Holiday Hospitality Franchising Inc. v. Amco Ins. Co.
| Decision Date | 13 October 2011 |
| Docket Number | No. 33A01–1103–CT–104.,33A01–1103–CT–104. |
| Citation | 955 N.E.2d 827 |
| Parties | HOLIDAY HOSPITALITY FRANCHISING, INC., Appellant–Defendant,v.AMCO INSURANCE COMPANY, Appellee–Plaintiff.Holiday Inn Express of New Castle, LLC, Anil Megha, S.H., Individually and as Parent and Next Friend of R.M.H., a minor child, and Michael V. Forshey, Interested Parties–Defendants. |
| Court | Indiana Appellate Court |
OPINION TEXT STARTS HERE
Robert B. Clemens, Curtis T. Jones, Bose McKinney & Evans LLP, Indianapolis, IN, Attorneys for Appellant Holiday Hospitality Franchising, Inc.Freedom Villa Miller, Smith Fisher Maas & Howard, P.C., Indianapolis, IN, Attorney for Interested Parties Holiday Inn Express of New Castle, LLC and Anil Megha.Mark D. Gerth, Kightlinger & Gray, LLP, Indianapolis, IN, Attorney for Interested Party S.H. Individually and as Parent and Next Friend of R.M.H., A Minor Child.Danford R. Due, Scott E. Andres, Due Doyle Fanning, LLP, Indianapolis, IN, Attorneys for Appellee.
Holiday Hospitality Franchising, Inc. (“Holiday Hospitality”) appeals the trial court's grant of Amco Insurance Company's (“AMCO”) motion for summary judgment. Holiday Hospitality raises two issues for our review, which we restate as whether an “occurrence” took place for the purposes of the insureds' insurance policy, and whether a hotel guest is “in the care, custody or control” of the hotel. Concluding the alleged negligent acts give rise to an “occurrence” under these circumstances and a genuine question of material fact remains regarding whether R.M.H. was in the hotel's “care, custody or control,” we reverse and remand for further proceedings.
In May of 2007, Michael Forshey, an employee of Holiday Inn Express of New Castle, LLC (“Holiday Inn”), molested R.M.H., a fifteen-year-old guest at the Holiday Inn. Holiday Inn, along with its parent company Holiday Hospitality, was insured by AMCO under the same policy.1 The insurance policy provided for bodily injury and property damage liability coverage, personal and advertising liability coverage, and a duty to defend. The pertinent provisions of the policy are as follows:
I. COVERAGES
1. INSURING AGREEMENT
a. We will pay those sums up to the applicable Limit of Insurance that the insured becomes legally obligated to pay as damages because of “bodily injury” or “property damage” to which this insurance applies. We will have the right and duty to defend the insured against any “suit” seeking those damages for which there is coverage under this policy.
HOWEVER, we will have no duty to defend the insured against any “suit” seeking damages for “bodily injury” or “property damage” to which this insurance does not apply.
* * *
b. This insurance applies to “bodily injury” and “property damage” only if:
1) The “bodily injury” or “property damage” is caused by an “occurrence” that takes place in the “coverage territory”;
* * *
2. EXCLUSIONS
This insurance, including any duty we have to defend “suits”, does not apply to:
a. Expected or Intended Injury
“Bodily injury” or “property damage” which is expected or intended by the insured.
This exclusion applies even if the resulting “bodily injury” or “property damage”:
1) Is of a different kind, quality or degree than initially expected or intended; or
2) Is sustained by a different person, entity, real property, or personal property than that initially expected or intended.
* * *
r. Abuse or Molestation
“Bodily injury” or “property damage” arising out of:
1) The actual or threatened abuse or molestation by anyone of any person while in the care, custody, or control of any insured, or
2) The negligent:
a) Employment;
b) Investigation;
c) Supervision;
d) Reporting to the proper authorities, or failure to so report; or
e) Retention;
of a person for whom any insured is or ever was legally responsible and whose conduct would be excluded by Paragraph 1) above.
* * *
a. We will pay those sums up to the applicable Limit of Insurance that the insured becomes legally obligated to pay as damages because of “personal and advertising injury” to which this insurance applies. We will have the right and duty to defend the insured against any “suit” seeking those damages for which there is coverage under this policy.
HOWEVER, we will have no duty to defend the insured against any “suit” seeking damages for “personal and advertising injury” to which this insurance does not apply.
* * *
This insurance, including any duty we have to defend “suits”, does not apply to:
a. “Personal and advertising injury”:
1) Caused by or at the direction of the insured with the knowledge that the act would violate the rights of another and would inflict “personal and advertising injury”;
* * *
12) Arising out of:
a) The actual or threatened abuse or molestation by anyone of any person while in the care, custody or control of any insured, or
b) The negligent:
i) Employment;
ii) Investigation;
iii) Supervision;
iv) Reporting to the proper authorities, or failure to so report; or
v) Retention;
of a person for whom any insured is or ever was legally responsible and whose conduct would be excluded by Paragraph
a) above;
* * *
IV. LIABILITY CONDITIONS
The following conditions apply in addition to the COMMON POLICY CONDITIONS.
