Brotherhood Mutual Insurance Company v. Bible Baptist Church et al
Filing
83
MEMORANDUM OPINION AND ORDER granting Defendants' 73 and 75 Motions for Summary Judgment and denying Plaintiff's 80 Motion for Summary Judgment; a separate judgment order will be entered implementing the Court's findings; the Clerk is DIRECTED to remove this action from the docket of the Court. Signed by Judge Thomas E. Johnston on 12/7/2017. (cc: counsel of record; any unrepresented party) (kp)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA
CHARLESTON DIVISION
BROTHERHOOD MUTUAL
INSURANCE COMPANY,
Plaintiff,
v.
CIVIL ACTION NO. 2:16-cv-00341
BIBLE BAPTIST CHURCH, et al.,
Defendants.
MEMORANDUM OPINION AND ORDER
Before the Court are the parties’ cross-Motions for Summary Judgment.
(ECF Nos. 73,
75, 80.) For the reasons that follow, Plaintiff’s Motion for Summary Judgment is DENIED.
(ECF No. 80.) Defendants’ Motions for Summary Judgment are GRANTED.
(ECF Nos. 73,
75.) The Court enters declaratory and injunctive relief in the manner set forth below.
I.
BACKGROUND
This declaratory judgment action stems from two underlying complaints filed in
Kanawha County Circuit Court by A.B., by and through his Guardian ad Litem, William Jesse
Forbes, and K.R.L, by and through his parent and next friend, Jocelyn Gail Arbeiter, against
Defendants, Bible Baptist Church (“Bible Baptist”), Blue Creek Academy (“BCA”), James
Waldeck, and J.R. Thompson.1
1
The first case is captioned: A.B.. a minor, bv William Jesse Forbes, as his Guardian Ad Litem v. Blue Creek
Academy et al., Kanawha County Circuit Court No. 15-C-1016. The second case is captioned: K.R.L., by and
through his parent and Next Friend, Jocelyn Gail Arbeiter v. Blue Creek Academy et al., Kanawha County Circuit
Court No. 16-C-950.
1
A. The Underlying Civil Complaints
Plaintiff Brotherhood Mutual Insurance Company (“Brotherhood Mutual”) provides
insurance to Defendant Bible Baptist.
Bible Baptist owns the boarding school BCA, which is
managed by James Waldeck and run by J.R. Thompson. Plaintiffs, A.B. and K.R.L., were
students at BCA for approximately two years and seventeen months respectively. (ECF No. 74
at 3–4.)
Both A.B. and K.R.L. allege in separate pending, underlying actions filed in Kanawha
County Circuit Court that they were subject to sexual and physical abuse as well as
malnourishment and educational neglect.
(See ECF Nos. 75-3, 75-4.)
Specifically, A.B.
alleges that the following:
22. During his two year tenure at BCA, Plaintiff A.B. suffered significant physical
and emotional abuse.
23. BCA subjected A.B. to malnourishment, isolationism, corporal punishment,
starvation, and physical abuse.
24. Plaintiff A.B. was sexually abused by another resident of the facility due to
the lack of supervision and other improper standards utilized by the facility.
30. Aside from the starvation, physical abuse, extreme punishments, and various
other maltreatments, BCA also committed educational neglect.
(ECF No. 75-3 at ¶¶ 22–24, 30.) K.R.L. specifically alleges the following:
21. During his seventeen (17) month tenure at BCA, Plaintiff K.R.L. suffered
significant physical, sexual, and emotional abuse.
22. BCA exposed and subjected Plaintiff to malnourishment, isolationism,
corporal punishment, starvation, and physical abuse.
25. Plaintiff K.R.L. was sexually abused by another staff member’s son of the
facility due to lack of supervision and other improper standards utilized by the
facility.
2
(ECF No. 75-4 at ¶¶ 21–22, 25.)
Both complaints further allege that BCA was negligent in its
hiring and supervision of the staff.
In response to the above complaints filed against them,
Bible Baptist requests insurance coverage under their Brotherhood Mutual policy.
B. Brotherhood Mutual Insurance Policy
The Brotherhood Mutual policy at issue in this case was in effect from June 13, 2011, to
June 13, 2014, and provided coverage for A.B. and K.R.L.’s claims.2
Specifically, the policy
provides a coverage limit of $1,000,000 per occurrence for Bodily Injury/Property Damage
Liability, “Nursery Supervision,” and “Nursery Corporal Punishment, with an Aggregate
Coverage Limit of $3,000,000.
(See ECF No. 32-3 at 6.) Additionally, there is a separate
coverage limit of $100,000 for “Sexual Acts Liability Coverage” with an Aggregate Coverage
Limit of $100,000.
(See id. at 7.)
