Allan Ranta v. Catholic Mutual Relief Society

Filing

UNPUBLISHED PER CURIAM OPINION filed. Originating case number: 9:11-cv-00074-SB Copies to all parties and the district court/agency. [998900826].. [11-2233]

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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 11-2233

ALLAN CARL RANTA,
Plaintiff - Appellant,
v.
THE CATHOLIC MUTUAL RELIEF SOCIETY OF AMERICA,
Defendant - Appellee,
and
WAYLAND YODER BROWN,
Defendant.

Appeal from the United States District Court for the District of
South Carolina, at Beaufort.
Sol Blatt, Jr., Senior District
Judge. (9:11-cv-00074-SB)

Submitted:

May 18, 2012

Decided:

July 24, 2012

Before MOTZ, GREGORY, and DUNCAN, Circuit Judges.

Affirmed by unpublished per curiam opinion.

Lawrence E. Richter, Jr., Aaron E. Edwards, THE RICHTER FIRM,
LLC, Mt. Pleasant, South Carolina, for Appellant.
Richard A.
Farrier, Jr., Robert H. Jordan, NELSON MULLINS RILEY &
SCARBOROUGH, LLP, Charleston, South Carolina; David M. Spector,

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Dennis G. LaGory, David C. Giles, SCHIFF HARDIN LLP, Chicago,
Illinois, for Appellee.

Unpublished opinions are not binding precedent in this circuit.

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PER CURIAM:
Allan

Carl

Ranta

brought

suit

against

the

Catholic

Mutual Relief Society (“Catholic Mutual”), seeking a declaratory
judgment that the insurance company is required to indemnify
Wayland Yoder Brown, a defrocked priest and convicted pedophile,
for the $100 million tort judgment Ranta obtained against him.
The district court granted Catholic Mutual’s motion for summary
judgment and denied Ranta’s cross motion for summary judgment,
and Ranta now appeals.
reversible error.

We have reviewed the record and find no

Accordingly, we affirm.

In 2006, Ranta brought suit against Brown, the Holy
See,

the

Roman

Catholic

Diocese

of

Savannah,

and

Most

Rev.

Raymond Lessard and J. Kevin Boland, the Diocese’s former and
current bishops, in South Carolina state court, alleging that
Brown sexually molested, raped, and physically assaulted him as
a minor from 1978 to 1982, resulting in years of psychological
damage with physical manifestations.
“Settlement

Agreement

and

Release”

In 2009, Ranta reached a
with

the

Roman

Catholic

Diocese of Savannah, Lessard, and Boland, whereby Ranta agreed
to release “any and all” claims against the named Defendants, as
well as the Defendants’ insurers, including Catholic Mutual.

In

return, the Defendants agreed to pay Ranta $4.24 million “in
full settlement and discharge of all claims which are, or might
have been, the subject matter of the Complaint.”
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Ranta subsequently filed a motion for summary judgment
against Brown, who was not a party to the Settlement Agreement.
In response, Brown pled his Fifth Amendment right against selfincrimination.

The South Carolina Court of Common Pleas granted

Ranta summary judgment on all causes of action, awarding him $50
million in actual damages and $50 million in punitive damages
based upon “the violent and severe sexual abuse” suffered by
Ranta, the pain and suffering that resulted, and the extensive
and substantial medical care incurred.

Ranta v. Roman Catholic

Diocese of Savannah, No. 2006-CO-27-143 (S.C. Ct. Comm. Pl. Jan.
10, 2010).
In

December

2010,

Ranta

brought

the

instant

action

against Catholic Mutual in South Carolina state court, seeking a
declaratory
indemnify

Brown

against him.
and

both

district

judgment
for

that
the

Catholic

$100

Mutual

million

tort

is

obligated

judgment

to

obtained

Catholic Mutual removed the case to federal court,

parties
court

filed

found

motions

that

the

for

summary

Settlement

judgment.

Agreement

did

The
not

release Catholic Mutual with respect to Ranta’s claims against
Brown.
of

However, the court ruled that summary judgment in favor

Catholic

Mutual

was

nonetheless

warranted,

as

Brown’s

intentional acts of sexual molestation did not constitute an
“occurrence” under the insurance policy at issue.

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The district

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court denied Ranta’s subsequent motion to alter or amend the
court’s judgment, and Ranta timely appealed.
We

review

judgment de novo.

the

district

court’s

grant

of

summary

Jennings v. Univ. of N.C., 482 F.3d 686, 694

(4th Cir. 2007) (en banc).

Summary judgment shall be granted

“if the movant shows that there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter
of law.”

Fed. R. Civ. P. 56(a).

“At the summary judgment

stage, facts must be viewed in the light most favorable to the
nonmoving party only if there is a genuine dispute as to those
facts.”

Scott v. Harris, 550 U.S. 372, 380 (2007) (internal

quotation marks and citation omitted).

“Where the record taken

as a whole could not lead a rational trier of fact to find for
the nonmoving party, there is no genuine issue for trial.”

Id.

(internal quotation marks and citation omitted).
Under South Carolina choice of law rules, ∗ an insurance
policy is governed by the law of the state in which the policy
was issued.

Unisun Ins. Co. v. Hertz Rental Corp., 436 S.E.2d

549, 551-52 (S.C. Ct. App. 1993).

Brown is a Georgia resident

and the policy was issued in Georgia; therefore, Georgia law
governs the interpretation of the insurance policy.
∗

Pursuant to

As the district court sits in South Carolina, South
Carolina choice of law rules govern this diversity case. Klaxon
Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496 (1941).

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Georgia law, to establish a prima facie case on a claim under an
insurance policy, the insured must show that the occurrence was
within the insured risk.

