Capitol Specialty Insurance Corporation v. The Beach Eatery & Surf Bar LLC et al

Filing 57

ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT; GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION FOR SUMMARY JUDGMENT; AND DENYING PLATIFF'S MOTION TO STRIKE - granting in part and denying in part 24 Motion for Summary Judgment; denying 33 Motion to Strike ; and granting in part and denying in part 21 Motion for Summary Judgment. Signed by Senior Judge Edward F. Shea. (CC, Case Administrator)

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UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WASHINGTON

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Plaintiff,

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18

No.

CAPITOL SPECIALTY INSURANCE
CORPORATION,

v.
THE BEACH EATERY & SURF BAR, LLC,
d/b/a JACK DIDLEY'S EATERY AND
CATERING; ERIC TODD JONES and
REBECCA JONES, husband and wife
and the marital community composed
thereof; BENJAMIN ADAM TRUDEAU and
JANE DOE TRUDEAU, husband and wife
and the marital community composed
thereof; MATTHEW THOMAS HIBBARD
and JANE DOE HIBBARD, husband and
wife and the marital community
composed thereof; MICHAEL V.
EISELE and JANE DOE EISELE,
husband and wife and the marital
community composed thereof;
MICHAEL D. CATES; and JOHN and
JANE DOES 1-5,

CV-13-05041-EFS

ORDER GRANTING IN PART AND
DENYING IN PART PLAINTIFF’S
MOTION FOR SUMMARY JUDGMENT,
GRANTING IN PART AND DENYING IN
PART DEFENDANTS’ MOTION FOR
SUMMARY JUDGMENT, AND DENYING
PLAINTIFF’S MOTION TO STRIKE

Defendants.

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20
21

I.

INTRODUCTION

22

Before the Court, without oral argument, is Plaintiff’s Motion

23

for Summary Judgment Regarding Assault or Battery Exclusion, ECF No.

24

21; Defendants’1 Cross-Motion for Summary Judgment, ECF No. 24; and

25

Plaintiff’s Motion to Strike Certain Evidence Offered in Response and

26

1

Note that this motion is joined by all defendants with the exception of
Michael D. Cates.

ORDER - 1

1

Cross-Motion

to

Plaintiff’s

2

Assault or Battery Exclusion and Memorandum of Authorities, ECF No.

3

33.

4

Court is fully informed.

5

partially grants Plaintiff’s Motion for Summary Judgment finding that

6

the

7

defamation

8

Defendants’ Cross-Motion for Summary Judgment finding an ambiguity as

9

to reasonable force, and denies Plaintiff’s Motion to Strike.

Summary

Judgment

Regarding

Assault

or

Battery

claim

in

For the reasons that follow, the Court

Exclusion

the

creates

underlying

II.
A.

for

Having reviewed the pleadings and the file in this matter, the

10
11

Motion

no

duty

lawsuit,

to

defend

partially

the

grants

BACKGROUND

Factual History2

12

The catalyst for the present case is an altercation between

13

Michael D. Cates and certain staff members of Jack Didley’s Eatery &

14

Catering, a property operated by The Beach Eatery & Surf Bar, LLC

15

(hereafter referred to, in a term including its staff, as the “Beach

16

Eatery”) in Kennewick, Washington on February 18–19, 2011.

17

case, Cates was a patron at Jack Didley’s.

18

injuries as a result of being ejected from the bar.

19

lawsuit

20

County Superior Court against Beach Eatery alleging assault, negligent

21

hiring

(hereafter

and

referred

selection,

to

as

negligent

the

In that

Cates received several

“Cates

supervision,

Cates filed a

lawsuit”)

negligent

in

Benton

training,

22
2

23
24
25
26

When considering the summary judgment motions and drafting this
background section, the Court 1) took as true all undisputed facts; 2)
viewed all evidence and drew all justifiable inferences therefrom in
non-moving party’s favor; 3) did not weigh the evidence or assess
credibility; and 4) did not accept assertions made that were flatly
contradicted by the record. See Scott v. Harris, 550 U.S. 372, 380
(2007); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).

ORDER - 2

1

negligent

2

defamation, negligence (excessive force), and respondeat superior.
At

3

retention,

issue,

in
of

intentional

the

a

infliction

factual

commercial

context

of

emotional

this

case,

is

5

executed between Capitol Insurance and Beach Eatery which was titled

6

Commercial

7

Coverage Form.

