St. Paul Fire & Marine Ins. v. Campbell Cty. School

• Decision Date: 26 June 1985
• Docket Number: No. C85-0002-B.,C85-0002-B.
• Citation: 612 F. Supp. 285
• Parties: ST. PAUL FIRE AND MARINE INSURANCE COMPANY, a Minnesota corporation, Plaintiff, v. CAMPBELL COUNTY SCHOOL DISTRICT NO. 1, Defendant.
• Court: U.S. District Court — District of Wyoming

612 F. Supp. 285

ST. PAUL FIRE AND MARINE INSURANCE COMPANY, a Minnesota corporation, Plaintiff, v. CAMPBELL COUNTY SCHOOL DISTRICT NO. 1, Defendant.

No. C85-0002-B.

United States District Court, D. Wyoming.

June 26, 1985.

Dan B. Riggs, Lonabaugh & Riggs, Sheridan, Wyo., for plaintiff.

Dan R. Price, II, Morgan, Brorby, Price & Roberts, Gillette, Wyo., for defendant.

ORDER ON CROSS MOTIONS FOR SUMMARY JUDGMENT

BRIMMER, District Judge.

The above entitled matter came before the Court pursuant to cross motions for summary judgment. The Court, having reviewed the pleadings and the evidence offered, and being fully advised in the premises, FINDS and ORDERS as follows:

This is a declaratory judgment action initiated by plaintiff St. Paul Fire and Marine Insurance Company (St. Paul) seeking a declaration by the Court that it has no duty to defend or pay out on a case involving a civil rights suit against the insured, Campbell County School District No. 1 (School District). Both sides ask for summary judgment on the issue of liability and duty to defend regarding the civil rights suit instituted against the School District by Judy Worth.

Judy Worth, a teacher for the School District, while sponsor of the school newspaper, became entangled in a battle over publication of a certain satirical cartoon. When the school principal refused to let the cartoon be published, Ms. Worth called in outside help, including the American Civil Liberties Union (ACLU). Ms. Worth contends that because of her activities she was demoted, harassed, and in general subjected to emotional suffering. Ms. Worth sued the School District for violation of her First Amendment rights, and seeks damages for, inter alia, emotional suffering. The School District informed plaintiff St. Paul that it expected the insurance company to defend and cover this lawsuit, and St. Paul now seeks a declaration from this Court that the policies in question do not invoke either a duty to defend or cover any losses arising from the Worth lawsuit.

Three separate policies are involved in this matter, and although they are partially interrelated, the Court will deal with them one at a time. The first policy, a Comprehensive General Liability Insurance Policy, effective from October 13, 1983 through July 1, 1984, provides in part that the company will pay for all damages because of "bodily injury ... caused by an occurrence, "and the company shall have the right and the duty to defend any (such) suit...." The policy goes on to define "bodily injury" as "bodily injury, sickness or disease sustained by any person which occurs during the policy period...." Finally, the policy defines "occurrence" as "an accident, including continuous or repeated exposure to conditions, which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured."

Given the policy language, the crux of the matter is whether or not the events causing Ms. Worth's alleged emotional suffering constitute an occurrence. The alleged events in question include such matters as harassment by her superiors for calling in the ACLU, failure to be reinstated as journalism sponsor, etc. None of these events can be construed as unintentional, and the School District admits as much. However, the District contends that since the outcome of the events, namely Ms. Worth's emotional distress, was unintentional, the events should be considered an occurrence.

There is no clear Wyoming law on this question. Although in Wyoming an "insurer is obligated to defend if there is potentially a case under the complaint within the coverage of the policy," "potential" has not been given an expansive reading. Boston Insurance Company v. Maddux Well Service, 459 P.2d 777, 779 (Wyo.1967). In Action Ads, Inc. v. Great American Ins. Co., 685 P.2d 42 (Wyo.1984), the Wyoming Supreme Court recently declined to give an expansive reading to a similar insurance clause defining occurrence. Although the injury itself could be construed within the clause, because the employee in question only sued the insured for breach of contract, the Court found that the insurance company had no duty to defend or cover the losses. The Court acknowledged that this was "a narrow reading of the liability-coverage clause", but reasoned that an "occurrence" referred to tortious conduct, and that "Action Ads' potential liability in this case stemmed not from its own negligent behavior, but from a contractual obligation." Id. at 45 (emphasis added).

The Court is faced with a similar situation. The School District's potential liability also stems not from negligence, but from intentional acts on the part of its agents. St. Paul argues that intentional acts do not fit within the policy definition of occurrence, which speaks in terms of an accident. The Court agrees. In construing a near identical clause, the District Court for the District of North Dakota held:

This standard definition limits coverage to "fortuitous losses", that is damages arising from "mistake or carelessness" on the part of insured rather than from "intentional or reckless acts". Rolette County v. Western Cas & Sur. Co., 452 F.Supp. 125, 130 (D.N.D.1978).

Since it is clear that any emotional damages to Ms. Worth were caused by intentional acts, and were not the result of an accident, the Court must conclude that the incidents in question were not an "occurrence" as defined by the policy. See also Pendergraft v. Commercial Standard Fire & Marine Co., 342 F.2d 427, 429 (10th Cir.1965); and Service Welding & Mach. Co. v. Michigan Mutual Liability Co., 311 F.2d 612, 617 (6th Cir.1962).

Moreover, even if the existence of an occurrence were assumed, the type of damage alleged, i.e. emotional suffering, does not constitute "bodily injury". In Bituminous Fire & Marine Ins. Co. v. Izzy Rosen's, Inc. 493 F.2d 257, 261 (6th Cir. 1974), the court concluded, in discussing a policy obligation to pay for damages because of bodily...