Scottsdale Ins. Co. v. Olivares

614 S.W.3d 65

SCOTTSDALE INSURANCE COMPANY, Respondent,

v.Maria OLIVARES, Appellant.

WD 83178

Missouri Court of Appeals, Western District.

OPINION FILED: September 29, 2020

Motion for Rehearing and Transfer to Supreme Court Denied October 27, 2020

Application for Transfer Denied January 26, 2021

Danny L. Worker and Kendall Canfield, Edwardsville, IL, Attorneys for Respondent.

John E. Turner and Christopher P. Sweeny, Kansas City, MO, and Michael Fleming, Lee's Summit, MO, Attorneys for Appellant.

Before Division Two: Karen King Mitchell, Presiding Judge, and Anthony Rex Gabbert and W. Douglas Thomson, Judges

Karen King Mitchell, Presiding Judge

Maria Olivares appeals the award of summary judgment to Scottsdale Insurance Company in its declaratory judgment action to determine insurance coverage for the death of Olivares's son (Son). Olivares raises two points on appeal. She claims that the motion court erred in granting summary judgment because Scottsdale failed to establish that its assault and/or battery coverage form applied as a matter of law to limit coverage to $25,000.00 in that (1) the terms "assault," "battery," and "assault and/or battery" as used in the policy were ambiguous and thus should be interpreted in favor of coverage; and (2) the uncontroverted facts failed to establish that Son's death arose out of an "assault," "battery," or "assault and/or battery" as those terms were defined by the court. Finding no error, we affirm.

Background

On the evening of October 24, 2013, Son was at a bar owned by Aztec Marketing, Inc. While at the bar, Son was involved in a fight with another patron (Patron); others present broke up the fight, and a bar employee ordered Patron to leave. As he was leaving, Patron was overheard saying, "I'll be back. You'll regret it." Patron went to his car and retrieved a gun; he then returned to the bar, where he fired a shot in the air. A bar employee called the police, but Patron shot Son before the police arrived. Son later died.

In January 2017, Olivares filed a wrongful death action against Aztec and one of its employees, asserting claims for negligent security and dram shop liability. At the time of the shooting, Aztec was insured by Scottsdale; the policy included commercial general liability and liquor liability coverage. With respect to bodily injury coverage, the pertinent part of the commercial general liability coverage form stated, "We will pay those sums that the insured becomes legally obligated to pay as damages because of ‘bodily injury’ ... to which this insurance applies." The policy defined "bodily injury" as "bodily injury, sickness or disease sustained by a person, including death resulting from any of these at any time." In relevant part, the liquor liability coverage form stated,

We will pay those sums that the insured becomes legally obligated to pay as damages because of "injury" to which this insurance applies if liability for such "injury" is imposed on the insured by reason of the selling, serving or furnishing of any alcoholic beverage.

The policy defined "injury" as "damages because of ‘bodily injury’ ... including damages for care, loss of services or loss of support." The policy's coverage limits for commercial general liability and liquor liability were $1,000,000.00.

The policy contained an Assault and/or Battery Limited Liability Coverage Form, which limited coverage for assault and battery, although those terms were not defined in the policy. In pertinent parts, the assault/battery coverage form stated,

This endorsement modifies insurance provided under the following:

COMMERCIAL GENERAL LIABILITY COVERAGE PART

...

LIQUOR LIABILITY COVERAGE PART

...

Except as provided by this coverage form, this policy does not apply to "injury," "bodily injury," ... arising from:

1. Assault and/or Battery committed by:

a. Any insured;

b. Any employee/"employee" of any insured; or

c. Any other person; or

2. The failure to suppress or prevent Assault and/or Battery by any person in 1. above; or

3. The selling, serving or furnishing of alcoholic beverages which results in Assault and/or Battery; or

4. The negligent:

a. Employment;

b. Investigation;

c. Supervision;

d. Reporting to the proper authorities, or failure to so report; or

e. Retention

of a person for whom any insured is or ever was legally responsible and whose conduct would be excluded by paragraphs 1. and 2. above.

We will have no duty to defend any suit/"suit" against you seeking damages/"damages" on account of any such injury unless coverage is provided by this Coverage Form.

The coverage provided is described below:

INSURING AGREEMENTS

For the premium shown below, we agree to afford coverage with respect to Assault and/or Battery Liability only as indicated on this Coverage Form and subject to the liability limits and provisions as set forth in this Coverage Form.

