Millers Mut. Ins. Co. v. Strainer

• Decision Date: 19 May 1983
• Docket Number: No. 82-379,82-379
• Citation: 40 St.Rep. 743,663 P.2d 338,204 Mont. 162
• Parties: MILLERS MUTUAL INSURANCE COMPANY, Plaintiff and Respondent, v. Anthony STRAINER, Defendant and Appellant.
• Court: Montana Supreme Court

Page 338

663 P.2d 338

204 Mont. 162

MILLERS MUTUAL INSURANCE COMPANY, Plaintiff and Respondent, v. Anthony STRAINER, Defendant and Appellant.

No. 82-379.

Supreme Court of Montana.

Submitted March 8, 1983.

Decided May 19, 1983.

Jacques, Gallagher & Murphy, Helena, Leo J. Gallagher, argued, Helena, for defendant and appellant.

Keller, Reynolds, Drake, Sternhagen & Johnson, Helena, P. Keith Keller, argued, Helena, for plaintiff and respondent.

Utick, Grosfield & Uda, Helena, for amicus curiae.

MORRISON, Justice.

This is an appeal from a declaratory judgment entered by the District Court of the First Judicial District, State of Montana, determining that Millers Mutual Insurance Company (Respondent) had no liability for coverage or defense to Anthony Strainer (Appellant). We vacate the judgment of the District Court.

On December 16, 1981, respondent brought a declaratory judgment action against appellant to determine the parties' rights, liabilities and duties under a homeowner's policy issued by respondent to appellant. Previously appellant had been named as a co-defendant with ASARCO, Inc., in a personal injury action brought by one Alfred Elwell. Respondent sought a declaration that it was not required to provide coverage or afford defense of the action because the allegations underlying the third party action were outside the scope of coverage of the issued policy.

On October 18, 1979, in the ASARCO plant in East Helena, Alfred Elwell was allegedly injured when he was the object of a practical joke played by Strainer, a co-employee. Workers at the ASARCO plant are required to wear respirators in a portion of the plant. Due to complaints by the workers that the respirators were leaking, the respirators were being checked by means of a test which pumped air through a glass tube filled with a solid chemical. The forced air produced smoke which was then directed into the faces of the workers wearing respirators. After the tests were completed and without knowledge on the part of Elwell, the appellant removed a filter tube in Elwell's respirator and, according to the agreed facts, Strainer then:

"... squirted a puff of the smoke into the respirator's air chamber. Mr. Strainer knew the dust caused people to cough, but did not know the chemical contents of the glass tube, stanic oxychoride, was [sic] dangerous and did not know the smoke would cause any injury other than momentary discomfort as a result of coughing and inserted the smoke solely as a practical joke."

Elwell inhaled the smoke and allegedly was seriously injured. On October 15, 1981, Elwell filed suit against ASARCO and appellant, claiming they were liable to him for his injuries. ASARCO subsequently moved for and was granted a summary judgment based upon the exclusive remedy afforded by workers' compensation. However, the action against appellant was premised upon an intentional act and therefore fell outside the exclusive remedy provisions of workers' compensation.

The issue presented here is whether an intentional act sufficient to remove a case from the exclusive remedy provisions of the Worker's Compensation Act is the kind of intentional act which denies coverage in a third party action based upon the "intentional act" exclusions of an insurance policy. If the intentional act contemplated by workers' compensation law is the same type of intentional act contemplated by the insurance policy exclusion, then the appellant must fail.

Respondent presents a second but related issue. Respondent contends that Elwell's complaint, in Paragraph VI, alleges that the appellant Strainer intended Elwell's injuries and that irrespective of what the stipulated facts show, there can be no coverage where the complaint invokes the policy exclusion.

Paragraph V of Elwell's complaint alleged, in pertinent part, that the appellant Strainer "maliciously, wilfully, and intentionally ... squirted hydrogen chloride gas, or other comparable acid and abrasive gases, into [Elwell's] respirator hoses, causing [Elwell] to go into convulsions and to be permanently and seriously injured."

Paragraph VI of the complaint alleged:

"That [Elwell's] serious and totally and permanently disabling injuries were the proximate result of [Strainer's] malicious, wilfull, and intentional acts; that [Strainer] is, despite his position as safety officer at ASARCO Inc.'s East Helena Smelter, known on the job as a 'clown' and 'practical joker', which was known to Defendant ASARCO, Inc. both before and after the incident herein complained of, and ASARCO, Inc. failed both before and after this incident to take any measures to prevent [Strainer], its employee and agent, from causing injury to others; that since the incident complained of, ASARCO, Inc. has further ratified and approved the conduct of [Strainer] complained of herein in wilfully, maliciously and intentionally injuring [Elwell], by promoting [Strainer]." (Emphasis supplied)

It was upon Paragraph VI, and specifically the emphasized language, that the trial court based its conclusion that the policy involved excluded coverage for damages or for defense of the third party action. The insurance policy provided for coverage for all damages appellant became legally obligated to pay "because of bodily injury or property damage ... caused by an occurrence," but specifically excluded coverage for "bodily injury or property damage which is either expected or intended from the standpoint of the insured."

For Elwell to bring a third party action, and not be barred by the exclusive remedy of workers' compensation, he must fall within the provisions of section 39-71-413, MCA, which provides as follows:

"Liability of fellow employee for intentional and malicious acts or omissions--additional cause of action. If an employee receives an injury while performing the duties of his employment and the injury or injuries so received by the employee are caused by the intentional and malicious act or omission of a servant or employee of his employer, then the employee ... shall, in addition to the right to receive compensation under the Workers' Compensation Act, have a right to prosecute any cause of action he may have for damages against the servants or employees of his employer causing the injury." (Emphasis added)

The underlined language must be compared to the language of exclusion in the insurance policy. As previously noted the policy excluded coverage for "bodily injury or property damage which is either expected or intended from the standpoint of the insured." The...