BROOM v. WILSON PAVING & EXCAVATING, INC.
2015 OK 19
| Okla. | 2015Background
- On May 30, 2007 Steven Broom, hired through staffing agency Labor Ready, was working in a trench for Wilson Paving when the trench collapsed and he suffered serious injuries.
- Broom collected workers' compensation from Labor Ready and then sued Wilson Paving in district court; the court found Wilson Paving liable and entered a $1,150,000 judgment (no appeal by parties).
- Wilson Paving carried two policies: an AIIC workers' compensation/employers liability policy and a Mid-Continent Commercial General Liability (CGL) policy; Mid-Continent sought a declaratory judgment and later resisted post-judgment garnishment of its CGL policy.
- AIIC obtained a federal declaratory judgment (favorable to AIIC) interpreting its policy and excluding coverage for the claims as intentionally caused/aggravated by the insured; Mid-Continent argued that judgment precluded coverage under its CGL policy.
- Mid-Continent defended denial of coverage under two CGL exclusions: (1) "expected or intended injury" and (2) an "earth movement" exclusion that lists events like caving in, subsidence, settling, etc.
- The Oklahoma Supreme Court held Mid-Continent's CGL policy covers Broom's injuries: the expected/intended exclusion did not apply (recovery was based on negligence), and the earth movement exclusion is ambiguous and limited to naturally occurring earth movement, not man-made trench collapse.
Issues
| Issue | Plaintiff's Argument (Broom/Wilson Paving) | Defendant's Argument (Mid-Continent) | Held |
|---|---|---|---|
| Effect of AIIC federal declaratory judgment on Mid-Continent coverage | Federal ruling did not decide Mid-Continent policy; not binding on Mid-Continent coverage | Federal judgment precludes coverage under principles of claim/issue preclusion or res judicata | Not binding — policies differ, Mid-Continent had no full opportunity to litigate its policy; federal ruling not determinative |
| Status of Broom under Mid-Continent policy (employee vs. temporary worker) | Broom was a temporary worker for Wilson Paving and thus covered by Mid-Continent | Mid-Continent argued Broom was an employee (or otherwise within employment hierarchy) so exclusions apply | Court found Broom was a temporary worker for Mid-Continent purposes and thus within intended CGL coverage |
| Expected or intended injury exclusion applicability | Negligence-based recovery — not intentional; exclusion should not bar coverage | Injury was substantially certain or intended by Wilson Paving, triggering exclusion | Exclusion did not bar coverage because judgment was grounded in negligence, which is inconsistent with intent |
| Earth movement exclusion scope (natural vs. man-made) | Exclusion should be limited to naturally occurring catastrophic earth movement; trench collapse from construction is man-made and not excluded | Trench collapse is "caving in" / earth movement and excluded regardless of cause | Exclusion ambiguous as written; construed against insurer and limited to natural earth movement — does not bar coverage for this man-made trench collapse |
Key Cases Cited
- Max True Plastering Co. v. U.S. Fid. & Guar. Co., 912 P.2d 861 (Okla. 1996) (insurance exclusions must be clear; ambiguity construed against insurer)
- Spears v. Shelter Mut. Ins. Co., 73 P.3d 865 (Okla. 2003) (insurer must use clear language to limit liability; reasonable expectations doctrine)
- Miller v. Miller, 956 P.2d 887 (Okla. 1998) (preclusion principles require full and fair opportunity to litigate)
- Kile v. Kile, 63 P.2d 753 (Okla. 1936) (definition of negligence distinguishes it from intentional conduct)
- Peters Twp. Sch. Dist. v. Hartford Accident & Indem. Co., 833 F.2d 32 (3d Cir. 1987) (earth movement exclusions generally target natural catastrophic events)
- Henning Nelson Constr. Co. v. Fireman's Fund Am. Life Ins. Co., 383 N.W.2d 645 (Minn. 1986) (earth movement exclusion read as applying to natural events, not man-made earth movement)
- Fayad v. Clarendon Nat'l Ins. Co., 899 So. 2d 1082 (Fla. 2005) (majority rule: earth movement exclusion limited to naturally occurring earth movement)