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        IN THE UNITED STATES COURT OF APPEALS
                 FOR THE FIFTH CIRCUIT


                                    No. 17-20812               United States Court of Appeals
                                                                        Fifth Circuit

                                                                      FILED
                                                              November 19, 2018
EVANSTON INSURANCE COMPANY,
                                                                 Lyle W. Cayce
             Plaintiff - Appellee                                     Clerk


v.

MID-CONTINENT CASUALTY COMPANY,

             Defendant - Appellant




                Appeal from the United States District Court
                     for the Southern District of Texas


Before JONES, CLEMENT, and SOUTHWICK, Circuit Judges.
EDITH B. CLEMENT, Circuit Judge:
      This is a dispute between a primary liability insurer and an excess
liability insurer over the number of “accidents” that took place under an
insurance policy. Over a ten-minute period on November 15, 2013, the
insured’s Mack truck struck (1) a Dodge Ram, (2) a Ford F150, (3) a Honda
Accord, (4) a toll plaza, and (5) a Dodge Charger. The insurers’ disagreement
focuses on the final three collisions. In previous state court litigation, multi-
million-dollar settlements were reached between the various claimants and the
insurance companies. But the Mack truck’s primary insurer refused to
contribute more than $1 million toward the settlements of the final three
collisions, claiming that they were part of a single “accident” under its policy
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                                 No. 17-20812
and that $1 million was the primary insurer’s limit of liability per accident.
The excess insurer sued the primary insurer in federal district court. The
parties stipulated to the facts and filed cross motions for summary judgment
as to whether the final three impacts constituted a single “accident” or separate
“accidents” under the policy and Texas law. Although the district court held
that two accidents occurred, we reverse because there was only one.
                                       I.
      Since the case was submitted below on a stipulation, there is no dispute
as to the material facts. Mid-Continent Casualty Company issued a
commercial auto insurance policy to Global Waste Services, LLC. The policy
had a $1 million per-accident limit of insurance and required Mid-Continent to
defend Global until the policy limit was exhausted. The policy provides in
relevant part:


      SECTION II — LIABILITY COVERAGE
      A.      Coverage
              We will pay all sums an “insured” legally must
              pay as damages because of “bodily injury” or
              “property damage” to which this insurance
              applies, caused by an “accident” and resulting
              from the ownership, maintenance or use of a
              covered “auto”.
                                      ...
      C.      Limit of Insurance
              Regardless of the number of covered “autos”,
              “insureds”, premiums paid, claims made or
              vehicles involved in the “accident”, the most we
              will pay for the total of all damages and
              “covered pollution cost or expense” combined
              resulting from any one “accident” is the Limit
              of Insurance for Liability Coverage shown in
              the Declarations.

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                                  No. 17-20812


              All “bodily injury”, “property damage” and
              “coverage pollution cost or expense” resulting
              from continuous or repeated exposure to
              substantially the same conditions will be
              considered as resulting from one “accident”.
                                       ...
      SECTION V — DEFINITIONS
      A.      “Accident” includes continuous or repeated
              exposure to the same conditions resulting in
              “bodily injury” or “property damage”.