The policy defines an occurrence as “an accident and includes repeated exposure to
similar conditions.” (See id. at 77.)
It further states the following:
If an occurrence to which any liability coverage of this policy applies consists of
acts, errors, omissions, decisions, incidents, events, breaches of duty, damage or
loss occurring on more than one date during any policy period or policy periods,
such events or damage, together with any related loss, will constitute a single
occurrence. . . .
(Id. at 100.) Regarding sexual acts, specifically, the policy states the following:
Any of the above acts or conduct will be considered a single sexual act if
undertaken by the same perpetrator or perpetrators, even if such acts are directed
against more than one person, happen over time, or take place during more than
one policy period.
2
Initially, Brotherhood Mutual filed this declaratory judgment action stating that its policy did not provide coverage
for the claims, alleging that James Waldeck had misrepresented that the church did not have any other facilities,
including BCA, which would fall under the policy coverage. (ECF No. 1.) After conducting discovery,
Brotherhood Mutual conceded that its policy covered BCA, leaving the only matter in dispute the number of
occurrences contained in A.B. and K.R.L.’s claims. (See ECF No. 80 at 4.)
3
(Id. at 80.)
C. Current Motions
Citing the above definitions, Brotherhood Mutual filed an Amended Complaint on June
9, 2017, seeking a declaration, pursuant to 28 U.S.C. § 2201 and Rule 57 of the Federal Rules of
Civil Procedure, that A.B. and K.R.L.’s claims constitute one occurrence under the insurance
policy.
(See ECF No. 70.) Subsequently, Defendants Bible Baptist and A.B. by William
Jessie Forbes, together with K.R.L. by Jocelyn Gail Arbeiter, filed motions for summary
judgment arguing that A.B. and K.R.L.’s claims count as at least two occurrences under the
insurance policy as there were multiple causes for the claims.
(See ECF Nos. 74, 76.)
Brotherhood Mutual filed a cross-motion for summary judgment arguing that A.B. and K.R.L.’s
claims count as a singular occurrence under the insurance policy as they stem from the single
cause of negligent supervision by BCA.
(See ECF No. 80.) All three motions have been fully
briefed and are now ripe for consideration.
II.
LEGAL STANDARD
Summary judgment is warranted when “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).
A genuine
dispute of material fact exists if, in viewing the record and all reasonable inferences drawn
therefrom in a light most favorable to the non-moving party, a reasonable fact-finder could return
a verdict for the non-movant.
See Fed. R. Civ. P. 56(e).
“Facts are ‘material’ when they
might affect the outcome of the case, and a ‘genuine issue’ exists when the evidence would allow
a reasonable jury to return a verdict for the nonmoving party.”
News & Observer Publ. Co. v.
Raleigh–Durham Airport Auth., 597 F.3d 570, 576 (4th Cir. 2010).
4
The moving party bears the initial burden of showing that there is no genuine issue of
material fact and that he is entitled to judgment as a matter of law.
Celotex Corp. v. Catrett,
477 U.S. 317, 322–23. “The burden then shifts to the nonmoving party to come forward with
facts sufficient to create a triable issue of fact.”
Temkin v. Frederick Cty. Comm’rs, 945 F.2d
716, 718 (4th Cir. 1991). When determining whether there is an issue for trial, the Court must
view all evidence in the light most favorable to the non˗moving party.
Constr., Inc., 915 F.2d 121, 123 (4th Cir. 1990).
Perini Corp. v. Perini
The non˗moving party must offer some
“concrete evidence from which a reasonable juror could return a verdict in his favor.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256 (1986). “[A] party opposing a properly
supported motion for summary judgment may not rest upon mere allegation or denials of his
pleading, but must set forth specific facts showing that there is a genuine issue for trial.”
Id.
“The mere existence of a scintilla of evidence” in support of the nonmoving party is not enough
to withstand summary judgment; the judge must ask whether “the jury could reasonably find for
the plaintiff.” Id. at 252.
III.
DISCUSSION
Cross-motions for summary judgment are reviewed separately if material facts are in
dispute. Rossignol v. Voorhaar, 316 F.3d 516, 523 (4th Cir. 2003).
Here, the facts underlying
Brotherhood Mutual’s claim are undisputed—the parties merely dispute the legal significance of
those facts.
Furthermore, under West Virginia law, “determination of the proper coverage of an
insurance contract when the facts are not in dispute is a question of law.”
Norfolk S. Ry. Co. v.
Nat’l Union Fire Ins. of Pittsburg, Pa., 999 F. Supp. 2d 906, 910 (S.D. W. Va. 2014).
Therefore, as stated above, the only issue in dispute is whether A.B. and K.R.L.’s claims
5
constitute multiple occurrences under the Brotherhood Mutual insurance policy.
