Alea London Limited v. Woodcock
| Citation | 649 S.E.2d 740,286 Ga. App. 572 |
| Decision Date | 05 June 2007 |
| Docket Number | No. A07A0653.,No. A07A0654.,A07A0653.,A07A0654. |
| Parties | ALEA LONDON LIMITED v. WOODCOCK et al. Woodcock et al. v. ALEA London Limited. |
| Court | United States Court of Appeals (Georgia) |
Budd, Larner, Rosenbaum, Greenberg & Sade, Gilbert M. Malm, Atlanta, for appellant.
Brown, Readdick, Bumgartner, Carter, Strickland & Watkins, John E. Bumgartner, Laura E. Roberts, Brunswick, for appellees.
In this appeal and cross-appeal, we affirm a judgment entered in favor of Ray Woodcock, individually and d/b/a Mulligan's Bar and Grill ("the bar"), and Bruce L. Stanfield, in ALEA London, Limited's declaratory judgment action. The case hinges on the proper interpretation of the assault and battery exclusion in ALEA's commercial general liability ("CGL") insurance policy. Although we disapprove of the trial court's decision to submit the question of contract construction to the jury, the jury properly determined that coverage existed for the incident in question, and the judgment entered on the verdict reflects that finding and correctly concludes that ALEA has both a duty to defend and the duty to indemnify Woodcock. The judgment therefore is affirmed.1 The relevant facts follow.
ALEA filed this action against Woodcock and Stanfield seeking a declaration that the CGL policy ALEA issued to Woodcock did not cover injuries sustained by Stanfield when he was struck in the nose by a beer bottle thrown by a patron in the bar. The patron threw the bottle at a different person but missed, hitting Stanfield instead. Stanfield contended that Woodcock was liable because he and other employees failed to prevent the bottle thrower's attack. Stanfield claimed he suffered serious injury and disfigurement and would incur $65,000 in medical expenses for reconstructive surgery.
ALEA claimed that it had no duty to defend or indemnify Woodcock because the incident fell within the policy's assault and battery exclusion, which states:
Exclusion a. . . . Expected or intended injury. "Bodily Injury" or "Property Damage" expected or intended from the standpoint of any insured; or arising out of an assault or battery, provoked or unprovoked, or out of any act or omission in connection with prevention or suppression of an assault or battery, committed by any insured or an employee or agent of the insured.
ALEA and Woodcock filed cross motions for summary judgment. ALEA argued that the exclusion barred coverage for the incident because Stanfield admitted that his injuries arose from an assault and battery that was unprovoked by him and perpetrated by a dangerous patron in the bar. Woodcock argued that the exclusion did not apply because the assault and battery was committed by a patron, and not "by any insured or an employee or agent of the insured."
The trial court denied both motions for summary judgment, ruling that the exclusion was ambiguous and that the ambiguity should be resolved by a jury.2 All parties moved for reconsideration, urging the court to apply the rules of contract construction to decide the issue as a matter of law, given that no facts were in dispute. The trial court denied the motions for reconsideration.
A pretrial order was entered on June 1, 2006. During the pretrial conference, the court conditionally denied ALEA's motion in limine, which sought to exclude reference to an insurance policy issued to Woodcock the day after this incident. The assault and battery exclusion in the subsequent policy states, in pertinent part: "This insurance does not apply to any claim arising out of an assault and/or battery or out of any act or failure to act to prevent or suppress an assault and/or battery whether caused by the insured, an employee, a patron, or any other person."3 The court ruled that the subsequent policy exclusion would be admissible if ALEA argued at trial that the language in the applicable policy was clear in its meaning. In addition, the trial court approved defendants' proposed verdict form, which asked the jury to determine "coverage" as opposed to only the duty to defend, as ALEA had requested.