In addition to the primary insurance policy, Global held an excess liability
policy from Evanston Insurance Company with a $5 million per-accident
liability limit. We are concerned with the terms of the primary insurance
policy.
      On November 15, 2013, a Global employee named Marlon Diggs lost
control of his Mack truck on North Beltway 8 in Houston. Witnesses say that
Diggs was driving the truck erratically. At approximately 11:04 a.m., the Mack
truck hit a Dodge Ram in the 800 block of North Beltway 8. Three minutes
later, the Mack truck struck a Ford F150 in the 2500 block of North Beltway
8. Two minutes after that, the Mack truck approached a toll plaza and caused
the series of collisions which are at issue.
      At approximately 11:09 a.m., the Mack truck struck a Honda Accord that
was waiting in line at the toll plaza in the 3300 block of North Beltway 8.
Joseph Williams was driving the Accord and his wife, Laurie Williams, was the
only passenger. The Mack truck pushed the Accord forward more than one
hundred feet into the crash attenuator barrels separating two toll lanes, where
the Accord came to rest perpendicular to the road. Although Joseph Williams
was not seriously injured in the collision, Laurie Williams sustained severe
injuries.
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      Once separated from the Accord, the Mack truck continued to travel
through the automatic toll lane for approximately sixty-six feet before striking
a Dodge Charger driven by Gwenetta Powell. While travelling through the
lane, the Mack truck struck the tollbooth, causing significant damage. After
impacting the Charger, the Mack truck continued pushing the Charger until it
crashed into the right-side retaining wall, pinning the Charger between the
Mack truck and the wall. At some point between the Mack truck’s impact with
the Charger and the vehicles coming to rest against the wall, Diggs fell out of
the truck. Diggs did not apply the brakes at any time from first striking the
Accord until the Mack truck crashed into the retaining wall. Powell and Diggs
both died in the accident.
      Relatives of Powell sued Global in state court, and the Williams family
intervened. Additionally, Harris County made demands on Global for the
cleanup and repair of the toll plaza. All the claims ultimately settled. The
Williams family received $4.5 million—approximately $1 million from Mid-
Continent and the remaining $3.5 million from Evanston. Mid-Continent
withdrew from the litigation after settling with the Williams family, claiming
exhaustion of its policy limit. Evanston then settled with the Powells and
Harris County for $2.1 million and $75,000, respectively. Mid-Continent did
not contribute to either settlement.
      Evanston filed suit in federal court in Texas seeking reimbursement
from Mid-Continent for a portion of the payments Evanston made on behalf of
Global. Evanston also sought to recover the entirety of its defense costs. The
parties stipulated to the relevant facts and filed cross motions for summary
judgment. Evanston argued that Mid-Continent incorrectly construed all the
collisions occurring after the Mack truck’s impact with the Accord to be a single




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                                   No. 17-20812
“accident.” 1 According to Evanston, each separate impact between the Mack
truck and another vehicle or object constituted a separate accident subject to
separate liability limits. Mid-Continent asserted that under Texas law, there
was only one accident because the only event that gave rise to the various
injuries was Diggs’s negligence.
      The district court referred the motions to a magistrate judge, who
concluded that under the policy language two accidents occurred. According to
the magistrate, “[t]he collisions between the Mack truck and the Honda Accord
and between the Mack truck and the Dodge Charger were separate accidents
because they occurred independently, the former did not lead to the occurrence
of the latter.” The district court adopted the magistrate’s recommendation over
Mid-Continent’s objection. The court entered judgment in favor of Evanston.
The court concluded that Mid-Continent should have paid out a total of about
$2,045,000 under the various settlements. Because Mid-Continent only paid
$1 million in the underlying state litigation, the district court ordered it to pay
Evanston about $1,045,000 plus the costs of Evanston’s defense. Mid-
Continent appeals that ruling.
                                         II.
      Because this case is before the court on cross motions for summary
judgment, we review the district court’s rulings de novo and construe all
evidence and inferences in favor of the non-moving parties. LCS Corr. Servs.,
Inc. v. Lexington Ins. Co., 800 F.3d 664, 669 (5th Cir. 2015). The parties agreed
below that the only question was whether the Mack truck’s collisions near the
toll plaza constituted one “accident” or multiple “accidents” under the language
of the policy. The interpretation of the word “accident” as used in the insurance


      1 As for the two collisions which occurred before the Mack truck hit the Accord,
neither the district court nor the parties discuss them, probably because the damage
was minor and the excess coverage not implicated.
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contract is a question of law, which the court reviews de novo. Ran-Nan Inc. v.
Gen. Accident Ins. Co. of Am., 252 F.3d 738, 739 (5th Cir. 2001) (per curiam).

