Session Dare: February 23, 2017
from the Chancery Court for Williamson County No. 43913 James
G. Martin, III, Judge
judgment action in which an insurance company seeks a
determination of its coverage obligations arising out of a
business insurance policy it issued relative to a class
action suit brought against the insured for sending
unsolicited faxes in violation of the Telephone Consumer
Protection Act ("TCPA"). The court granted the
insurance company's motion for summary judgment in part,
holding that the insurance company had no duty to indemnify
under the "accidental event" coverage or the
"personal injury" coverage, that the company had a
duty to defend under the "advertising injury"
coverage, and that the company had a duty to defend against
all claims. The insured filed a motion to alter or amend,
which was denied by the court. On appeal, the insured argues
that the court issued an improper advisory opinion, erred in
holding the company had no duty to indemnify under the
"accidental event" coverage, and abused its
discretion by failing to consider new evidence proffered in
the insured's motion to alter or amend the judgment.
Finding no error, we affirm the trial court in all respects.
R. App. P. 3 Appeal as of Right; Judgment of the Chancery
L. Cooper, Nashville, Tennessee, for the appellant, Kaigler
& Associates, Inc.
McLemore, Franklin, Tennessee; Michael Resis and Christine V.
Anto, Chicago, Illinois, for the appellee, Allstate Insurance
Richard H. Dinkins, J., delivered the opinion of the court,
in which Andy D. Bennett and W. Neal McBrayer, JJ., joined.
RICHARD H. DINKINS, JUDGE
Factual and Procedural Background
& Company, Inc. ("Kaigler" or
"Defendant") is a surplus line insurance company
that makes specialty insurance products available to
independent agents; it is owned by David Kaigler. A class
action suit ("the Underlying Suit") was filed
against Kaigler in the Circuit Court of Cook County,
Illinois, which alleged that Kaigler sent unsolicited fax
messages to recipients in violation the Telephone Consumer
Privacy Act ("TCPA"). The complaint sought
statutory damages under the TCPA in the amount of $500 per
violation; alleged that Kaigler's practice of faxing
unsolicited advertisements caused the recipients to lose
paper, toner, and the use of their fax machines, as well as
lost time by employees; and that Kaigler knew or should have
known that it did not have permission to send the faxes. The
court granted partial summary judgment in favor of
plaintiffs, holding that all elements of the TCPA claim had
been met; the court denied, without prejudice, the portion of
the motion directed at damages.
February 19, 2015, Allstate Insurance Company
("Allstate"), which issued a Customizer Business
Insurance Policy to Kaigler, filed suit in Williamson County
Chancery Court, seeking a declaration of its responsibility
to defend Kaigler in the Underlying Suit and what coverage
was triggered under the policy. Specifically, Allstate sought
a determination that its obligations to Kaigler arose
"only under the 'advertising injury' coverage
and that a duty to defend Kaigler does not arise under the
'accidental event' coverage" or the personal
injury coverage. Kaigler answered, inter alia,
denying the allegations of the complaint and asserting that
Allstate failed to state a claim for relief. In due course,
Allstate filed a motion for summary judgment, contending that
it had no duty to defend or indemnify Kaigler in the
Underlying Lawsuit under the "advertising injury, "
"accidental event, " or "personal injury"
coverage. The court granted Allstate's motion in part,
holding that Allstate did not have a duty to indemnify under
the "accidental event" or "personal
injury" coverage; that it had a duty to defend Kaigler
under the "advertising injury" coverage; and that
"[b]ecause Allstate has a duty to defend Kaigler under
the 'advertising injury' coverage … Allstate
has a duty to defend Kaigler against all claims."
filed a motion to alter or amend the judgment, requesting
that the court reconsider the grant of summary judgment on
the issue of Allstate's duty to indemnify under its
"accidental event" coverage. The court denied
Kaigler's motion, holding that two affidavits Kaigler
proffered as new information would not have changed the
outcome of the case, that the information contained in the
affidavits was available at the time summary judgment was
granted, and that adjudication of the duty to indemnify
question was proper in light of the status of the underlying
class action in which liability had been determined. On
appeal, Kaigler asks this court to determine whether the
trial court erred in ruling on Allstate's motion and
whether the trial court erred in ruling that Allstate has no
duty to defend or indemnify under the "accidental
The Trial Court's Consideration of the Coverage
first examine Kaigler's contention that because the duty
to defend is not actually in dispute and the duty to
indemnify is premature, the trial court improperly issued an
advisory opinion. Kaigler bases this contention on the
holding in Policemen's Ben. Ass'n of Nashville v.
Nautilus Ins. Co., that "because an insurer's
duty to indemnify is dependent upon the outcome of a case,
any declaration as to the duty to indemnify is premature
unless there has been a resolution of the underlying
claim." M2001-00611-COA-R3-CV, 2002 WL 126311, at *8
(Tenn. Ct. App. Feb. 1, 2002).
Relative to this issue, the trial ...