Insurer must defend trucking company in fatality on its property
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A federal appeals court Monday overturned a lower court ruling and held an insurer must defend a trucking company in a fatal accident on its property.
In 2020, a truck driver employed by another company was killed on the property of Midlothian, Texas-based Tarango Trucking LLC when he was struck by the tractor of a tractor truck whose braking system disengaged while he was operating a hydraulic lift on its trailer, according to the ruling by the 5th U.S. Circuit Court of Appeals in New Orleans in Penn-America Insurance Co. v. Tarango Trucking, LLC.
Bala Cynwyd, Pennsylvania-based Penn-America defended Tarango in the ensuing underlying litigation under a reservation of rights.
The insurer then filed a declaratory judgment action in U.S. District Court in Dallas, arguing that a “parking exception” to an auto exclusion in its CGL policy does not restore coverage.
The district court ruled the insurer had no duty to defend or indemnify the trucking company but was overturned by a three-judge appeals court panel.
The ruling said it agreed with the trucking company “that the Parking Exception applies to bodily and property damage that arise out of parking.
“Because the Petition alleges some claims that arise out of parking and are potentially covered by the Policy, Penn-America must defend Tarango in the Underlying Action,” it said, while also holding it was premature for the district court to decide the indemnity issue.
Plaintiff attorney Sandy McCorquodale, of the Law Office of Sandy McCorquodale P.C. in Dallas, said the 5th Circuit’s ruling was “well-reasoned” and includes a more detailed discussion of the parking exception than in most cases that address this standard exception.
“The case still has a ways to go on the duty to indemnify, but we will address that when we get back to the lower court,” he said.
The insurer’s attorneys did not respond to a request for comment.
