IN THE
TENTH COURT OF APPEALS
No. 10-03-00289-CV
United States Fire
Insurance Company,
Appellant
v.
Coy Gnade, et al.,
Appellees
From the 249th District Court
Johnson County, Texas
Trial Court # C-2001-00430
MEMORANDUM Opinion
This insurance-coverage case arose from a judgment for breach-of-contract damages entered after a bench trial. This suit was severed from a declaratory judgment action by the Gnade Plaintiffs against National Union Fire Insurance Company (“National Union”) and U.S. Fire Insurance Company (“U.S. Fire”) when the Texas Department of Transportation (“TxDOT”) and its engineers (“Engineers”) intervened. TxDOT and the Engineers sued U.S. Fire, seeking a declaration of the duty to defend in two lawsuits, and seeking to recover already incurred defense costs and $1,250,000 paid by TxDOT in settling five underlying lawsuits. After a judgment was entered for TxDOT, U.S. Fire brought this appeal.
Background
On March 9, 1998, TxDOT contracted with Champagne-Webber (“Champagne”) to repave shoulders on Interstate 35W in Tarrant County. Champagne subcontracted with Dustrol to remove the shoulders. Dustrol milled away the shoulders beginning April 23, 1998, and ending May 22, 1998. Between May 30, 1998, and August 15, 1998, at least nine auto accidents occurred along the project site, resulting in lawsuits against Dustrol, Champagne, TxDOT, and the Engineers. TxDOT made a demand on U.S. Fire to defend and indemnify it in the underlying lawsuits, which U.S. Fire refused. TxDOT settled five underlying lawsuits for $1,250,000.
Duty to Defend and Indemnify
U.S. Fire’s first issue argues that the trial court erred by declaring that U.S. Fire breached a duty to defend and indemnify TxDOT and its employees because those claims were not covered by the National Union and U.S. Fire insurance policies issued to Dustrol. It challenges the trial court’s findings of fact and conclusions of law supporting the judgment. We will consider individually each of U.S. Fire’s arguments against the trial court’s judgment.
“Named-insureds”
U.S. Fire argues that TxDOT and the Engineers were never “named insureds” on the declarations pages of the National Union and U.S. Fire policies.[1] It challenges the legal and factual sufficiency of several of the trial court’s findings of fact and its conclusion of law that TxDOT is a named insured.
When the complaining party raises a “no evidence” point challenging the legal sufficiency of the evidence to support a finding that favors the party who had the burden of proof on that finding, we must sustain the finding if, considering only that evidence and the inferences which support the finding in the light most favorable to the finding and disregarding evidence and inferences to the contrary, any probative evidence supports it. Browning-Ferris, Inc. v. Reyna, 865 S.W.2d 925, 928 (Tex. 1993). If there is more than a scintilla of evidence to support the finding, the no-evidence challenge fails. Id. When an appellant raises a factual sufficiency issue, we review all of the evidence to determine if the weight of the evidence in the record supports the trial court findings. Koch Oil v. Wilber, 895 S.W.2d 854, 861 (Tex. App.—Beaumont 1995, writ denied). Conclusions of law are reviewed de novo as legal questions. State v. Heal, 917 S.W.2d 6, 9 (Tex. 1996). Conclusions of law will be upheld on appeal if the judgment can be sustained on any legal theory supported by the evidence. Tex. Dep’t of Pub. Safety v. Stockton, 53 S.W.3d 421, 423 (Tex. App.—San Antonio 2001, pet. denied).
