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C.R. England, Inc. v. Hallmark County Mutual Insurance Co.

United States District Court, S.D. Mississippi, Northern Division

March 15, 2017

C.R. ENGLAND, INC. PLAINTIFF
v.
HALLMARK COUNTY MUTUAL INSURANCE COMPANY DEFENDANT

          ORDER

          CARLTON W. REEVES, UNITED STATES DISTRICT JUDGE

         In state court proceedings, trucking company C.R. England secured a final judgment worth $73, 762.52 against trucking company National Translink.[1] England subsequently sought payment from National Translink's insurer, Hallmark County Mutual Insurance Company, via garnishment. Hallmark removed the dispute here.

         Now before the Court is England's motion for summary judgment. The familiar summary judgment standard applies, and there are no disputed material facts. See Fed. R. Civ. P. 56(a).

         Hallmark contends that it has no duty to pay a final judgment rendered against its insured where the prevailing trucking company has its own insurance. It points to evidence that England “does not carry insurance for physical damages and business losses, rather it self-insures.” It also points to evidence that England has cargo insurance, even though in this case the value of the lost cargo was less than the deductible-so again, England paid it out-of-pocket. The crux of Hallmark's argument is that England has no rights against it because England had insurance for cargo and self-insures against other risks.

         Hallmark relies upon Fifth Circuit precedent finding, in this narrow trucking insurance context, “no coverage for purposes of disputes among insurers over ultimate liability.” John Deere Ins. Co. v. Truckin' U.S.A., 122 F.3d 270, 275 (5th Cir. 1997) (emphasis added).

The decisions of this court indicate that the policy embodied in the statutes and regulations was to assure that injured members of the public would be able to obtain judgments collectible against negligent authorized carriers. Our cases have held, however, that this policy has no application to coverage disputes among insurers.

Canal Ins. Co. v. First Gen. Ins. Co., 889 F.2d 604, 611 (5th Cir. 1989), modified on reh'g by 901 F.2d 45 (5th Cir. 1990). “The purpose of section 10927 and regulations is to assure to members of the public and shippers that a certified carrier has independent financial responsibility . . . to pay for losses created by its carrier operations.” Id. (brackets omitted).

         The problem with Hallmark's argument is this: England is not an insurance company. This is not a dispute among insurers about who should contribute toward a final judgment. Rather, the injured party-England-is itself attempting to recover its losses from the tortfeasor's insurance company. Because England is the victim, not the victim's insurer, it is entitled to collect its final judgment from Hallmark. See id.

         Hallmark presses that England is “akin” to an insurance company. It is true that England is (in part) self-insured, but that is just another way of saying that England carries no insurance for physical damages and business losses. And although England does have cargo insurance, it did not make a claim. England received no payout and no insurer has ever been in a position to seek recovery or contribution from Hallmark-scenarios in which Hallmark's argument might have carried it farther.[2] As it stands, though, Hallmark's protestations are unavailing.

         As this is the only reason Hallmark has advanced to avoid coverage, England's motion for summary judgment will be granted. A separate final judgment will issue this day.

SO ORDERED.

---------

Notes:

[1] The dispute arose from the collision of two 18-wheeler rigs traveling east along Interstate 20 in Warren County, Mississippi. Fortunately, the only damage included ...


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