As reported in the last issue of Coverage Opinions, second place in the Insurance Coverage Haiku Contest went to renowned coverage attorney Robert Chemers of Pretzel & Stouffer in Chicago.  Robert’s winning haiku was this gem:

Intentional stabs
Insurer says no cover
Now negligent stabs

Robert shared with me the source of his idea for the haiku.  It’s remarkable.  It’s one of the best “artfully drafted” complaint cases I’ve ever seen.  [This is kinda like Coverage Opinion’s version of VH1’s Behind the Music.] 

The haiku had its genesis in Allstate Insurance Co. v. Carioto, 551 N.E.2d 382 (App. Ct. Ill. 1990).  The case involved coverage for an insured, Jeffrey Carioto, under a homeowner’s policy, for a personal injury action brought against him by Jenner Evans.  Evans claimed that Carioto stabbed him during the course of an armed robbery.  Carioto pleaded guilty to attempted murder. 

There were several issues before the court.  But the one giving life to the haiku was this.  Allstate filed an action seeking a declaratory judgment that it was not obligated to defend or indemnify Carioto because of an intentional acts exclusion.

Allstate moved for summary judgment and it was granted.  Evans appealed and argued that the coverage action was premature because the “question of Carioto’s intent was an ‘ultimate fact’ yet undetermined in the pending tort action.”

The appeals court acknowledged that, while insurers are encouraged to file declaratory judgment actions to address coverage issue, “in instances where bona fide controversies arise over the issue of negligence versus intentional conduct, declaratory judgment actions are generally inappropriate.”

But, despite this general rule, the court concluded that a bona fide controversy did not exist in the matter at hand, since “the insured’s conduct, a criminal conviction resulting from that conduct, and judicial admissions made by the insured, together provide conclusive evidence that the conduct was intentional.”  In essence, the evidence of intentional conduct was overwhelming.

Here is where it gets interesting.  Evans, seeing the coverage challenges on account of the intentional acts exclusion (to say the least), drafted an amended complaint that was obviously designed to implicate Allstate.  This is certainly not unusual.  Plaintiff’s lawyers, in cases involving intentional torts, often draft complaints to include allegations of negligence.  Since the duty to defend is tied, at least, to the allegations in the complaint, their hope is that the insurer -- which must treat the allegations as true, even if groundless, etc. – will be forced by the negligence allegation to acknowledge a defense obligation.  

Sometimes this works and sometimes it doesn’t.  In some cases, the allegations against the insured so clearly involve intentional conduct, that the court rejects the negligence allegations, despite the rule that the allegations in the complaint control.  Essentially, the court is saying that it will not allow itself to be snookered into concluding that a defense is owed, when it knows the real story, and knows that the complaint was “artfully drafted” -- a term that some courts use – to trigger a defense.

That’s what happened in Carioto.  But here, the artfulness of the complaint drafting was some of the best I’ve ever seen.  The complaint is museum worthy.  In concluding that there was no bona fide controversy, that Carioto’s actions were intentional, the court described the plaintiff’s lawyer’s masterpiece:

“In this case, the nature of the assault against Evans, and the initial allegations made by Evans in his suit against Carioto, are certainly consistent with Allstate’s contention that Carioto’s conduct was intentional.  The complaint filed against Carioto on February 25, 1983, was for assault committed willfully and maliciously with force and arms against Evans.  There is no question that such conduct is excluded under the Allstate homeowner’s policy. Two and one-half years later, the third amended complaint alleged that Carioto’s actions were merely ‘careless and negligent’ in ‘falling on’ or ‘failing to avoid’ or ‘negligently striking’ Evans.  We find these allegations facetious, given that Carioto announced his intent to stab Evans; brandished his knife in order to effect the robbery; after receiving the object of the robbery, Evans’ money, joined his accomplice in the struggle on the ground; and stabbed Evans 17 times even after his accomplice withdrew.”

The plaintiff’s lawyer artfully drafted a complaint so that Allstate would show it the Monet.  But the court was just not convinced that the insurer must pay any van Dough.  

As Robert Chemers said:

Intentional stabs
Insurer says no cover
Now negligent stabs