 11–12.) These are questions of law that must be decided by the Court. See, e.g., Barnes v. Greater Ga. Life Ins. Co., 243 Ga.App. 149, 530 S.E.2d 748, 749 (2000) ("The construction of an insurance contract is a matter of law for the court."); Colony Ins. Co. v. Corrosion Control, Inc., 390 F. Supp. 2d 1337, 1339 (M.D. Ga. 2005) ("The construction of an insurance contract, including the question whether an insurer has a duty to defend and indemnify its insured, is a question of law."). Thus, for this reason, the Court GRANTS Owners’ Motion to Exclude. (Doc. 18.)
BACKGROUND
As described above and in more detail below, this garnishment action follows the entry of a money judgment in favor of Plaintiff for the wrongful death of April Jenkins during a surgery performed at CLJ's medical center. The applicability of an insurance contract that had been issued by Owners to CLJ is the core dispute in the civil action presently before this Court. (Doc. 1-2, pp. 5, 7–9.) The relevant details are discussed below.
I. CLJ's Insurance Policy with Owners
Sometime before Jenkins’ death, CLJ purchased the at-issue policy from Owners through an independent insurance agency, D. Ward Insurance Services, Inc. ("D. Ward"). (Doc. 32, p. 1; doc. 30-1, p. 2; doc. 22-1, p. 7.) Along with the policy, Owners included a cover letter that concluded with the following statement: "Feel free to contact your independent Auto-Owners agent with questions you may have about any of your insurance needs." (Doc. 22-1, p. 7.) As for the policy itself, it included coverage for, among other things, certain "advertising injur[ies]," which were defined as injuries arising out of the "[o]ral or written publication of material that slanders or libels a person or organization" or "that violates a person's right of privacy." (Id. at pp. 48, 58.)
The policy stated that if the insured had an additional insurance policy "covering the same loss or damage," it would "pay only for the amount of covered loss or damage in excess of the amount due from that other insurance ...." (Id. at pp. 45–46.) It also included several exclusion provisions, noting areas where the policy did not extend coverage. (Id. at p. 49.) One of these provisions stated that the policy did "not apply to ‘Bodily injury’ ... due to rendering or failure to render any professional service." (Id. at pp. 49, 51.) It then listed several examples of rendering or failing to render professional services, including "[m]edical [or] surgical ... services or treatment[,] [a]ny health service or treatment, [and] [a]ny cosmetic ... service or treatment." (Id. at p. 52.) While this exclusion provision used the phrase "due to," many other exclusion provisions within the policy used a slightly different phrase and excluded coverage for bodily injury "arising out of" some act or omission. (See, e.g. id. at pp. 51–53) (excluding " ‘[b]odily injury’ ... arising out of the ownership, maintenance, use or entrustment to others of any aircraft ...")
In a separate section titled "Liability and Medical Expenses General Conditions," the policy stated that the insured "must see to it that we are notified promptly of an ‘occurrence’ that may result in a claim." (Id. at p. 57.) In addition, it also provided that "[i]f a claim is made or ‘suit’ is brought against any insured, you must see to it that we receive prompt written notice of the claim or ‘suit.’ " (Id. ) Finally, the policy noted that "[n]o one may bring a legal action against us under this insurance unless: [t]here has been full compliance with all of the terms of this insurance." (Id. at p. 72.)
A separate part of the policy notes that throughout the contract the pronouns "we," "us," or "our" refer to "the Company providing this insurance." (Doc. 22-1, p. 48.)
II. April Jenkins’ Death and Subsequent Litigation
On February 19, 2013, April Jenkins underwent liposuction surgery at CLJ's medical center. (Doc. 32, p. 2.) Dr. Nedra Dodds performed the procedure. (Doc. 30-2, p. 2.) Towards the end of the operation, Jenkins "went rigid." (Id. ) According to her testimony, Dr. Dodds instructed an "office staff" member who was not a licensed medical provider to call 911, but allegedly this call was not made for another twenty-nine minutes. (Id. ) Dr. Dodds also attempted to use the drug atropine but was delayed because the medical supply "crash" cart was not properly stocked. (Id. at p. 3.) Jenkins was transported to a hospital where she was pronounced dead. (Doc. 30-34, p. 2.) Following an autopsy, the medical examiner concluded that Jenkins "died as a result of [a] pulmonary fat emboli" which, he commented, is "a known complication of liposuction /fat transfer procedures." (Id. at pp. 12–13.)
