Merced Mutual Ins. Co. v. Mendez

• Decision Date: 11 August 1989
• Docket Number: No. F010623,F010623
• Citation: 213 Cal.App.3d 41,261 Cal.Rptr. 273
• Court: California Court of Appeals Court of Appeals
• Parties: MERCED MUTUAL INSURANCE COMPANY, Plaintiff and Respondent, v. Bobby MENDEZ et al., Defendants and Appellants.

Page 273

261 Cal.Rptr. 273

213 Cal.App.3d 41

MERCED MUTUAL INSURANCE COMPANY, Plaintiff and Respondent, v. Bobby MENDEZ et al., Defendants and Appellants.

No. F010623.

Court of Appeal, Fifth District, California.

Aug. 11, 1989.

[213 Cal.App.3d 43] Canelo, Hansen & Wilson, James H. Wilson, Ralph S. Temple, Jr., Merced, for defendants and appellants.

Marderosian & Swanson, James W. Swanson, Fresno, for plaintiff and respondent.

OPINION

ARDAIZ, Associate Justice.

This is an appeal from the entry of summary judgment in favor of respondent Merced Mutual Insurance Company. The trial court determined respondent had no duty to defend or indemnify Mendez for damages caused by engaging in acts of oral copulation and attempted oral copulation allegedly against Ms. Peery's will. We shall affirm.

On October 16, 1985, Helen and Claude Peery filed a complaint against Bobby Mendez and the County of Merced, claiming Mendez had sexually assaulted Ms. Peery several times at their mutual place of employment. The complaint alleged causes of action for both intentional and negligent assault and battery. The complaint further alleged causes of action for both intentional and negligent infliction of emotional distress stemming from the incidents.

Depositions of both Mendez and Peery, submitted with the motion for summary judgment, reveal radically divergent versions of the events. Mendez's version portrays a consensual sexual encounter between the parties. Peery's recital of events reveals a brutal physical attack culminating in forced oral copulation and three attempts by Mendez to repeat the act.

At the time the acts occurred and at the time the Peery complaint was filed, Mendez was covered under a homeowners policy issued by respondent. With respect to personal liability, the policy provides in relevant part:

"If a claim is made or a suit is brought against any insured for damages because of bodily injury or property damage caused by an occurrence to which this coverage applies, we will: [p] 1. pay up to our limit of liability for the damages for which the insured is legally liable; and [p] 2. provide a defense at our expense by counsel of our choice, even if the allegations are groundless, false or fraudulent."

The policy defines "occurrence" as

"an accident, including exposure to conditions, which results, during the policy period, in: [p] a. bodily injury; or [p] b. property damage."

The policy then excludes coverage for:

"bodily injury or property damage: [p] a. which is expected or intended by the insured."

Mendez tendered his defense to respondent. Respondent filed an action for a declaratory judgment that it had no obligation After hearing on respondent's motion for summary judgment, the court issued the following decision:

to indemnify or defend Mendez in the action brought by the Peerys. Respondent argued Mendez's acts were intentional and thus not within the general coverage provisions of the homeowners policy. Alternatively, respondent argued the conduct complained[213 Cal.App.3d 45] of was excluded under policy provisions and Insurance Code section 533. ¹

"Plaintiff has moved for a Summary Judgment declaring that it has no obligation to defend Bobby Mendez nor to indemnify him for damages he is alleged to have caused Helen Peery and Claude Peery.

"Plaintiff had issued one or more homeowners insurance policies to Mendez at least one of which was in effect at the relevant time.

"The policy provided coverage to Mendez if a claim is made or suit brought against him because of bodily injury caused by an occurrence. The word 'occurrence' means an accident which results in bodily injury. The policy coverage does not apply to injury which is expected or intended by the insured. The conclusion to be drawn from the testimony of Mendez relied on in this proceeding was that his sexual advances to Peery were consensual and there was no wrongdoing.

"If Mendez misunderstood or misinterpreted the words and acts of conduct of Peery and continued his advances he, nevertheless, intended those acts and the consequences of those acts. Peery's claim of harm does not make those acts of Mendez accidental."

Appellants filed timely notices of appeal.

DISCUSSION

Summary judgment is proper where no triable issue of fact is presented and the sole question is one of law. (Neinstein v. Los Angeles Dodgers, Inc. (1986) 185 Cal.App.3d 176, 179, 229 Cal.Rptr. 612.) Where the underlying facts are not disputed, construction of an insurance policy presents a question of law. The appellate court is not bound by the trial court's interpretation. Rather, it must independently interpret the language of the insurance contract. (Royal Globe Ins. Co. v. Whitaker (1986) 181 Cal.App.3d 532, 536, 226 Cal.Rptr. 435.)

