Great American Alliance Ins. v. Windermere Baptist Conference , 931 F.3d 771 ( 2019 )

United States Court of Appeals
For the Eighth Circuit
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No. 17-3635
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Great American Alliance Insurance Company
Plaintiff - Appellant
v.
Windermere Baptist Conference Center, Inc.; Jeremy Richards; Karlee Richards
Defendants - Appellees
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Appeal from United States District Court
for the Western District of Missouri - Jefferson City
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Submitted: February 12, 2019
Filed: July 29, 2019
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Before SMITH, Chief Judge, BENTON and STRAS, Circuit Judges.
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STRAS, Circuit Judge.
While attending Bible camp, a child fell from a 50-foot-high zipline. The
parties dispute who potentially bears financial responsibility for her injuries. On one
side is the conference center that operated the zipline. On the other is the Bible
camp’s insurer. We conclude that, under the plain language of the insurance policy,
the insurer is not responsible for the conference center’s alleged negligence.
I.
Windermere Baptist Conference Center is located on the shores of Missouri’s
Lake of the Ozarks. For many years, Student Life, an affiliate of the Southern
Baptist Convention, has used Windermere to host its camps. According to their
contract, Student Life rents group lodging and conference rooms from Windermere.
In return, campers have access to Windermere’s common spaces and some of its
recreational areas, including the swimming pool, miniature-golf course, and hiking
trails. But a few recreational areas—including “the Edge,” Windermere’s ropes and
zipline course—are not freely available to campers. Rather, to access the Edge,
campers must make separate arrangements and pay an additional fee.
Karlee Richards and her youth group attended a Student Life Bible camp.
During their free time one afternoon, they arranged to use the Edge. In addition to
scheduling a specific time with Windermere and paying the entrance fee, the
campers had to submit a permission and release form signed by a parent. Midway
through the course, a Windermere employee forgot to reconnect Karlee’s harness to
the zipline’s tether, and she fell 50 feet to the ground.
This tragic accident led to extensive litigation between Windermere and the
Richards family. Eventually, Windermere asked Student Life’s insurer, Great
American Alliance Insurance Company, to indemnify it as an additional insured
under Student Life’s general-liability insurance policy. Great American refused on
the ground that the accident did not “ar[ise] out of the . . . use of . . . premises leased”
to Student Life.
Great American then filed a separate declaratory-judgment action in federal
district court against, as relevant here, Windermere, Karlee, and Karlee’s father.
After both sides moved for summary judgment, the court ruled that Windermere was
covered by Student Life’s policy. Great American appeals this decision, which we
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review de novo. See United Fire & Cas. Co. v. Titan Contractors Serv., Inc., 751
F.3d 880, 883 (8th Cir. 2014).
II.
Student Life’s insurance policy covered Windermere as an additional insured
only if its “liability ar[ose] out of the ownership, maintenance[,] or use of that portion
of the premises leased to [Student Life].” The crucial question, then, is whether
Karlee’s zipline accident “ar[ose] out of” the use of premises that Windermere
“leased to” Student Life. Neither phrase is defined in the policy, so we give each
the “ordinary meaning . . . that the average layperson would reasonably understand.”
Martin v. U.S. Fid. & Guar. Co., 996 S.W.2d 506, 508 (Mo. banc 1999) (citation
omitted).
The common understanding of a “lease” is a “contract by which one conveys”
property for a certain period of time “for a specified rent or compensation.”
Webster’s Third New International Dictionary 1286 (2002). Combining this
definition with the specific terms of the policy, the only “premises” Windermere
“conveyed” to Student Life were the conference rooms and the lodging specified in
the contract. Their contract did not mention any other areas, much less give Student
Life a “right [to] exclusive possession” of them, which is “the hallmark of a lease.”
Kan. City Area Transp. Auth. v. Ashley, 485 S.W.2d 641, 645 (Mo. Ct. App. 1972);
see also Kimack v. Adams, 930 S.W.2d 505, 507 (Mo. Ct. App. 1996) (defining a
lease as a “contract . . . for exclusive possession of [property] for a determinate
period” (emphasis added) (citation omitted)).
The Edge was no exception. It was off-limits to any campers who did not
make special arrangements in advance, including Karlee and her youth group. To
be sure, campers could get right up to the security fence surrounding the Edge. But
the area itself was at all times under the control of Windermere’s employees. Student
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Life, in other words, not only lacked exclusive possession of the Edge, it had no right
to possession of it at all.
Windermere responds that even if it did not lease the Edge, its liability still
“ar[ose] out of” Student Life’s lease of the conference rooms and lodging. Under
Missouri law, the phrase “arising out of” requires something less than proximate
cause but something more than a simple “but-for . . . temporal and spatial
relationship,” which is all that is present here. Walden v. Smith, 427 S.W.3d 269,
283 (Mo. Ct. App. 2014) (interpreting a car-insurance policy that covered damages
“aris[ing] out of the use of” the car); see also Capitol Indem. Corp. v. 1405 Assocs.,
Inc., 340 F.3d 547, 550 (8th Cir. 2003) (explaining that “arising out of” means
“originating from,” “growing out of,” “having its origin in,” or “flowing from”
(citation omitted)).
Karlee’s accident only “arose out of” Student Life’s use of the leased premises
in the sense that she would not have used the Edge but for her attendance at Bible
camp. Nothing about the “use” of these areas caused the accident or made it more
likely to occur. See Walden, 427 S.W.3d at 283 (denying coverage because the “use
of the vehicle [did not] creat[e] . . . a condition that caused” the accident). This
means that the connection here is only a “temporal and/or spatial” one,” id. at 278;
see also State Farm Mut. Auto. Ins. v. Flanary, 879 S.W.2d 720, 722–23 (Mo. Ct.
App. 1994) (similar), not one “originating from” or “having its origin in” Student
Life’s use of the leased premises, Capitol Indem. Corp., 340 F.3d at 550 (citation
omitted).
Indeed, the Missouri Court of Appeals reached a similar conclusion in U.S.
Fidelity & Guaranty v. Drazic, 877 S.W.2d 140 (Mo. Ct. App. 1994). Drazic
involved a slip-and-fall injury in a parking lot to a woman who worked in a nearby
building. When the parties disagreed about whether the building owners were
entitled to additional-insured coverage under her employer’s insurance policy, the
court held that the accident did not arise out of her employer’s lease, even though
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the parking lot “immediately adjoin[ed]” the building and employees would almost
certainly need to cross it. Id. at 141–43.
Unlike the employee in Drazic, Student Life’s campers could still use the
leased spaces without going anywhere near the Edge. So, following the path that
Drazic has laid out for us, Windermere’s potential liability for Karlee’s injuries
could not possibly have “aris[en] out of the . . . use of . . . the premises leased” to
Student Life.
III.
We accordingly reverse and remand for the entry of summary judgment in
favor of Great American.
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