"[W]ithin several weeks" of Jenkins’ death, CLJ's office manager, John Marshall, called D. Ward about Jenkin's death. (Doc. 30-1, p. 2.) According to Marshall, he contacted D. Ward in reliance upon the language in the policy's cover letter advising CLJ to contact its independent agent with any questions. (Id. ) Marshall says he talked to the representative at D. Ward specifically about the delayed 911 call and the inadequately stocked "crash" cart, and that he was told there was no coverage because what he described was a medical malpractice claim. (Id. ) He also says he was never told by anyone at D. Ward that he needed to submit a written report of Jenkins’ death. (Id. at pp. 2–3.)
On August 6, 2013, Plaintiff filed a wrongful death suit against CLJ and Dr. Dodds in the State Court of Cobb County. (Doc. 32, p. 5; Doc. 1-4; p. 1.) The complaint asserted that Dr. Dodds was liable for professional negligence, and that CLJ was vicariously liable. (Doc. 1-4, pp. 5–7.) A few months later, in October, Dr. Dodds told her defense counsel that she had an insurance policy with Owners. (Doc. 30-2, p. 4.) According to Dr. Dodds, her defense counsel told her they would present the claim to Owners. (Id. ) Nothing in the record indicates that her defense counsel contacted Owners at that time, however. In April 2014, Owners received a demand letter drafted by Plaintiff's attorney, which had initially been sent to CLJ's attorney who had in turn forwarded it to D. Ward who then sent it to Owners. (Doc. 30-8, pp. 1–6.) Sometime later, Owners sent CLJ a letter informing it that the policy did not provide coverage for the claims surrounding Jenkins’ death because CLJ failed to provide timely notification of both the incident and the lawsuit and also because the claims fell within the policy's professional services exclusion. (Doc. 32, p. 8.) Plaintiff then filed an amended complaint in his lawsuit against CLJ in November 2014. (Id. at p. 9.) This amended complaint contained a "Non-professional Negligence" claim based on the allegedly delayed 911 call and for CLJ's publication of "inaccurate data of Dr. Dodds’ credentials" on its Website, which Ms. Jenkins had allegedly visited prior to her surgery. (Doc. 1-4, pp. 21, 31.) Plaintiff's counsel sent Owners a copy of the amended complaint on June 19, 2015. (Doc. 32, p. 9; doc. 30-14.) In response, Owners reiterated to CLJ that the policy did not provide coverage. (Doc. 32, p. 10; doc. 30-15, p. 1.)
Three years later, the State Court of Cobb County entered default against CLJ. (Doc. 32, p. 10.) Plaintiff obtained a judgment in the amount of $60,000,000 against CLJ. (Id. at p. 11.) Plaintiff then filed the at-issue garnishment action against Owners seeking payment under the policy. (Doc. 1-2, p. 2.) Once litigation began, Plaintiff deposed Thomas Bernardi who worked in Owners’ legal department. (Doc. 24, p. 4.) Bernardi testified that an insured calling an independent agent about a claim could in some instances serve notice of that claim to Owners. (Id. at pp. 9–10.)
III. Procedural History
On January 22, 2019, Plaintiff filed the at-issue garnishment against Owners in the State Court of Chatham County. (Doc. 1-2.) Owners removed the case to this Court. (Doc. 1.) It subsequently filed an Answer and a counterclaim seeking a declaratory judgment stating that the policy does not require Owners to indemnify CLJ. (Doc. 4.) On September 4, 2019, Owners filed the Motion for Summary Judgment presently before the Court. (Doc. 20.) Plaintiff then filed a Response, (doc. 31), to which Owners filed a Reply, (doc. 38).
STANDARD OF REVIEW
Summary judgment "shall" be granted if "the movant shows that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A fact is "material" if it "might affect the outcome of the suit under the governing law." FindWhat Inv'r Grp. v. FindWhat.com, 658 F.3d 1282, 1307 (11th Cir. 2011) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ). A dispute is "genuine" if the "evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id.
The moving party bears the burden of establishing that there is no genuine dispute as to any material fact and that it is entitled to judgment as a matter of law. See Williamson Oil Co. v. Philip Morris USA, 346 F.3d 1287, 1298 (11th Cir. 2003). Specifically, the moving party must identify the portions of the record which establish that there are no "genuine dispute[s] as to any material fact and the movant is entitled to judgment as a matter of law." Moton v. Cowart, 631 F.3d 1337, 1341 (11th Cir. 2011). When the nonmoving party would have the burden of proof at trial, the moving party may discharge its burden by showing that the record lacks evidence to support the nonmoving party's case or that the nonmoving party would be unable to prove his case at trial. See id. (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322–23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ). If the moving party discharges this burden, the burden shifts to the nonmovant to go beyond the pleadings and present affirmative evidence to show that a genuine issue of fact does exist. Anderson, 477 U.S. at 257, 106 S.Ct. 2505.
