"[T]o have standing to assert rights under the Texas Insurance Code and claim the benefits of violations of that Code by an unauthorized insurer requires that a plaintiff qualify as a third-party beneficiary of the insurance policy.”
How later courts described this case
- "[T]o have standing to assert rights under the Texas Insurance Code and claim the benefits of violations of that Code by an unauthorized insurer requires that a plaintiff qualify as a third-party beneficiary of the insurance policy.”
- “furnished to” is unambiguous
Written by the judges who cited it.
The opinion
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
November 24, 2008
No. 08-40189 Charles R. Fulbruge III
Clerk
DELFINO PARRA, JR.
Plaintiff - Appellant
v.
MARKEL INTERNATIONAL INSURANCE COMPANY LIMITED, formerly
known as Terra Nova Insurance Company Ltd.
Defendant - Appellee
Appeal from the United States District Court
for the Southern District of Texas, Laredo
5:06-CV-59
Before DAVIS, STEWART, and DENNIS, Circuit Judges.
PER CURIAM:*
The Appellant, Delfino Parra, Jr. (“Parra”), challenges the district court’s
order granting summary judgment to Appellee, Markel International Insurance
Company Limited (“Markel”), on grounds that Markel’s policy provided no
coverage to its insured, Interamerican Textile Incorporated (“Interamerican”),
to cover the judgment Parra obtained against Interamerican.
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
No. 08-40189
Parra worked intermittently for Interamerican on an as needed basis.
While engaged in this work in Interamerican’s warehouse, he suffered serious
injury. Interamerican exercised its option to operate outside the workers’
compensation program in Texas and therefore carried no workers’ compensation
insurance. Interamerican did maintain a commercial general liability policy
with surplus lines insurer, Markel. Because Interamerican was a non-subscriber
to the Texas workers’ compensation program, it had no tort immunity and
therefore Parra sued Interamerican for damages under Texas tort law.
Interamerican did not notify Markel of the suit and Parra obtained a judgment
against Interamerican for a sum in excess of $1 million. Parra then sought to
recover this judgment from Markel as a third party beneficiary under
Interamerican’s commercial general liability policy with Markel.
Markel filed a motion for summary judgment contending that it provided
no coverage for the judgment Parra obtained against its insured based on the
following exclusion:
Exclusions
e. Employer’s liability
“Bodily injury” to:
(1) an “employee” of the insured arising out of and in the course of:
(a) Employment by the insured; or
(b) Performing duties related to the conduct of the insured’s business...
Definitions
(5) “Employee” includes a “leased worker.” “Employee” does not include a
“temporary worker”
(9) “Leased worker” means a person leased to you by a labor leasing firm under an
agreement between you and the labor leasing firm, to perform duties related to the
conduct of your business. “Leased worker” does not include a “temporary worker.”
(17) “Temporary worker” means a person who is furnished to you to substitute for a
permanent “employee” on leave or to meet seasonal or short-term workload
conditions.
Markel contended that Parra was an employee of the insured at the time
of his injury and coverage was excluded. Parra argued that he was a “temporary
2
No. 08-40189
worker” and that the district court erred in concluding that liability for his
injury was excluded under the “employee” exclusion. As indicated from the
policy language quoted above, temporary worker is a defined term: “temporary
worker means a person who is furnished to you to substitute for a permanent
employee on leave or to meet seasonal or short-term workload conditions.” The
district court concluded that although Parra was a worker used to meet short-
term workload conditions, the summary judgment evidence established that he
was not “furnished” to Interamerican. The district court concluded that for this
reason, he did not meet the policy definition of “temporary worker”.
The record reveals that Interamerican sometimes called Parra when it
needed temporary workers and at other times Parra would contact
Interamerican through its warehouse supervisor, Guerrero. On occasion
Guerrero would contact Parra when temporary help was needed. Parra argued
that he was “furnished” to Interamerican by Guerrero. The district court
concluded that the clause “person who is furnished to you” required a showing
that a third person rather than an agent or employee of the employer referred
the temporary worker to the employer for employment. We agree. As the
Eighth Circuit in Northland Casualty Co. v. Meeks, 540 F.3d 869, 875 (8th Cir.
2008), stated, “we find that the policy’s use of the term ‘furnished to’ is
unambiguous and clearly requires the involvement of a third party in furnishing
a worker either to ‘substitute for a permanent ‘employee’ on leave’ or ‘to meet
seasonal or short-term workload conditions.’” Id. at 875. We agree with this
analysis and also agree with the Meeks court that attaching any other meaning
to the term would render the provision meaningless.
We therefore agree with the district court that the policy provided no
coverage for the judgment obtained by Parra.
Parra asserted additional claims for violation of various provisions of the
Texas Insurance Code which would preclude Markel from asserting coverage
3
No. 08-40189
defenses in the policy. However, to have standing to assert rights under the
Texas Insurance Code and claim the benefits of violations of that Code by an
unauthorized insurer requires that a plaintiff qualify as a third-party beneficiary
of the insurance policy.
We agree with the district court that Parra, who is a potential judgment
creditor of Markel since he holds a judgment against its insured, is nevertheless
not a third-party beneficiary. See Palma v. Verex Assur., Inc., 79 F.3d 1453,
1457 (5th Cir. 1996).
Parra also asserts a claim under the Texas Insurance Code § 541.151 for
unfair or deceptive practices by insurers. However, as we held in Warfield v.
Fidelity and Deposit Co., 904 F.2d 322, 327 (5th Cir. 1990), Texas law does not
permit a person to recover under this section unless there is a direct and close
relationship between wrongdoer and claimant. In other words, the plaintiff
must establish either privity with the insurer or some sort of reliance on actions
of the insurer. Parra failed to demonstrate either privity or reliance.
For the reasons stated above and the reasons stated in the district court’s
thorough December 11, 2007 opinion, we affirm the district court’s judgment.
AFFIRMED.
4