Unpublished Disposition, 902 F.2d 41 (9th Cir. 1990)

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U.S. Court of Appeals for the Ninth Circuit - 902 F.2d 41 (9th Cir. 1990)

STATE FARM INSURANCE COMPANY, Plaintiff-Appellee-Cross-Appellant,v.Everett W. AUSTIN, Sharon Austin, Gary Austin, Defendants,andKim Boswell, a single person individually and as guardian adlitem for Kasi Boswell, InterveningDefendants-Appellants-Cross-Appellees,

Nos. 88-3608, 88-3633.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted June 6, 1989.Decided May 11, 1990.

Before GOODWIN, Chief Judge, and EUGENE A. WRIGHT and WILLIAM A. NORRIS, Circuit Judges.


MEMORANDUM* 

Intervening defendant Kim Boswell, the parent of a sexually molested three-year old girl, appeals the district court's summary judgment in favor of State Farm Insurance Company in State Farm's declaratory judgment action against Everett and Sharon Austin, the parents of the eleven-year old boy who was accused of the molestation. State Farm cross-appeals the district court's grant of the Boswells' motion to intervene. We vacate and remand.

Investigations conducted by the State of Idaho Department of Health and Welfare and the Pocatello Police Department indicated that Gary Austin sexually molested Kasi Boswell during a period of time when the Austins were holders of a homeowner's liability policy issued by State Farm.

The Boswells notified the Austins of their claim for injury to Kasi Boswell. Upon learning of the Boswells' claim, State Farm filed in federal district court a declaratory judgment action against the Austins. State Farm sought a declaration that Gary Austin's sexual misconduct was intentional as a matter of law and was therefore excluded from coverage pursuant to the policy's standard exclusion for intentional injuries.

Before the declaratory proceedings were concluded, the Boswells filed in an Idaho state court their tort action against the Austins for damages resulting from the sexual molestation. They also filed a motion to intervene in State Farm's federal declaratory judgment action against the Austins.

Over State Farm's objection, the district court granted the Boswells' motion to intervene. The court found that the Boswells were entitled to intervene as permissive intervenors pursuant to Fed. R. Civ. P. 24(b), and ordered them to file a response to State Farm's motion for summary judgment.

In due course, the district court granted State Farm's motion for summary judgment. The Austins have not appealed. The Boswells, as intervenors, appeal the summary judgment. State Farm cross-appeals the district court's grant of permissive intervention to the Boswells.

Subsequent to the filing of this appeal, the Austins suffered a default judgment in Idaho state court.

We first consider State Farm's cross-appeal.

State Farm contends that the district court erroneously granted the Boswells' motion for permissive intervention. State Farm argues that the Boswells had no claim against the Austins which shared a question of law or fact in common with State Farm's declaratory judgment action against the Austins. It further argues that the Boswells' state tort action against the Austins was legally indifferent to the intent of Gary Austin, and therefore was unrelated to the policy coverage question at issue in State Farm's declaratory judgment action.

The Boswells, on the other hand, contend that the question of Gary Austin's intent in sexually molesting Kasi Boswell is a common question shared by the state tort action and State Farm's declaratory judgment action to interpret the homeowner's liability policy.

The district court may, in its discretion, grant permissive intervention when (1) the movant's claim or defense and the main action have a question of law or fact in common, California ex rel. Van de Camp v. Tahoe Regional Planning Agency, 792 F.2d 779, 782 (9th Cir. 1986) (quoting Fed. R. Civ. P. 24(b)); (2) the motion is timely, County of Orange v. Air California, 799 F.2d 535, 539 (9th Cir. 1986), cert. denied, 480 U.S. 946 (1987); and (3) the movant establishes a basis for federal subject matter jurisdiction independent of the court's jurisdiction over the underlying action, Equal Employment Opportunity Comm'n v. Nevada Resort Ass'n, 792 F.2d 882, 886 (9th Cir. 1986); Blake v. Pallan, 554 F.2d 947, 956 (9th Cir. 1977).

The crucial issue here is whether the Boswells have met the "common question of law or fact" requirement for permissive intervention. The district court granted permissive intervention on the ground that the Austins were not adequately protecting any contingent interests the Boswells may have had in defeating State Farm's declaratory action. It did not address the "common question of law or fact" requirement.

The fundamental question in State Farm's declaratory judgment action against the Austins concerning policy coverage was whether Gary Austin's acts of sexual misconduct were intentional for the purpose of Idaho insurance law.

It is evident that the Boswells artfully strove to make Gary Austin's intent an issue in the state tort case. The record includes the transcript of Gary Austin's deposition in the state court proceedings in which several questions were asked by Kim Boswell's counsel regarding Gary Austin's intent in sexually molesting Kasi Boswell. The Boswells' counsel also prepared an unsigned affidavit for Gary Austin (which does not appear to have been introduced in the state court proceedings), stating that Gary Austin did not intend to harm Kasi Boswell. Both of these documents were lodged in the district court record but the district court correctly refused to admit them into evidence.

Kim Boswell's counsel had no need to establish in the state court tort action that Gary Austin did not intend to harm Kasi Boswell. It is highly unlikely that a jury would increase an injured party's recovery in a state tort action upon becoming convinced that the sexual molester did not intend to perform the acts of which the injured party complained.

In State Farm's declaratory action, of course, it was to Kim Boswell's advantage to try to demonstrate that Gary Austin did not intend to harm Kasi Boswell, because the insurance policy that State Farm had issued to the Austins did not cover intentional acts, and the Austins apparently had no other assets to make a lawsuit an attractive enterprise.

All this leads to the unavoidable question whether intent was legitimately at issue in Kim Boswell's state tort action to make intent the "common question of law or fact" required under Rule 24(b). On the record before us, we cannot say. The record of the Idaho state court proceedings was not before the district court and is not before us on appeal. The transcript of Gary Austin's deposition and the unsigned affidavit were offered after the district court had ruled on the Boswells' motion for permissive intervention and were never filed in the district court record.

Because we cannot determine whether the "common question of law or fact" requirement for permissive intervention was met, we are compelled to vacate the judgment. On remand, the district court is directed to review the Idaho state court proceedings in order to determine whether intent was legitimately at issue in the state court case. If, under Idaho law, the intent of the perpetrator of a child molestation is a material question of law or fact in a damage action, then the court could find that the "common question of law or fact" requirement for permissive intervention was met.

If there are further appeals in this litigation this court will retain jurisdiction of the case.

Because we cannot say whether intervention was properly granted, we do not address the issue of standing to appeal or the effect of the exclusion clause of the policy.

VACATED AND REMANDED.

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This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3