Allstate Property and Casualty Insurance Company v. Giroux et al, No. 3:2015cv05954 - Document 22 (W.D. Wash. 2016)
Court Description: ORDER denying 16 Motion for Summary Judgment by Judge Benjamin H. Settle.(TG)
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Allstate Property and Casualty Insurance Company v. Giroux et al Doc. 22 1 2 3 4 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT TACOMA 5 6 7 ALLSTATE PROPERTY AND 8 CASUALTY INSURANCE CO., Plaintiff, 9 10 v. CASE NO. C15-5954 BHS ORDER DENYING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT WITHOUT PREJUDICE 11 RICHARD W. GIROUX, et al., 12 Defendants. 13 14 This matter comes before the Court on Plaintiff Allstate Property and Casualty 15 Insurance Co.’s (“Allstate”) motion for summary judgment (Dkt. 16). The Court has 16 considered the pleadings filed in support of and in opposition to the motion and the 17 remainder of the file and hereby denies the motion without prejudice for the reasons 18 19 stated herein. I. PROCEDURAL HISTORY 20 21 On December 31, 2015, Allstate filed a declaratory judgment action against 22 Defendants Andy Rhee, Kevin Rhee, and Richard Giroux (“Giroux”). Dkt. 1 (“Comp.”). Allstate seeks an order that it does not have a duty to defend or indemnify Andy Rhee and Kevin Rhee (collectively, “the Rhees”) and their spouses in the lawsuit filed against ORDER - 1 Dockets.Justia.com 1 2 them by Giroux. Id. ¶ 14. On March 15, 2016, the Rhees filed an answer and asserted counterclaims against Allstate. Dkt. 7. The Rhees allege Allstate breached its duty to 3 investigate and duty of good faith and fair dealing. Id. ¶ 25. 4 On May 20, 2016, Allstate moved for summary judgment. Dkt. 16. On June 13, 5 6 2016, the Rhees responded. Dkt. 18. On June 16, 2016, Allstate replied. Dkt. 20. II. FACTUAL BACKGROUND 7 8 A. Underlying Suit 9 On December 7, 2015, Giroux filed a personal injury complaint against the Rhees 10 and their spouses in Pierce County Superior Court. Dkt. 17, Declaration of Douglas 11 Foley (“Foley Dec.”), Ex. 1. The following allegations are taken from Giroux’s 12 complaint. 13 14 15 Giroux was teaching a golf lesson at the Meadow Park Golf Course in Pierce County on June 7, 2015. Id. ¶ 2.01. During the lesson, one of Giroux’s students inadvertently picked up one of the Rhees’ golf balls and gave it to Giroux. Id. ¶ 2.02. 16 Giroux realized that the student had picked up the Rhees’ golf ball as the Rhees 17 approached in a golf cart. Id. ¶ 2.03. 18 According to Giroux’s complaint, the Rhees “exited the golf cart, repeatedly 19 20 swore at the group, and aggressively approached [Giroux] and [the] golf students.” Id. 21 ¶ 2.05. Giroux claims Kevin Rhee approached him and “started to flick the brim of the 22 [Giroux’s] hat with his finger, exclaiming ‘what are you going to do about it?’” Id. ¶ 2.06. ORDER - 2 1 2 Giroux further asserts that Andy Rhee “then used both hands to forcefully, and intentionally, push [Giroux], causing [him] to fall backwards onto the ground.” Id. 3 ¶ 2.07. Giroux alleges he sustained injuries to his right arm and shoulder. Id. ¶ 2.08. 4 While Giroux was on the ground, the Rhees “stood over him, nudging [Giroux] with their 5 6 feet and saying, ‘get up.’” Id. ¶ 2.09. Giroux brings claims for assault and battery, outrage, negligent infliction of 7 8 emotional distress, and negligence. Id. ¶¶ 3.1–6.3. According to the Rhees’ briefing, 9 Allstate agreed to defend them under a reservation of rights. Dkt. 18 at 10. 10 B. Allstate Policies 11 Andy Rhee and Kevin Rhee each have homeowners’ insurance policies with 12 Allstate. Foley Dec., Exs. 2 & 3. Their Allstate policies are the same policy form, and 13 therefore contain the same coverage, terms, definitions, and exclusions. See id. 14 15 The Allstate policies provide family liability coverage for “damages which an insured person becomes legally obligated to pay because of bodily injury or property 16 damage arising from an occurrence to which this policy applies, and is covered by this 17 part of the policy.” Foley Dec., Ex. 2 at 50. “If an insured person is sued for these 18 19 20 21 damages, [Allstate] will provide a defense with counsel of [its] choice, even if the allegations are groundless, false or fraudulent.” Id. The policies define “bodily injury” as “physical harm to the body, including 22 sickness or disease, and resulting death.” Id. at 24. An “occurrence,” in turn, is defined as “an accident, including continuous or repeated exposure to substantially the same ORDER - 3 1 2 general harmful conditions during the policy period, resulting in bodily injury or property damage.” Id. at 26. 3 Relevant to the instant motion, the policies contain an “intentional or criminal 4 acts” exclusion to family liability coverage: 5 6 7 8 9 10 We do not cover any bodily injury or property damage intended by, or which may reasonably be expected to result from the intentional or criminal acts or omissions of, any insured person. This exclusion applies even if: a) such insured person lacks the mental capacity to govern his or her conduct; b) such bodily injury or property damage is of a different kind or degree than intended or reasonably expected; or c) such bodily injury or property damage is sustained by a different person than intended or reasonably expected. 