In the trucking industry, “Bobtailing” means that a tractor is being operated without a trailer attached. According to the Louisiana Third Circuit Court of Appeal, a Bobtail liability policy provides the insured with uninsured/underinsured motorist coverage, even when the tractor is not bobtailing, that is, attached to a trailer.
In Castille v. Blum, handed down on March 16, 2016, the plaintiff truck driver was involved in a multiple-vehicle collision on the Interstate 10 in Louisiana. He filed suit against the other drivers and their insurers, and then joined his own UM carrier, Certain Underwriters at Lloyd’s, London. Underwriters had issued the plaintiff a surplus lines “Bobtail Liability Insurance Policy.” The plaintiff admitted that he was not bobtailing at the time of the accident, as a trailer was attached to his tractor. After answering the lawsuit, Underwriters sought a summary judgment regarding coverage, which the trial court granted.
According to the Court of Appeal, the policy included the following coverage language: “This Insurance Policy applies to business and non-business uses of a covered automobile, but only as respects to the tractor unit whilst the tractor unit is not attached to a trailer.” However, the UM endorsement, which the court emphasized “changes” the policy, provided that Underwriters “will pay all sums the ‘insured’ is legally entitled to recover as compensatory damages from the owner or driver of an ‘uninsured motor vehicle.’”
Interpreting these two provisions to find coverage, the court stated: “As made clear by the underlined portions of the policy above, we first note that liability coverage available under the liability portion of the policy is defined to insure a completely different loss than UM/UIM coverage. Liability coverage protects the insured from certain amounts ‘for which the insured is legally liable,’ whereas UM/UIM coverage protects against uninsured or underinsured persons who are legally obligated to pay certain amounts to the insured. Therefore, the language in the liability section’s insuring agreement that limits the applicability of ‘this insurance’ (i.e. the liability insurance) to ‘covered automobiles’ that are ‘bobtailing’ does not affect the UM/UIM coverage defined by the policy.”
Judge Genovese issued a strongly-worded dissent. “The majority opinion in this case creates uninsured motorist/underinsured motorist (UM/UIM) coverage where there is none. The crux of the majority opinion is that the UM/UIM endorsement ‘changes’ the policy. That is a truism insofar as every endorsement ‘changes’ the policy. The change in the policy as a result of the UM/UIM endorsement is that UM/UIM coverage will now be a part of the policy of insurance issued to the insured. It does not change the general insuring agreement relative to the insured’s accident or losses.”
The majority opinion and the dissent reflect the majority’s use of the strict language of the policy to find coverage, instead of considering the purpose of the policy when construed as a whole. This decision will probably be appealed to the Louisiana Supreme Court, and it will be interesting to see if the high court accepts review.
Castille v. Blum, No. 15-0742 (3/16/16).