Hartford Roman Catholic Diocesan, Corp. v. Interstate Fire & Cas. Co., Civil No. 3:12cv1641(JBA)
| Decision Date | 28 July 2016 |
| Docket Number | Civil No. 3:12cv1641(JBA) |
| Citation | 199 F.Supp.3d 559 |
| Court | U.S. District Court — District of Connecticut |
| Parties | The HARTFORD ROMAN CATHOLIC DIOCESAN, CORP., Plaintiff, v. INTERSTATE FIRE AND CASUALTY CO., Defendant. |
Elizabeth J. Stewart, Marilyn Beth Fagelson, Murtha Cullina, New Haven, CT, Melissa A. Federico, Murtha Cullina LLP, Hartford, CT, for Plaintiff.
Rhonda J. Tobin, Stephen O. Clancy, Jessica A.R. Hamilton, Robinson & Cole, LLP, Hartford, CT, for Defendant.
The Court held a bench trial from April 7, 2016 to April 28, 2016 on claims by Plaintiff the Hartford Roman Catholic Diocesan Corporation (the "Archdiocese") that Defendant Interstate Fire and Casualty Company ("Interstate") is liable for breach of contract (Count One), breach of the covenant of good faith and fair dealing (Count Two), and unfair trade practices, in violation of the Connecticut Unfair Insurance Practices Act ("CUIPA"), Conn. Gen. Stat. § 38a–815 et seq. , and the Connecticut Unfair Trade Practices Act ("CUTPA"), Conn. Gen. Stat. § 42–110b (Count Three), arising from Interstate's failure to indemnify the Archdiocese for monies it paid to four victims of three of its priests' sexual abuse. For the reasons that follow, judgment is entered in the Archdiocese's favor on Count One, and in Interstate's favor on Counts Two and Three.
Based on the evidence presented during the bench trial, the Court makes the following findings of fact with respect to: (1) the nature of the insurance policies at issue in this case; (2) the underlying claims of sexual abuse; (3) the Archdiocese's knowledge, if any, of the accused priests' pedophilic tendencies prior to the claims of abuse by the underlying claimants; and (4) the claims handling process.
Between September 1, 1978 and September 1, 1985, the Archdiocese of Hartford, a Connecticut non-profit, charitable corporation encompassing Hartford, New Haven, and Litchfield counties Findings of Facts ( ) [Doc. # 171] ¶ 1), purchased excess indemnity insurance policies from Interstate as part of its participation in the "Bishops Plan," which was brokered by Arthur J. Gallagher & Co., later Gallagher Bassett Insurance Service ("Gallagher Bassett"), the Archdiocese's third-party insurance administrator (id. at ¶ 3; see Bishops Plan, Pl.'s Trial Ex. 239). Under this plan, the Archdiocese maintained a Self-Insured Retention ("SIR") for the first layer of coverage; underwriters Lloyds of London and other London Market insurers (collectively "Lloyds") and Centennial Insurance Company provided the first layer of excess insurance; and Interstate provided the final layer of excess coverage.1 (Stip. Facts ¶ 5.) Interstate's policies followed the form of Lloyds' policies except to the extent that the provisions in the underlying policies were inconsistent with the provisions in Interstate's policies. (See Interstate's Policy, Pl.'s Trial Ex. 2, Part I ¶ 1.) As third-party administrator, Gallagher Bassett facilitated the flow of information from the Archdiocese to its insurers, notifying the excess insurance providers when claims had been opened and keeping them apprised of correspondence or events that might affect their coverage analysis and liability. (See Bishops Plan at 15.)
Under the policies, Interstate agreed to indemnify the Archdiocese "for all sums" that it was obligated to pay "arising out of any occurrence or happening during the period of insurance." "Occurrence" was defined as "an accident or a happening or event or a continuous or repeated exposure to conditions which unexpectedly and unintentionally results in personal injury, or damage to property during the policy period." (Id. § II: Definitions (3).)
In its summary judgment ruling, the Court interpreted these provisions to mean that Interstate was obligated to indemnify the Archdiocese for all sums paid (a) arising out of the Archdiocese's placement of the accused priests in environments where they had the opportunity to abuse children if (b) the Archdiocese did not subjectively know that it was (c) substantially probable that the priests would abuse children. .)
Before the Archdiocese can recover under the insurance policies, it is obligated to satisfy certain conditions precedent outlined in the policies. (See Interstate's Policy § V.) These include, as relevant here: (1) the "books or records" provision; and (2) the "proof of loss" provision.
Under the books or records provision, "the Underwriters or their duly authorized representatives shall be permitted at all reasonable times during the continuance of this Insurance to ... examine the Assured's books or records so far as they relate to coverage afforded by this Insurance." (Lloyds' Policy § IV.3.) In its summary judgment ruling, the Court interpreted "books or records" to include personnel and Canon 489 files2 and not solely financial documents. .)
The "proof of loss" provision provides: " (Stip. Facts ¶ 19; Lloyds' Policy § IV.11.) Neither Interstate's nor Lloyds' policies define the phrase "proof of loss." (Stip. Facts ¶ 21; see Interstate's Policy; Lloyds' Policy.)