LIMITS OF LIABILITY	COVERAGE
$ 25,000 Each Event	Assault and/or
$ 50,000 Aggregate	Battery Liability
$ INCLUDED TOTAL PREMIUM

1. COVERAGE – ASSAULT AND/OR BATTERY LIABILITY

We will pay on your behalf all sums which you shall become legally obligated to pay as "damages" because of "injury," "bodily injury," ... to any person arising out of Assault and/or Battery that takes place during the policy period.

We will have the right and duty to defend any suit against you seeking such "damages," even if any of the allegations of the suit are groundless, false or fraudulent and may make such investigation and such settlement of any claim or suit as we deem expedient, but we shall not be obligated to pay any claim or judgment or to defend any suit after the applicable Limit of Liability shown in this Coverage Form has been exhausted. However, we will have no duty to defend the insured against any suit seeking "damages" to which this insurance does not apply.

...

4. LIMITS OF LIABILITY

Regardless of the number of insureds under this policy, our liability is limited as follows:

The limit of liability stated in this coverage form as applicable to each Event is the most we will pay for all "damages" arising out of "injury," "bodily injury," ... because of assault and/or battery, regardless of the number of insureds, persons injured, claims made or suits brought or persons or organizations making claims or bringing suits. The limit of liability stated above as Aggregate, subject to the above provision regarding each Event, is the total limit of our liability under this coverage for all "damages" in any policy period.

5. DEFINITIONS

"Damages" means a monetary judgment, award, or settlement, including damages for death, which are payable because of injury to which this insurance applies. However, damages do not include criminal restitution.

"Event" means an act or series of acts based on or arising out of the same assault and/or battery.

In February 2018, Olivares, Aztec, and Scottsdale entered into a settlement agreement, which fully released Aztec and its employee from the underlying action while reserving the issue of coverage limits to be litigated between Olivares and Scottsdale. Pursuant to the agreement, a $1,000,000.00 judgment was entered against Aztec with the understanding that the judgment would be satisfied from the policy only. Scottsdale paid Olivares $25,000.00 pursuant to the assault/battery coverage form, but Olivares contends that the shooting is covered by the full $1,000,000.00 limit of the policy, and not the $25,000.00 limit of the assault/battery coverage form.

Scottsdale filed this declaratory judgment action seeking a determination that the assault/battery coverage form applies and limits coverage for Son's shooting death to $25,000.00. Thereafter, Scottsdale moved for summary judgment setting out twenty-two uncontroverted facts. In response, Olivares admitted the facts set forth in Scottsdale's motion; she did not allege any additional facts. Scottsdale then filed a reply that did not assert any additional facts; no sur-reply was filed.

At oral argument, Scottsdale asserted that, pursuant to the undisputed facts set forth in its motion, the assault/battery coverage form unambiguously limited coverage for Son's death to $25,000.00. Olivares argued that the terms "assault" and "battery" are ambiguous, and therefore, must be interpreted in favor of coverage. She further argued that, even if the terms are not ambiguous, Scottsdale's uncontroverted facts failed to establish, as a matter of law, that the assault/battery coverage form applied.¹

On May 20, 2019, the court granted Scottsdale's motion for summary judgment.² The court found "that the terms ‘assault’, ‘battery’, and ‘assault and/or battery’ have commonly understood definitions and are not ambiguous." The court stated,

Webster's Third New World College Dictionary defines assault as, "an unlawful threat or unsuccessful attempt to do physical harm to another, causing a present fear of immediate harm." ^{[ ]} Battery is defined as, "any illegal beating or touching of another person, either directly or with an object." ^{[ ]} The definition provided for assault and battery is, "the carrying out of threatened physical harm or violence." ^{[ ]}

This Court must apply the plain meaning to "assault", "battery", and "assault and/or battery", even if it restricts coverage. The most reasonable and commonly understood definitions of those terms provided above, as applied to the undisputed facts of the underlying case show that the Assault and Battery Form apply. The shooter threatened the patrons of the bar ("assault"), left to retrieve his gun from the car, and eventually shot the deceased ("battery" and "assault and battery"). While [Olivares] argues that battery is most commonly thought of as a beating, the dictionary definition clearly provides for touching with an object, as we have here with a bullet. This Court finds that all three terms in question, "assault", "battery", or "assault and/or battery" apply here and that coverage falls under the Assault and Battery Form.

Olivares timely filed a motion for new trial to which she attached the...