The case proceeded to trial on stipulated facts. Pertinent allegations in Stanfield's complaint were read to the jury. A copy of the trial court's order denying the parties' motions for reconsideration also was read to the jury, including the following quote from Danos v. Thompson:4
The construction of a contract is a matter for the courts, and it involves a three-step process. First, the trial court must decide whether the language is clear and unambiguous. If it is, the court simply enforces the contract according to its clear terms; the contract alone is looked to for its meaning. Next, if the contract is ambiguous in some respect, the court must apply the rules of contract construction to resolve the ambiguity. Finally, if the ambiguity remains after applying the rules of construction, the issue of what the ambiguous language means and what the parties intended must be resolved by a jury.5
Woodcock moved for a directed verdict on the ground that once the court determined that the exclusion was ambiguous, the court should have construed the exclusion against ALEA as the drafter of the policy.6 The court denied the motion. The court extensively charged the jury on the rules applicable to construction of contracts in general and to interpretation of insurance policies in particular. During deliberations, the jury foreperson sent a note to the court, asking for a copy of the court's instructions. The court recharged the jury that when interpreting an ambiguous insurance contract, "such contracts must be construed favorably to the insured and against the insurer." After deliberating further, the jury foreperson sent another note asking whether the jury's decision should be based on insurance law or on the intent of the parties. The court brought the jurors back in, and they stated that they could not come to an agreement on intent because there was no evidence submitted on that issue. The court again instructed the jury that an ambiguous insurance contract "must be construed favorably to the insured and against the insurer."
Finally, the jury reached a verdict, finding that the policy at issue provided coverage to Woodcock for the claims alleged by Stanfield. The court entered judgment on the verdict in favor of Woodcock and Stanfield on the issue of coverage, including both the duty to defend and the duty to indemnify. ALEA filed a motion for new trial, which the court denied after a hearing. ALEA appeals in Case No. A07A0653, alleging that the trial court erred in (1) denying its motion for summary judgment; (2) denying its motion for reconsideration; (3) submitting the issue of its duty to indemnify to the jury; (4) conditionally denying its motion in limine; (5) charging and recharging the jury that ambiguities in insurance contracts must be construed against the insured; (6) entering judgment on the verdict; and (7) denying its motion for new trial. In Case No. A07A0654, Woodcock cross appeals in the event we reverse in the main appeal. Because we rule in favor of Woodcock and Stanfield on the main appeal, Woodcock's cross appeal is moot. The cases are thus consolidated for disposition in a single opinion.
1. ALEA's challenge to the orders denying its motions for summary judgment and reconsideration are rendered moot by the subsequent entry of verdict and judgment because the legal issue raised in the motions — the applicability of the exclusion — was considered at trial. "After verdict and judgment, it is too late to review a judgment denying a summary judgment, for that judgment becomes moot when the court reviews the evidence upon the trial of the case."7 "[W]here a motion for summary judgment is overruled on an issue and the case proceeds to trial and the evidence at the trial authorizes the verdict (judgment) on that issue, any error in overruling the motion for summary judgment is harmless."8 We will, however, consider the challenge to the judgment rendered on the verdict and the denial of ALEA's motion for new trial. 9
2. On appeal, we examine the record in the light most favorable to the verdict and judgment.10 "[A] jury verdict, after approval by the trial court, and the judgment thereon will not be disturbed on appeal if supported by any evidence, in the absence of any material error of law."11 The denial of a motion for a new trial is a matter within the sound discretion of the trial court and will not be disturbed if there is any evidence to authorize it.12
In the case at bar, the policy and Stanfield's allegations support a finding that coverage exists. We disagree, however, with the trial court's decision to submit the issue to the jury. "Construction and interpretation of a contract are matters of law for the court."13 "Contracts, even when ambiguous are to be construed by the court and no jury question is presented unless after application of applicable rules of construction an ambiguity remains."14 "If the court finds that an ambiguity exists, it is the court's duty to resolve that ambiguity by applying the pertinent rules of contract construction."15
The rules of construction require the court to consider the policy as a whole, to give effect to each provision, and to interpret each provision to harmonize with each other.16 In addition, "[i]t is well established that a court should avoid an interpretation of a contract which renders portions of the language of the contract meaningless."17 Finally,
[a]ny ambiguities in the contract are strictly construed against the insurer as drafter of the document, any exclusion from coverage sought to be invoked by the insurer is likewise strictly construed, and insurance contracts are to be read in accordance with the reasonable expectations of the insured where possible. 18
But "the cardinal rule of contract construction is to ascertain the...
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