                                       III.
      The parties agree that Texas law governs this diversity action and
informs the interpretation of the Mid-Continent insurance policy. Under Texas
law, the court must construe the policy according to the general rules of
contract construction to give effect to the parties’ intent. Gilbert Tex. Constr.,
L.P. v. Underwriters at Lloyd’s London, 327 S.W.3d 118, 126 (Tex. 2010).
Courts begin with the language of the contract “because we presume parties
intend what the words of their contract say.” Id. “The policy’s terms are given
their ordinary and generally-accepted meaning unless the policy shows the
words were meant in a technical or different sense.” Id. “If the court is
uncertain as to which of two or more meanings was intended, a provision is
ambiguous.” H.E. Butt Grocery Co. v. Nat’l Union Fire Ins. Co. of Pittsburgh
(HEB), 150 F.3d 526, 529 (5th Cir. 1998).
                                       A.
      The policy defines “accident” to include “continuous or repeated exposure
to the same conditions resulting in ‘bodily injury’ or ‘property damage.’” Under
the “Limit of Insurance” provision, the policy states that “[r]egardless of the
number of covered ‘autos,’ ‘insureds,’ premiums paid, claims made or vehicles
involved in the ‘accident,’” the most Mid-Continent would pay for “the total of
all damages . . . resulting from any one ‘accident’” was the policy limit of $1
million. Although the parties disagree on its meaning, neither Mid-Continent
nor Evanston argues the policy is ambiguous. And Texas courts routinely
interpret the term “accident” or its equivalent without finding ambiguity.
HEB, 150 F.3d at 529.