8

and endorsement titled “Assault or Battery Exclusion” which is meant

9

to modify both the Commercial General Liability Form and the Liquor

Coverage

Form

and

insurance

the

interpretation

Liability

liability

distress,

4

General

general

of

Liquor

policy

Liability

Included in the insurance policy is a 4-part document

10

Liability Coverage Form.

11

Exclusion exclude from insurance coverage under the policy certain

12

types of harm.

13

Liability Coverage Form, excludes from insurance coverage what it

14

defines as expected or intended “bodily harm” and “property damage.”

15

Section

16

excludes

17

intended “injury.”

18

apply to ‘bodily injury’ or ‘property damage’ resulting from the use

19

of reasonable force by any insured to protect persons or property.”

20

Section B states that “[t]his exclusion does not apply to ‘injury’

21

resulting from the use of reasonable force by any insured to protect

22

persons or property.”

23

force from the Expected or Intended Injury policy exclusion, and thus

24

allow coverage for harm resulting from the use of reasonable force.

25

In

26

“reasonable force provisions”) disallow coverage for damage resulting

B,

other

ORDER - 3

Section A, which applies to the Commercial General

which

from

Sections A and B of the Assault or Battery

applies

insurance

words,

to

the

coverage

Liquor
what

it

Liability
defines

Coverage
as

Form,

expected

or

Section A states that “[t]his exclusion does not

Both Parts A and B except the use of reasonable

Parts

A

and

B

(hereafter

referred

to

as

the

1

from expected or intended harm, but allow coverage when the resulting

2

harm is the product of reasonable force.

3

Part C, however, also titled “‘Assault or Battery’ Exclusion,”

4

rejects this idea in what will hereafter be referred to as the “no

5

force provision,” stating that:
This insurance does not apply to, nor shall we have a duty
to defend, any claim or “suit” seeking damages or expenses
due to “bodily injury,” “property damage,” “personal and
advertising injury” or “injury”, as defined respectively in
the Commercial General Liability Coverage Form and Liquor
Liability Coverage Form, arising out of, resulting from, or
in connection with any of the following acts or omissions
regardless of their sequence or any concurring cause:
. . . .
e. The use of any force or property whether or not
the “bodily injury”, “property damage”, “personal
or advertising injury” or “injury” was committed
by or at the direction of you, any insured or any
person or legal entity; . . . .”

6
7
8
9
10
11
12
13
14

The reasonable force exceptions to the Assault and Battery Exclusion

15

in Parts A and B seem to conflict with Part C’s provisions regarding

16

any force.

17

reasonable force, Part C seems to say that the use of any force

18

precludes insurance coverage.

19

which provision controls: the reasonable force provisions or the no

20

force provision.

21

that Plaintiff has a duty to defend Beach Eatery in the Cates lawsuit.

22

B.

While Parts A and B allow coverage for those who use

The question this court must answer is

Concurrently, Defendants ask the Court to decide

Procedural History

23

In Washington State, “[i]f the insurer is uncertain of its duty

24

to defend, it may defend under a reservation of rights and seek a

25

declaratory judgment that it has no duty to defend.”

26

Fund Ins. Co., 161 Wn.2d 43, 54 (Wash. 2007).

ORDER - 4

Woo v. Fireman’s

Plaintiff followed this

1

protocol by sending a Reservation of Rights Letter dated March 25,

2

2013, to Beach Eatery, and filing this declaratory action to determine

3

if Plaintiff has a duty to defend Beach Eatery in the Cates lawsuit.
Plaintiff

4

filed

its

Motion

for

Summary

Judgment

Regarding

5

Assault or Battery Exclusion, claiming that the Assault or Battery

6

Exclusion in the insurance policy, namely Part C subsection (e) on the

7

use of any force, precludes insurance coverage for the defendants in

8

the Cates lawsuit, as it is uncontested that there was the use of at

9

least some force in that altercation.

ECF No. 21 at 9.

Plaintiff

10

cites McAllister v. Algora Syndicate, Inc., 103 Wn. App. 106, 111

11

(2000), which says that if there is an assault or battery exclusion

12

and there are claims “ultimately based on assault and battery in the

13

sense

14

negligence cannot be proved,” the exclusion denies coverage for those

15

claims that while not actually titled “assault” or “battery,” are

16

claims that are not possible unless there is the assault or battery to

17

begin with.

that

without

first

establishing

the

underlying

assault,

ECF No. 21 at 10–12.

