Nationwide Mutual Insurance Company v. Raiford et al

Filing 23

MEMORANDUM OPINION. See for complete details. It is so ORDERED. Signed by District Judge Robert E. Payne on 02/06/2017. (nbrow)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
Richmond Division

FEB - 7 20l7

NATIONWIDE MUTUAL INSURANCE
COMPANY,

CLERK, U.S. DISTRICT COURT
RICHMOND, VA

Plaintiff,

v.

Civil Case No. 3:16cv340

AMY JO RAIFORD, Administrator
of the Estate of Nancy Sue
Walton, and JOSEPH EARL
WALTON, Jr.
Defendants.
MEMORANDUM OPINION

This matter is before the Court following a bench trial on
a

stipulated

Judgment

record

("Complaint")

Insurance Company

and

on

filed

the
by

("Nationwide")

set forth below,
Nationwide,

held

Complaint
Plaintiff

(ECF No.

for

Declaratory

Nationwide

1) .

For the

Mutual
reasons

the Court will grant declaratory judgment for
order

that

it

has

no

duty

to

defend

or

to

indemnify Joseph Walton in the lawsuit that underlies this case.

BACKGROUND

Nationwide's
under 28 U.S.C.

§§

Complaint

seeks

a

judicial

determination,

2201 and 1332, that it owes no duty to defend

or indemnify Joseph Earl Walton ("Walton") in an action filed in
state court against Wal ton by Amy Jo Raiford,

Administrator of

the Estate of Nancy Sue Walton

(the "underlying action") . 1

purposes of this declaratory judgment action,

For

the parties have

stipulated to the facts respecting Nationwide's insurance policy
and the allegations
(ECF 13)

in the complaint

("Stipulated Facts").

in the underlying action

Based on the

NATIONWIDE' S OPENING PRETRIAL BRIEF

stipulated facts,

(ECF No.

14)

("Pl.

Br."),

the OPPOSITION BRIEF OF DEFENDANT JOSEPH EARL WALTON JR.

(ECF

No. 18) ("Def. Resp."), and NATIONWIDE'S REPLY BRIEF (ECF No. 19)
("Pl.

Reply")

were

filed,

and a

bench trial

( ECF No.

22)

was

held on January 31, 2017.

THE STIPULATED FACTS

Walton

and

Nancy

Sue

Walton,

his

wife,

were

the

named

insureds in the homeowners insurance policy issued by Nationwide
for

the

Facts

period of

1).

At

all

May

15,

times

2014

leading

to May
up

to

15,

2015.

January

(Stipulated

19,

2015,

the

Waltons were husband and wife and shared the insured home.

Id.

On January 19, 2015, Mrs. Walton died. Id.
Amy

Jo

Raiford,

daughter

of

Mrs.

Walton,

subsequently

became administrator of Mrs. Walton's estate and brought a tort
suit against Walton on behalf of the estate.

Id.

at 1-2. After

Both Walton and Raiford are named as defendants.
Raiford, who
has been properly served herein, has declined to file an Answer
or participate in any way.
Nationwide has not moved for entry
of default or for default judgment, preferring instead to have
Raiford bound by the result of this trial.
1

2

receiving notice of the suit,
under a

Nationwide began defending Walton

full and complete reservation of rights and filed this

declaratory judgment action seeking a declaration that it had no
duty to defend,

and therefore

no duty to

indemnify,

Wal ton in

the underlying action. Id. at 2.
In Virginia,
def end .

it is well-settled that an "insurer's duty to

is broader than [the]

obligation to pay,

and arises

whenever the complaint alleges facts and circumstances,
which

would,

policy."
(2010).

if

Copp

proved,

v.

fall

Nationwide

Consequently,

within
Mut.

the

Ins.

risk

Co.,

to

def end.

the

67 5,

Va.

by

682

the parties agreed at trial that there is

They also

that there exists a

covered

27 9

no duty to indemnify if the Court determines
duty

some of

agreed that,

duty to defend,

a

if

that

there

the Court

is no

decides

decision on the duty to

indemnify must be deferred until after the underlying action is
determined.

The

analysis

in

this

case

therefore

rests

on

the

content of the insurance policy and the facts and circumstances
alleged

in

the

complaint

in

the

underlying

documents are part of the stipulated record.

action.

Id.

Both

(Stipulated Facts,

Exhibit A-B).

A.

The Complaint In the Underlying Action (ECF No. 13-2)
In

that

relevant

Mrs.

negligent

part,

Walton's
conduct

of

the

death

underlying
was

Walton.

caused
(UC

3

<JI<JI

complaint
by

the

26-27).