Accordingly,
summary judgment is proper after determining the number of occurrences under the insurance
policy.
A. Policy Terms Ambiguity
When considering the question of how many occurrences there are for insurance
purposes, the Supreme Court of Appeals of West Virginia has said that the threshold inquiry is
first whether the “occurrence clause” of the insurance policy is ambiguous.
Nationwide Mut. Ins. Co., 332 S.E.2d 639, 642 (W. Va. 1985).
See Shamblin v.
The test for determining
whether there is an ambiguity is whether “the language of the policy provision is reasonably
susceptible of two different meanings or is of such doubtful meaning that reasonable minds
might be uncertain or disagree as to its meaning.”
Ind., 223 S.E.2d 441, 443 (W. Va. 1976).
See Prete v. Merchants Prop. Ins. Co. of
Furthermore, the Supreme Court of Appeals has
explained that a latent ambiguity “arises when the instrument upon its face appears clear and
unambiguous, but there is some collateral matter which makes the meaning uncertain.”
See
Flanagan v. Stalnaker, 607 S.E.2d 767, (W. Va. 1976) (citing Collins v. Treat, 152 S.E. 205, 206
(W. Va. 1930)).
However, the mere fact that the parties disagree on the meaning of an
instrument does not automatically render the instrument ambiguous.
See id. at 770.
Lastly, if
there is an ambiguity, the court should liberally construe such ambiguities in favor of the insured.
See Tackett v. Am. Motorists Ins. Co., 584 S.E.2d 158, 163 (W. Va. 2003).
found, then the policy provision should be applied and not construed.
Life Ins. Co. of Am., 209 S.E.2d 567, 569 (W. Va. 1974).
6
If ambiguity is not
See Tynes v. Supreme
For example, in Shamblin, the insurance policy provided that an occurrence included
injuries or damages “arising out of continuous or repeated exposure to substantially the same
general conditions.”
See 332 S.E.2d at 643. The Supreme Court of Appeals found that this
policy provision was unambiguous.
See id. at 644. This Court has applied the same reasoning
in Canal Insurance Co. v. Blankenship, which had a similar policy provision, to find that the
provision was unambiguous.
See 129 F.Supp.2d 950, 953–54 (S.D. W. Va. 2001).
Here, Defendants Bible Baptist argue that the policy provision that defines “occurrence”
as including “repeated exposure to similar conditions” is ambiguous.
(See ECF No. 74 at 14.)
Specifically, Defendants argue that “similar conditions” could mean “more than one condition
arising from or giving rise to a single instance of sexual assault rather than similar conditions
arising from multiple events.”
(See id.) This Court applies the rationale of the Supreme Court
of Appeals in Shamblin in finding that this type of policy provision is unambiguous.
S.E.2d 639, 643–44 (W. Va. 1985).
See 332
This is especially apparent in light of the provision of the
policy that expounds on “repeated exposure to similar conditions” and states the following:
If an occurrence to which any liability coverage of this policy applies consists of
acts, errors, omissions, decisions, incidents, events, breaches of duty, damage or
loss occurring on more than one date during any policy period or policy periods,
such events or damage, together with any related loss, will constitute a single
occurrence . . . .
(ECF No. 32-3 at 100.)
Furthermore, the insurance policy defines a “related loss” as “a loss of
any kind, or multiple losses, of any kind, arising directly or indirectly out of or in connection
with . . . the same or related act(s), error(s), omission(s), decision(s), incident(s), event(s), or
breach(es) of duty.”
(Id. at 79.) This is pertinent in this case because a loss includes bodily
7
injury.
(See id. at 77.)
Lastly, the policy provision expounds on what this means in the
context of sexual abuse and states the following:
Any of the above acts or conduct will be considered a single sexual act if
undertaken by the same perpetrator or perpetrators, even if such acts are directed
against more than one person, happen over time, or take place during more than
one policy period.
(Id. at 80.)
These provisions, taken together, indicate that the policy intends for similar
conditions to mean multiple conditions arising from a single source rather than similar conditions
arising from multiple sources.
As such, the “occurrence clause” of the Brotherhood Mutual
insurance policy is not ambiguous.
B. Number of Occurrences Under the Policy Terms
Once it has been determined whether the instrument is ambiguous, courts have utilized
three approaches to determine the number of occurrences under an insurance policy:
approach, the cause approach, and the triggering event approach.
the effects
See 64 A.L.R. 4th § 2(a)
(1985). The law of the forum state determines which approach applies.
See id.
Courts using
the effects approach look at the effects of the accident to determine the number of occurrences.
Id. at § 3.
Contrarily, courts using the cause approach look at the cause or causes of the damage
to determine the number of occurrences.
Id. at § 4.