U.S. Fire argues that because TxDOT was not listed on the Declarations pages of the National Union and U.S. Fire policies, it was not a named insured. However, the trial court found that TxDOT was an “additional named insured” under National Union policy endorsement form 61712. The terms “additional insured” and “additional named insured” have technical meanings. An additional insured is a party protected under a policy without being named in the policy. W. Indem. Ins. Co. v. Am. Physicians Ins. Exch., 950 S.W.2d 185, 188-89 (Tex. App.—Austin 1997, no writ); see also Mark Pomerantz, Note, Recognizing the Unique Status of Additional Named Insureds, 53 Fordham L. Rev. 117, 118 (1984). An additional named insured is a person or entity whose name is specifically added to the policy as an insured after the issuance of the original policy. Id. A party typically becomes an additional named insured pursuant to an agreement obligating the named insured to add the additional named insured to the named insured's pre-existing insurance policy. Id. The trial court found that the intent behind the issuance of endorsement form 61712 was to assure that TxDOT was an additional named insured.
U.S. Fire argues that endorsement form 61712 is of no significance because it confers coverage only where an additional-insured listing is required by contract. Form 61712 is a blanket endorsement form with the caption “Additional Insured – Where Required Under Contract or Agreement.” It amends the policy to include among “Who is an Insured” persons or organizations to whom Dustrol became obligated under contract or agreement to insure. However, the National Union policy has two 61712 endorsement forms—one which contains only the blanket endorsement and one which contains the blanket endorsement plus “Texas Dept. of Transportation (State of Texas)” and “Duinick Bros., Inc.” The trial court interpreted the inclusion of the latter endorsement as specifically naming TxDOT and Duinick Bros. insureds under the policy.
U.S. Fire argues that it is the words in the endorsement itself that control, and that even though TxDOT is named on the endorsement, TxDOT is only an insured if Dustrol was in fact required by contract to insure TxDOT. We disagree. U.S. Fire’s interpretation would render the terms “Texas Dept. of Transportation (State of Texas)” and “Duinick Bros., Inc.,” as well as the addition of the second form 61712 itself, superfluous. The second endorsement would be meaningless were TxDOT only insured “where required by contract,” because the first form covers that situation. In interpreting the policy, we attempt to give a reasonable meaning to all provisions rather than interpret it so that one part is inexplicable or creates surplusage. Liberty Mut. Ins. Co. v. American Employers Ins. Co., 556 S.W.2d 242, 245 (Tex. 1997). We agree with the trial court that the second endorsement adds TxDOT as an additional named insured under the policy.
U.S. Fire argues that the endorsement naming TxDOT and Duinick Bros. did not involve the I-35W project, and that Dustrol never agreed to make TxDOT a named insured for all TxDOT projects or for the I-35W project. However, there is nothing on the endorsement page stating that the endorsement is limited to any specific project.
TxDOT Engineers
U.S. Fire argues that even if TxDOT is an additional named insured, the TxDOT Engineers are not entitled to coverage. It argues that because the “where required under contract” provision of the endorsement distinguishes between “persons and organizations,” the endorsement would not include TxDOT’s employees unless a contract required that the employees receive coverage. We disagree. As discussed above, the endorsement names TxDOT as an insured under the policy. The fact that the “where required under contract” provision would extend coverage to persons to whom Dustrol becomes obliged by contract to insure says nothing about whether a named organization’s employees are insured under the policy. The trial court found that because the second endorsement added TxDOT as an additional named insured under section II(1) of the National Union policy, TxDOT’s employees are insureds under section II(2) of the policy. We agree with the trial court.
Known Loss Doctrine
U.S. Fire argues that any coverage bestowed on TxDOT by the second endorsement 61712 is invalid under the “known loss” or fortuity doctrine. Endorsement 61712 was added to the National Union policy after all of the accidents giving rise to the underlying lawsuit had occurred, but was made retroactive to be effective as of May 1, 1998, the effective date of the original policy. The fortuity doctrine encompasses the proposition that insurance coverage is precluded where the insured is, or should be, aware of an ongoing progressive loss or known loss at the time the policy is purchased. Two Pesos, Inc. v. Gulf Ins. Co., 901 S.W.2d 495, 502 (Tex. App.—Houston [14th Dist.] 1995, no writ) (citing Inland Waters Pollution Control, Inc. v. Nat’l Union Fire Ins. Co., 997 F.2d 172, 175-77 (6th Cir. 1993)). An insured cannot insure against something that has already begun and which is known to have begun. Summers v. Harris, 573 F.2d 869, 872 (5th Cir. 1998). It is contrary to public policy for an insurance company knowingly to assume a loss occurring prior to its contract. Burch v. Commonwealth County Ins. Co., 450 S.W.2d 838, 840-41 (Tex. 1990).
