A Massachusetts federal district court has ruled that Massachusetts law assured property damage coverage for an innocent named insured when an unnamed co-insured resident of the premises they shared intentionally set those insured premises afire – notwithstanding any policy provision to the contrary.
The Case
After Susan Shepperson's home in Salem, Massachusetts, was damaged in a fire, she filed a claim with her homeowner's insurance carrier, Metropolitan Property and Casualty Insurance Company.
Metropolitan denied the claim, contending that Ms. Shepperson was not entitled to recover for damages caused by the fire if it was determined that one of her sons (whom, the insurer contended, resided in the home) had intentionally set the fire because under the policy no insured – whether named or unnamed – was entitled to coverage for an intentional loss even if they “did not commit or conspire to commit the act causing the loss.”
Ms. Shepperson sued Metropolitan, and moved for partial summary judgment. She argued that even if her son were considered an insured under the Metropolitan policy, any intentional acts that he may have committed did not preclude recovery by an innocent insured such as herself.
Specifically, she claimed that “[t]o the extent that the language of the [p]olicy purport[ed] to exclude coverage for an innocent insured for a loss caused by the intentional acts of another insured, it [was] inconsistent with the scope of coverage afforded by the standard fire policy dictated by statute in M.G.L. c. 175, § 99, and must therefore be deemed unenforceable as a matter of law.”
The District Court's Decision
The district court granted Ms. Shepperson's motion.
In its decision, the district court explained that the language of the Metropolitan policy stated that “no one defined as you or your is entitled to coverage, even people defined as you or your who did not commit or conspire to commit the act causing the loss.” This language, the district court added, was “clear and unambiguous” and suspended coverage for all insured parties – even those who were innocent of any wrongdoing – when any insured party caused an intentional loss.
The district court then found that the exclusion, although “clearly expressed,” appeared to be prohibited by M.G.L. c. 175, § 99. The district court predicted that the Massachusetts Supreme Judicial Court would conclude that M.G.L. c. 175, § 99, provided coverage for innocent co-insureds, and it ruled that Ms. Shepperson, if found to be innocent of causing the fire to her premises, would presumably be able to recover under the policy.
Finally, the district court pointed out that the record demonstrated that Ms. Shepperson was away from the insured premises at the time of the fire, that she had no involvement in causing the fire, that Metropolitan has introduced no evidence to suggest otherwise, and that Metropolitan had not even bothered to ask about her involvement during her examination under oath. The district court concluded, therefore, that Ms. Shepperson was an innocent insured, and was entitled to summary judgment with respect to Metropolitan's liability as to her breach of contract claim against Metropolitan.
The case is Shepperson v. Metropolitan Property and Casualty Ins. Co., No. 16-12116-DPW (D. Mass. May 22, 2018). Attorneys involved include: For Susan Shepperson, Plaintiff: Robert P. Powers, LEAD ATTORNEY, Melick & Porter, LLP, Boston, MA. For Metropolitan Property and Casualty Insurance Company, Defendant: Michael L. Snyder, Snyder Law, P.C., Quincy, MA.
Steven A. Meyerowitz
Steven A. Meyerowitz, a Harvard Law School graduate, is the founder and president of Meyerowitz Communications Inc., a law firm marketing communications consulting company. He may be contacted at [email protected].