Lastly, courts using the triggering
approach look neither at the cause nor effect of the accident, but focus on the act that subjected
the insured to liability.
Id. at § 5.
In Shamblin, the Supreme Court of Appeals of West Virginia chose a test similar to the
triggering approach and stated, “An occurrence means one event, not several events . . . [t]he
cases have consistently construed ‘occurrence’ or ‘accident’ in liability policies to mean the
event for which the insured becomes liable, not some antecedent cause of the injury.” 332
8
S.E.2d at 644 (quoting Champion Int’l Corp. v. Cont’l Cas. Co., 546 F.2d 502 (2d Cir. 1976)
(Newman, J., dissenting)).
In Shamblin, there were two negligent acts by two different
individuals that resulted in an automobile collision that caused one injury.
See id. at 644–65.
The court, using the above stated test, found that although there were two negligent acts, there
was only one occurrence, the collision, stating that “[t]he term ‘occurrence’ in a limitation of
liability clause within an automobile liability insurance policy refers unmistakably to the
resulting event for which the insured becomes liable and not to some antecedent cause(s) of the
injury.”3
Id. at 644.
In Kosnoski v. Rogers, the Supreme Court of Appeals of West Virginia applied the
Shamblin test to a case involving a carbon monoxide leak in an apartment building that caused
injuries in several different households.
18, 2014).
See No. 13-0494, 2014 WL 629343, at *1 (W. Va. Feb.
The insurance policy there defined an occurrence as “an accident, including
continuous or repeated exposure to substantially the same general harmful conditions.”
See id.
The court found that there was only a single occurrence because the event that attached liability
was the singular gas leak, not the traveling of the gas to the different apartments.
See id. at *3.
Using the test set out in Shamblin, the Court will address sexual abuse, physical abuse,
malnutrition, and educational neglect claims individually.
1. Sexual Abuse Claims
3
The Fifth Circuit recently used a similar test in Seahawk Liquidating Trust v. Certain Underwriters at Lloyds
London, stating the following:
When an occurrence is technically defined to include a series of losses arising from the same
event, it includes only those losses proximately caused by that event. . . .Thus, the district court
applied the correct legal standard in determining the number of occurrences by analyzing whether
the February story was the proximate cause—not just a contributing or but-for cause.
810 F.3d 986, 993–94 (5th Cir. 2016).
9
Several courts have dealt with the question of whether the sexual abuse of multiple
victims constituted a singular or multiple occurrences for insurance policy purposes.
In H.E.
Butt Grocery Co. v. National Union Fire Insurance Co., a grocery employee was accused of
sexually abusing two children in the grocery store on different occasions.
258 (5th Cir. 1998) (applying Texas law).
See 150 F.3d 526,
The court, while acknowledging that the underlying
negligent supervision was the but-for cause of the sexual abuse, held that the sexual abuse
constituted separate occurrences and stated the following:
While ‘a single occurrence may result in multiple injuries to multiple parties over
a period of time . . . [] if one cause is interrupted and replaced by another
intervening cause, the chain of causation is broken and more than one occurrence
has taken place . . . . Here, it is clear that each child’s injuries are independent and
caused by the separate acts of sexual abuse.
Id. at 534; See also Soc’y of Roman Catholic Church of Diocese of Lafayette v. Interstate Fire &
Cas. Co., 26 F.3d 1359, 1363, 1368 (5th Cir. 1994) (finding that the first molestation of each
child constituted a separate occurrence but the repeated molestation of that individual child arose
out of the same occurrence as the first molestation); Commercial Union Ins. Co. v. Roberts, 7
F.3d 86, 89 (5th Cir. 1993) (“Each and every allegation arises out of the alleged acts of sexual
molestation. The claims of negligence are not independent causes-in-fact of the injuries.”).
The Seventh Circuit has similarly found that where the tort is negligent supervision, each
act of sexual abuse could be a separate occurrence.
F.3d 101 (7th Cir. 1996).
See Lee v. Interstate Fire & Cas. Co., 86
There, the insurance policy defined an occurrence as “an accident or
a happening or event or a continuous repeated exposure to conditions which unexpectedly and
unintentionally results in personal injury. . . . All such exposure to substantially the same general
10
conditions existing or emanating from one location shall be deemed one occurrence.”
Id. at
103. The court stated the following:
But a single negligent act undoubtedly can produce multiple “occurrences” if the
injuries are independent—consider the pharmaceutical company that negligently
prepares a batch of drugs, injuring many users; or consider the diocese that digs a
basement for a cathedral and fails to erect a fence, attracting several children who
fall to their deaths.
See id. at 104.
However, there is not a uniform approach to this question.
Brotherhood Mutual alerts
this Court to one such case from the Superior Court of Pennsylvania.