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                                  No. 17-20812
      In fact, the policy’s definition of “accident” is virtually identical to the
definitions in other commercial liability policies. See id. at 529. Some insurance
policies use the term “occurrence” instead of “accident,” but both terms are
usually defined as “continuous or repeated exposure to conditions,” and policies
frequently provide that all damage or injury “arising out of continuous or
repeated exposure” to the same conditions is considered to have arisen from
the same accident or occurrence. There are sometimes small differences
between definitions, but they are usually not significant.
      For example, some policies define an accident or occurrence to include
all injuries “resulting from the same general conditions,” Foust v. Ranger Ins.
Co., 975 S.W.2d 329, 333 (Tex. App. 1998); others refer to all injuries “arising
out of . . . substantially the same general conditions,” HEB, 150 F.3d at 529;
and still others encompass all injuries “resulting from . . . substantially the
same conditions.” Evanston argues that a policy’s use of the phrase “same
conditions” instead of “same general conditions” requires a stricter similarity
in the conditions to establish a single accident. This is likely incorrect. Texas
recognizes that policies which define “occurrence” in the manner described
above are to be interpreted more broadly than policies which leave occurrence
undefined. See Foust, 975 S.W.2d at 334–35. And we have noted before that
these types of definitions are “virtually identical.” See, e.g., HEB, 150 F.3d at
529. That the policy does not include the word “general” should not normally
affect the analysis, and it does not affect the result here.
                                        B.
      In any event, Texas applies the same approach—the “cause” approach—
to interpreting all such provisions. Although the Supreme Court of Texas has
never said so, we have repeatedly observed that “Texas courts agree that the
proper focus in interpreting ‘occurrence’ is on the events that cause the injuries
and give rise to the insured’s liability, rather than on the number of injurious
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effects.” HEB, 150 F.3d at 530. But while every case which addresses this topic
acknowledges the same standard, different courts have sometimes understood
that standard to mean different things.
      Certain other jurisdictions, such as Louisiana, have adopted an “effects”
approach to interpreting insurance policies in which each separate claim
arising from the insured’s negligence is considered a separate occurrence.
Pennzoil-Quaker State Co. v. Am. Int’l Specialty Lines Ins. Co., 653 F. Supp. 2d
690, 704 n.4 (S.D. Tex. 2009). The “cause” approach simply tells us that the
“effects” approach is not appropriate under Texas law. The cause test is not
clear regarding which cause or causes are supposed to count.
      Federal courts attempting to understand the “cause” test typically begin
with our decision in Maurice Pincoffs Co. v. St. Paul Fire & Marine Ins. Co.,
447 F.2d 204 (5th Cir. 1971). Pincoffs, the insured, unknowingly imported bird
seed that had been contaminated in Argentina. Pincoffs then sold the seed to
eight different dealers, who in turn resold it to bird owners. The birds that ate
the contaminated seed died, and their owners sued. The policy at issue in
Pincoffs defined “occurrence” as “an accident, including injurious exposure to
conditions, which results, during the policy period, in bodily injury or property
damage neither expected nor intended from the standpoint of the insured.” Id.
at 206. We held “that the ‘occurrence’ to which the policy must refer is the
occurrence of the events or incidents for which Pincoffs is liable.” Id. We
reasoned that the incidents that subjected Pincoffs to liability were the eight
sales, therefore there had been eight “occurrences” under the policy. Id. at 207.
      This approach has sometimes been called the “liability-triggering event”
test. Despite occasional disagreement as to whether the test is conceptually
distinct from the “cause” test, the Pincoffs approach has become widely
accepted following its endorsement by a Texas appellate court in Goose Creek
Consol. ISD v. Cont’l Cas. Co., 658 S.W.2d 338 (Tex. App. 1983). In Goose Creek,
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an arsonist set fire to two schools in the same school district. Although the
same arsonist was the but-for cause of both fires, the fires occurred several
blocks and at least two hours apart, and neither caused the other. Id. at 339.
Hoping to pay a single deductible, the school district argued that the fires
should be treated as a single occurrence because both arose from the same
“unbroken chain of events.” Id. After citing to Pincoffs, the court disagreed,
concluding there were two occurrences because the “two fires [were]
distinguishable in space and time and . . . one did not cause the other.” Id. at
340–41.
      Pincoffs and Goose Creek clarified that to determine the number of
occurrences under a policy, we count the number of acts by the insured which
gave rise to liability. This clarification is helpful, but incomplete. It leaves
unanswered the question of at what level of generality we define the insured’s
actions. In HEB, we answered that question by placing the emphasis on
unbroken proximate causation. “While a single occurrence may result in
multiple injuries to multiple parties over a period of time,” we recognized in
HEB that “if one cause is interrupted and replaced by another intervening
cause, the chain of causation is broken and more than one occurrence has taken
place.” HEB, 150 F.3d at 534 (quotations omitted). In other words, unless the
proximate cause for the injuries is continuous and unbroken, there must be
more than one occurrence.
      In HEB, this court applied that rule to conclude that an HEB employee’s
sexual abuse of two different children, a week apart, at an HEB store
constituted two separate occurrences under HEB’s insurance policy. Id. at 535.
Hoping to limit liability under its self-insurance, HEB had claimed there was
only one occurrence because both incidents arose from its ongoing negligent
supervision of the same employee. Rejecting that reasoning, we explained that
Texas courts would not ignore the “immediate” cause of each child’s injury in
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favor of the “underlying negligent supervision” when counting occurrences. Id.
at 530. Because it was the two independent acts of sexual abuse and not the
underlying negligent supervision that “gave rise to HEB’s separate and
distinct liability” to each child, two separate occurrences had taken place under
the policy. Id. at 531.
      HEB has sometimes been misunderstood, including by the district court
in this case. Some courts have interpreted HEB to mean that a so-called
overarching cause can never constitute a single occurrence. They say courts
must instead identify the “immediate cause” of the injuries. See Pennzoil-
Quaker State Co. v. Am. Int’l Specialty Lines Ins. Co., 653 F. Supp. 2d 690, 705–