18

Defendants in their response to Plaintiff’s Motion for Summary

19

Judgment, and in filing their own Cross-Motion for Summary Judgment,

20

argue that the no force provision does not apply to the reasonable

21

force provisions, or in the alternative, that the entire Assault or

22

Battery Exclusion is ambiguous due to a conflict between the no force

23

provision and the reasonable force provisions.

24

14–15.

25

arises where the complaint against the insured, construed liberally,

26

alleges

ECF No. 24 at 6–8, 11,

Washington insurance law states that “[t]he duty to defend

facts

ORDER - 5

which

could,

if

proven,

impose

liability

upon

the

1

insured within the policy’s coverage.”

2

London, Ltd., 168 Wn.2d 398, 404–05 (2010).

3

Washington law states that doubts and ambiguities are read in favor of

4

insurance coverage.

5

that Plaintiff owes them a duty to defend, asserting that there is at

6

least

7

conflicting terms directly controlling whether or not a duty to defend

8

in the Cates lawsuit exists.

an

ambiguity

Plaintiff

9

also

Defendants point out that

Id. at 411; ECF No. 24 at 10.

in

the

moves

Manager

Assault

or

Defendants argue

Battery

Exclusion

with

ECF No. 24 at 6–8, 11, 14–15.
to

testimony

Cates

12

testimony

is

13

Declaration.”

14

is a Post-Incident Report that Hibbard wrote regarding the February

15

18–19, 2011 altercation between Cates and the staff of the Beach

16

Eatery.

lawsuit.

ECF

17

happened during that altercation, which appears to show that the Beach

18

Eatery’s

19

Defendants rely on the Hibbard Declaration to further their argument

20

that they exercised reasonable force.

21

argues that this testimony should be stricken under Federal Rules of

22

Evidence 401, 402, and 403, because the testimony is irrelevant to the

23

case before this Court, as the testimony does not answer the question

24

of whether Cates’ claims are covered under the policy.

25

3.

26

//

underlying
in

what

is

hereafter

ECF No. 28; ECF No. 33 at 3.

ECF No. 28.

staff

whose

staff

Matthew

assaulted

contained

Didley’s,

by

11

the

Jack

certain

Hibbard,

in

of

strike

10

ORDER - 6

General

Am. Best Food, Inc. v. Alea

No.

called

allegedly
33.

the

This

“Hibbard

The Hibbard Declaration

The report shows Hibbard’s recollection of what

exercised

reasonable

force

towards

Cates.

ECF No. 24 at 12.

Id.

Plaintiff

ECF No. 33 at

III. PARTIES’ MOTIONS FOR SUMMARY JUDGMENT

1
2

A.

Legal Standard for Summary Judgment

3

Summary judgment is appropriate if the record establishes "no

4

genuine dispute as to any material fact and the movant is entitled to

5

judgment as a matter of law.”

6

opposing summary judgment must point to specific facts establishing a

7

genuine dispute of material fact for trial.

8

477 U.S. 317, 324 (1986); Matsushita Elec. Indus. Co. v. Zenith Radio

9

Corp., 475 U.S. 574, 586-87 (1986).

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

The party

Celotex Corp. v. Catrett,

If the non-moving party fails to

10

make such a showing for any of the elements essential to its claim for

11

which it bears the burden of proof, the trial court should grant the

12

summary judgment motion.

13

B.

14

Celotex Corp., 477 U.S. at 322.

Legal Standard for Interpreting Insurance Policies
The construction of an insurance contract is a question of law.

15

State Farm Gen.

16

Bordeaux, Inc. v. Am. Safety Ins. Co., 145 Wn. App. 687, 694 (2008).

17

Courts construe insurance policies as contracts.

18

American States Ins. Co., 154 Wn.2d 165, 171 (2005).

19

policy as a whole and give it a “‘fair, reasonable, and sensible

20

construction as would be given to the contract by the average person

21

purchasing insurance.’”

22

Co., 15 P.3d 115, 122 (Wash. 2000) (quoting Am. Nat'l Fire Ins. Co. v.

23

B & L Trucking & Constr. Co., 134 Wn.2d 413, 427–28 (1998)).

24

language in standard form policies is interpreted in accord with the

25

understanding of the average purchaser even if the insured is a large

26

corporation with company counsel.”

ORDER - 7

Ins. Co. v. Emerson,

102 Wn.2d 477,

480 (1984);

Quadrant Corp. v.
We consider the

Weyerhaeuser Co. v. Commercial Union Ins.

“The

Queen City Farms, Inc. v. Central

1

Nat’l Ins. Co. of Omaha, 126 Wn.2d 50, 66 (1994) (quoting Boeing Co.