Co. of Am. v. Allen, 708 A.2d 828 (Pa. Super. Ct. 1998).
See Gen. Accident Ins.
In that case, the state court, applying
the cause approach, held that a mother’s repeated negligence in failing to protect her three
children from sexual abuse by their stepfather constituted a single occurrence because the
defendant’s failure to prevent the abuse was “ongoing throughout the period of abuse.”
See id.
at 834.
Here, as stated above, A.B.’s and K.R.L.’s underlying complaints allege individual
instances of sexual abuse by two different individuals at BCA.
(See ECF Nos. 75-3, 75-4.)
A.B. alleges that he was sexually abused by a fellow resident of the facility.
(See ECF No. 75-3
at ¶ 24.) K.R.L. alleges that he was sexually abused by a staff member’s son.
(See ECF No.
75-4 at ¶ 25.) Neither A.B. nor K.R.L. allege that there was any connection between their
individual sexual assaults other than the broader allegation of negligent supervision by BCA.
(See ECF No. 76 at 8.)
Brotherhood Mutual, relying on Kosnoski v. Rogers, 2014 WL 629343, at *1, argues that
A.B.’s and K.R.L.’s sexual abuse allegations, along with their other allegations of malnutrition
11
and educational neglect, constitute a single occurrence stemming from BCA’s negligent
supervision.
(See ECF No. 80 at 6.) Brotherhood Mutual further argues that although the
victims and perpetrators are different, the injuries were caused by continuous or repeated
exposure to substantially the same general harmful conditions.
(See id. at 9.)
Conversely, Defendants argue that the events that triggered liability were the acts of
sexual abuse and not BCA’s negligent supervision.
(See ECF No. 74 at 12–19; ECF No. 76 at
6–7.) The Defendants rely on H.E. Butt Grocery Co., and similar cases to argue that A.B.’s and
K.R.L.’s discrete instances of abuse constitute separate occurrences as the abuse involved two
different victims and two different perpetrators.
This Court agrees with Defendants.
(See ECF No. 74 at 18; ECF No. 76 at 8–9.)
First, applying the principles in Shamblin and
Kosnoski, the events that attached liability were the sexual assault of A.B. and the sexual assault
of K.R.L.
In Shamblin, liability for the car accident was not attached by the two negligent
driving acts, but only by the actual collision.
See 332 S.E.2d at 644–45.
Here, liability was
not attached by the negligent supervision by BCA but two sexual assaults by the two separate
actors.
This reasoning is congruent with the reasoning in Kosnoski, where liability attached
when the gas actually leaked from the boiler furnace and not before simply because there was
negligent maintenance, and Hollis v. Lexington Insurance Co., which Brotherhood Mutual cites,
where liability attached when the fireworks explosion occurred and not when there were
negligent acts committed before.
See No. 13-0494, 2014 WL 629343, at *1 (W. Va. Feb. 18,
2014); see also No. 16-1533, 2017 WL 1076706, at *1 (4th Cir. Mar. 22, 2017).
In addition, as
noted in H.E. Butt Grocery Co., there would be no injury but for the underlying sexual assaults.
See 150 F.3d at 258 (citing Commercial Union Ins. Co. v. Roberts, 7 F.3d 86 (5th Cir. 1993)).
12
Furthermore, the Brotherhood Mutual insurance policy states the following regarding
what sexual abuse would constitute a single occurrence:
Any of the above acts or conduct will be considered a single sexual act if
undertaken by the same perpetrator or perpetrators, even if such acts are directed
against more than one person, happen over time, or take place during more than
one policy period.
(ECF No. 32-3 at 80.) Here, as stated above, the sexual abuse to A.B. and K.R.L. was not
undertaken by the same perpetrator or perpetrators.
It is not alleged that A.B.’s and K.R.L.’s
abusers were in concert with each other. Thus, following the plain meaning of the policy, there
are clearly two occurrences here.
Lastly, if this Court were to follow Brotherhood Mutual’s line of reasoning, then any
injuries that occurred at BCA would constitute a singular occurrence under the umbrella of
negligent supervision by BCA.
The Fifth Circuit illustrated this point in U.E. Texas
One-Barrington, Ltd. v. General Star Indemnity. Co., stating as follows:
To point to the installation of the pipes as the single event which gave rise to the
damage to the nineteen buildings proves too much. Of course it is true that had
the plumbing system never been installed the leaks would not have occurred. In
this sense, it is true that the leaks which independently damaged the nineteen
buildings arose from the same event. However, to look this far back would
render any damage to the complex occurring at any time related to the plumbing
as arising from the same event.
332 F.3d 274, 278 (5th Cir. 2003).
However, each subsequent instance of sexual abuse by one perpetrator against one child
falls under the same occurrence as the first instance of sexual abuse.