In determining whether a summary judgment motion should be granted, a court must view the record and all reasonable inferences that can be drawn from the record in the light most favorable to the nonmoving party. Peek-A-Boo Lounge of Bradenton, Inc. v. Manatee Cty., 630 F.3d 1346, 1353 (11th Cir. 2011) (citing Rodriguez v. Sec'y for Dep't of Corr., 508 F.3d 611, 616 (11th Cir. 2007) ). However, "facts must be viewed in the light most favorable to the non-moving party only if there is a ‘genuine’ dispute as to those facts." Scott v. Harris, 550 U.S. 372, 380, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007). "[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Id. (citation and emphasis omitted).
DISCUSSION
Plaintiff's garnishment action seeks money from Owners under the policy that the Owners issued to CLJ. (Doc. 1-2.) Owners argues that it does not have an obligation to pay under the policy because CLJ did not promptly notify it about Jenkins’ death or about the wrongful death suit. (Doc. 20, pp. 8–15.) Owners also argues that the policy did not afford coverage because Plaintiff's claims in the wrongful death suit "are excluded by the professional services exclusion" in the policy. (Id. at pp. 17–23.) For the following reasons the Court GRANTS Owners’ Summary Judgment Motion. (Doc. 20.)
I. Choice of Law
In this diversity action, the Court must apply the choice-of-law rules of its forum state of Georgia to determine which state's substantive laws apply. Boardman Petroleum, Inc. v. Federated Mut. Ins. Co., 135 F.3d 750, 752 (11th Cir. 1998). This garnishment action sounds in contract. For "contract cases, [Georgia] follows the traditional doctrine of lex loci contractus : contracts are ‘governed as to their nature, validity and interpretation by the law of the place where they were made’ unless the contract is to be performed in a state other than that in which it was made." Id. (quoting Gen. Tel. Co. of Se. v. Trimm, 252 Ga. 95, 311 S.E.2d 460, 461 (1984) ). As is relevant here, Georgia law considers "an insurance contract [to be] made where it is delivered." Travelers Prop. Cas. Co. of Am. v. Moore, 763 F.3d 1265, 1271 (11th Cir. 2014) (quoting Boardman Petroleum, 135 F.3d at 752 ). Here, the policy's cover letter indicates it was sent to CLJ's Georgia address, and there is no indication that CLJ, the insured, received the policy at any other location in some other state. (Doc. 22-1, p. 7.) Thus, Georgia law applies to Plaintiff's claim.
II. CLJ Did Not Comply with the Policy's Notice Provisions
Owners first argues that CLJ failed to satisfy the policy's notice provisions, which required prompt reporting of both Jenkins’ death and Plaintiff's wrongful death suit, and that the failure to comply with these conditions precedent mean that Owners is not obligated to pay under the policy. (Doc. 20, pp. 8–10.) "In Georgia, insurance is a matter of contract, and the parties to an insurance policy are bound by its plain and unambiguous terms." Hays v. Ga. Farm Bureau Mut. Ins. Co., 314 Ga.App. 110, 722 S.E.2d 923, 925 (2012) (quoting Old Republic Union Ins. Co. v. Floyd Beasley & Sons, 250 Ga.App. 673, 551 S.E.2d 388 (2001) ). Here, it is undisputed that the policy required Owners to be "notified promptly of an ‘occurrence’ that may result in a claim." (Doc. 22-1, p. 57.) In addition, in the same section, the policy states that, in the event a claim is made or a "suit" is brought, the insured "must see to it that we receive prompt written notice of the claim or ‘suit.’ " (Id. ) Introductory language in the policy states that "the word[ ] ‘we ... refer[s] to the Company providing this insurance,’ " which, here, would be Owners (Id. at p. 48.) Finally, the policy states that no one can bring legal action against Owners under the policy unless "[t]here has been full compliance with all of the terms of this insurance ...." (Id. at p. 72.) The Court finds that, under Georgia law, this language unambiguously establishes these notice requirements as conditions precedent for coverage. See Progressive Mountain Ins. Co. v. Bishop, 338 Ga.App. 115, 790 S.E.2d 91, 94 (2016) ("A general provision that no action will lie against the insurer unless the insured has fully complied with the terms of the policy will suffice to create a condition precedent.").