06 (S.D. Tex. 2009) (“When there is more than one immediate cause of events
giving rise to an insured’s liability in an underlying lawsuit, courts have
rejected the argument that there is a single ‘occurrence’ based on continuous
‘exposure’ to the insured’s alleged negligence.”); Esparza v. Eagle Express
Lines, Inc., No. 4:05-CV-315, 2007 WL 969585, at *10 (E.D. Tex. Mar. 28, 2007)
(“[I]t was each collision in the instant case that created the continuous or
repeated exposure to the same, or substantially the same, conditions, not the
fact that the tractor-trailer crossed the median.”).
      But what we actually said in HEB was “that when the underlying basis
for liability is negligent supervision, yet the damage is caused by an
intervening intentional tort, the court cannot look past the immediate cause of
the damage for purposes of the insurance policy.” HEB, 150 F.3d at 531
(emphasis added). So although the district court construed HEB to mean that
the “overarching cause” of the injuries must always be ignored for occurrence
purposes, properly understood, HEB merely suggests that an overarching
cause should be ignored where an intervening cause—like an intentional tort—
breaks the chain of causation. As HEB itself recognized: if there was “but one
proximate, uninterrupted, and continuing cause which resulted in all of the
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injuries and damage,” then there was one occurrence. Id. at 534 (quotations
omitted).
      This understanding is confirmed both by Texas case law and by our most
recent decisions. The seminal Texas case on the topic is Foust. In Foust, a
farmer hired a pilot to crop dust his fields with herbicide. Some of the herbicide
drifted onto neighboring tracts of land, damaging the neighbors’ crops. Foust,
975 S.W.2d at 331. The neighbors and the pilot’s insurer disputed how many
occurrences had taken place under the policy, which defined “occurrence” to
mean “a sudden event or repeated exposure to conditions involving the aircraft
during the policy period.” Id. at 333 (emphasis omitted). The policy also
provided that all “bodily injury or property damage resulting from the same
general conditions will be considered to be caused by one occurrence.” Id.
(emphasis omitted).
      The crop dusting took almost three hours, and the neighbors argued that
a finding of a single “occurrence” was inappropriate. They emphasized that the
plane had landed several times to refuel during that period, and that the
temperature, wind, and altitude varied during the several passes over different
sections of the property. Id. But the Texas appellate court disagreed that those
changes were significant. Id. at 335. Focusing on the plain meaning of the
policy language, it instead concluded that all of the damage had been caused
by “repeated exposure to the same general conditions—the drift of a herbicide
which was being applied to crops on adjoining property.” Id. It was the crop
dusting process which had damaged the neighboring tracts, and the fact that
the “single procedure” required the plane to land intermittently or change
altitude did not affect the continuous nature of the crop dusting. Id.
      In other words, because the court in Foust considered all the injuries to
have been caused by the same continuous negligence of the insured, there was
only one occurrence under the policy. This court recently reaffirmed that
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                                 No. 17-20812
principle in Seahawk Liquidating Trust v. Certain Underwriters at Lloyds
London, 810 F.3d 986 (5th Cir. 2016). In Seahawk, the court considered
whether there had been one occurrence or two where a drilling rig sustained
damage in a February storm that was then a contributing factor to the rig’s
malfunction and further damage after a July storm. The policy defined
“occurrence” to include “a sequence of losses or damages arising from the same
occurrence.” Id. at 991. The insurers argued that each storm was a separate
occurrence because the damage caused by the February storm was not a
proximate cause of the damage which occurred after the July storm.
      Focusing on the decisions in Goose Creek and HEB, this court agreed
with the insurers. We held that “[w]hen an occurrence is technically defined to
include a series of losses arising from the same event, it includes only those
losses proximately caused by that event.” Id. at 993. We again rejected reliance
on the “overarching cause” or on pure but-for causation, clarifying that the
focus should instead be “on the direct, immediate, and proximate cause of the
losses to determine the number of occurrences.” Id. at 992–93. Because the
district court did not clearly err by finding that the July storm was an
intervening cause of the losses, this court agreed that two occurrences had
taken place under the policy. Id. at 994; see also U.E. Texas One-Barrington,
Ltd. v. Gen. Star Indem. Co. (General Star), 332 F.3d 274, 282 n.7 (5th Cir.
2003) (Smith, J., concurring in part and dissenting in part) (recognizing that
“[s]ome courts have suggested that an intervening cause might change the
number of occurrences”).
      As articulated in HEB, Foust, and Seahawk, the appropriate inquiry is
whether there was one proximate, uninterrupted, and continuing cause which
resulted in all of the injuries and damage. If so, then there was a single
occurrence. If the chain of proximate causation was broken by a pause in the
negligent conduct or by some intervening cause, then there were multiple
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occurrences, even if the insured’s negligent conduct which caused each of the
injuries was the same kind of negligent conduct.
                                          C.
      With these principles in mind, reversal of the district court is clearly
appropriate. The district court based its decision on a misunderstanding of the
case law. In short, the court believed that the “overarching cause” of injuries
can never constitute a single occurrence under Texas law, and instead
attempted to identify the “immediate causes” of the injuries that gave rise to
the insured’s liability. Because the insured did not become liable to anyone
until his Mack truck collided with their vehicle, the court conceptualized each
collision as a separate event giving rise to liability. That was a mistake.
      Texas law only prohibits courts from looking to the “overarching cause”
of the injuries when the overarching cause is not a “proximate, uninterrupted,
and continuing cause” of all the injuries. See HEB, 150 F.3d at 534. “To
proximately cause an injury, an actor need not be the last cause, or the act
immediately preceding the injury.” J. Wigglesworth Co. v. Peeples, 985 S.W.2d
659, 663 (Tex. App. 1999). The appropriate question is whether the continuous
negligence of the Mack truck driver was interrupted and the chain of causation
broken. Cf. Foust, 975 S.W.2d at 335 (finding one occurrence where the
insured’s crop dusting was a “single procedure”); Pincoffs, 447 F.2d at 206
(finding multiple occurrences because there were separate negligent sales). 2