See H.E. Butt Grocery
Co., 150 F.3d at 533 (“[T]he conclusion that multiple molestations of the same child is only one
occurrence is easily distinguishable from the conclusion regarding separate acts of molestation of
different children. Where an employee repeatedly molests the same child, each new act of abuse
13
does not necessarily give rise to new liability for the employer.”).
This is consistent with the
instant policy provision defining occurrence which states that “[i]f an occurrence to which any
liability coverage of this policy applies consists of acts . . . occurring on more than one date
during any policy period or policy periods, such events or damage, together with any related loss,
will constitute a single occurrence.” (ECF No. 32-3 at 100.) Thus, this Court finds that the
recurring sexual abuse of A.B. counts as one occurrence and the recurring sexual abuse of K.R.L.
constitutes a second occurrence.
2. Physical Abuse Claims
A.B. and K.R.L. also allege physical abuse in their complaints, both stating that “BCA
subjected [them] to malnourishment, isolation, corporal punishment, starvation and physical
abuse.” (ECF Nos 75-3 at ¶ 23; ECF No. 75-4 at ¶ 22.) Defendants further allege that this
physical abuse was at the hands of J.R. Waldeck4, “who was improperly supervised by James
Waldeck and improperly hired by Bible Baptist Church.” (See ECF No. 82 at 2–3.)
Defendants argue that the physical abuse suffered by each boy is a separate occurrence
because it is not alleged to have occurred as part of the sexual abuse or malnutrition and the
proximate cause for each allegation is different.
(See ECF Nos. 76 at 9, 11; ECF No. 82 at 3–
4.) Brotherhood Mutual maintains its argument that the physical abuse allegations are part of a
singular occurrence encompassing all of Defendants’ claims because they constitute “repeated
exposure” to the similar condition of BCA’s negligence.
(See ECF No. 80 at 9.)
Few courts have addressed whether, when alleged together, physical abuse and sexual
abuse constitute two separate occurrences.
In answering this question, the courts have looked at
4
Although Plaintiffs name J.R. Waldeck as a perpetrator of the abuse in the underlying state actions, he is not a
defendant in the state actions nor this action and is not to be confused with Defendant James Waldeck.
14
whether the injuries alleged from physical abuse were logically severable from the sexual abuse
claims.
The Court of Appeals of Texas addressed this question in TIG Insurance v. San
Antonio YMCA.
See 172 S.W.3d 652 (Tex. App. 2005).
and sexual abuse by a camp counselor.
That case involved claims of physical
See id. at 655, 663 (“‘[T]he child was physically,
sexually, and mentally abused’ by a YMCA employee and ‘the minor child suffered physical
abuse . . . .’”). The court concluded that the physical abuse allegations suggested that they were
unassociated with the sexual abuse allegations and thus the claims constituted a possible cause of
action outside of the sexual abuse cause of action.
See id. at 663.
Citing the Court of Appeals of Texas decision, in TIG Insurance v. Merryland Childcare
& Development Center, the Western District of Tennessee faced the question of whether injuries
characterized as stemming from physical assault were separate from injuries claimed for sexual
abuse so that they fell outside of an insurance policy’s sexual abuse exclusions.
See No.
04-2666, 2007 WL 316571 at, *7–8 (W.D. Tenn. Jan. 21, 2007). There, the court found that,
despite alleging physical abuse and sexual abuse separately, because the child’s injuries all
stemmed from the sexual abuse and could not “be logically extricated therefrom,” the physical
abuse claims were not separate from the sexual abuse claims.
See id.; see also Peerless Ins. Co.
v. K.F.H., No. 2:15-cv-00104, 2015 WL 5992112 at, *5 (D. Me. Oct. 15, 2015) (“To the extent
that K.F.H. was harmed by Vrooman’s verbal communications to K.F.H. made to facilitate and
perpetuate his sexual abuse of her, such harm was connected with and incident to the sexual
molestation that K.F.H. suffered.”) (discussing whether an insurance policy’s exclusion of
coverage for injuries arising out of sexual molestation included verbal abuse suffered by the
victim).
15
Lastly, the Eleventh Circuit addressed this issue in a case involving physical injuries
stemming from physical assault accompanying rape.
See Guideone Elite Ins. Co. v. Old Cutler
Presbyterian Church, Inc., 420 F.3d 1317 (11th Cir. 2005) [hereinafter Guideone].
In
Guideone, the court held that the assault and battery of the victim and each of her children was
sufficiently separated from the rape of the victim. See id. at 1332 (“[T]he rape of the Victim is
one occurrence; the robbery is another; the kidnapping of the Victim and her children is another;
and each act of assault and battery upon the Victim and each of her children, is another.”)