Because these notice provisions were conditions precedent for coverage, the Court must next determine whether CLJ complied with them. "In general, the question of whether an insured gave notice of an event or occurrence [promptly], as required by a policy of insurance, is a question for the factfinder. And an insured may ‘be able to present evidence of excuse or justification for the delay.’ " Plantation Pipeline Co. v. Royal Indem. Co., 245 Ga.App. 23, 537 S.E.2d 165, 167 (2000) (quoting Richmond v. Ga. Farm Bureau Mut. Ins. Co., 140 Ga.App. 215, 231 S.E.2d 245, 249 (1976) ). However, Georgia courts "have also held that ‘under all of the facts and circumstances of a particular case, it may be found that an insured's delay in giving notice of an accident to his insurer was unjustified and unreasonable as a matter of law." Id. (quoting Richmond, 231 S.E.2d at 249 ).
Throughout this Order, the Court relies upon Georgia law interpreting notice provisions using the words and phrases "prompt," as well as "immediately" and "as soon as practicable" because Georgia courts have interpreted these words and phrases to have the same meaning in this context. See State Farm Fire & Cas. Co. v. LeBlanc, 494 F. App'x 17, 22 (11th Cir. 2012) (per curiam) ("Georgia precedent shows that ‘prompt’ has the same meaning as terms like ‘as soon as practicable’ and ‘immediate.’ ") (citations omitted).
Plaintiff asserts that CLJ's office manager, John Marshall, informed D. Ward about Jenkins’ death in February 2013 and that notice to D. Ward should have served as notice to Owners. (Doc. 31, p. 12.) Under Georgia law, "[i]ndependent insurance agents [like D. Ward] ... are generally considered the agent of the insured, not the insurer." European Bakers, Ltd. v. Holman, 177 Ga.App. 172, 338 S.E.2d 702, 704 (1985). However, an insurer can place an independent insurance agent "in a position of apparent authority such that one might be justified in assuming that the agent had authority to receive notice of an occurrence or claim." Kay-Lex Co. v. Essex Ins. Co., 286 Ga.App. 484, 649 S.E.2d 602, 607 (2007). Because Plaintiff is asserting an apparent agency relationship between D. Ward and Owners, he has the burden to create an issue of fact as to whether such a relationship existed. See Carter v. Kim, 157 Ga.App. 418, 277 S.E.2d 776, 776 (1981) ("[W]here the existence of an agency is relied upon, the burden of proof rests with the party asserting the relationship."). In addition, "in order for the doctrine of apparent agency to apply, the claimant must also show justifiable reliance on the representation of agency." Kay-Lex Co., 649 S.E.2d at 607. Here, Plaintiff is unable to carry his burden. First, the policy's language clearly states that Owners, as the company providing the insurance, must be notified promptly. (Doc. 22-1, pp. 48, 57.) The lack of any language mentioning an independent insurance agent, such as D. Ward, as an appropriate entity to receive notice strongly indicates that it lacked apparent authority to do so. See Se. Express Sys., Inc. v. S. Guar. Ins. Co. of Ga., 224 Ga.App. 697, 482 S.E.2d 433, 435 (1997) ("[N]either the language of the policy nor anything stamped upon the face of the policy gave apparent authority to the independent insurance agent to receive the notice required to be given to the insurer ...."). Plaintiff argues that Owners’ cover letter created apparent authority in D. Ward by informing CLJ to "[f]eel free to contact your independent Auto-Owners agent with questions you may have about any of your insurance needs," (doc. 22-1, p. 7). However, this letter says nothing about giving the independent insurance agent notice (of occurrences, claims, or suits), and district courts interpreting Georgia law have rejected the notion that such language in a cover letter can create apparent authority in the independent insurance agent. See Auto-Owners Ins. Co. v. Xytex Tissue Servs., LLC, 421 F. Supp. 3d 1369, 1378 (S.D. Ga. 2019) (finding that nearly identical language on the front page of an insurance policy did not grant the independent agent "authority to receive notice").
Additionally, Plaintiff points to the deposition testimony of Thomas Bernardi, a member of the legal department at Owners who conceded during his deposition that certain circumstances may exist where notification given to an independent agent could serve as notice to Owners. (Doc. 31, p. 14; doc. 24, p. 10.) Plaintiff also argues that apparent authority existed here because his demand letter—which contained information about the wrongful death claim—was forwarded to Owners by D. Ward in April 2014. (Doc. 31, p. 14; doc. 30-8, p. 2.) Plaintiff cites no case law, however, showing that the forwarding of the letter would establish apparent authority, especially in light of the clear language in the policy explicitly requiring that notice be given to Owners. More significantly, Plaintiff cannot feasibly argue that, when Marshall called D. Ward in February 2013, he did so in justifiable reliance on either Bernardi's testimony (given on August 9, 2019) or D. Ward's forwarding of the demand letter to Owners (in April 2014)—neither of which had occurred yet. Without the crucial showing of justifiable reliance by CLJ, Plaintiff cannot establish that D. Ward possessed apparent authority to receive notice from CLJ. See Alea London Ltd. v. Cook, No. 4:06-CV-0238-HLM, 2007 WL 5376619, at *11 (N.D. Ga. Sept. 19, 2007) ("However, in order for apparent agency to apply, ‘the claimant must also show justifiable reliance on the representation of agency.’ ") (quoting Kay-Lex Co., 649 S.E.2d at 607 ). Thus, for all the above reasons, the Court finds that CLJ's communications with D. Ward did not satisfy the policy's notice provision.
