United States District Court, E.D. Virginia, Norfolk Division
RUSSELL LLOYD POTTER, ALVERTA VANESSA DAVIS, PROGRESSIVE NORTHERN INSURANCE CO., and STATE FARM MUTUAL AUTOMOBILE INSURANCE CO., Plaintiffs,
AMERICAN ALTERNATIVE INSURANCE CORPORATION, and HNH VIRGINIA, INC. D/B/A HAND 'N HEART, Defendants.
OPINION AND ORDER
Coke Morgan, Jr. Senior United Stales District Judge.
insurance-related action stems from a car accident between
Plaintiffs Russell Lloyd Potter ("Potter") and
Alverta Vanessa Davis ("Davis"). It comes before
the Court following a two-day bench trial on Potter's
declaratory judgment action, which seeks a declaration of the
parties' rights and obligations. Specifically, the
parties dispute whether Defendant American Alternative
Insurance Corporation ("AAIC"), which issued a
claims-made professional and general liability policy to
Davis's employer, Defendant HNH Virginia, Inc. d/b/a Hand
'N Heart ("HNH"), should afford excess
liability coverage to Davis for the accident. Following the
bench trial, the Court took this matter under advisement. The
Court now sets forth its findings of fact and conclusions of
law, thereby resolving all outstanding issues in this matter,
and enters judgement in favor of AAIC.
Court possesses removal jurisdiction pursuant to 28 U.S.C.
§ 1441. On September 8, 2015, this Court granted
AAIC's unopposed Motion to Realign the Parties. Doc. 23.
The Court ordered that Davis, Progressive Northern Insurance
Co. ("Progressive"), and State Farm Mutual
Automobile Insurance Co. ("State Farm") be
considered Plaintiffs. Id. at 5. Because HNH
represents a nominal party, the Court must disregard its
citizenship for purposes of diversity jurisdiction. See Doc.
23; see also Navarro Sav. Ass'n v. Lee. 446 U.S.
458, 461 (1980). Since the amount in controversy exceeds $75,
000.00, realigning the parties endowed this Court with
diversity jurisdiction, as it established complete diversity
of citizenship between Plaintiffs Potter, Davis, Progressive,
and State Farm and Defendant AAIC. See 28 U.S.C. §§
December 28, 2012, at approximately 1:00 p.m., Potter and
Davis were involved in a car accident on Little Neck Road in
Virginia Beach, Virginia. The accident occurred when Davis
attempted to exit a parking lot and turn on to Little Neck
Road. However, when she started to exit the parking lot, her
vehicle struck the side of Potter's vehicle. Potter is
seeking $500, 000.00 compensatory damages in state court. It
is undisputed that Davis owned the vehicle she was driving at
the time of the accident. At that time, Davis worked as a
companion aide for HNH, a home care agency. Potter did not
sue HNH in the underlying state-court lawsuit.
Provider Aide Record, or timesheet, reveals that she worked
from 9.00 a.m. to 11:30 a.m. on December 28, 2012. See Pl.
Ex. 8. On the Provider Aide Record, Davis checked that she
performed the following tasks on December 28, 2012: clean
kitchen/wash dishes, make/change bed linen, and listing
supplies/shopping. Id. Davis testified that, at the
time of the accident, she had just picked up medication from
the pharmacy for a client, Maxine Cole. After the accident,
Davis called HNH and spoke to a receptionist named Kayla, who
informed Davis that no one at HNH would be able to deliver
the medication to Ms. Cole. Therefore, after the accident,
Davis's brother, William Jones, drove Davis to Ms.
Cole's home so that Davis could deliver the medication.
Davis's call to HNH apparently went unreported, and Mary
Gavin ("Gavin"), HNH's Vice President of
Operations, did not learn of the accident until after Potter
instituted the underlying lawsuit against Davis.
testified that obtaining the medication constituted a
"favor, " as she had clocked out of work for the
day and since she needed to perform errands for herself
anyway. She described the errand as "personal." She
clarified that her duties were encompassed by the two and
one-half hours she spent on the job on December 28, 2012. She
differentiated this situation from a situation in which she
ran an errand for a client during her designated work hours,
noting that "that would be like on the job."
Indeed, Davis testified that when she first told Gavin that
she had been sued due to a car accident, she did not
originally believe HNH had been implicated, because the
accident occurred on her own time when she was running
personal errands and merely performing a favor for a client.
Companion Aides' Duties
Companion Aide Job Description lists companion aides'
duties as the following: housekeeping, meal preparation and
serving meals; wash and dry dishes; daily interaction with
client and client family; completion of monthly in-service
training programs; compliance with Hand 'n Heart
universal precautions; is on time for client assignments as
scheduled and/or provides at least 24 hours advance notice of
cancellation. Def. Ex. 2. HNH does not limit companion
aides' duties to those described in the job description.
Indeed, it presumably allows its companion aides to perform
errands such as grocery shopping. See Pl. Ex. 8. Employees
are not to work more than six (6) minutes after their
scheduled quitting time without a manager's approval. See
Def. Ex. 3 at 19-20. Their timesheets must be submitted
without error. Id. ; see also Def. Ex. 7.
HNH's written Medication Administration Policy Statement
9.4 ("Statement 9.4") does not allow staff members
to transport clients' medications to clients "except
in extenuating circumstances, " see Def. Ex. 4, though
Gavin testified that she could think of no set of
circumstances in which she would allow an employee - even a
registered nurse - to retrieve a client's prescription.
exists that HNH did not enforce its written policies. For
example, even though Gavin eventually became aware that Davis
claimed she picked up medication for Ms. Cole, see Pl. Ex.
13, and even though Davis reported the fact that she was in
possession of medication to HNH on the day of the accident,
Gavin never disciplined Davis for her alleged infraction.
Gavin testified that she did not discipline Davis because she
did not know whether to believe Davis's claims concerning
the medication, especially considering the fact that Davis
already had informed Gavin that the accident did not involve
HNH and that records included no incident report detailing
Davis's call to HNH on the day of the accident. However,
even if Gavin truly disbelieved Davis, Gavin still failed to
reprimand Davis for lying about her activities on the day of
the accident. If Davis's statements concerning the
medication were true, then Davis not only violated Statement
9.4, but she also worked outside of her reported shift. Yet,
Davis never received a reprimand. On the contrary, HNH
promoted her to a personal care aide.
Relevant Insurance Policies
issued a personal automobile liability policy to Davis's
husband with a per person liability limit of $25, 000.
Progressive has made an irrevocable offer of $25, 000 to
settle Potter's claims in the underlying lawsuit, and it
is providing Davis with a defense in that suit. State Farm
issued a personal automobile liability insurance policy to
Potter. This policy affords up to $250, 000 in Underinsured
Motorist Coverage. AAIC issued a claims-made professional and