Finally, a section of the Lloyds' policies entitled "Litigation Proceedings" provides: "No suit to recover on account of loss under this insurance shall be brought until 90 days after proof of loss shall have been furnished, nor at all unless commenced within twenty seven months from the date upon which loss occurred, if such loss, is within the knowledge of the Assured; if not, the twenty seven months shall begin upon notice to the Assured of such loss or claim." (Lloyds' Policy § IV.13)
Between August 2010 and May 2012, the Archdiocese settled four claims by individuals (JA, KS, Matthew Doe, and Richard Mallory) alleging that they had been sexually abused by three Archdiocesan priests (Fathers Robert Ladamus, Stephen Crowley, and Ivan Ferguson) when they were children, between 1977 and 1984 or 1985.
JA reported that he was sexually abused by Father Robert Ladamus when he was a student at St. Mary's Church and School in Milford, Connecticut. (Stip. Facts ¶ 44; see JA Demand Ltr., Pl.'s Trial Ex. 7 at 2.) He alleged that the abuse began when he was in 6th or 7th grade, sometime in 1981 or 1982, in Connecticut as well as on trips to Vermont and Florida, and consisted of "fondling, tickling, ... wrestling," and exposure. (JA Demand Ltr. at 2)
KS reported that he was sexually abused by Father Stephen Crowley when he was approximately eight years old and a student at St. Francis of Assisi School in Torrington, Connecticut during the 1981-82 school year. (See Stip. Facts ¶ 72; KS Demand Ltr., Pl.'s Trial Ex. 11 at 3.) The abuse included fondling, mutual masturbation and oral sex. (KS Demand Ltr. at 3–4.)
Both Richard Mallory and Matthew Doe reported abuse by Father Ivan Ferguson. Mr. Mallory claimed that between November 1977 and October 1978, when Father Ferguson was a teacher at Northwest Catholic High School and was in residence at the rectory at St. Bernard's Church in Tariffville, Connecticut, Father Ferguson fondled him, ejaculated in front of him, and attempted to sodomize him. (See Stip. Facts ¶ 100; Mallory Demand Ltr., Pl.'s Trial Ex. 17 at 4.) Mr. Doe alleged that Father Ferguson abused him from the summer of 1981 to the fall of 1982, when Mr. Doe was approximately 13-14 years old, and Father Ferguson was the Assistant Pastor at St. Mary's Parish in Derby, Connecticut. (See Stip. Facts ¶ 133; Doe Claim Notification, Pl.'s Trial Ex. 23 at 2.)
Interstate asserts that the Archdiocese was on notice that Fathers Crowley and Ferguson had abused children prior to their abuse of KS, Mr. Doe, and Mr. Mallory.3 The Court's factual findings with respect to notice are detailed here.
The trial record contains evidence that Father Crowley began to abuse children as early as 1975. (See ML Abuse Report, Pl.'s Trial Ex. 39.) However, there is little evidence that anyone at the Archdiocese was made aware of this abuse until March 1983, when a group of parents wrote to Archbishop John Whealon4 accusing Father Crowley of having abused their children. (See 1983 Ltrs., Pl.'s Trial Ex. 127.).
While Interstate points to a report of abuse in Father Crowley's Canon 489 file prepared by victim ML's counsel, in which ML alleges that he "believe[d] that the school teachers knew about...
To continue reading
Request your trial
-
Dorchester Mut. Ins. Co. v. Krusell
...D. Maldonado, J.D. Rogers, & J.R. Plitt, Couch on Insurance 3d § 127:25 (2019), citing Hartford Roman Catholic Diocesan, Corp. v. Interstate Fire & Cas. Co., 199 F. Supp. 3d 559 (D. Conn. 2016) (sexual abuse by priests was deemed "occurrence" under insurance policy of archdiocese that had p......
-
Arroyo-Delgado v. Dep't of Educ. of PR.
... ... Civil No. 15-2001 (FAB) United States District Court, ... " Stolt Nielsen S.A. v. AnimalFeeds Int'l Corp. , 559 U.S. 662, 670 n. 2, 130 S.Ct. 1758, 176 ... v. U.S. Conference of Catholic Bishops , 705 F.3d 44, 52 (1st Cir.2013) (quoting ... (quoting Horizon Bank & Tr. Co. v. Massachusetts , 391 F.3d 48, 53 (1st ... ...
-
50 Waterville St. Tr. v. Vt. Mut. Ins. Co.
...of loss condition using the doctrine of substantial compliance, see Hartford Roman Cath. Diocesan, Corp. v. Interstate Fire & Cas. Co., 199 F.Supp.3d 559, 582, 591-93 (D. Conn. 2016), aff'd, 905 F.3d 84 (2d Cir. 2018), Connecticut courts have often used the doctrine to evaluate the satisfac......
-
Murphy Med. Assocs. v. Cigna Health & Life Ins. Co.
...even without allegation that the practice goes beyond denial of claims from just one provider, the Plaintiffs. In Hartford Roman Cath. Diocesan, the Second found insufficient evidence of a general business practice even where plaintiffs “submitted 57 claims as a representative sample of [de......