Because D. Ward did not act as Owners’ agent, according to the record, Owners first became aware of Jenkins’ death and the wrongful death lawsuit in April 2014, when it received Plaintiff's demand letter. (Doc. 30-8, pp. 1–6.) This was more than a year after Jenkins’ death and eight months after Plaintiff filed his wrongful death action, even though the policy required "prompt" notice of each event. See Allstate Ins. Co. v. Airport Mini Mall, LLC, 265 F. Supp. 3d 1356, 1382 (N.D. Ga. 2017) (separate notice requirements in an insurance policy create separate obligations for the insured). Plaintiffs have not pointed the Court to any precedent whereby Georgia courts have deemed such notice (i.e., one year after a death and eight months after suit is filed) to be prompt. Quite to the contrary, courts applying Georgia law have held that a delay as short as four months can, absent justification, preclude recovery as a matter of law. See State Farm Fire & Cas. Co. v. LeBlanc, 494 F. App'x 17, 23 (11th Cir. 2012) (per curiam) (insured's four-month delay held unreasonable under Georgia law, absent a valid excuse); Hathaway Dev. Co. v. Ill. Union Ins. Co., 274 F. App'x 787, 791 (11th Cir. 2008) (per curiam) (delays of four, five, and eight months are unreasonable as matter of Georgia law); Richmond v. Ga. Farm Bureau Mut. Ins. Co., 140 Ga.App. 215, 231 S.E.2d 245, 249 (1976) ("Under these circumstances the eight months delay in notifying the insurer was unreasonable as a matter of law.").
Plaintiff argues that Owners became aware of the wrongful death suit by March 21, 2014, because, at that time, D. Ward forwarded portions of the policy to John Marshall. (Doc. 31, p. 14.) He argues that sending the policy supports the inference that Marshall must have requested the policy because of the ongoing suit (and thus he must have given notice of the suit when he made the request). (Id. ) Even if such an inference exists, the Court has already explained that D. Ward was not Owners’ agent, so it could not receive notice on Owners’ behalf. In addition, even if Owners received notice on March 21, 2014, this would have still been more than a year after Jenkins’ death and seven months after Plaintiff filed the wrongful death suit. This is still a long enough delay in notification to preclude recovery under the policy as a matter of law, for the reasons described in this Order. See, e.g., Caldwell v. State Farm Fire & Cas. Ins. Co., 192 Ga.App. 419, 385 S.E.2d 97, 100 (1989) (six-month delay unreasonable).
Owners also did not receive a copy of the amended complaint in the wrongful death suit until seven months after Plaintiff filed the amended complaint. (Doc. 32, p. 9.) This delay occurred despite the policy's requirement that the insured "[i]mmediately" send Owners a copy of any "legal papers received in connection with the claim or ‘suit.’ " (Doc. 22-1, p. 57.)
Plaintiff argues that it provided notice in a reasonable amount of time and cites Lumbermens Mutual Casualty Co. v. Plantation Pipeline Co., 214 Ga.App. 23, 447 S.E.2d 89 (1994) in support. (Doc. 31, p. 15.) In Lumbermens, the plaintiff had an excess insurance policy with the defendant insurer along with two other policies with other insurance companies. Lumbermens Mut. Cas. Co., 447 S.E.2d at 90. The excess policy stated that "whenever it appears that an occurrence is likely to involve indemnity under this policy, written notice thereof shall be given to the company or any of its authorized agents as soon as practicable." Id. at 90–91. Plaintiff did not notify the defendant insurer until it became clear that liability would exceed the coverage of its other policies, and the insurer argued that this violated the notice provision. Id. at 90. The Court of Appeals of Georgia affirmed the trial court's grant of summary judgment to the plaintiff because no facts indicated that the plaintiff should have known earlier that its excess policy would be implicated. Id. at 91.
