Foster v. Allstate Ins. Co.
| Decision Date | 11 December 1981 |
| Citation | 637 S.W.2d 655 |
| Parties | Rendell FOSTER and Catherine Ann Foster, Appellants, v. ALLSTATE INSURANCE COMPANY, Appellee. |
| Court | Kentucky Court of Appeals |
B. Frank Radmacher, III, Louisville, for appellants.
C. Dant Kearns, Stites, McElwain & Fowler, Louisville, for appellee.
Before COOPER, HOWARD and WILHOIT, JJ.
Catherine Ann Foster and Rendell Foster, her husband, appeal from a judgment of the Jefferson Circuit Court declaring that under the terms of the homeowner's insurance policy issued to them by the appellee, Allstate Insurance Company, coverage was excluded for an injury arising out of Mrs. Foster's activities as a baby-sitter.
The appellee issued a homeowner's insurance policy to the appellants, insuring their new home as of August 12, 1978. The application for this policy indicated that there was no business or professional activity on the insured premises, and, as far as the record discloses, there was none either at the time that the application was made or the policy issued. Sometime during the next month, Mrs. Foster decided to do baby-sitting in her home. After obtaining the necessary permit from the appropriate Jefferson County agency and advertising in a local newspaper, Mrs. Foster began to baby-sit with the infant son of a Mr. and Mrs. Trujillo for $35.00 per week. On May 24, 1979, while in Mrs. Foster's care and at her home, the Trujillo infant was fatally injured when he fell and struck the back of his head on a coffee table in her living room. A negligence action was then brought against Mrs. Foster on account of the infant's death. This action was then brought by the appellee seeking a declaration of whether the liability coverage of the homeowner's policy issued to the Fosters afforded Mrs. Foster coverage for any liability resulting from the infant's death. The trial court held that coverage was excluded under section 1(d) of the Exclusion to Section II of the policy.
The provision referred to by the trial court states that the liability protection afforded by Section II of the policy does not apply:
(d) to bodily injury or property damage arising out of business pursuits of any Insured except activities therein which are ordinarily incident to non-business pursuits ....
The definition section of the policy defines "business" to include
(a) a trade, profession or occupation, including farming, and the use of any premises or portion of residence premises for any such purposes ....
The appellants argue that at the time at which the infant was injured Mrs. Foster was not engaged in a "business pursuit" as that term is used in the exclusion, and that even if she were, the exclusion does not apply because her activities were such as are ordinarily incident to nonbusiness pursuits. For purposes of this opinion, we shall assume that Mrs. Foster's baby-sitting was a "business pursuit" and focus our attention on the latter part of the appellants' argument.
The exclusion at issue has been the subject of considerable, but not consonant, judicial interpretation. See, e.g., Robinson v. Utica Mutual Insurance Co., 585 S.W.2d 593 (Tenn. 1979), and cases cited in Annot., 48 A.L.R.3d 1096 (1973). It has been interpreted in our own jurisdiction in Neal v. Celina Mutual Insurance Co., Ky., 522 S.W.2d 179 (1975). There, the Court stated that the exclusion "plainly has reference to accidents that occur in the carrying on of a business pursuit." Id. at 180-81. It did not, however, interpret the exception found in the exclusion. Read in its entirety and in light of the foregoing case, the exclusion at first appears by its plain language to provide that an accident which occurs in the carrying on of a business pursuit is excluded from coverage unless that accident occurs while the insured, although engaged in carrying on a business pursuit, is also engaged in activities which are ordinarily incident to nonbusiness pursuits. This is much the same interpretation which has been given to the exclusion by the Supreme Court of California in Crane v. State Farm Fire and Casualty Co., 5 Cal.3d 112, 485 P.2d 1129, 95...
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