However, the trial court found that there was no evidence of what Dustrol or TxDOT knew about the accidents upon which claims were later filed, no evidence of whether National Union knew about the prior occurrences, and no evidence that Dustrol or TxDOT made any incorrect representations or concealed any information from National Union prior to the issuance of the second endorsement 61712. We cannot say that coverage is precluded under the “known loss” doctrine.
Under the terms of both the National Union and U.S. Fire policies, the unintentional failure by the insured to disclose past occurrences cannot be used by National Union or U.S. Fire to prejudice coverage under the policies. The trial court found no evidence that Dustrol or TxDOT intentionally failed to disclose anything. We cannot say that coverage was precluded under the policy for failure to disclose past occurrences.
“Required by Contract” and “Certificates of Insurance”
Because we find that TxDOT is an additional named insured under National Union’s policy, we need not consider U.S. Fire’s arguments that Dustrol was not required by contract to include TxDOT as an insured under the policy and that the certificates of insurance issued to TxDOT did not expand the policy to include TxDOT. The trial court’s finding that TxDOT was an additional named insured in the National Union policy is sufficient to support its conclusion that TxDOT was insured under the U.S. Fire policy.
Completed Operations
U.S. Fire argues that TxDOT was not insured because Dustrol had completed its operations on the I-35W project. However, its argument is based upon language in certain endorsements providing coverage where required by contract. Endorsement 61712, which lists TxDOT as an additional named-insured, does not include the exclusionary language cited by U.S. Fire. We agree with the trial court that the completed operations exclusion does not apply to endorsement 61712. Thus we need not consider whether Dustrol’s operations were completed at the time the accidents occurred.
Remaining Issues
U.S. Fire complains generally that the trial court erred in admitting parole evidence. Even construing the appellate rules and U.S. Fire’s issue liberally, we do not find any specific ruling complained of by U.S. Fire that resulted in an improper judgment. Tex. R. App. P. 38.9.
U.S. Fire also complains generally that the trial court refused to enter U.S. Fire’s proposed findings of fact and conclusions of law. The trial court, however, as the trier-of-fact has no duty to make additional or amended findings that are unnecessary. A trial court is required to make only additional findings and conclusions that are appropriate. See Tex. R. Civ. P. 298; ASAI v. Vanco Insulation Abatement, Inc., 932 S.W.2d 118, 122 (Tex. App.—El Paso 1996, no writ). Moreover, the trial court is not required to make additional findings which conflict with the original findings. See Hunter v. NCNB Tex. Nat'l Bank, 857 S.W.2d 722, 727 (Tex. App.—Houston [14th Dist.] 1993, writ denied). A request for additional findings must be specific and should not be buried among minute differentiations or numerous unnecessary requests. Stuckey Diamonds v. Harris County Appraisal Dist., 93 S.W.3d 212, 213 (Tex. App.—Houston [14th Dist.] 2002, no pet. h.). U.S. fire requested 174 alternative findings of fact and conclusions of law. It complains of no specific omission for our review. We find no issue on which the judgment should be reversed.
CONCLUSION
We overrule U.S. Fire’s issues and affirm the judgment.
BILL VANCE
Justice
Before Chief Justice Gray,
Justice Vance, and
Justice Reyna
(Chief Justice Gray dissenting)
Affirmed
Opinion delivered and filed March 9, 2005
[CV06]
[1] The policy U.S. Fire issued to Dustrol lists National Union’s policy as its underlying policy. It is an “umbrella policy,” and includes among its “Insureds” “any person or organization included as an insured in the ‘Underlying Insurance.’”