2

v. Aetna Cas. & Sur. Co., 113 Wn.2d 869, 882–83 (1990)).

3

policy language is clear and unambiguous,” the court “must enforce it

4

as written;” the court “may not modify it or create ambiguity where

5

none

6

ambiguous only if its provisions are susceptible to two different

7

interpretations, both of which are reasonable.

8

Peasley, 131 Wn.2d 420, 424 (1997).

9

of the insured.

exists.”

Quadrant,

154

Wn.2d

at

171

(2005).

A

“[I]f the

policy

is

Allstate Ins. Co. v.

Courts resolve ambiguity in favor

Moeller v. Farmers Ins. Co. of Wash., 173 Wn.2d 264,

10

272 (2011).

11

by definitions provided therein.”

12

145 Wn.2d 417, 427 (2002).

13

C.

Overton v. Consolidated Ins. Co.,

Analysis
1.

14

“Courts interpreting insurance policies should be bound

The Insurance Policy Is Ambiguous, and Thus, Reasonable

15

Force Is an Exception to the Expected Or Intended Injury

16

Exclusion
“The first step in interpreting an insurance contract is to

17
18

determine if the policy language is ambiguous.”

19

v. Bryan, 125 Wn. App. 24, 30 (2004).

20

to be ambiguous after comparing the reasonable force provisions of

21

Parts A and B to the no force provision of Part C.

22

force provisions in Parts A and B conflict directly with the no force

23

provision in Part C.

24

an

25

providing coverage where reasonable force was used, Part C disallows

26

coverage in all circumstances where any force was used.

exception

ORDER - 8

to

the

Alaska Nat’l Ins. Co.

This court finds the document

The reasonable

While Parts A and B allow reasonable force to be
Expected

Or

Intended

Injury

Exclusion,

thus

Furthermore,

1

the no force provision and the reasonable force provisions are in the

2

same

3

provisions on the page immediately preceding that of the no force

4

provision, which does not refer in any way to the reasonable force

5

provisions.

6

and different interpretations in the factual context of the Cates

7

lawsuit alleging assault brought about by Beach Eatery.

8

131 Wn.2d at 424.

9

the

short

three-page

endorsement,

with

the

reasonable

force

The insurance policy is thus capable of two reasonable

insured

See Allstate,

One interpretation is that the use of any force by

completely

blocks

insurance

coverage.

A

second

10

interpretation is that the insured is guaranteed insurance coverage if

11

the

12

reconcile these two provisions in a way that makes sense and avoids

13

ambiguity,

14

insurance policy and the endorsement.

insured

The

15

exercises

the

court

reasonable

Court

may

must

decide

force.

follow

this

As

contract

it

law

is

impossible

to

interpret

to

the

Quadrant, 154 Wn.2d at 171.

issue

on

summary

judgment,

as

16

interpretation of an insurance contract is a question of law.

17

Farm, 102 Wn.2d

18

character from regular contracts though, in that they are construed in

19

favor of coverage.

20

the rule that “exclusionary clauses are to be most strictly construed

21

against the insurer.”

22

99 Wn.2d 65, 68 (1983).

23

an

24

interpretations present in the exclusion, the Court must construe it

25

in favor of the insured, and give effect to the provision which allows

26

coverage.

exclusion,

ORDER - 9

at 480.

and

Insurance contracts

Moeller, 173 Wn.2d at 272.

are of

State

a different

Even more important is

Phil Schroeder, Inc. v. Royal Globe Ins. Co.,

as

The endorsement at issue in this case is such
there

are

Moeller, 173 Wn.2d at 272.

two

different

but

reasonable

Thus, the Court rules that the

1

reasonable force provisions apply over the no force provision.

2

Additionally, Plaintiff relies upon Montpelier U.S. Insurance

3

Co. v. Boku L.L.C., No. 12—CV–01457, 2014 WL 1246767 (D. Conn. Mar.

4

24, 2014), asserting that reasonable force language in an Expected or

5

Intended Injury Exclusion does not conflict with an Assault or Battery

6

Exclusion.

However, it is important to note that the provisions at

7

issue

appear

8

Exclusion,” which in turn modifies documents purporting to insure

9

Defendants in documents titled “Commercial General Liability Coverage

here

in

an

endorsement

titled

“Assault

or

Battery

10

Form” and “Liquor Liability Coverage Form.”

11

this court must interpret the insurance contract through the eyes of

12

an

13

insurance purchaser would know that in agreeing to an endorsement and

14

modification titled “Assault or Battery Exclusion,” that they are not

15

only agreeing not to be insured for assault and battery, but to also

16

not be insured when any force is used.