11 Id. at 52. 12 Finally, the policies include a joint obligations clause: 13 14 15 16 17 18 This policy imposes joint obligations on the Named Insured(s) listed on the Policy Declarations as the insured and on that person’s resident spouse. These persons are defined as you or your. This means that the responsibilities, acts and omissions of a person defined as you or your will be binding upon any other person defined as you or your. This policy imposes joint obligations on persons defined as an insured person. This means that the responsibilities, acts and failure to act of a person defined as an insured person will be binding upon another person defined as an insured person. 19 Id. at 26–27. 20 21 III. DISCUSSION Allstate moves for summary judgment on its duty to defend and duty to indemnify. 22 Dkt. 16. ORDER - 4 1 2 3 A. Summary Judgment Standard Summary judgment is proper only if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material 4 fact and that the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). 5 The moving party is entitled to judgment as a matter of law when the nonmoving party 6 7 8 9 fails to make a sufficient showing on an essential element of a claim in the case on which the nonmoving party has the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). There is no genuine issue of fact for trial where the record, taken as a whole, 10 could not lead a rational trier of fact to find for the nonmoving party. Matsushita Elec. 11 Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986) (nonmoving party must 12 present specific, significant probative evidence, not simply “some metaphysical doubt”). 13 See also Fed. R. Civ. P. 56(e). Conversely, a genuine dispute over a material fact exists 14 if there is sufficient evidence supporting the claimed factual dispute, requiring a judge or 15 16 jury to resolve the differing versions of the truth. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 253 (1986); T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n, 809 F.2d 17 626, 630 (9th Cir. 1987). 18 The determination of the existence of a material fact is often a close question. The 19 20 21 22 Court must consider the substantive evidentiary burden that the nonmoving party must meet at trial—e.g., a preponderance of the evidence in most civil cases. Anderson, 477 U.S. at 254; T.W. Elec. Serv., Inc., 809 F.2d at 630. The Court must resolve any factual issues of controversy in favor of the nonmoving party only when the facts specifically attested by that party contradict facts specifically attested by the moving party. The ORDER - 5 1 2 nonmoving party may not merely state that it will discredit the moving party’s evidence at trial, in the hopes that evidence can be developed at trial to support the claim. T.W. 3 Elec. Serv., Inc., 809 F.2d at 630 (relying on Anderson, 477 U.S. at 255). Conclusory, 4 nonspecific statements in affidavits are not sufficient, and missing facts will not be 5 6 7 presumed. Lujan v. Nat’l Wildlife Fed’n, 497 U.S. 871, 888–89 (1990). B. In Washington, the interpretation of insurance policies is a question of law. Am. 8 9 Insurance Policy Interpretation Star Ins. Co. v. Grice, 121 Wn.2d 869, 874 (1993), opinion supplemented by 123 Wn.2d 10 131 (1994). Washington courts construe insurance policies as a whole, giving force and 11 effect to each clause in the policy. Id. If the policy language is clear and unambiguous, 12 the Court will not modify the policy or create an ambiguity. Id. If the policy language is 13 fairly susceptible to two different reasonable interpretations, it is ambiguous, and the 14 Court may attempt to discern the parties’ intent by examining extrinsic evidence. Id. If 15 16 the policy remains ambiguous after resort to extrinsic evidence, the Court construes the ambiguities against the insurer. Id. at 874–75. 17 C. Allstate’s Motion 18 Allstate argues it does not have a duty to defend or indemnify the Rhees in the 19 20 21 22 underlying suit because Giroux’s complaint is not covered by the Allstate policies. Dkt. 16. Under Washington law, the duty to defend is broader than the duty to indemnify. Woo v. Fireman’s Fund Ins. Co., 161 Wn.2d 43, 52 (2007). “The duty to defend arises based on the insured’s potential for liability and whether allegations in the complaint ORDER - 6 1 2 could conceivably impose liability on the insured.” Id. at 60. An insurer defending a suit under a reservation of rights “must defend until it is clear that the claim is not covered.” 3 Am. Best Food, Inc. v. Alea London, Ltd., 168 Wn.2d 398, 405 (2010). “Moreover, an 4 ambiguous complaint must be construed liberally in favor of triggering the duty to 5 6 7 defend.” Woo, 161 Wn.2d at 60. Meanwhile, the duty to indemnify depends on “the insured’s actual liability to the claimant and actual coverage under the policy.” Hayden 8 v. Mut. of Enumclaw Ins. Co., 141 Wn.2d 55, 64 (2000). 