Granite State Ins. Co. v. Bottoms
| Decision Date | 28 February 1992 |
| Docket Number | No. 910962,910962 |
| Citation | 243 Va. 228,415 S.E.2d 131 |
| Parties | GRANITE STATE INSURANCE COMPANY, et al. v. Nathan BOTTOMS, et al. Record |
| Court | Virginia Supreme Court |
George J. Dancigers, Norfolk (Michelle ReDavid Rack, Heilig, McKenry, Fraim and Lollar, on briefs), for appellants.
Kenneth R. Yoffy, Newport News (LeeAnn N. Barnes, Weaver & Yoffy, on brief), for appellees Lillian R. Bellamy and Elizabeth P. Sanderlin.
Johnny C. Cope, Newport News, for appellees Nathan Bottoms, Colon Brinkley, et al., Trustees of Zion Baptist Church, Zion Baptist Church and Baptist Progress Union, Inc., t/a Zion Baptist Home for the Elderly.
Present: All the Justices.
In this insurance case, the dispositive issue is whether the trial court correctly ruled that an exclusion in a policy issued to the owner of business property did not bar coverage for a claimant's injuries.
In February 1986, appellant Granite State Insurance Company, a member of appellant New Hampshire Insurance Group (collectively, the insurer), issued a "Property Owners Policy" to the Trustees of Zion Baptist Church. The church and Baptist Progress Union, Inc. (collectively, the insured), operate Zion Baptist Home for the Elderly, a Newport News home for adults licensed by the Commonwealth's Department of Social Services.
In December 1986, while the policy was in effect, Olive C. Peters, age 89, a resident of the Home and an incompetent person, was injured there. Subsequently, Lillian R. Bellamy and Elizabeth P. Sanderlin, Committees for Peters (hereinafter, the claimant or Peters) filed suit based on negligence against the insured seeking damages for their ward's personal injuries.
In March 1989, the insured (including Nathan Bottoms and other church trustees) filed the present declaratory judgment action against the insurer. The insured alleged that the insurer, relying on a policy exclusion, had refused to provide a defense to the insured in the tort litigation and had advised that no coverage would be afforded in regard to any judgment that might be rendered in favor of the claimant. The insured asked the court to declare that the policy requires the insurer to provide a legal defense and to cover any judgment the claimant may obtain against it. The insurer then filed a third-party motion against the claimant, asserting that the claimant was a necessary party to the declaratory judgment action.
Following an August 1989 hearing, the trial court ruled that the policy required the insurer to provide a defense in the tort litigation but withheld a ruling on the coverage question. In February 1991, a bench trial was held on the coverage issue. The insured, the insurer, and the claimant joined in a stipulation of facts. In addition, the trial court heard the testimony of two witnesses.
Upon consideration of the evidence and argument of counsel, the trial court ruled "that the exclusion in question does not exclude from coverage the claims set forth in the underlying" litigation and that the insurer is obligated to "defend and provide coverage" for the underlying claims consistent with other provisions of the insurance policy. The insurer appeals the March 1991 final order.
According to the stipulation, Peters had been a resident of the Home for about six years at the time of the accident in question. She had "organic brain syndrome," difficulty in moving, and loss of memory. She was ambulatory but tended to "wander off" unless supervised. She was unable to bathe herself, unable to care for her "toileting needs" unassisted, unable to groom herself, and unable to dress unassisted.
On the day in question, a nurse's aide employed by the Home assisted Peters into a bathroom about 7:30 p.m. to prepare her for bed. As part of the routine, the aide intended to help Peters in using the toilet, "to hand wash her at the sink and dry her, apply bath powder, dress her in clean pajamas and then assist her into bed."
After the aide had removed soiled clothing worn by Peters and assisted her onto the commode, another less disabled resident entered the room to bathe. The aide left Peters sitting on the commode while she carried the soiled clothing to a laundry room.
Upon returning to the bathroom about 20 minutes later, the aide found Peters standing in an agitated state with red areas on her body. She had sustained first and second degree burns on her back, neck, arms, and buttocks which required hospitalization. In the tort litigation, the claimant alleged she was burned by extremely hot water from the bathtub or shower.
As we have said, the Home was a "home for adults." As pertinent here, such a home is defined as "any place, establishment, or institution, public or private ... operated or maintained for the maintenance or care of four or more adults who are aged, infirm or disabled." Code § 63.1-172(A). The statute provides that "maintenance or care" means "the protection, general supervision and oversight of the physical and mental well-being of the aged, infirm or disabled individual." § 63.1-172(B).
The Home is not a "nursing home." A nursing home is defined as "any facility ... in which the primary function is the provision, on a continuing basis, of nursing services and health-related services for the treatment and inpatient care of two or more nonrelated individuals, including facilities known by varying nomenclature or designation such as convalescent homes, skilled nursing facilities or skilled care facilities, intermediate care facilities, extended care facilities and nursing or nursing care facilities." Code § 32.1-123. According to the pastor of Zion Baptist Church, the Home provides no health care or medical treatment for its residents.
The portion of the insurance contract at issue is titled "Owners', Landlords' and Tenants' Section II Coverage." Under the title is this label: "Coverage for Designated Premises and Related Operations in Progress Other Than Structural Alterations, New Construction and Demolition."
As pertinent, the insuring agreement provides: "The company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of ... bodily injury ... to which this insurance applies, caused by an occurrence and arising out of the ownership, maintenance or use of the insured premises and all operations necessary or incidental thereto."
The policy contract also contains "Section II Additional Exclusions." Exclusion A, at issue here, is labelled "Malpractice and Professional Services." It provides: "The following modifies such insurance as is afforded by the provisions of the policy relating to the following: ... Owners', Landlords' and Tenants' Liability Insurance."
The specific language of the exclusion reads: "It is agreed that with respect to any operation described below or designated in the policy as subject to this form, the insurance does not apply to bodily injury ... due to ... the rendering of or failure to render ... any service or treatment conducive to health or of a professional nature."
Following the pre-printed words of the exclusion "Description of Operations:" is typed "Nursing Home." Elsewhere, the policy contains typed language indicating that the "Occupancy" is "Nursing Home," and...
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