OPINION OF THE COURT
Allstаte Insurance Company seeks a declaratory judgment that it has no duty to defend or indemnify its insured, William Zuk, in a wrongful death action arising out of the death of Zuk’s friend, Michael Smith, whom Zuk shot and killed. On November 2, 1985, Zuk was cleaning and loading a shotgun in a hunting lodge owned by his parents, Benedict and Margaret Zuk. The gun accidentally discharged and Smith, who was sitting a few feet away from Zuk, was shot in the thigh, severing his femoral artеry. He subsequently bled to death. Zuk was charged with second degree manslaughter and was convicted on his guilty plea of recklessly causing Smith’s death (Penal Law § 125.15 [1]). Allstate argues that Smith’s death is not covеred under the homeowner’s liability policy at issue because the policy excludes injuries that could "reasonably be expected to result” from criminal acts. Allstate contends that Zuk’s сonviction conclusively establishes this exclusionary element.
We hold that Zuk’s criminal conviction does not collaterally block the civil litigation of the issue whether Smith’s death could "reasоnably be expected to result” from Zuk’s acts. Under this policy provision, in the factual context of this dispute and its procedural framework, that issue cannot be resolved as a matter оf law. We therefore reverse the order of the Appellate Division granting summary judgment to Allstate.
Respondent Patricia Smith, individually and as administra
Allstаte initially agreed to defend but not indemnify Zuk, based on the interplay of the policy exclusion and Zuk’s criminal conviction. Allstate then commenced this action seeking a judgment against Zuk, his parents, and Patricia Smith, relieving it of its defense and indemnification obligations and declaring the rights, duties and obligations of the parties. Supreme Court denied Allstate’s motion for summary judgment, concluding that a mаterial issue of fact existed— namely, whether Smith’s death could, as referenced to the insurance policy clause, "reasonably be expected to result” from Zuk’s mishandling of the shotgun. The Aрpellate Division reversed and granted Allstate summary judgment. That court held that Zuk’s guilty plea in the criminal proceeding established as a matter of law that Smith’s death was caused by a criminal aсt and therefore Zuk was collaterally estopped from contesting that conclusively determined issue in this civil action. This Court granted leave to appeal and we now reverse.
An insurer has a duty to defend its insured in a pending lawsuit when the complaint alleges a covered loss or when the insurer has actual knowledge of facts establishing the reasonable possibility of cоverage (see, Fitzpatrick v American Honda Motor Co.,
However, an insurer can be relieved of its duty to defend if it establishes as a matter of law that there is no possible factual or legal basis on which it might eventually be obligated to indеmnify its insured under any policy provision (see, Villa Charlotte Bronte v Commercial Union Ins. Co.,
Allstate argues that Zuk’s second degree manslaughter conviction establishes as a matter of law that Zuk reasonably expected that his acts would cause Smith’s death. In limited circumstances, a particular issue expressly or necessarily decided in a criminal proceeding may be given preclusive effect in a subsequent affected civil action (see, Matter of Nassau Ins. Co. [Bergen — Superintendent of Ins.],
As the Appellate Division recognized, Zuk’s criminal conviction established that Smith’s death was caused by a criminal act. Under the terms of Allstate’s exclusionary clause, howеver, the inquiry does not stop with the determination that the loss resulted from a criminal act. In order for the exclusion to contradict coverage, the loss must be one that could
Zuk’s conviction of second degree manslaughter was nеcessarily based on a finding that he recklessly caused Smith’s death (Penal Law § 125.15 [1]). A person acts recklessly, in a criminal context, when that person is aware of and consciously disregards a substаntial and unjustifiable risk of a result, where the risk is of such a nature and degree that to disregard it constitutes a gross deviation from the standard of conduct of a reasonable person (Penal Lаw § 15.05 [3]).
While an almost metaphysical argument can be mounted that disregarding a known risk of death — the criminal standard — is equivalent to reasonably expecting that death will occur as a result of thе action taken — the standard expressed in the policy — the particular matrix of this policy clause and factual context allow at least one other reasonable, and therefore disqualifying, syllogism. A person may engage in behavior that involves a calculated risk without expecting — no less reasonably — that an accident will occur. Such behavior, which may be reckless for criminal responsibility purposes, does not necessarily mean that the actor reasonably expected the accident to result (see, McGroarty v Great Am. Ins. Co.,
In sum, the issue whether Smith’s death could "reasonably be expected to result” from Zuk’s acts was not necessarily determined in the criminal proceeding and was not identical to the issues that were determined there. Thus, Allstate should not be permitted to use collateral estoppel to deprive the Zuks of their only opportunity to determine the effect, if
Under these facts, this policy and this analysis, the issues in the criminal and civil actions are not identical, a core feature which distinguishes this case from the cases in which we held that an insured, or a subrogee, was collaterally estopped by the insured’s conviction of an intent сrime from relitigating the identical issue of intent in an insurance coverage dispute where the policy at issue excluded coverage for intentional acts (see, D’Arata v New York Cent Mut. Fire Ins. Co.,
Accordingly, the order of the Appellate Division should be reversed, with costs, and the plaintiff’s motion for summary judgment denied.
Chief Judge Wachtler and Judges Simons, Kaye, Alexander, Titone, and Hancock, Jr., concur.
Order reversed, etc.