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Click here for the full text of this decision FACTS:Cesar Reyna owned a bus, driven by Joel Quinones Lozano, that crashed in Mexico. The bus had a head-on collision with a vehicle occupied by Jorge Cantu and Manuel Oyervidez, both of whom were killed. Cantu’s relatives sued Reyna and Lozano in Texas state court. Reyna notified his insurer, Lincoln General Insurance, of the suit. Lincoln informed him that it was denying coverage and would not be defending him. Because Reyna did not file an answer to the Cantu relatives’ complaint, the relatives secured a $13 million default judgment against Reyna, who was found to be 90 percent liable for the damages, and Lozano. Reyna’s rights to any insurance proceeds were transferred to the Cantu relatives. Lincoln filed a declaratory judgment on its coverage and duty-to-defend obligations. The Cantu relatives and one of Oyervidez’s relatives were permitted to intervene. The trial court granted Lincoln’s motion for summary judgment. The policy provides coverage that is triggered by an “accident” resulting “from the ownership, maintenance or use of a covered auto.” The term “accident” is defined as including “continuous or repeated exposure to the same conditions resulting in bodily injury or property damage. The accident must occur within the policy period and the coverage territory, which is further defined as including the United States, Puerto Rico and Canada. The intervenors appeal, arguing Lincoln’s standard business auto policy requires it to provide a defense to Reyna for the bush crash, which occurred in Mexico, and the negligent hiring, training and supervision of Lozano, all of which happened in Texas. HOLDING:Affirmed. The court reviews the holding in Fidelity & Guaranty Ins. Underwriters Inc. v. McManus, 633 S.W.2d 787 (Tex. 1982), a negligent entrustment case where a bicycle accident was caused by a boy who was riding a bike borrowed from someone else. The policy in that case excluded coverage when the bike was used outside the residence area. The court found that there would have been no coverage-triggering accident of negligent entrustment but for the negligent operation or use of the bicycle, which was excluded from coverage. There was no duty to defend in that case. King v. Dallas Fire Ins. Co., 85 S.W.3d 185 (Tex. 2002), involved a duty to defend in a negligent hiring suit that was based on an individual’s intentional conduct; intention conduct was excluded from coverage. The King court stated that whether an occurrence was an accident depends on the insured’s standpoint. The King court declined, then, to apply a “but for” or an “arising out of” test to the determine if an occurrence existed. Instead, the court concluded it must look from the insured’s standpoint, as required by the language of the policy, in determining whether the insured was negligent in contributing to the injury. The court distinguished McManus as “inapposite” because it did not require a consideration of intent. The court continues by saying that King is distinguishable from this case. The court says that as it reads King, the court’s determination that negligent hiring, training and supervision is an occurrence applies in cases involving intentional conduct where the court is required to interpret intent and from whose standpoint. This is a negligence case, and intents is not at issue. The court, thus, refuses to apply the King holding, as urged by the intervenors. Instead, this case is akin to McManus. “We conclude in cases involving injury caused by negligence where intent is clearly not at issue, the ‘but for’ or”arising out of’ standard still applies. Under the ‘but for’ standard, there could be no cause of action against the employer but for the employee’s negligent conduct, and where the employee’s conduct does not fall within the scope of coverage, there is no occurrence or accident to trigger coverage and the duty to defend. The ‘but for’ analysis applies in this case.” The collision in this case took place in Mexico. The clear language of the policy only covers accidents that occur within the coverage territory, and Mexico is not within the coverage territory. “That Reyna’s alleged negligence occurred in Texas is irrelevant because the cause of action against him arises out of the bus crash in Mexico which does not fall within the coverage provisions. Applying the”eight corners’ doctrine, Lincoln is not required to defend Reyna because the only facts alleged are those excluded from coverage.” OPINION:Kinkeade, J.; Wiener, Prado and Kinkeade, JJ.

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