Hartford Fire Ins. Co. v. CNA Ins. Co.(Europe)
2011 U.S. App. LEXIS 1685
| 1st Cir. | 2011Background
- Hartford and Federal defended European Colour during the Custadio wrongful-death suit; CNA Europe insured European Colour and denied contribution.
- Hartford paid $1,000,000 and Federal paid $1,700,000 toward the settlement; Hartford also incurred defense fees of $293,188.63.
- CNA Europe policy covers up to £2,000,000 per occurrence for injuries arising out of US-site business visits by UK-resident directors/non-manual employees; district court held this did not cover Custadio.
- European Colour settled with the widow; underlying four directors' visits occurred in years preceding the accident; record details four key directors and their safety duties.
- The district court granted summary judgment for CNA Europe; First Circuit reviews de novo and ultimately affirms that the accident did not arise out of a business visit under Dunthorne, even under a broader causation interpretation.
- The court discusses Dunthorne, Scott, and applicability of English-law interpretation of “arising out of,” applying Massachusetts choice-of-law rules.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether ‘arising out of’ requires a close causal link under English law. | Hartford/Federal argue Dunthorne broadens causation. | CNA Europe argues policy-limited causation standard. | Not required to adopt Dunthorne if complex attenuation applies; in any case, no sufficient causal link. |
| Does the accident arise out of business visits by European Colour directors? | Yes, visits affected safety information and reporting. | No direct/contemporary causal connection under Dunthorne. | Even under broader standard, no relevant causal sense link. |
| Should CNA Europe be liable for defense costs incurred in Custadio defense? | Costs should be apportioned as arising from covered risk. | Policy not triggered by the accident through business visits. | No contribution under policy terms. |
Key Cases Cited
- Scott v. Copenhagen Reinsurance Co. (UK), 2 All E.R. (Comm.) 190 (Eng. Ct. App. 2003) (arising from one event requires a significant causal link)
- Dunthorne v. Bentley, 1999 Lloyd's Rep. I.R. 560 (England 1999) (‘arising out of’ contemplates more remote consequences but requires relevant causal link)
- Gov't Ins. Office of New S. Wales v. Green & Lloyd, 114 C.L.R. 437 (Australia 1965) (cited for causation principles in ‘arising out of’ context)