("UC")

alleges

intentional
Specifically,

and
it

alleges

that

Walton

intentionally

and

severely

abused

Mrs.

Walton in the days leading up to and including January 3, 2015,
thereby

causing

condition

from

an

"exacerbation

which

she

died."

of

(UC

<JI

a

treatable

medical

The

further

27) .

UC

alleges that, on January 8, 2015, the date on which the decedent
"became

physically

sick

and

Walton

incapacitated,"

was

instructed by Raiford to take Mrs. Walton to Patient First, but
that

Wal ton

"negligently

unattended." (UC

<JI

seek

medical

Walton's
<JI

11) .

home

Mrs.

decedent

to

remain

after being told of Walton's refusal

treatment,

and

the

9).

Later that same day,
to

allowed

found

Wal ton was

Raiford

her

mother

allegedly
in

a

went

the

state.

serious

to

(UC

flown to VCU Medical Center,

where she

was diagnosed as having suffered a stroke and where a forensic
nurse allegedly "took photographs of all the bruises caused by
[Mr. Walton's] beatings."
hospice care

at

2015.

14) .

(UC

wrongful
Walton.
daughter,
loss

of

<JI

home,
The

death,
(UC

!!

solace,

Mrs.

12-13). After being returned to

<JI

Walton passed away on January 19,

underlying action seeks

pain,
25-27).

Raiford,

(UC

and
It

mental
also

anguish

alleges

damages

suffered

that

the

by

and comfort

of

the

the
Mrs.

decedent's

has suffered "severe mental anguish,

companionship

for

sorrow,

decedent

as

well as loss of her company and love and has otherwise suffered

4

decedent's medical expenses and funeral expenses which Defendant
has refused to pay." (UC
B.

The
record,

24).

~

The Insurance Policy (ECF No. 13-1)

insurance

policy

and Nationwide

is

also

a

part

argues

that

of

the

stipulated

it

has

no

duty

to

defend

primarily on the strength of three of its provisions: Paragraphs
l(a)

and l(i)

page H2.

on pages Hl of the policy,

and Paragraph 2(f)

on

(Pl. Br. 9-18). The relevant provisions state:

1. Coverage E
Personal liability and Coverage F
Medical Payments to others do not apply to bodily
injury or property damage:
a) caused intentionally by or at the direction of an
Insured, including willful acts the result of
which the insured knows or ought to know will
follow from the Insured's conduct . . . .
relating
omissions
i) resulting
from
acts
or
directly or indirectly to sexual molestation,
physical or mental abuse, harassment, including
sexual harassment, whether actual, alleged or
threatened.

*****
2. Coverage E - Personal liability does not apply to . . .
f) bodily injury to an insured as defined in Section
II- Liability definitions 5.a) and 5.b).
(ECF No.

13-2, Hl)

goes

to

on

(emphases in original). The insurance policy

define

"bodily

injury"

to

"mean[]

including resulting care,

sickness or disease,

or

does

death.

Bodily

mental anguish,

injury

humiliation,

not

include

bodily

loss of services

emotional

distress,

mental distress or injury,

5

harm,

or any

similar injury unless the direct result of bodily harm." Id. at
Gl,

~

1 (emphasis in original).

ANALYSIS

In Virginia,
than

[the]

an "insurer's duty to def end

obligation to pay,

is broader

and arises whenever the complaint

alleges facts and circumstances, some of which would,

if proved,

fall within the risk covered by the policy." Copp v. Nationwide
Mut.

Ins. Co., 279 Va.

Ins. Co. of Am.,
referred

to

as

675,

683

(2010);

219 Va. 101, 104
the

"eight

see also Lerner v. Gen.

(1978). This test is commonly

corners

rule"

because

it

"concerns

only the four corners of the policy and the four corners of the
complaint."

Copp,

clear

Nationwide

that

279

Va.
has

at

682.

no

duty

Applying
to

this

defend

test,

Walton

it
in

is
the

underlying action in this case,

because no combination of facts

alleged

proven,

in

the

UC

would,

if

"fall

within

the

risk

covered by the policy." Id. at 683.
The UC clearly asserts that Wal ton caused "bodily injury"
to Mrs. Walton within the meaning of the insurance policy.

(UC

~

26-27). But, both parties agree that both Walton and Mrs. Walton
are the "named Insured" of the insurance policy in this case.
(Stipulated

Facts

1) .

Therefore,

the

liability

exclusions

provided on pages Hl and H2 of the insurance policy apply. Under
a plain reading of those exclusions,

6

it is clear that no set of

facts found by the jury would trigger coverage under the policy,
even when construing the exclusionary language in the light most
favorable to the insured as required by Virginia law.
Elec.

& Power Co. v. Northbrook Prop.