      2  The district court also does an unconvincing job of distinguishing Twin City
Fire Ins. Co. v. Ill. Nat’l Ins. Co., No. 1:11–cv–00144–SS, LEXIS 197629 (W.D. Tex.
Mar. 12, 2012), a case in which a defect in the insured’s road construction caused
three separate car accidents on different days. The court held that the three accidents
constituted a single occurrence, emphasizing the broad language of the policy and
that all the injuries were proximately caused by a single negligent act of the insured:
the defective road construction. Id. at *7. That result would be consonant with the
approach described here. Cf. General Star, 332 F.3d at 278 (finding nineteen
occurrences where water leaks in nineteen apartment buildings were caused by
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                                  No. 17-20812
      The chain of causation remained unbroken on these facts. The ongoing
negligence of the runaway Mack truck was the single “proximate,
uninterrupted, and continuing cause” of all the collisions. After all, the parties
agree that Diggs did not apply the brakes at any time from first striking the
Accord until all the vehicles came to rest. The language of the contract provides
that all injuries—no matter the number of vehicles involved or the number of
claims made—arising from continuous or repeated exposure to substantially
the same conditions are considered a single accident. The broad language of
the policy must be given effect. See Foust, 975 S.W.2d at 335. Absent any
indication that the driver regained control of the truck or that his negligence
was otherwise interrupted between collisions (and we have no such indication),
all of the collisions resulted from the same continuous condition—the unbroken
negligence of the Mack truck driver. There was therefore one “accident” under
the policy.
      We REVERSE the district court and RENDER judgment in favor of Mid-
Continent.




nineteen separate negligent plumbing installations, not a single negligent plumbing
installation).
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