OneBeacon wins against Argonaut in ruling over trucking policy

A federal appeals court on Thursday affirmed a lower court ruling in OneBeacon Insurance Co.’s favor in a dispute with Argonaut Insurance Co. in a case involving a trucking policy.

Darrell Esnault, a commercial truck driver, operates a truck that Elmwood Louisiana-based Triple G Express Inc. leased from Marrero, Louisiana-based Double S Transportation LLC, according to the ruling by the 5th U.S. Circuit Court of Appeals in New Orleans in Argonaut Insurance Co. v. Atlantic Specialty Insurance Co.

The truck is ordinarily garaged at Mr. Esnault’s residence, the ruling said. After making his final delivery at a New Orleans railroad terminal on Feb. 22, 2019, Mr. Esnault began driving the truck to a nearby store to buy groceries, but before he got to the store, realized he did not have enough money so he turned back home. 

When he was about four blocks away from home, he decided to buy cigarettes at a nearby gas station. He collided with another car driven by Christian Davis while making a U-turn, about 22 minutes after he had left the railroad terminal.

Argonaut and OneBeacon unit Atlantic Specialty separately insured Triple G for the truck Mr. Esnault was driving, the ruling said. Argonaut’s policy is a general commercial auto policy, while ASIC’s is a narrower, non-trucking liability coverage policy that typically provides liability coverage only when a commercial truck is used for non-business purposes, the ruling said.

Mr. Davis filed suit against the two insurers in state court for his injuries. ASIC refused to defend Triple G and Mr. Esnault, and Argonaut proceeded alone and settled the suit for an undisclosed amount, according to the ruling.

Argonaut then filed suit in U.S. District Court in New Orleans, claiming ASIC’s policy applied, and that ASIC should have provided a defense.

The district court ruled in ASIC’s favor, and was affirmed by a three-judge appeals court panel.

ASIC’s policy “defines ‘non-trucking’ as being operated ‘solely for personal use unrelated to the business of the Motor Carrier,’” the ruling said.

“According to the stipulated facts, when Esnault collided with Davis, he was engaged in both personal and business pursuits: he was buying groceries and cigarettes (personal) while returning the truck to its primary garage location (business). So Esnault was not using the truck solely for personal use,” it said, in affirming the lower court’s ruling.

Attorneys in the case did not respond to requests for comment.