102 So. 3d 863
La. Ct. App.2012Background
- Thomas E. Sova, a Cove Subdivision lot owner, sued the Cove Homeowners Association for fines, penalties, and alleged harassment and privacy intrusions arising from enforcement of subdivision restrictions.
- State Farm Fire and Casualty Company insured the Association; it sought and obtained summary judgment that the policy provided no coverage for Sova’s claims.
- The trial court granted State Farm’s motion for summary judgment; Sova appealed asserting there was a triable issue on coverage.
- The policy included Business Liability (Section II) with exclusions and an Optional Directors and Officers Coverage (Option DO) for wrongful acts.
- The court conducted a de novo review of the policy language and the undisputed facts, concluding that no coverage existed for Sova’s alleged injuries under either the Business Liability or Directors and Officers provisions.
- The opinion notes a dissent by Whipple, who would find the policy ambiguous and within coverage under a different interpretation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the policy provides coverage for Sova’s mental anguish claim. | Sova seeks coverage for mental anguish as personal injury. | State Farm argues no coverage because the injury is not an ‘occurrence’ under the bodily injury/personal injury definitions and is barred by exclusions. | No coverage; mental anguish not an accident under policy definitions. |
| Whether the alleged harassment, invasion of privacy, malicious prosecution, or defamation fall within covered personal injury or advertising injury. | Sova asserts harassment, privacy invasion, and defamation as personal injuries. | State Farm contends these claims do not constitute bodily injury, advertising injury, or personal injury within the policy. | Not covered as bodily or advertising injury; potential personal injury requires proven offenses, which were not established. |
| Whether the Directors and Officers Optional Coverage (Option DO) provides coverage for the claims. | Sova alleged negligent acts by Association officers/directors. | The evidence shows compliance with counsel and no wrongful acts; negligence alone is insufficient. | No coverage under Option DO; no proven wrongful acts. |
| Whether there is any reasonable interpretation of the policy under which coverage could be afforded. | Ambiguity in policy language could support coverage. | Policy language is clear or at least unambiguous; exclusions apply. | No reasonable interpretation provides coverage under the undisputed facts. |
Key Cases Cited
- Hill v. Shelter Mutual Insurance Company, 935 So.2d 691 (La.2006) (mental anguish may be bodily injury under policy definitions)
- Crabtree v. State Farm Insurance Co., 632 So.2d 736 (La.1994) (claims for bodily injury include mental anguish in similar policies)
- Sensebe v. Canal Indemnity Company, 35 So.3d 1122 (La.App.1st Cir.2010) (insurer bears burden to show exclusions apply; policy interpretation is legal)
- Knight v. L.H. Bossier, Inc., 118 So.2d 700 (La.App.1st Cir.1960) (an ‘accident’ is an unforeseeable event; material for coverage analysis)
- Starr v. Boudreaux, 978 So.2d 384 (La.App.1st Cir.2007) (defamation elements; publication required)