Homeowners Policy and Coverage for Assault and Battery Claims
October 20, 2014
An employee filed a complaint against a co-worker claiming that the co-worker committed continuous assaults and batteries on the employee at the place of employment. This case is Love v. Sirey, 119 So.3d 732 (2013).
Love filed a complaint for personal injuries against Sirey claiming that Sirey committed continuous assaults and batteries on Love through inappropriate comments and bodily contact; these alleged acts occurred at the workplace. Sirey contacted her homeowners insurer, State Farm, for defense and coverage.
State Farm initially defended Sirey but then filed a declaratory judgment action asserting that coverage defenses precluded coverage. The trial court granted State Farm's summary judgment motion and this appeal followed.
Sirey contended that the trial court erred in its finding that the acts claimed in the complaint against the insured did not constitute an insurable occurrence under the policy provisions. The Court of Appeal of Louisiana, Fifth Circuit, noted that State Farm argued that the acts of battery and assault were intentional in nature and thus, did not constitute an occurrence as defined in the policy. The appeals court said that the policy defined “occurrence” as an accident but the policy did not define “accident.” Moreover, the definition of “occurrence” did not specifically exclude assault and battery. Therefore, considering the precise language of the policy and the allegations set forth in the complaint, the court ruled that the homeowners policy did not unambiguously or clearly exclude Love's claims from coverage as an insurable occurrence. The court found that the trial court erred in this instance.
Sirey also said that the trial court erred in finding that the claims against her did not result in bodily injury as defined in the policy. State Farm contended that the emotional distress claimed by Love was excluded since the definition of “bodily injury” stated that the term did not include emotional distress or mental distress. However, the appeals court pointed out that Love claimed unwanted bodily contact and also claimed that Sirey's acts caused Love to be disabled. Love also claimed that due to fear and anxiety, she developed a physical injury, namely loss of her bodily functions. The court said that the policy did not unambiguously exclude coverage for these claims and the trial court erred in its findings.
In the third assignment of error, Sirey claimed that the trial court erred by finding that this was an intentional act that was excluded by the intentional act provision in the policy. Sirey said the policy actually excluded intentional injuries. State Farm said the acts of assault and battery are intentional torts and are excluded. The court said there is a difference between an intentional act and an intentional injury. Furthermore, courts have held in other cases that the language used in an intentional injury exclusion is ambiguous. An intentional injury clause by its very language does not exclude coverage for bodily injury caused by an insured's intentional act. Thus, the excluded injury would be the injury the insured intended, not the injury that the insured unintentionally caused, however intentional the act that produced the injury. The court said it had to be determined whether Sirey intended the injuries and this was a genuine issue of material fact. Thus, the trial court erred in its findings.
The insured also contended that the trial court erred in granting summary judgment to the insurer because the acts alleged in the complaint related to the business pursuits exclusion in the policy. State Farm said the acts occurred almost entirely at the workplace where Love and Sirey are co-workers and so, the acts are excluded under the business pursuits exclusion. However, the appeals court said that the exclusion does not apply to activities that are ordinarily incident to non-business pursuits and so, the court ruled that a genuine issue of material fact exists regarding whether the business pursuits exclusion unambiguously excludes coverage. The trial court erred in its findings.
The appeals court vacated the trial court's judgment granting summary judgment to State Farm and remanded the case to the trial court for further proceedings.
Editor's Note: This ruling by the appeals court is based on its finding of ambiguity in the policy language. For every exclusion that the insurer claimed to be applicable, the court found the exclusionary language to be ambiguous and so, the provisions were construed against the insurer and in favor of the insured.
Note that the court did an excellent job of explaining the duties of the insured and the insurer when it comes to the implementation of an insurance policy. The ruling of the court also makes the point that policy language is always subject to judicial interpretation.