Here, the event that triggered liability for the physical abuse claims was J.R. Waldeck’s
first act of physical abuse, not BCA’s general negligence.
See 332 S.E.2d at 644–45.
Furthermore, similar to TIG Insurance v. San Antonio YMCA, the physical assault allegations are
separate from the sexual abuse, malnutrition, and educational neglect claims and allege a
different perpetrator than the sexual abuse and educational neglect claims.
at ¶ 23; ECF No. 75-4 at ¶¶ 22, 24; ECF No. 82 at 2.)
(See ECF No. 75-3
Thus, the trigger for the physical abuse
claims is separate from the other claims, constituting a finding that the physical abuse claims are
a separate occurrence.
However, contrary to the sexual abuse claims, the physical abuse of A.B. and K.R.L.
together constitute a singular occurrence. The physical abuse claims are more akin to Kosnoski
and Shamblin in that the physical abuse claims were triggered by a singular source:
J.R.
Waldeck’s abusive behavior, whereas the sexual abuse claims were triggered by two, unrelated
perpetrators.
The commencement of J.R. Waldeck’s abusive behavior attached liability to BCA
for physical abuse. Any child exposed to J.R. Waldeck’s abusive behavior can be said to have
been exposed to “similar conditions” and trace back his or her injury to that initial trigger, thus
16
encompassing the later abuse into the same occurrence as the initial abuse.
at 77.)
(See ECF No. 32-2
This reading of “occurrence” is also congruent with Brotherhood Mutual’s policy
definition that a “related loss” is a loss “arising directly or indirectly out of or in connection with
. . . the same related acts, incidents, events, or breaches of duty” and the policy’s provisions
stating that sexual abuse and discriminatory acts, “undertaken by the same perpetrator or
perpetrators, even if such acts are directed against more than one person, happening over time”
constitute a single occurrence.
(See id. at 79, 80.)
Lastly, once liability for the physical abuse was attached any further instances of physical
abuse were encompassed in that initial occurrence.
(See also ECF No. 32-3 at 100.)
See H.E. Butt Grocery Co., 150 F.3d at 533.
Thus, this Court rejects Brotherhood Mutual’s argument that
the physical abuse claims arise out of the same conditions as the other claims and finds that the
physical abuse against A.B. and K.R.L. constitute one occurrence separate from the other
occurrences.
3. Malnutrition Claims
In their state court complaints, A.B. and K.R.L. further allege that they suffered
malnutrition due to “J.R. Waldeck and Blue Creek Academy staff’s failure to feed them as well
as Bible Baptist Church’s policies and James Waldeck’s failure to supervise that allowed these
boys to be malnourished.”
(ECF No. 82 at 2–3.) Thus, A.B.’s and K.R.L.’s malnutrition
allegations name the same perpetrators.
Defendants advance their same argument above that the malnutrition claims constitute a
separate occurrence from the other claims.
(See ECF No. 76 at 9.)
17
Brotherhood Mutual also
advances its same argument stated above that the malnutrition claims are part of the same
occurrence.
(See ECF No. 80 at 9; ECF No. 82 at 3–4.)
Here, the “resulting event for which the insured [became] liable” for the malnutrition was
the failure to feed A.B. and K.R.L.
See Shamblin, 332 S.E.2d at 644. Thus, this resulting
event is different than the resulting events that attached liability for the sexual abuse, physical
abuse, and educational neglect claims. Furthermore, it does not appear that Defendants allege
that this malnutrition occurred as part of the sexual abuse or physical abuse. Therefore, the
malnutrition claims constitute a separate occurrence from the other claims.
The same reasoning as to why A.B.’s and K.R.L.’s physical abuse claims constitute one
occurrence applies here.
claims are the same:
As stated above, the trigger for both A.B.’s and K.R.L.’s malnutrition
J.R. Waldeck’s and BCA’s withholding of food from A.B. and K.R.L.
(See ECF No. 82 at 2–3.) As the trigger is the same for both claims, there is only one
occurrence between the two claims.
See Shamblin, 332 S.E.2d at 644. This is also congruent
with the insurance policy’s definition of “related loss” discussed above.
(See ECF No. 32-3 at
79.)
Thus, this Court finds that A.B. and K.R.L.’s malnutrition claims constitute a singular
separate occurrence from the other claims.
4. Educational Neglect Claims
Lastly, A.B. and K.R.L. both allege that BCA committed “educational neglect” by failing
to provide them adequate education.
(See ECF No. 75-3 at ¶ 30; ECF No. 75-4 at ¶ 27; ECF
No. 76 at 9.) Brotherhood Mutual maintains its argument that this claim is part of a single
occurrence that envelopes all of A.B.’s and K.R.L.’s claims because all of the claims were
18
“caused by continuous or repeated exposure to substantially the same general harmful
conditions.” (See ECF No. 80 at 9.)