& Cas.

Ins.

Virginia

Co.,

252 Va.

265, 270 (1996).
If the jury were to find that Walton intentionally caused
bodily injury to Mrs. Walton, Paragraph l(a) of the policy would
clearly exclude coverage.
to

find

that Wal ton's

remain

excluded

excludes

from

bodily

(ECF No.

conduct
the

injuries

13-2, Hl) .

If the jury were

was merely negligent,

policy
that

by

are

Paragraph

the

result

level

abuse."
of

Id.

intent

(emphasis

found by the

added) .
jury,

And,

l(i),
of

which

"acts

or

. physical or

omissions relating directly or indirectly to

mental

it would

regardless

of

any "bodily injury to

any
an

insured" is excluded from coverage by Paragraph 2(f). Id. at H2.
Thus, even if every fact alleged in the UC was proven at trial,
the

policy

would

Virginia law,

not

cover

any

of

it.

Accordingly,

Nationwide has no duty to defend.

under

See Copp,

279

Va. at 683.
Walton counters these rather obvious results by relying on
the allegations contained in Paragraph 24 of the UC,
Resp.
asserts

at

4-7,
that

but
the

that

reliance

decedent's

is

daughter,

misplaced.
Raiford,

see Def.

Paragraph
has

24

suffered

damages in the form of mental anguish and medical and funeral

7

expenses.

(UC

~

24) . But,

while it is true that Raiford is not

"an insured" subject to the exclusion in 2(f), she is also not a
party to the underlying action. Raiford's mental anguish is only
relevant because Va.

Code

8. 01-52 allows a

§

jury to consider

the mental anguish of a decedent's beneficiaries, as well as any
medical
death,

and

funeral

expenses

associated

with

the

decedent's

in arriving at a "fair and just" award in the wrongful

death action brought on behalf of the decedent.
Code

§

8.01-50.

the

question

See also Va.

Paragraph 24 is therefore legally irrelevant to

of

liability,

and

therefore

irrelevant

to

the

question of Nationwide's duty to defend. Id.
During

the

hypothesized that

bench

trial

in

Paragraph 24

this

case,

could still

Walton's
trigger

a

counsel
duty to

defend in the event that Raiford joined the underlying action in
her individual capacity before trial, but that argument is also
contrary

to

Virginia

reality,

Nationwide

law.

would

Even

if

still

that

have

no

hypothetical
duty

to

became

defend.

In

Virginia, plaintiffs may recover for emotional distress only if
they

can

demonstrate

injury,

or

otherwise prove that the relevant conduct was intentional.

See

Hughes v. Moore,

an

accompanying

214 Va. 27, 34

physical

(1973). Under Paragraph l(a)

the insurance policy, all injuries

of

(to anyone) are excluded from

coverage if they are the consequence of an intentional act of
"an Insured."

(ECF No.

13-2,

Hl) . And,

8

al though Wal ton argues

that the jury could find that Raiford's anguish was due to his
negligence

(and therefore escape provision 1 (a) ) ,

Raiford would

still not recover because she suffered no accompanying physical
injury. Thus, even if proven true, the mental anguish alleged in
Paragraph 24 of the UC does not "fall within the risk covered by
the policy." See Copp, 279 Va. at 683. 2 Therefore, Nationwide has
no duty to defend Walton on the basis of Paragraph 24.

Because

the other facts and circumstances alleged in the UC also do not
"fall within the risk covered by the policy," Nationwide has no
duty

to

defend

the

underlying

action

in this

because the duty to defend is "is broader than
to

pay,"

Nationwide

Declaratory

also

judgment

in

case.
[the]

has

no

duty

to

favor

of

Nationwide

Moreover,
obligation

indemnify.
is

Id.

therefore

appropriate.

CONCLUSION

For
Nationwide
with

the

the
has

reasons
no

stated

duty

underlying

to

above,

def end

action

in

the

Court

Joseph Wal ton
this

case,

and

finds
in
no

that

connection
duty

to

Beyond the legal deficiency noted in this paragraph, the Court
also notes that, under a plain reading of its provisions, the
policy itself precludes recovery for emotional distress except
where a covered person's mental suffering is the direct result
of a bodily harm he or she sustained. (See ECF 13-1 at Gl, ~1).
Thus, even if were possible for Raiford to personally and
successfully sue Walton for her emotional distress, Nationwide
would still have no duty to defend in that action.
2

9

indemnify

in

connection

with

the

same.

A

judgment

to

effect will be entered.

It is so ORDERED.

/s/

/2-l-f'

Robert E. Payne
Senior United States District Judge

Richmond, Virginia
Date: February
~ , 2017

10

that