White Pine Insurance Co. v. Taylor
165 A.3d 624
| Md. Ct. Spec. App. | 2017Background
- On March 31, 2013, Howard R. Taylor was shot in the leg while opening the door to West End Pub; shooter unidentified and motive unknown. No evidence at trial described how the shooting occurred.
- West End Pub requested defense and indemnity from its insurer, White Pine; White Pine denied coverage invoking an Assault and Battery Exclusion in the commercial general liability policy.
- West End and Taylor executed a Consent Verdict: West End admitted negligence and agreed to a $100,000 settlement; West End assigned its claims against White Pine to Taylor.
- Taylor (as assignee) sued White Pine for breach of contract seeking $74,999.99; White Pine counterclaimed for declaratory relief. Bench trial produced only Taylor’s testimony and insurer claims-handling testimony; no evidence of shooter’s intent.
- Trial court entered judgment for Taylor for $100,000 (the Consent Verdict amount); White Pine appealed.
- On appeal the court affirmed that White Pine failed to prove the Assault and Battery Exclusion applied, upheld reasonableness of the Consent Verdict, but vacated the $100,000 award to reduce it to $74,999.99 (amount pleaded).
Issues
| Issue | Plaintiff's Argument (Taylor) | Defendant's Argument (White Pine) | Held |
|---|---|---|---|
| Whether White Pine met its burden to show the Assault & Battery Exclusion bars coverage | The Consent Verdict establishes West End’s liability; insurer must prove an exclusion applies, and White Pine presented no evidence of an intentional assault or battery | The Policy’s definition of “battery” ("an act which brings about harmful or offensive contact") contains no intent requirement, so proof Taylor was shot is enough to invoke the exclusion | Held for Taylor: insurer failed to prove the exclusion applied because the policy is ambiguous as to accidental vs. intentional acts and insurer presented no evidence of intent |
| Whether the Consent Verdict admitting negligence was unreasonable | Consent Verdict was reasonable given West End’s settlement and available evidence of damages | Unreasonable because the shooting appeared unforeseeable and West End could have defended; lack of evidence of prior incidents | Held for Taylor: White Pine failed to produce sufficient evidence to create an issue that the settlement was unreasonable |
| Whether the trial court erred in awarding $100,000 when ad damnum sought $74,999.99 | Court may enter judgment up to assigned recovery; should enforce the Consent Verdict | Award exceeds pleaded amount; judgment should be limited to ad damnum | Held for White Pine on this point: judgment reduced to $74,999.99 (vacated to that amount) |
| Proper construction of the Assault & Battery Exclusion and whether insurer bears burden to prove exclusion | Exclusions are strictly construed; insurer must clearly establish exclusion applies | Exclusion’s plain definition of battery eliminates need to prove intent | Held: ambiguity exists; construed narrowly against insurer, so insurer must show intentional battery to bar coverage and failed to do so |
Key Cases Cited
- Prop. & Cas. Ins. Guar. Corp. v. Beebe-Lee, 431 Md. 474 (insurer bears burden to prove exclusions after insured shows coverage via settlement)
- SpaceSaver Systems, Inc. v. Adam, 440 Md. 1 (contract interpretation is question of law; apply objective theory)
- Nelson v. Carroll, 355 Md. 593 (battery requires some form of intent; indirect contact via setting a force in motion can constitute battery)
- Kawaauhau v. Geiger, 523 U.S. 57 (distinguishing intentional torts from negligence; intent to cause consequences is central)
- Philadelphia Indem. Ins. Co. v. Maryland Yacht Club, 129 Md. App. 455 (policy language governs; ascertain contracting parties' intent from instrument as whole)
- JMP Associates, Inc. v. St. Paul Fire & Marine Ins. Co., 345 Md. 630 (ambiguous policy language construed as a reasonably prudent layperson would understand it)
- Megonnell v. United Servs. Auto. Ass’n, 368 Md. 633 (exclusionary provisions are construed narrowly against insurer)
- Bijou v. Young-Battle, 185 Md. App. 268 (general rule: absent amendment to ad damnum, court should reduce excess verdict to pleaded amount)