17

Upon reading the reasonable force provisions, average purchasers would

18

immediately believe that they are still covered under circumstances

19

where the insured exerts reasonable force, because it says exactly

20

that on the first page of the endorsement in plain language.

21

The absence of any language in the no force provision which even hints

22

at modifying the reasonable force provisions creates in the average

23

insurance purchaser an expectation of insurance coverage in cases

24

where reasonable force was exercised.

25

122.

26

not apply where the expected or intended damages resulted from the use

average

insurance

purchaser,

it

is

ECF No. 1–1 at 69–71.

unlikely

that

an

As

average

See Woo, 161 Wn.2d at 52.

See id.

See Weyerhaeuser, 15 P.3d at

Accordingly, this court finds that the no force provision does

ORDER - 10

1

of reasonable force as set forth in the Assault or Battery Exclusion.
2.

2

Plaintiff Cannot Rely on the Assault or Battery Exclusion
to Avoid Defending Beach Eatery from Cates’ Assault Claim

3
4

Having found that the insurance policy is ambiguous and that the

5

reasonable force provision applies when in conflict with the no force

6

provision, the court must next determine if it is conceivable that the

7

complaint

8

insurance policy.

in

the

Cates

lawsuit

alleges

facts

covered

under

the

See Woo, 161 Wn.2d at 56.

9

Washington law requires that the duty to defend be analyzed in

10

accordance with the allegations in the complaint in the underlying

11

lawsuit.

12

(2013).

13

insured, construed liberally, alleges facts which could, if proven,

14

impose liability upon the insured within the policy’s coverage.”’”

15

Id. (emphasis added) (citations omitted).

16

is based on the potential for liability.”

17

(emphasis in original).

18

to defend unless the claim alleged in the complaint is ‘clearly not

19

covered by the policy.’”

20

triggered if the insurance policy conceivably covers the allegations

21

in the [underlying] complaint . . . .”

22

low threshold, and one that is quite easy to reach.

See Nat’l Sur. Corp. v. Immunex Corp., 176 Wn.2d 872, 879
“[T]he duty to defend ‘“arises when a complaint against the

“The duty to defend . . .
Woo, 161 Wn.2d at 52

And “[a]n insurer is not relieved of its duty

Id. at 53.

“[T]he duty to defend is

Id.

“Conceivably” is a very

23

Here, while the complaint does not allege that Defendants used

24

reasonable force in the altercation with Cates, an allegation that

25

would clearly trigger the duty to defend, it must be remembered that

26

the

Court

ORDER - 11

must

liberally

interpret

the

complaint

when

analyzing

1

whether there is a contractual duty to defend.

2

Nat’l Sur. Corp., 176

Wn.2d at 879.

3

Plaintiff argues that if the reasonable force provision applies,

4

then every insured defendant alleged to have assaulted someone will

5

claim that they used reasonable force, and thus will be insured as a

6

result, leading to an absurd result providing coverage for those who

7

were intended to be excluded from coverage via the Assault or Battery

8

Exclusion.

9

required under the wording of the entire insurance policy (with all

ECF No. 31 at 9.

including

the

However, this is exactly what is

10

modifications

Assault

or

Battery

Exclusion),

as

11

construed under Washington insurance law.

12

animate this field of law, not the least of which is that insurance

13

policies are to be construed in favor of coverage when there are

14

different but reasonable interpretations, this ruling is driven by the

15

language of the policy before this court.

Under the principles which

Moeller, 173 Wn.2d at 272.

As noted, an insurer is relieved of its duty to defend only if

16
17

the underlying complaint is clearly not covered by the policy.

18

161 Wn.2d at 53.

19

Commercial General Liability Coverage Form states that the insurer is

20

obligated to cover damages for “bodily injury” or “property damage.”

21

ECF No. 1-1 at 41.

22

insurer is obligated to cover injuries sustained by “selling, serving

23

or furnishing of any alcoholic beverage.”

24

these provisions are modified by certain exclusions and modifications.

25

The closest modification that applies as to the alleged assault is the

26

no

force

ORDER - 12

However, there is no such clarity in this case.

Woo,
The

The Liquor Liability Coverage Form states that the

provision,

but

this

Court

ECF No. 1-1 at 75.

has

already

ruled

Both of

that

the

1

reasonable

force

provisions

prevail.

The

Cates

2

several causes of action all stemming from the injuries Cates received

3

in the incident with Beach Eatery’s employees.