* * *
5. Separation of Insureds
Except with respect to the Limits of Insurance, and any rights or duties specifically assigned in this policy to the first Named Insured, this insurance applies:
a. As if each Named Insured were the only Named Insured; and
b. Separately to each insured against whom claim is made or “suit” is brought.
* * *
V. DEFINITIONS
The terms “you”, “your”, “we”, “us”, “our” and “insured” are defined in the Preamble of this Coverage Form. The following words or phrases, which appear in quotation marks throughout this Coverage Form and any of its endorsements, are defined as follows:
* * *
* * *
13. “Occurrence” means an accident, including continuous or repeated exposure to substantially the same general harmful conditions.
* * *
Appendix to Brief of Appellant at 128–49.
In September of 2008, S.H., individually and as parent and next friend of R.M.H., filed a twelve-count complaint against the following: Forshey; an individual member of the Holiday Inn limited liability company; Holiday Inn; and Holiday Hospitality. Holiday Hospitality filed a motion for partial summary judgment on the issue of whether it could be held vicariously liable for the actions of Forshey. Concluding Forshey's misconduct occurred while he was outside the scope of his employment, the trial court granted the partial summary judgment as to all underlying defendants. The only remaining claims in the underlying litigation are for negligent hiring, retention, and/or supervising.
In 2009, AMCO filed this declaratory judgment action, seeking the trial court's determination that AMCO's policy with Holiday Inn does not provide coverage to any of the defendants in the suit brought by S.H. AMCO then filed a motion for summary judgment, and, following a hearing, the trial court granted AMCO's summary judgment motion on March 21, 2011. Holiday Hospitality now appeals the trial court's grant of AMCO's motion for summary judgment. 2
Summary judgment is appropriate “if the designated evidentiary matter shows that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Ind. Trial Rule 56(C). On appeal, we are bound by the same standard as the trial court. Hamilton v. Ashton, 846 N.E.2d 309, 313 (Ind.Ct.App.2006), clarified on reh'g on other grounds, 850 N.E.2d 466, 467 (Ind.Ct.App.2006), trans. denied. We consider only those facts which were designated to the trial court at the summary judgment stage. Id. We do not reweigh the evidence, but instead liberally construe the evidence in the light most favorable to the non-moving party to determine whether a genuine issue of material fact exists. Id. A genuine issue of material fact exists where facts concerning an issue which would dispose of the litigation are in dispute or where the undisputed material facts are capable of supporting conflicting inferences on such an issue. Id. at 314. On appeal, the appellant bears the burden of demonstrating that the trial court erred, and if the trial court's ruling can be sustained on any basis or theory supported by the record, we must affirm. Id. However, “[w]hen any party has moved for summary judgment, the court may grant summary judgment for any other party upon the issues raised by the motion although no motion for summary judgment is filed by such party.” T.R. 56(B).
Insurance policies are contracts that are subject to the same rules of construction as other contracts. Sheehan Constr. Co., Inc. v. Cont'l Cas. Co., 935 N.E.2d 160, 169 (Ind.2010), opinion adhered to as modified on reh'g on other grounds, 938 N.E.2d 685, 687 (Ind.2010). When the language of an insurance policy is clear and unambiguous, we give the language its plain and ordinary meaning. Id. If unambiguous, an insurance policy must be enforced according to its terms. Id. Insurers have the right to limit their coverage of risks by imposing exceptions, conditions, and exclusions. Id. But if there is ambiguity in the language of an insurance policy, we strictly construe it against the insurer. Auto–Owners Ins. Co. v. Harvey, 842 N.E.2d 1279, 1283 (Ind.2006). An ambiguity exists where a provision is susceptible to more than one interpretation and reasonable persons would differ as to its meaning. Id.
Holiday Hospitality first argues the trial court...
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Holiday Hospitality Franchising, Inc. v. AMCO Ins. Co.
...was “in the care, custody or control” of Holiday Inn Express at the time Forshey molested him. Holiday Hospitality Franchising, Inc. v. Amco Ins. Co., 955 N.E.2d 827, 836 (Ind.Ct.App.2011). On rehearing, the Court of Appeals clarified that its reversal applied only to Holiday Hospitality, H......
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Holiday Hospitality Franchising, Inc. v. AMCO Ins. Co., 33A01–1103–CT–104.
...R.M.H., (collectively, the “Petitioners”) have petitioned for rehearing of this court's decision in Holiday Hospitality Franchising, Inc. v. Amco Ins. Co., 955 N.E.2d 827 (Ind.Ct.App.2011), in which we reversed the trial court's grant of Amco Insurance Company's (“AMCO”) motion for summary ......