9 To determine whether the duty to defend exists, the Court first “examines the 10 policy’s insuring provisions to see if the complaint’s allegations are conceivably 11 covered.” Id. If the complaint’s allegations are conceivably covered, the Court “must 12 then determine whether an exclusion clearly and unambiguously applies to bar coverage.” 13 Id. Exclusionary clauses are strictly construed against the insurer. Expedia, Inc. v. 14 15 Steadfast Ins. Co., 180 Wn.2d 793, 803 (2014). The insurer bears the burden of proving that an exclusionary clause applies. Am. Star Ins. Co. v. Grice, 121 Wn.2d 869, 875 16 (1993). 17 In the underlying suit, Giroux alleges he “was the victim of an unprovoked assault 18 19 20 and battery perpetrated by Defendants Andy and Kevin Rhee” that involved flicking his hat, pushing him to the ground, and kicking him while on the ground. Foley Dec., Ex. 1 21 ¶ 3.2. Giroux further claims the Rhees “intentionally and recklessly inflicted emotional 22 distress” upon him. Id. ¶ 4.3. Finally, Giroux alleges the Rhees “had an independent duty to use reasonable care to avoid causing [him] emotional distress” and “failed to use reasonable care to avoid causing [his] damages.” Id. ¶¶ 5.2, 6.2. ORDER - 7 1 2 Allstate contends it does not have a duty to defend the Rhees because all of Giroux’s claims stem from deliberate acts, which do not constitute an “occurrence” under 3 the coverage provisions of the Allstate policies. Dkt. 16 at 10–12. For the same reason, 4 Allstate argues the intentional and criminal acts exclusion precludes coverage as well. Id. 5 6 at 13. The Allstate policies provide family liability coverage for an “occurrence,” which 7 8 is defined as “an accident . . . resulting in bodily injury or property damage.” Foley Dec., 9 Ex. 2 at 50. The policies do not define the term “accident.” When undefined in an 10 insurance policy, Washington courts have “referenced two similar definitions of the term 11 ‘accident’ in insurance coverage cases: (1) an unusual, unexpected, and unforeseen 12 happening; and (2) a loss that happens without design, intent, or obvious motivation.” 13 United Servs. Auto. Ass’n v. Speed, 179 Wn. App. 184, 197 (2014) (internal quotation 14 15 marks and citations omitted). In light of these definitions, “Washington courts repeatedly have held that the insured’s deliberate conduct generally does not constitute an accident.” 16 Id. 17 The policies also contain an intention or criminal acts exclusion, which precludes 18 19 20 coverage for “any bodily injury or property damage intended by, or which may reasonably be expected to result from the intentional or criminal acts or omissions of, any 21 insured person.” Foley Dec., Ex. 2 at 52. This exclusion applies even if the “bodily 22 injury or property damage is of a different kind or degree than intended or reasonably expected.” Id. Based on the plain language of these provisions, the Allstate policies ORDER - 8 1 2 preclude coverage for deliberate acts or omissions that result in bodily injury or property damage. 3 At this time, the Court cannot conclude that the underlying complaint is clearly not 4 covered by the Allstate policies. Although Giroux’s complaint contains allegations of 5 6 7 intentional conduct, Giroux also alleges the Rhees negligently caused him emotional distress and failed to use reasonable care to avoid causing him damages. The inclusion of 8 these allegations creates ambiguity on the face of Giroux’s complaint, which the Court 9 must construe liberally in favor of triggering a duty to defend. See Woo, 161 Wn.2d at 64 10 (“The insured must be given the benefit of the doubt if is not clear from the face of the 11 complaint that the policy does not provide coverage.”). 12 To the extent Allstate argues Giroux has not pled sufficient facts to support his 13 negligence claims, see Dkt. 16 at 14, this argument should be raised in the underlying 14 15 state court suit, which is still ongoing. This Court is without jurisdiction to dismiss the underlying negligence claims for failure to provide sufficient factual allegations. In the 16 event Giroux’s negligence claims are dismissed in the underlying suit, Allstate may 17 renew its motion for summary judgment in this Court. 18 19 20 With regard to Allstate’s duty to indemnify, the Rhees’ actual liability in the underlying suit has not yet been determined. It is therefore premature for the Court to 21 decide whether Allstate has a duty to indemnify. See Hayden, 141 Wn.2d at 64 (“The 22 duty to indemnify hinges on the insured’s actual liability to the claimant and actual coverage under the policy.”). For these reasons, the Court denies Allstate’s motion. ORDER - 9 1 2 IV. ORDER Therefore, it is hereby ORDERED that Allstate’s motion for summary judgment 3 (Dkt. 16) is DENIED without prejudice. 4 Dated this 7th day of July, 2016. 5 A 6 7 BENJAMIN H. SETTLE United States District Judge 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 ORDER - 10
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