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Click here for the full text of this decision FACTS:While driving down a paved, public country road, Jaime Langston crashed her car after she skidded on a patch of slick mud, clay, sand or some combination thereof. Langston was injured, but her child was killed. Langston sued Wilson-Riley Inc., which operated a sand pit immediately adjacent to the accident site, in state court. She later added SLS Management Corp., the owner of the property on which Wilson-Riley operated, to the suit. She argued that after recent heavy rains, Wilson-Riley trucks tracked mud onto the roadway as they exited the sand pit onto the country road. Wilson-Riley and SLS had two insurance policies at the time. EMCASCO Insurance Company issued a commercial auto liability policy, which specified that it would cover injuries cased by “an accident and resulting from the ownership, maintenance or use of a covered auto.” American International Specialty Lines Insurance Company (AISLIC) issued a commercial general liability policy that excluded coverage for injury arising out of “ownership, maintenance, or use or entrustment to others of any . . . auto.” Loading and unloading were activities included within the definition of “use.” Before Langston sued, EMCASCO and AISLIC each hired their own attorneys to represent Wilson-Riley: EMCASCO hired Mike Winchester, and AISLIC hired Chad Parker. Both asserted their reservations of rights in defending the suit. In its reservation-of-rights letter, AISLIC stated its belief that the auto exclusion provision of its policy precluded coverage of Langston’s claims. In January 2003, nine months after Langston filed suit, AISLIC settled Langston’s claim against SLS for $200,000. At this time, EMCASCO notified AISLIC that EMCASCO believed Langston’s claims against Wilson-Riley still involved AISLIC’s coverage. According to EMCASCO, after the SLS settlement, Parker never reappeared in the Wilson-Riley’s defense. According to AISLIC, the reason Parker did not do much more work on the case is because the discovery and pleading deadlines had passed, so there was little substantive work to do in the first place. EMCASCO demanded that AISLIC share equally in the cost of settling Wilson-Riley’s case. AISLIC refused, citing Langston’s pleadings, the evidence AISLIC presumed would be introduced at trial, and statements Langston’s attorney made, all of which added up to eliminating any liability AISLIC might have been exposed to. Langston’s amended petition, filed after the SLS settlement, added that the unpaved exit from the Wilson-Riley sand pit “caused a washing of mud onto the road during rainy weather,” and it was not paved until after the accident. Langston added a negligence per se claim against Wilson-Riley, based on Penal Code �42.03, for obstructing the road adjacent to the work site. AISLIC, however, continued to maintain that Langston’s claim was based only on auto liability, which would be included in coverage under the EMCASCO policy, but excluded from coverage under the AISLIC policy. It offered $20,000 toward a potential settlement, but EMCASCO refused. EMCASCO then settled with Langston for $350,000. In exchange, Langston agreed to release Wilson-Riley from all claims. EMCASCO sued AISLIC for subrogation, seeking recovery of all or part of the $350,000 settlement. On cross-motions for summary judgment, the district court granted AISLIC’s motion, finding Langston’s damages were covered by EMCASCO’s policy and excluded from coverage under AISLIC’s policy. The district court held that the washing of the mud from the unpaved exit could not have a separate and independent cause of the accident. The mud and clay tracked onto the country road necessarily involved the use of motor vehicles, thus triggering coverage under the EMCASCO policy. HOLDING:Vacated and remanded. Examining Langston’s pleadings, the court finds that a causal relationship was not alleged between the use of the trucks and the injury. Therefore, on the pleadings alone, EMCASCO is not entitled to a determination that there was no coverage. Rather, the pleadings show that EMCASCO had a duty to defend. The court notes, however, that the duty to defend and the duty to indemnify are separate and distinct duties. The court states that Texas courts use the “complete operation” in deciding whether a duty to indemnify exists. That test encompasses two parts under these FACTS:(1) whether the insured’s act was incident to, and having a connection with, the use of the truck; and (2) whether that act proximately caused Langston’s injury. As to the first part, the court observes that Texas courts have read business auto policies to cover loading and unloading of the covered vehicle, even where it is not specifically mentioned in the policy’s text. That is, the entire process involved in the movement of the vehicle, can trigger coverage. Under this expansive view, for there to be coverage, the vehicle need not be in “operation,” “in motion” or “an active participant” with respect to a plaintiff’s injuries. The court finds that Texas courts have never dealt with the specific question of whether mud or debris tracked by a truck’s tires is within the “incident to use” scope. Since Texas courts have read similar provisions broadly, the court concludes that such an activity would be incident to use of the covered vehicle. “Debris falling from a car’s cargo is incident to the transportation of that carg It is inherent in the transportation of cargo that some of it may spill or fall unto the road. . . Similarly, the tracking of debris by the tires is incident to the operation of a vehicle on unpaved roads: It is inherent in driving on unpaved roads that some sand, mud, or clay may attach to the tires.” The court adds that, because the plaintiff’s injuries need not be caused by the negligent operation of the vehicle, but instead by an act incident to its use, it is unnecessary for the plaintiff’s injuries to occur at the time of, or immediately after, the tracking of debris. As to the second part of the “complete operation” test, proximate cause, the court finds that while it was foreseeable that debris left on the road could cause an accident, it is unknown whether the accident would not have occurred without the trucks tracking the debris onto the road. The mud could have, for example, washed onto the road independent of the trucks’ presence. There is a genuine issue of material fact, then, on this question. On remand, the district court should determine whether there is sufficient evidence to declare as a matter of law that the heavy rain before the accident could have washed enough mud onto the road that could have independently caused the accident. OPINION:Smith, J.; Garwood, Smith and DeMoss, JJ.

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