4

is assault: he alleges that he “was physically assaulted and pushed

5

into the street onto his back.”

lists

6

was the “result[] from the use of reasonable force . . . to protect

7

persons or property.”

8

facts and principles, the Court finds that it is at least conceivable

9

that the complaint alleges facts which could make the complaint fall

One of Cates’ claims

ECF No. 1–2 at 4.

ECF No. 1–2 at 69.

complaint

Conceivably, this

In accordance with these

10

within the policy’s coverage.

11

the expected or intended force Beach Eatery’s security staff used

12

against Cates as alleged in the underlying lawsuit was reasonable, and

13

thus within the policy’s coverage.

14

duty to defend Defendants on the assault allegation in the underlying

15

Cates lawsuit by relying upon the no force provision.

16

3.

Plaintiff

Not

Thus, Plaintiff cannot avoid its

Have

a

Duty

to

Defend

Defendants’

Alleged Defamation

17
18

Does

In other words, it is conceivable that

Defendants

argue

that

Cates’

defamation

invokes

19

Plaintiff’s duty to defend.

20

Best Food, Inc. v. Alea London, Inc., 168 Wn.2d 398 (2010) to support

21

their position.

22

fight with each other.

23

one of the patrons (Antonio) shot the other (Dorsey).

24

returned fire, and wounded Antonio.

25

inside.

26

leaving

Id.
him

ORDER - 13

ECF No. 24 at 17–21.

claim

They cite American

In that case, two patrons of a nightclub started a
Id. at 402–04.

Just outside the nightclub,

Id.

Id.

Security

Security dragged Dorsey

Security was then ordered to remove him and did so,
by

the

curb

of

the

street.

Id.

Dorsey

sued

the

1

nightclub, alleging that it “failed to take reasonable precautions to

2

protect him against criminal conduct despite considerable notice of

3

the potential harm[,]” and that “the security guards exacerbated his

4

injuries by dumping him on the sidewalk after he was shot.”

Id.

The

5

nightclub “sought protection from its insurer, Alea London, Ltd.”

Id.

6

Alea denied its duty to defend on the ground that the insurance policy

7

it had with the nightclub had an exclusion which excluded insurance

8

coverage

9

battery.”

“for
Id.

injuries

or

damages

‘arising

out

of’

assault

or

The Alea Court, in reviewing the assault and battery

10

exclusion before it, recognized that claims that an insured acted

11

negligently after an excluded event can be covered.

Id. at 410-11.

12

Here, Defendants argue that Alea applies because the defamation

13

occurred after the alleged assault and was “independent enough to

14

warrant a defense[,]” and thus, Alea’s holding dictates that Capitol

15

has a duty to defend.

16

408).

17

was significantly different from the one here.

18

stated that “[t]his insurance does not apply to any claim arising out

19

of . . . [r]eporting to the proper authorities or failure to so report

20

. . . .”

21

exclusion

22

provision”) disclaims any coverage for “‘bodily injury,’ ‘property

23

damage, ‘personal and advertising injury’ or ‘injury’ . . . arising

24

out of, resulting from, or in connection with . . . regardless of

25

their sequence or any concurring cause . . . [t]he reporting to the

26

proper authorities or failure to do so by you, any insured, or any

ECF No. 24 at 19 (citing Alea, 168 Wn.2d at

However, this argument fails to note that the exclusion in Alea

ORDER - 14

The exclusion in Alea

Alea, 168 Wn.2d at 696 (emphasis added).
in

this

case

(hereafter

referred

to

as

However, the
the

“reporting

1

person or legal entity . . . .”

2

Unlike the exclusion in Alea, the exclusion in this case is much

3

broader and is not limited by time.

4

might not fit under the category of harm arising out of reporting to

5

the proper authorities, it surely fits into the category of harm in

6

connection with the reporting to the proper authorities regardless of

7

its sequence to the underlying alleged assault.

8

construe ambiguities in favor of the insured, it cannot construe it in

9

favor of coverage where it clearly is not covered by the policy.
264,

272

insurance policies are to be read in favor of coverage); Quadrant

12

Corp., 154 Wn.2d at 171 (stating that the court “may not modify” an

13

insurance policy “or create ambiguity where none exists.”); Allstate

14

Ins. Co., 131 Wn.2d at 424 (“An ambiguity exists only if the language

15

on its face is fairly susceptible to two different but reasonable

16

interpretations.”

17

citations omitted).

18

ambiguity where the wording in question lacks ambiguity.

