Court of Appeals of Texas, Thirteenth District, Corpus Christi-Edinburg
TEXAS POLITICAL SUBDIVISIONS PROPERTY/CASUALTY JOINT SELF INSURANCE FUND, Appellant,
PHARR-SAN JUAN-ALAMO ISD, Appellee.
appeal from County Court at Law No. 4 of Hidalgo County,
Benavides, Hinojosa, and Perkes Memorandum, Justices.
GREGORY T. PERKES, Justice.
insurance-coverage dispute, appellant Texas Political
Subdivisions Property/Casualty Joint Self Insurance Fund
(TPS) filed a petition against appellee Pharr-San Juan-Alamo
ISD (PSJA) seeking a declaration of its rights and
obligations under an automobile liability policy (Auto
Policy). PSJA countersued for declaratory relief and breach
of contract. Both parties moved for summary judgment, and the
trial court rendered judgment in favor of PSJA, finding TPS
breached its duties to defend and indemnify.
issues that we treat as three, TPS argues on appeal that the
trial court erred by (1) denying its motion for summary
judgment, (2) granting PSJA's motion for summary
judgment, and (3) failing to apply the one satisfaction rule.
Because neither party carried its summary judgment burden, we
reverse and remand.
Flores sued PSJA for damages sustained by a minor who,
according to her petition, "was severely injured after
being thrown from a golf cart" driven by a PSJA
employee. PSJA demanded that TPS defend and
indemnify it in the underlying suit and TPS denied coverage.
Auto Policy provides liability coverage as follows:
[TPS] will pay all sums the [PSJA] legally must pay as
damages because of bodily injury or
property damage to which this self-insurance
applies, caused by an accident and resulting
from the ownership, maintenance or use of a covered
[TPS] has the right and duty to defend any
suit asking for these damages. However,
[TPS] has no duty to defend suits for
bodily injury or property
damage not covered by this self-insurance. [TPS] may
investigate and settle any claim or suit as
[TPS] or its authorized representative considers appropriate.
[TPS]'s duty to defend or settle ends when the applicable
Limit of Self-Insurance has been exhausted by payment of
judgments or settlements.
bolded terms are given a specific meaning under the Auto
Policy. An "auto" is defined as "a land motor
vehicle, trailer or semitrailer designed for travel on public
roads but does not include mobile equipment."
"Mobile equipment" is defined, in part, as
"vehicles designed for use principally off public
maintains that golf carts are necessarily "mobile
equipment" under Texas law because the Texas
Transportation Code defines a "golf cart" as
"a motor vehicle designed by the manufacturer primarily
for use on a golf course." See Tex. Transp.
Code Ann. § 502.001(18). In other words, TPS contends
that a golf cart cannot, under any circumstances, be designed
for use principally on public roads. As such, TPS concludes
that the allegations in the underlying petition negate its
duties to defend and indemnify PSJA. See Farmers Tex.
Cty. Mut. Ins. Co. v. Griffin, 955 S.W.2d 81, 84 (Tex.
1997) (per curiam) ("We now hold that the duty to
indemnify is justiciable before the insured's liability
is determined in the liability lawsuit when the insurer has
no duty to defend and the same reasons that negate the duty
to defend likewise negate any possibility the insurer will
ever have a duty to indemnify."). TPS filed three
separate traditional motions for summary judgment based on
this argument, relying only on the Auto Policy and the
petition in the underlying lawsuit to support its argument.
See GuideOne Elite Ins. Co. v. Fielder Rd. Baptist
Church, 197 S.W.3d 305, 308 (Tex. 2006) ("Under the
eight-corners or complaint-allegation rule, an insurer's
duty to defend is determined by the third-party
plaintiff's pleadings, considered in light of the policy
provisions, without regard to the truth or falsity of those
allegations." (citing Argonaut Sw. Ins. Co. v.
Maupin, 500 S.W.2d 633, 635 (Tex. 1973))). The trial
court denied each motion.
acknowledges that golf carts were traditionally designed
primarily for use on a golf course, but argues the term has a
broader meaning today because manufacturers now design and
advertise some golf carts primarily for use on
public roads. In a combined motion, PSJA filed a traditional
motion for summary judgment on the duty to defend and a
no-evidence motion on the duty to indemnify. To support its
traditional motion on the duty to defend, PSJA submitted
advertisements from golf cart manufacturer E-Z-GO's
website that depicted people using several models of golf
carts to perform everyday errands on public roads. One such
Inspired by get-up-and-go lifestyles, the 2-passenger
E-Z-GO® 2Five' is compact, offers ample storage and
all the power you need to head out for errands, dinner or a
leisurely drive. Fully electric, your only pit stop at the
corner gas station will be for coffee or a Sunday paper.
The following picture accompanies the advertisement:
standard features on this model include a speedometer,
three-point seat belts, an automatic parking brake, a
passenger side locking glove box, turn signals and four-way
flashers, headlights and taillights, brake lights, a
rear-view mirror, and driver and passenger side mirrors.
argued that because the petition failed to describe the
"golf cart" in question, a reasonable
interpretation of the petition included a golf cart designed
for use on a public road like those in the advertisements,
thus triggering the duty to defend. See GuideOne,
197 S.W.3d at 310 ("A plaintiff's factual
allegations that potentially support a covered claim is all
that is needed to invoke the insurer's duty to defend . .
. ." (citing Heyden Newport Chem. Corp. v. S. Gen.
Ins. Co., 387 S.W.2d 22, 26 (Tex. 1965))). In its
no-evidence motion on the duty to indemnify, PSJA argued
"mobile equipment" was an exclusion under the Auto
Policy; therefore, TPS carried the burden to prove that the
loss falls within the exclusion. See Gilbert Tex. Const.,
L.P. v. Underwriters at Lloyd's London, 327 S.W.3d