At the outset, we recognize that the "insurer's duty to defend [Mendez] is broader than its duty to indemnify ... because the duty to defend arises if the underlying civil claim is potentially covered by insurance. [Citations.] 'But where there is no possibility of coverage, there is no duty to defend' [citation] and the insurer is entitled to declaratory relief if the underlying civil action will not resolve issues affecting coverage." (Fire Insurance Exchange v. Abbott (1988) 204 Cal.App.3d 1012, 1029, 251 Cal.Rptr. 620.)

We further note at the outset that the cases relied on by appellant in urging a duty to defend are distinguishable and thus not controlling. In Gray v. Zurich Insurance Co. (1966) 65 Cal.2d 263, 54 Cal.Rptr. 104, 419 P.2d 168, the policy in question provided for payment " '... on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury or property damage, ...' " (Id. at p. 267, 54 Cal.Rptr. 104, 419 P.2d 168.) The policy further provided: " '[T]he company shall defend any suit against the insured alleging such bodily injury or property damage and seeking damages which are payable under the terms of this endorsement, even if any of the allegations of the suit are groundless, false, or fraudulent....' " (Ibid.) The policy excluded coverage for bodily injury damages caused intentionally by the insured. (Ibid.)

Similarly, the policy language in Allstate Insurance Company v. Overton (1984) 160 Cal.App.3d 843, 206 Cal.Rptr. 823 provided broad coverage for " '... all sums arising from the same loss which an insured person becomes legally obligated to pay as damages because of bodily injury or property damage covered by this part of the policy. [p] We may investigate or settle any claim or suit for covered damages against an insured person. If an insured person is sued for these damages, we will provide a defense with counsel of our choice, even if the allegations are not true....' " (Id. at pp. 845-846, 206 Cal.Rptr. 823.) The policy then excluded losses " '... intentionally caused by an insured person....' " (Id. at p. 846, 206 Cal.Rptr. 823.)

As respondent notes, the language of the policy in Gray and Overton is clearly distinguishable from the policy language in the present case. As previously noted, the policy here affords coverage and a duty to defend only "[i]f a claim is made or a suit is brought against any insured for damages because of bodily injury or property damage caused by an occurrence to which this insurance applies." (Emphasis added.) "Occurrence" is elsewhere defined as an "accident."

The policy in Gray did not include, as does the subject policy, the words "caused by an occurrence to which this insurance applies." The importance of this distinction is discussed in Royal Globe Ins. Co. v. Whitaker, supra, 181 Cal.App.3d 532, 226 Cal.Rptr. 435 as follows: "[H]ere [unlike Gray ], the insurer only promises to indemnify or defend actions involving bodily injury caused by an accident resulting in bodily injury neither expected nor intended by the insured." (Id. at p. 537, 226 Cal.Rptr. 435, emphasis added.)

As the court in Giddings v. Industrial Indemnity Co. (1980) 112 Cal.App.3d 213, 169 Cal.Rptr. 278 (hg. den. Jan. 14, 1981) explains:

"The present case is readily distinguishable from Gray and many of the cases following it, which have broadly interpreted the insurer's duty to defend. [Citations.] In each of these cases, damages of the type covered by the policy had undisputably occurred, and the insurer relied on an unclear exclusionary clause in asserting it was not obligated to defend its insured. Here, on the other hand, the question concerns the scope of the basic coverage itself...." (Id. at p. 218, 169 Cal.Rptr. 278.)

Thus, the threshold question in the present case is not whether an exclusion applies, but rather the scope of coverage itself: whether the conduct in question constitutes an accident within the meaning of the policy provision. In a declaratory relief action to determine the insurer's obligations under the policy, the burden is on the insured initially to prove an event is a claim within the scope of the basic coverage. (Royal Globe Ins. Co. v. Whitaker, supra, 181 Cal.App.3d at p. 537, 226 Cal.Rptr. 435.) The burden then shifts to the insurer to prove the claim falls within an exclusion. (Clemmer v. Hartford Insurance Co. (1978) 22 Cal.3d 865, 880, 151 Cal.Rptr. 285, 587 P.2d 1098.) ²

The established principles applicable to the interpretation of insurance policies are set forth in Reserve Insurance Co. v. Pisciotta (1982) 30 Cal.3d 800, 180 Cal.Rptr. 628, 640 P.2d 764:

"Words used in an insurance policy are to be interpreted according to the plain meaning which a layman would ordinarily attach to them. Courts will not adopt a strained or absurd interpretation in order to create an ambiguity where none exists. [Citations.]

"On the other hand, 'any ambiguity or uncertainty in an insurance policy is to be resolved against the insurer and ... if semantically permissible, the contract will be given such construction as will fairly achieve its object of providing indemnity for the loss to which the insurance r...