19

as to defamation, definitively and expressly lacks such ambiguity, and

20

thus the common law interpretation of insurance law has no effect in

21

this regard.

22

reasonable force provisions and the no force provision, Defendants

23

have not pointed to any provision which would provide any basis to

24

create at least an ambiguity that can be construed in their favor.

in

(stating

original)

that

(internal

ambiguities

See

11

(emphasis

(2011)

While the Court must

Moeller,

26

Wn.2d

Even if the defamation claim

10

25

173

ECF No. 1-1 at 70 (emphasis added).

quotations

in

and

In other words, the Court cannot construe an
The policy,

Unlike the argument concerning the conflict between the

Defendants argue that the use of reasonable force created the
defamation claim.

ORDER - 15

ECF No. 24 at 13.

Thus, the same analysis which

1

applies to the other claims applies to the defamation claim, namely

2

that

3

provisions, and thus Plaintiff has a duty to defend Defendants against

4

the defamation claim.

5

the exact wording of the reasonable force provisions, the nature of a

6

defamation claim, and the presence of the reporting provision.

7

reasonable

8

“property damage”4 in the Commercial General Liability Coverage Form,

9

and to “injury”5 in the Liquor Liability Coverage Form.

10

the

at 69.

reasonable

force

force

Id.

provision

applies

over

the

no

force

However, this argument fails to consider

provisions

apply

only

to

“bodily

injury”3

The
or

ECF No. 1–1

The harm referred to in the reasonable force provisions is

11
3

12
13
14
15
16
17
18
19
20
21
22
23
24
25
26

The Commercial General Liability Coverage Form defines “bodily injury” as
“bodily injury, sickness or disease sustained by a person, including death
resulting from any of these at any time.” ECF No. 1–1 at 53.
4 The Commercial General Liability Coverage Form defines the following terms:
13. “Occurrence” means an accident, including continuous or repeated
exposure to substantially the same general harmful conditions.
. . . .
17. “Property damage” means:
a. Physical injury to tangible property, including all resulting
loss of use of that property.
All such loss of use shall be
deemed to occur at the time of the physical injury that caused
it; or
b. Loss of use of tangible property that is not physically injured.
All such loss of use shall be deemed to occur at the time of the
“occurrence” that caused it.
ECF No. 1–1 at 54–55.
5 The Liquor Liability Coverage Form defines the following terms:
1. “Bodily Injury” means bodily injury, sickness or disease sustained
by a person, including death resulting from any of these at any
time.
. . . .
5.
“Injury” means damages because of “bodily injury” and “property
damage”, including damages for care, loss of services or loss of
support.
. . . .
7. “Property damage” means:
a. Physical injury to tangible property, including all resulting
loss of use of that property.
All such loss of use shall be
deemed to occur at the time of the physical injury that caused
it; or
b. Loss of use of tangible property that is not physically injured.
All such loss of use shall be deemed to occur at the time of the
occurrence that caused it.
ECF No. 1–1 at 79.

ORDER - 16

1

only physical harm to persons or property.

2

Defamation requires that the injured party prove “(1) falsity, (2) an

3

unprivileged communication, (3) fault, and (4) damages.”

4

Ass’n v. Roberts, 320 P.3d 77, 93 (Wn. App. 2013).

5

elements relate to physical harm; defamation is based on damage to

6

reputation.

7

P.3d at 93 (listing the elements of defamation).

8

force provisions do not address the type of harm defamation causes,

9

and as the reporting provision directly addresses such a defamation

10

claim as in this type of case, there is not even an ambiguity that can

11

be construed in favor of coverage.

12

duty to defend Defendants on the defamation claim.
Both

13

Id. at 53, 55, 69, 79.

Grange Ins.

None of these

ECF No. 24 at 18; see generally Grange Ins. Ass’n, 320

parties

raise

As the reasonable

Thus, Plaintiff does not have a

arguments

based

on

McAllister

14

Syndicate, Inc., 103 Wn. App. 106 (2000).

15

upon other grounds that

16

v.

Agora

defamation claim, this court need not address this issue.
IV.

17

Plaintiff owes

However, as it is clear

no duty to defend on

the

PLAINTIFF’S MOTION TO STRIKE EVIDENCE

The Federal Rules of Evidence has certain standards regarding

18
19

the

admissibility

of

evidence.

Evidence

must

be

relevant

to

be

20

admissible; “[i]rrelevant evidence is not admissible.”

21

402.

22

fact more or less probable than it would be without the evidence; and

23

(b) the fact is of consequence in determining the action.”