However, the pertinent policy language at issue in this case is inapposite to the language at issue in Lumbermens. Here, while the policy does state that Owners "will pay only for the amount of covered loss or damage in excess of the amount due from the other insurance," (doc. 22-1, pp. 45–46), the policy's notice provision requires prompt notification when there is "an ‘occurrence’ that may result in a claim," not just when it seems likely that Owners will have to indemnify a claim. (Id. at p. 57.) This broader language thus requires an insured to report an occurrence that could result in a claim even if other insurance ultimately pays for it. See, e.g., Lankford v. State Farm Mut. Auto. Ins. Co., 307 Ga.App. 12, 703 S.E.2d 436, 439 (2010) ("[T]he policy ... required [plaintiff] to provide notice ‘as soon as reasonably possible’ after the accident, and not ‘as soon as reasonably possible’ after the point that [other insurance] coverage was exhausted ....").
Plaintiff also argues that even if CLJ's notice was untimely, the delay was justified and reasonable because CLJ thought D. Ward would pass the information along to Owners and because Dr. Dodds asked her attorneys to submit a claim to Owners. (Doc. 31, p. 16.) Plaintiff cites no authority supporting this theory, and the Court's own review of the case law undermines these arguments. See Xytex Tissue Servs., 421 F. Supp. 3d at 1380 ("[R]elying on your insurance agent who fails to send notice to your insurer is not justification sufficient to excuse noncompliance with a notice provision."). Finally, Plaintiff asserts "[t]here is no evidence that anyone ... ever took time to explain to CLJ that the Owners policy could provide coverage." (Doc. 31, p. 16.) However, this argument also fails as the "law requires more than just ignorance, or even misplaced confidence, to avoid the terms of a valid contract." Allstate Ins. Co. v. Walker, 254 Ga.App. 315, 562 S.E.2d 267, 268 (2002) (quoting Protective Ins. Co. v. Johnson, 256 Ga. 713, 352 S.E.2d 760, 761 (1987) ). For all the above reasons, the Court GRANTS Owners’ Motion for Summary Judgment. (Doc. 20).
Plaintiff also argues that Owners violated its duty to defend CLJ. (Doc. 31, pp. 23–24.) It is not clear whether, under Georgia law, Plaintiff has standing to assert this claim since any duty to defend would have been owed to CLJ and not to Plaintiff. However, even if Plaintiff has standing to make this argument, it fails. Under Georgia law, "[a]n insurer's duty to defend turns on the language of the insurance contract and the allegations of the complaint asserted against the insured." City of Atlanta v. St. Paul Fire & Marine Ins. Co., 231 Ga.App. 206, 498 S.E.2d 782, 784 (1998). "When a complaint on its face shows that there is no coverage, but the insured notifies the insurer or the insurer's agent of additional facts that would place the claim within the policy coverage, the insurer must consider such facts ...." Yeomans & Assocs. Agency v. Bowen Tree Surgeons, Inc., 274 Ga.App. 738, 618 S.E.2d 673, 745 (2005). When the insurer learns of such additional facts, it should "conduct a reasonable investigation into the insured's contentions to determine the insured's rights under the insurance contract." Id. Here, as the Court has explained, CLJ failed to comply with the policy's notice requirements which were conditions precedent to Owners being required to provide coverage. Thus, based on the policy's language, Owners had no duty to defend CLJ, and CLJ has provided no additional facts that required Owners to investigate this issue further. For these reasons, Plaintiff's failure to defend argument fails.
III. The Policy Does Not Provide Coverage Because of Its Exclusion Provision
Even if CLJ had satisfied the notice provisions, Plaintiff's garnishment action would still fail because of the policy's professional services exclusion. "An insurance company may fix the terms of its policies as it wishes, provided they are not contrary to law, and it may insure against certain risks and exclude others." Lofton v. State Farm Mut. Auto. Ins. Co., 192 Ga.App. 154, 384 S.E.2d 245, 245 (1989) (internal quotation omitted). "As is the case with all contracts, unambiguous terms of an insurance policy require no construction, and the plain meaning of such terms must be given full effect, regardless of whether they might be beneficial to the insurer or detrimental to the insured." Cont'l Cas. Co. v. H.S.I. Fin. Servs., Inc., 266 Ga. 260, 466 S.E.2d 4, 6 (1996). However, "exclusions in an insurance policy are to be interpreted narrowly, in favor of the insured, ‘on the theory that the insurer, having affirmatively expressed coverage through broad promises, assumes a duty to define any limitations on that coverage in clear and explicit terms.’ " Rentrite, Inc. v. Sentry Select Ins. Co., 293 Ga.App. 643, 667 S.E.2d 888, 892 (2008).
