UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 97-31196
Summary Calendar
GLORIA JAMES; IEIA LEWIS,
Plaintiffs-Appellants,
VERSUS
ALLSTATE LIFE INSURANCE COMPANY; RONALD GUIDRY,
Defendants-Appellees.
Appeal from the United States District Court
For the Eastern District of Louisiana
(96-CV-3324-K)
July 7, 1998
Before DUHÉ, EMILIO M. GARZA, and DeMOSS, Circuit Judges.
PER CURIAM:1
Brian James (“James”) purchased a life insurance policy from
Allstate Insurance Company, an Illinois corporation. Ronald Guidry
(“Guidry”), an Allstate agent and a Louisiana citizen, assisted
James in completing a policy application and submitted the
application to Allstate. An independent investigative company,
PMS, Inc., verified the application information by speaking with
James. Allstate issued a policy to James, who, four months later,
1
Pursuant to the 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this opinion should not be published and is not precedent except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.
died from a gunshot wound to the head. Allstate’s post-death
investigation disclosed that the application contained false
information. The inquiry revealed that James had been charged with
two felonies, had undergone drug treatment, and was on probation
when he applied for the policy. Neither the application nor the
PMS, Inc. investigation divulged these facts. Allstate, therefore,
rescinded the policy and returned the premium payments.
James’s beneficiaries, who are Louisiana residents and the
plaintiffs here, sued Allstate and Guidry. They alleged damages
suffered through the fault of both parties in the rescission of the
insurance policy, in failing to properly inform James in the
application’s preparation, and in failing to properly prepare the
application. They contended that Guidry did not ask James all the
questions on the application and that Guidry supplied some of the
answers himself.
The defendants removed the suit; the plaintiffs moved to
remand. The defendants claimed that Guidry was fraudulently joined
to defeat federal diversity jurisdiction. Guidry moved for summary
judgment. The district court determined that Guidry had been
fraudulently joined, finding that there was no reasonable
possibility that Louisiana law might hold him liable.
Consequently, it granted Guidry’s motion for summary judgment and
denied plaintiffs’ motion to remand. The plaintiffs now appeal.
We review the denial of a motion to remand de novo. Burden v.
General Dynamics Corp., 60 F.3d 213, 216 (5th Cir. 1995). We
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review a grant of summary judgment under the same standard. Id. at
221.
The district court properly found that the defendants met
their onerous burden for proving fraudulent joinder as reviewed in
Ford v. Elsbury, 32 F. 3d 931, 935 (5th Cir. 1994). As an Allstate
insurance agent, under Louisiana law and the facts of this case,
Guidry had no duty to the insured; he owed a duty solely to his
principal, Allstate. La. Civ. Code Ann. arts. 3016 (West 1998);
Smason v. Celtic Life Ins. Co., 615 So. 2d 1079, 1087 (La.App. 4
Cir. 1993). Because Guidry neither issued the policy nor was party
to the insurance contract, he cannot be held liable for the
policy’s rescission. We find no Louisiana law that imposes a duty
upon an agent to make certain that an applicant has accurately
responded to the questions posed.
Even if Guidry had a personal duty to complete the application
accurately and properly, which we do not decide here, plaintiffs
are unable to prove that a breach of that duty caused their alleged
damages, denial of the $500,000 death benefit. James’s answers to
PMS, Inc., were the same responses found on the application.
Allstate’s underwriting procedures would have initially prohibited
coverage if Allstate had been informed of James’s felony charges,
drug treatment, and probation.
The district court, relying on the same facts and the
conclusions it drew from them in its denial to remand, properly
granted summary judgment in favor of the defendant, Guidry.
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We AFFIRM both the denial of the motion to remand and the
grant of summary judgment.
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