Intentional Acts Exclusion Bars Coverage for Insured's Acts While Voluntarily Intoxicated
In McSparrin v. Direct Ins., 2008 WL 1821865 (Ark.), an auto insurer filed an action seeking declaration that it had no duty to defend or indemnify an insured under the exclusionary clause in her policy. The circuit court ruled that the clause applied, such that the insurer had no duty to defend or indemnify the insured. The insured appealed. The Supreme Court of Arkansas held that, in a matter of first impression, the evidence supported the conclusion that the insured's conduct was intentional, such that the exclusionary clause applied.
In this case, Diana McSparrin repeatedly rammed her car into Joshua Dark's vehicle, which was parked outside Dark's home and unoccupied at the time. McSparrin's successive impacts moved Dark's vehicle nearly fifty feet, until it stopped against a car belonging to McSparrin's ex-boyfriend, Thomas Dennis, who lived next door to the Dark family. McSparrin testified that she might have been upset with Dennis before she began drinking at Dennis's house but said that she could not recall ramming into Dark's vehicle because she was intoxicated at the time.
Dark's father called 911 and police officers arrived and arrested McSparrin for driving while intoxicated. McSparrin's insurer, Direct Insurance Company, later filed the action for a declaratory judgment and alleged that because McSparrin had intentionally driven her vehicle into Dark's, Direct did not have a duty to defend or indemnify McSparrin under the intentional acts exclusion.
The trial court found that although it was undisputed that McSparrin was drunk, the facts demonstrated that she intentionally rammed Dark's vehicle. Thus, the exclusion applied and Direct did not have a duty to defend or indemnify McSparrin.
On appeal, McSparrin argued that the trial court erred because she could not have intentionally rammed Dark's vehicle due to her voluntary intoxication. The court of appeals determined that the general rule that coverage exists under insuring contracts and exclusion clauses for the unintended results of an intentional act, but not for damages assessed because of an injury which was intended to be inflicted, should apply; thus the exclusionary clause in the policy precluded the insurer from having a duty to defend or indemnify McSparrin.
In her appeal to the Arkansas high court, McSparrin contended that her intoxication caused her to blackout and that she had no recollection of ramming Dark's vehicle. However, according to the court, weighing against her was the fact that she rammed Dark's vehicle until it rested against her ex-boyfriend's (with whom she was upset), that she giggled as she repeatedly backed up and rammed Dark's vehicle, and that her intoxication was at least not so severe that she was cognizant of the fact that Dark's father had called the police to report her act and called him a derogatory name for doing so before her arrest. And, although McSparrin was arrested for DWI and showed at least some level of intoxication, she later made a recorded statement for her insurance company admitting that her damage to Dark's vehicle was intentional.
McSparrin also contended that the trial court's decision violated public policy, arguing the General Assembly had endorsed the public policy in favor of compensating victims because it had “seen fit to mandate automobile insurance coverage while home owners insurance is purely voluntary with the individual.” However, the court explained, Ark.Code Ann. §27-22-101(a) stated that the legislative intent of the Motor Vehicle Liability Insurance chapter was not intended in any way to alter or affect the validity of any policy provisions, exclusions, exceptions, or limitations contained in a motor vehicle policy required by this chapter. Therefore, the court afirmed the trial court's ruling that McSparrin's course of conduct showed that she acted intentionally, as it was not clearly against the preponderance of the evidence, nor was it contrary to any public policy the state's General Assembly had announced.