The professional services exclusion of the policy states that "[t]his insurance does not apply to ‘Bodily injury’ ... due to rendering or failure to render any professional service." (Doc. 22-1, pp. 49, 51.) In addition, the policy provides examples of professional services including "[m]edical [or] surgical ... services or treatment, [a]ny health service or treatment, [or] [a]ny cosmetic ... service or treatment." (Id. at p. 52.) Plaintiff argues that there is an internal ambiguity because some of the policy's other exclusion provisions use the phrase "arising out of" instead of "due to." (Doc. 31, p. 18; doc. 22-1, pp. 49–52.) According to Plaintiff, "due to" should be interpreted to mean "caused by" and this interpretation creates a question of fact concerning whether Jenkins’ death was the direct result of the liposuction surgery or instead the delayed 911 call and the inadequately stocked supply cart (which Plaintiff claims are clerical and not professional services). (Doc. 31, p. 18.)
In his wrongful death suit's amended complaint, Plaintiff alleged that CLJ's "website contained certain inaccurate and/or negligently retained data." (Doc. 1-4, p. 21.) In addition, Plaintiff's 2014 demand letter in connection with that case stated that "April Jenkins relied upon the negligent representations of Dodds and Opulence." (Doc. 1-5, p. 11.) Plaintiff's Response to the Motion for Summary Judgment gives passing mention to "improper advertising" but does not flesh out this allegation in much detail. (Doc. 31, p. 19.) The policy does include coverage for an "advertising injury," which is defined as "[o]ral or written publication of material" that "slanders or libels a person or organization" or "violates a person's right of privacy" as well as "[m]isappropriation of advertising ideas or style of doing business" and "[i]nfringement of copyright, title, or slogan." (Doc. 22-1, pp. 48, 58.) The policy does not define an "advertising injury" to include physical injuries connected to medical procedures even if the person underwent the medical procedure because of seeing an advertisement and the Court cannot conceive of a way that Plaintiff's claim fits within any of the policy's explicit definitions. The Court will not extend coverage to situations that the policy clearly does not intend. See Burnette v. Ga. Life & Health Ins. Co., 190 Ga.App. 485, 379 S.E.2d 188, 189 (1989) ("Courts have no more right by strained construction to make an insurance policy more beneficial by extending the coverage contracted for than they would have to increase the amount of coverage."). Thus, any argument for coverage here based on the "advertising injury" section of the policy fails.
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There is no Georgia case law on whether the appearance of "due to" and "arising out of" in the same policy provision makes those phrases ambiguous, and the case law is split across other states. Compare Utica Nat'l Ins. Co. of Tex. v. Am. Indem. Co., 141 S.W.3d 198, 202–03 (Tex. 2004) ("due to" and "arising out of" have different meanings when both are used in a policy, with the "due to" language requiring "a more direct type of causation"), with Estate of Tinervin v. Nationwide Mut. Ins. Co., 23 So.3d 1232, 1237 (Fla.App. 2009) (finding that "the policy language is unambiguous" even when the policy used "due to" and "arising out of" within the same exclusion provision). While Georgia courts have not addressed this particular issue, there is case law that provides guidance. In Jefferson Insurance Company of New York v. Dunn, the Georgia Supreme Court found "no material distinction" between the phrases "caused by" and "arose out of" when they are used in similar exclusion provisions, and it interpreted both phrases to require only "but for" causality. Jefferson Ins. Co. of N.Y. v. Dunn, 269 Ga. 213, 496 S.E.2d 696, 699 (1998). Providing further guidance, in Auto-Owners Ins. Co. v. State Farm Fire & Casualty Co., the Georgia Court of Appeals found an exclusion provision that stated "[t]his insurance does not apply to: ... ‘Bodily injury’ or ‘property damage’ due to rendering or failure to render any professional service" to be unambiguous and, notably, it interpreted the provision to only require that "the task ... arise out of the acts specific to the individual's specialized knowledge or training." Auto-Owners Ins. Co. v. State Farm Fire & Cas. Co., 297 Ga.App. 751, 678 S.E.2d 196, 199–201 (2009) (emphasis added). Finally, Georgia courts have cautioned against "strain[ing] to extend coverage where none was contracted or intended." Dunn, 496 S.E.2d at 699 (citing Liberty Nat'l Ins. Co. v. Davis, 198 Ga.App. 343, 401 S.E.2d 555, 556 (1991) ).