Perry v. State Farm Fire & Cas. Co.,

676 S.E.2d 376, 378 (Ga. Ct. App. 2008); Allstate Ins. Co. v.
Grayes, 454 S.E.2d 616, 618 (Ga. Ct. App. 1995).
The
injuries

policy

caused

accident,

by

at
an

including

issue

provides

“occurrence,”

injurious

coverage

which

exposure

to

is

for

personal

defined

as

conditions,

“an

which

results, during the certificate period, in personal injury . . .
neither

expected

insured party.

nor

intended

from

the

standpoint

of

the”

Although the policy does not define the term

“accident,” Georgia caselaw defines an accident as “an event
which

takes

design.”

place

without

one’s

foresight

or

expectation

or

Perry, 676 S.E.2d at 378 (citing Crook v. Ga. Farm

Bureau Mut. Ins. Co., 428 S.E.2d 802, 803 (Ga. Ct. App. 1993)).
On appeal, Ranta asserts that the district court erred
in finding that Brown’s acts of sexual abuse did not constitute
an “occurrence.”

According to Ranta, Brown knew or should have

known he was a danger to children, yet failed to protect Ranta
from him, thereby breaching his fiduciary duties as a priest.
Therefore,

Ranta

negligence,

which

contends,
triggers

Brown’s

coverage

insurance policy.

6

conduct

under

constitutes

Catholic

Mutual’s

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However,
Ranta’s

attempt

to

the

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district

court

recharacterize

properly

Brown’s

found

egregious

that

acts

of

child rape and sexual molestation as negligence does not render
Brown’s conduct accidental.
insurance

coverage

for

Numerous Georgia courts have denied

intentional

acts

of

sexual

abuse,

regardless of attempts to recast acts of child molestation in
terms of negligence.

See Roe v. State Farm Fire & Cas. Co., 376

S.E.2d 876, 877 (Ga. 1989) (rejecting argument that insurance
coverage

was

warranted

because

insured

perpetrator

sexually

molested child due to obsessive compulsion, without intent to
injure child, as “intentional child molestation carries with it
a presumption of intent to inflict injury”); Harden v. State
Farm Fire & Cas. Co., 605 S.E.2d 37, 38 (Ga. Ct. App. 2004)
(finding

that

homeowner’s

insurance

company

had

no

duty

to

indemnify insured who sexually molested a minor child, as the
insured “engaged in intentional (not accidental) sexual abuse of
the child, causing physical and mental damage to the child which
he could only have expected and intended”).
Indeed, overwhelming precedent establishes that acts
of child molestation are, as a matter of law, considered to be
intentional and therefore outside the scope of an “occurrence”
for insurance coverage purposes.

See Mfr. & Merch. Mut. Ins.

Co. v. Harvey, 498 S.E.2d 222, 226 (S.C. Ct. App. 1998) (listing
decisions

from

forty-one

states
7

finding

that

acts

of

child

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sexual

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molestation

injury).

carry

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presumption

of

intent

to

inflict

Although Ranta alleges that Brown acted negligently by

failing to protect Ranta against him, the allegations of sexual
misconduct

involve

intentional,

Moreover,

because

Brown’s

willful,

acts

of

and

sexual

deliberate
abuse

acts.

carry

the

inferred intent to harm Ranta, the acts alleged against Brown
are not “occurrences” and, therefore, are beyond the scope of
Catholic Mutual’s insurance coverage.
Ranta next asserts that the district court erroneously
awarded Catholic Mutual summary judgment because Catholic Mutual
failed

to

litigation,

defend
thereby

Brown

in

waiving

the
its

underlying
coverage

South

Carolina

defense.

Because

Catholic Mutual elected not to defend Brown, Ranta advances,
Catholic Mutual is estopped from challenging the state court’s
judgment

that

Brown’s

negligence

was

a

proximate

cause

of

Ranta’s injuries.
The district court properly rejected Ranta’s argument,
as the elements of collateral estoppel are not present.

Under

South Carolina law, collateral estoppel precludes only “a party
to the prior action or one in privity with a party to the prior
action” from relitigating an issue previously litigated.

Ex

parte Allstate Ins. Co., 528 S.E.2d 679, 681 (S.C. Ct. App.
2000).

The term “privy” means “one so identified in interest

with another that he represents the same legal right.”
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Id.

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Accordingly, when an insurer elects not to defend a tort suit on
the ground that the insured’s tortious conduct was outside the
scope of the insurance policy, the insured and the insurer do
not

share

an

identity

of

interest

regarding

action and, therefore, are not in privity.

the

underlying

See State Farm Fire

& Cas. Co. v. Garrity, 785 F.2d 1225, 1227 (4th Cir. 1986)
(“When

the

insured

is

sued

for

negligence

and

the

insurance

company believes the injury was intentional, [ ] the interests
of the insurer and the insured diverge.”).
Moreover, an insurance company “is neither obligated
to defend nor bound by the findings of the court if the claim
against the insured is not covered by the policy.”

Farm Bureau

Mut. Auto. Ins. Co. v. Hammer, 177 F.2d 793, 799 (4th Cir.
1949).
of

The district court properly found that the allegations

Ranta’s

defend.
bar

complaint

established

that

there

was

no

duty

to

Accordingly, the South Carolina tort judgment does not

Catholic

intentional

Mutual
and,

from

asserting

therefore,

outside

that
the

Brown’s
scope

conduct
of

was

insurance

coverage.
Based on the foregoing, we affirm the judgment of the
district
facts

court.

and

legal

We

dispense

contentions

with
are

9

oral

argument

adequately

because

presented

in

the
the

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materials

before

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the

court

and

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argument

would

not

aid

the

decisional process.
AFFIRMED

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