Defendants argue that the allegations of educational
neglect were triggered by a completely different event than any of the other allegations.
(See
ECF No. 76 at 9.)
The claim of educational neglect is analogous to other claims of injuries due to harmful
policies.
The Third Circuit, in addressing whether multiple injuries stemming from a
company’s discriminatory employment policies constituted a single or multiple occurrences,
stated the following:
The injuries for which Liberty was liable all resulted from a common source:
Liberty’s discriminatory employment policies. Therefore, the single occurrence,
for purposes of policy coverage, should be defined as Liberty’s adoption of its
discriminatory employment policies in 1965.
The fact that there were multiple injuries and that they were of different
magnitudes and that injuries extended over a period of time does not alter our
conclusion that there was a single occurrence. As long as the injuries stem from
one proximate cause there is a single occurrence. Champion Int'l. Corp. v. Cont’l
Cas. Co., 546 F.2d 502, 505-506 (2d Cir. 1976), cert. denied, 434 U.S. 819
(1977).
Appalachian Ins. Co. v. Liberty Mut. Ins. Co., 676 F.2d 56, 61 (3d Cir. 1982).
insurance policy’s definition of occurrence was similar to the one in the present case.
There, the
Id. at n.8
(“[A]n accident or a happening or event or a continuous or repeated exposure to conditions
which unexpectedly and unintentionally results in personal injury, property damage or
advertising liability during the policy period.
All such exposure to substantially the same
general conditions existing at or emanating from one premises location shall be deemed one
occurrence.”)
19
This reasoning is similar to the “single source” reasoning of the Supreme Court of
Appeals of West Virginia in Kosnoski described above.
See 2014 WL 629343, at *3. There
the court stated the following:
It is clear from the record that there was a leak of carbon monoxide from a single
source, the gas boiler furnace. While the gas undoubtedly traveled to different
rooms within the single building at different times over several hours, the injuries
to petitioners and the decedent were from continuous or repeated exposure to
substantially the same general harmful conditions. . . . Therefore, we find that
under the facts presented in this case, there was a single occurrence under the
policy at issue.
Id.
Here, the educational neglect allegations are similar to the discriminatory employment
policy in Appalachian and the gas leak in Kosnoski in that they stem from a single source:
namely, BCA’s inadequate education as a result of an improperly chosen curriculum.
(See ECF
No. 82 at 3–4.) Following the reasoning in Shamblin discussed more fully above, BCA’s
providing of inadequate education is the “resulting event” that triggered liability.
S.E.2d at 644.
See 332
The simple fact that BCA was neglectful generally does not mean that every
incident occurring while BCA was neglectful can be said to have been triggered by that general
neglect.
See id. (“[T]here may or may not have been two antecedent negligent acts but there
was only one resulting ‘occurrence,’ the event from which liability arises . . . .”).
Furthermore, this trigger of liability for the educational neglect claims is different from
the events that triggered liability for the sexual abuse, physical abuse, and malnutrition claims.
A claim of educational neglect constitutes a distinctly different tort than claims of sexual abuse,
physical abuse, or malnutrition.
condition to the other claims.
Thus, it cannot be said that educational neglect is a similar
The boys were only “continually exposed to similar conditions”
after BCA began providing inadequate education.
20
(See ECF No. 32-3 at 100) (“If an
occurrence to which any liability coverage of this policy applies consists of acts, errors,
omissions, decisions, incidents, events, breaches of duty, damage or loss occurring on more than
one date during any policy period or policy periods, such events or damage, together with any
related loss, will constitute a single occurrence.”).)
Therefore, this Court finds that A.B.’s and K.R.L.’s educational neglect claims constitute
a singular occurrence under the Brotherhood Mutual policy, separate from their sexual abuse,
physical abuse, and malnutrition claims.
IV.
CONCLUSION
In accordance with the foregoing discussion, the Court FINDS that the sexual abuse,
physical abuse, malnutrition, and educational neglect claims constitute five (5) occurrences
under the Brotherhood Mutual Insurance Policy and that the Brotherhood Mutual policy provides
at least $2,000,000 of coverage for A.B. and K.R.L.’s claims.
for Summary Judgment is DENIED.
Judgment are GRANTED.
(ECF No. 80.)
Brotherhood Mutual’s Motion
Defendants’ Motions for Summary
(ECF Nos. 73, 75.)
A separate judgment order will be entered implementing the Court’s findings. The
Clerk is DIRECTED to remove this action from the docket of the Court.
IT IS SO ORDERED.
21
The Court DIRECTS the Clerk to send a copy of this Order to counsel of record and any
unrepresented party.
ENTER:
22
December 7, 2017
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