Based on Georgia case law, the Court finds that the professional service exclusion at issue here is unambiguous and, like the provision in Dunn, requires only "but for" causality. Applying the facts of this case to this policy language is straightforward. It is undisputed that Jenkins experienced seizure-like symptoms while Dr. Dodds performed liposuction surgery on her, and that Plaintiff asserted a professional negligence claim against Dr. Dodds in the wrongful death suit. (Doc. 31, p. 2; doc. 1-4, pp. 25–26.) It is also undisputed that the medical examiner found that Jenkins "died as a result of [a] pulmonary fat emboli" which is "a known complication of liposuction /fat transfer procedures." (Doc. 30-34, pp. 12–13.) Even assuming without deciding that the call to 911 and the stocking of the supply cart (both of which were allegedly deficiently performed) were not within the realm of "professional services," neither would have even been needed but for the performance of the liposuction surgery, which is undoubtedly a professional service. See Dunn, 496 S.E.2d at 699 ("[W]here negligence is asserted as a concurrent cause of the injury, coverage need not be provided where the harm clearly arose out of conduct that came within the scope of the exclusionary clause.") (citing Dynamic Cleaning Serv., Inc. v. First Fin. Ins. Co., 208 Ga.App. 37, 430 S.E.2d 33, 35 (1993) ); cf. Video Warehouse, Inc. v. S. Tr. Ins. Co., 297 Ga.App. 788, 678 S.E.2d 484, 488 (2009) ("The intent of the policy, coupled with the exclusion, controls coverage .... Thus, the underlying facts and circumstances of the claim, rather than the theory of the claim, determine whether or not the exclusion applies.") (citation omitted).
The Georgia Court of Appeals’ decision in Macon-Bibb County Hospital Authority v. Continental Insurance Co., 196 Ga.App. 399, 396 S.E.2d 50 (1990), does not alter the Court's analysis. In that case, an ambulance broke down before it could transport an infant patient who needed medical assistance. Id. at 400, 396 S.E.2d 50. The family subsequently sued the hospital. Id. The hospital's insurer sought a declaratory judgment, arguing among other things that the event fell within the policy's professional service exclusion. Id. The court denied the declaratory judgment stating without analysis that the professional service exclusion did not apply to the case. Id. at 401, 396 S.E.2d 50. Plaintiff attempts to analogize the delayed ambulance to the late 911 call and the insufficiently stocked supply cart. (Doc. 31, p. 21.) However, Macon-Bibb is easily distinguishable from the fact of this case. Nothing from the facts of Macon-Bibb indicates that the hospital did anything to cause the infant's need for medical assistance. In other words, the hospital's provision of professional services played no causal role in the infant's injuries. In contrast, in the present case, Jenkins was receiving professional services and in the midst of a medical procedure when a medical emergency arose, necessitating a 911 call and additional medical supplies. Therefore, unlike Macon-Bibb, the professional services rendered to Jenkins unquestionably played a causative role in her death, and the delayed 911 call and inadequately stocked supply cart cannot be separated from the rendering of professional services.
For these reasons, the Court GRANTS summary judgment on the alternative ground that the policy did not cover Jenkins’ death because of the professional services exclusion. (Doc. 20.)
IV. Owners’ Request for Declaratory Judgment
In its Answer, Owners asserted a counterclaim asking the Court to declare that: (1) "the Policy does not provide coverage to [CLJ] for the Underlying Lawsuit or Judgment entered therein" and (2) "that Owners ... has no duty under the Policy with respect to the underlying claims or Judgment in the Underlying Lawsuit." (Doc. 4, p. 12.) While Owners’ Motion for Summary Judgment did state that it was "mov[ing] for summary judgment on all claims asserted in the above-styled action," (doc. 20, p. 1), neither party's briefing specifically addressed whether summary judgment was appropriate as to the counterclaim for declaratory judgment, (see doc. 38, p. 24) (in its Reply brief, Owners "respectfully urges the Court to grant its Motion for Summary Judgment and to enter an order dismissing the plaintiff's garnishment claim as a matter of law" but does not mention the declaratory judgment request).
Accordingly, the Court ORDERS Plaintiff and Owners to advise the Court in writing, within fourteen (14) days of the date this Order is entered, of each party's position concerning whether the entry of summary judgment as to Plaintiff's garnishment action has mooted Owners’ counterclaim for declaratory judgment or whether the request for declaratory judgment should proceed.
CONCLUSION
Based on the foregoing, the Court GRANTS Owners Insurance Company's Motion to Exclude Testimony By Plaintiff's Proposed Expert Mark D. Johnson, (doc. 18), and its Motion for Summary Judgment, (doc. 20.) The Court ORDERS Plaintiff and Owners to file their written submissions, as set forth in Discussion Section IV, supra, within fourteen (14) days of the entry of this Order.
SO ORDERED , this 4th day of August, 2020.