24

Evid. 401.

25

evidence,” and is thus a low threshold to pass.

26

Co., 204 Fed. Appx. 280, 283 (4th Cir. 2006).

Fed. R. Evid.

And “[e]vidence is relevant if: (a) it has a tendency to make a

ORDER - 17

Fed. R.

“Relevance is typically a low bar to the admissibility of
Jones v. Ford Motor

“The court may exclude

1

relevant evidence if its probative value is substantially outweighed

2

by

3

confusing the issues, misleading the jury, undue delay, wasting time,

4

or needlessly presenting cumulative evidence.”

a

danger

of

Plaintiff

5

one

or

argues

statements

more

that

of

the

following:

Hibbard

Fed. R. Evid. 403.

Declaration,

28,

8

relevant to the outcome of the Cates lawsuit, are irrelevant before

9

this Court because Cates’ complaint did not allege reasonable force,

10

and the duty to defend is determined by the injured’s complaint and

11

not the insured’s answer and defenses.

Id. at 3–4.

12

argues

statements

about

13

force should be stricken.

statements

in

The

Court

reasonable

Plaintiff argues that such statements, while

Hibbard

finds

was

No.

force.

the

states

ECF

7

that

Hibbard

prejudice,

includes

ECF No. 33 at 3.

what

unfair

6

14

regarding

the

Declaration’s

Thus, Plaintiff
reasonable

Id.
the

contested

the

Hibbard

15

Declaration, ECF No. 28, to be admissible and relevant evidence to

16

this case.

17

coverage.

18

whether

19

determination of whether there was a duty to defend those claims which

20

are covered under the reasonable force provisions of the Assault or

21

Battery Exclusion.

22

issue, it at least raises a conceivable basis for coverage, thus

23

triggering the insurer’s duty to defend.

24

Plaintiff’s motion to strike is denied.

25

the Hibbard Declaration are relevant to this case.

26

//

These statements are relevant for the determination of
This evidence applies directly to the determination of

reasonable

ORDER - 18

force

was

used,

and

thus

applies

to

the

Even though not necessarily dispositive of the

See Woo, 161 Wn.2d at 53.
The pertinent statements in

V.

1

CONCLUSION

2

In conclusion, the Court finds an ambiguity in the terms of the

3

insurance policy, in which it is reasonable for the insured to believe

4

coverage was available for damage resulting from the use of reasonable

5

force in protecting persons or property.

6

factual basis in the Cates complaint that this occurrence conceivably

7

resulted from reasonable force, Plaintiff cannot avoid its duty to

8

defend

9

Exclusion.

the

assault

claim

by

relying

upon

Therefore, as there is a

the

Assault

or

Battery

However, Plaintiff owes no duty to defend the defamation

10

claim.

While Defendants’ cross–motion vaguely seeks a finding of a

11

duty to defend, to the extent this would require an analysis of the

12

remaining

13

within the reasonable force exception to the Expected and Intended

14

Injury Exclusion or within a provision of the Assault and Battery

15

Exclusion, in the absence of briefing on point, the Court declines to

16

so

17

insurance policy which makes reasonable force a basis for coverage,

18

and as Defendants claim that they exercised reasonable force in the

19

altercation

20

Hibbard

21

Plaintiff’s Motion to Strike is denied.

22

Accordingly, IT IS HEREBY ORDERED:

23

1.

Cates

inquire

at

claims

this

which

is

Declaration’s

of

time.

the

negligence

And

as

subject

contested

and

there

of

the

statements

whether

is

an

they

ambiguity

underlying
are

would

in

lawsuit,

relevant,

and

fall

the

the
thus

Plaintiff’s Motion for Summary Judgment, ECF No. 21, is

24

GRANTED IN PART (no duty to defend as to defamation) and

25

DENIED IN PART (remainder).

26

2.

ORDER - 19

Defendants’ Cross–Motion for Summary Judgment, ECF No. 24,

1

is GRANTED IN PART (ambiguity as to the use of force) and

2

DENIED IN PART (remainder).
Plaintiff’s Motion to Strike, ECF No. 33, is DENIED.

3

3.

4

IT IS SO ORDERED.

5
6

The Clerk’s Office is directed to enter this

Order and provide copies to all counsel.
DATED this

30th

day of July 2014.

7
s/Edward F. Shea
EDWARD F. SHEA
Senior United States District Judge

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10
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14
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Q:\EFS\Civil\2014\5041.xmsj.lc2.docx

ORDER - 20