Home Page The Publication The Editor Contact Information Insurance Key issues Book Subscribe


Vol. 4, Iss. 3
March 18, 2015

An Insurance Blue Moon:
Coverage Owed For Sexual Assault -- “A Particularly Odd Set of Facts”

 

The number of decisions addressing the availability of coverage for a sexual assault are legion. They often, but not always, arise under the liability section of a homeowner’s policy. I have never undertaken a formal count, but, anecdotally, I can say that coverage is rarely owed for such claims.

The reasons given by courts, for denying coverage for sexual assault, are several. These include the following. Since sexual assault involves intentional conduct, it is not an accident/occurrence. And even if a sexual assault is pleaded as negligence, that is simply artful pleading, in hopes of triggering coverage, and the court won’t be fooled. If there is a requirement in the law that the injury, and not just the act, be intended, an intention to cause injury will be deemed, in light of the nature of a sexual assault. There may be an express exclusion in the policy for sexual assault. And a court may conclude that reasons of public policy preclude coverage. Or the basis for a court’s determination of no coverage for a sexual assault could be a combination of the above.

So if Allstate Property & Casualty v. Choi, No. 14-311 (E.D. Wash. Mar. 3, 2015), a case involving the availability of coverage for sexual assault, had been like most, we would not be having this discussion. That we are is because Choi bucked the trend and the court found that coverage was owed.

At issue was the availability of coverage for Jong Hwan Choi for the alleged sexual assault of Jessica Arroyo Obispo. Obispo alleged that Choi sexually assaulted her at his home in March 2013. She filed suit against him and alleged several causes of action. Choi was insured under a homeowner’s and personal umbrella policy issued by Allstate. Allstate undertook his defense and filed an action seeking a declaration that no coverage or duty to defend was owed for the claims made by Obispo. That action is still pending. Choi’s defense was that, in his opinion, Obispo consented to the sexual activity at the time it occurred. This was the same explanation that he gave when he pled guilty to a misdemeanor count of Assault in the Fourth Degree with Sexual Motivation.

The question at the outset for the court was whether there was an “occurrence,” similarly defined under both policies as an accident. Allstate’s argument was that sexual assault is an intentional act and cannot be considered an “accident.”

The court half agreed: “Allstate is correct in claiming that Choi’s defenses to a claim are immaterial to whether Allstate has a duty to defend. If Choi was being sued for assault and simply denied it, or claimed he thought he had consent, the duty to defend would not attach—because there could be no circumstance under which the insurer could be liable.”

But this wasn’t just a situation where Choi simply claimed that he thought he had consent. Rather, Obispo’s complaint opened the door to the mistaken consent argument as it incorporated “Choi’s claimed defense both by making alternative claims of negligence and negligent infliction of emotional distress, and by explicitly pleading facts that include Choi’s defense of mistaken consent.”

This made the situation different from one where Choi simply claimed that he thought he had consent. As the court explained: “Thus, the question whether Allstate has a duty to defend is not limited to the allegations of assault, battery, or intentional infliction of emotional distress. Two of Obispo’s claims rely on allegations that Choi in fact believed he had Obispo’s consent to engage in the sexual touching. Therefore, the pertinent question is whether mistaken consent can constitute an occurrence under either the homeowner or umbrella policies. The Court holds that it can.”

In reaching this conclusion, the court was guided by the Ninth Circuit’s 2008 decision in Fischer v. State Farm – a decision that the Choi court described as having “a particularly odd set of facts.” In Fischer, the court held that “intercourse, performed intentionally, can constitute an accident for insurance purposes in some circumstances.”

I read Fischer – “a particularly odd set of facts” is indeed an accurate description. Here the court held that “Fischer was negligent when he engaged in intercourse with Donna MacKenzie and that MacKenzie had consented to the intercourse. It reasoned that the jury could have believed she gave consent under the mistaken belief that her boyfriend, not Fischer, had climbed into her bed.”

The court expanded on the accident issue under this particularly odd set of facts: “What caused the harm in this case was not that Fischer engaged in intercourse, but that he engaged in nonconsensual intercourse, which he could not have reasonably foreseen. A reasonable person in his position would not be aware of or foresee the harmful consequences of intercourse with the consenting MacKenzie because he would not be aware of or foresee that her consent was ineffective and based on her mistaken belief that she was with her boyfriend. MacKenzie’s mistake as to Fischer’s identity constituted an ‘additional unexpected, independent and unforeseen happening.’ Accordingly, the harm was the result of an accident.”

The Fischer court did not address how MacKenzie could have possibly made this mistake. There is definitely more to this story.

 

 
Website by Balderrama Design Copyright Randy Maniloff All Rights Reserved