Mount Vernon Fire Ins. Corp. v. Oxnard Hospitality Enter., Inc.

• Decision Date: 16 September 2013
• Docket Number: B244569
• Citation: 162 Cal.Rptr.3d 211,219 Cal.App.4th 876
• Court: California Court of Appeals Court of Appeals
• Parties: MOUNT VERNON FIRE INSURANCE CORPORATION, Plaintiff, Cross–Defendant and Respondent; v. OXNARD HOSPITALITY ENTERPRISE, INC. et al., Defendants, Cross–complainants, and Appellants.

219 Cal.App.4th 876

162 Cal.Rptr.3d 211

MOUNT VERNON FIRE INSURANCE CORPORATION, Plaintiff, Cross–Defendant and Respondent;

v.OXNARD HOSPITALITY ENTERPRISE, INC. et al., Defendants, Cross–complainants, and Appellants.

B244569

Court of Appeal, Second District, Division 3, California.

Filed September 16, 2013

See 2 Witkin, Summary of Cal. Law (10th ed. 2005) Insurance, § 55 et seq.

APPEAL from a judgment of the Superior Court of Los Angeles County, Michelle R. Rosenblatt, Judge. Affirmed. (Los Angeles County Super. Ct. No. BC461268)

HollinsLaw, Kathleen Mary Kushi Carter and Christine R. Arnold, Irvine, for Plaintiff, Cross–Defendant and Respondent.

Law Offices of Russell G. Petti, Russell G. Petti, La Canada Flintridge; Kantor & Kantor and Glenn R. Kantor, Northridge, for Defendants, Cross–Complainants and Appellants.

CROSKEY, J.

This appeal involves the interpretation of the term “physical contact” in an insurance liability policy's “Assault or Battery” exclusion. Appellant, Roberta Busby (Busby) sued her employer, Oxnard Hospitality Enterprise, Inc., and others (collectively, Oxnard), for negligence after she sustained serious bodily injuries when a third party threw a glass full of a flammable liquid on her and set her on fire (underlying action). The trial court entered a $10 million stipulated judgment in Busby's favor against Oxnard.¹

In the instant action, Mount Vernon Fire Insurance Company (Insurer), the liability insurer for Oxnard, sought a declaratory judgment that it had no duty to indemnify Oxnard (and/or its owners), nor to pay any claim of Busby or her minor children arising from this incident. Insurer relied entirely on the policy's “Assault or Battery” exclusion. Based on that exclusion, the trial court granted Insurer's motion for summary judgment.

After a review of the record and the policy's provisions, we affirm. The term “battery,” as used in that exclusion, is defined as “ physical contact with another without consent” (italics added). We reject Busby's argument that such definition requires a direct “body-to-body” contact. Instead, we conclude that it necessarily includes a striking or touching as occurred in this case.

FACTUAL AND PROCEDURAL BACKGROUND

Busby, a nightclub dancer, suffered bodily injury on Oxnard's premises shortly after she had completed her shift when a patron of the nightclub threw flammable liquid on her and then set her on fire. Her assailant was later convicted of aggravated mayhem and torture. In the underlying action, Busby sued Oxnard and others for negligent failure to provide adequate security (underlying action). Included in Busby's original complaint was a cause of action on behalf of her children, Marissa Marie Morales and Gabriella Miriam Harris (minor children). That cause of action was for negligent infliction of emotional distress (NIED). Oxnard filed a demurrer.

Because minor children were absent when Busby was attacked, the trial court sustained the demurrer with leave to amend as to their cause of action. The minor children, however, did not amend and took no further action to pursue their claims. Busby's first amended complaint did not include the cause of action originally asserted by the minor children, but alleged only her causes of action for battery against her assailant and for negligence against her employer. The record does not disclose that Oxnard ever sought or obtained dismissal of the minor children's claim against it, or that the minor children ever filed a voluntarily dismissal.

While the underlying action was pending, the Insurer brought the instant action for declaratory relief. It sought a judgment declaring that it had no duty under the policy to pay any damages that might be awarded against Oxnard in the underlying action. Insurer relied on the “Assault or Battery” exclusion in the liability policy issued to Oxnard. That endorsement excluded coverage for “all ‘bodily injury’ ... arising out of ‘assault’ or ‘battery’ ... including but not limited to ‘assault’ or ‘battery’ arising out of or caused in whole or in part by negligence.... [¶] ‘Battery’ means negligent or intentional wrongful physical contact with another without consent that results in physical or emotional injury.”

The underlying action was resolved by a stipulated judgment against Oxnard in the amount of $10 million. As already noted, Oxnard assigned all of its rights against Insurer to Busby.

Subsequently, in the instant action, Insurer filed a motion for summary judgment against Busby.² In Busby's opposition to Insurer's motion for summary judgment, she argued that the exclusion's definition of battery required actual “body-to-body” physical contact. Since that admittedly did not occur here, she contends that the exclusion did not apply and thus there was coverage under the policy. She also argued that “physical contact” plainly means “actual physical touching between one person and another” and cited a dictionary's “definition of ‘physical’ [as] ‘of or relating to the body[ ]’ [citation]” and “ ‘contact’ [as] ‘a touching or meeting of bodies [ ]’ [citation].”

Insurer, in its motion for summary judgment, argued otherwise. It contended that “[‘physical contact’] means the union or junction of things that have a material existence, or the touching of material things” and cited a different dictionary's definition of “physical” as “ ‘of or relating to natural sciences,’ ‘having material existence’ and ‘of or relating to the body [ ]’ [citation].”

The trial court agreed with Insurer and granted its motion. Busby and minor children filed a timely notice of appeal.

CONTENTIONS

Busby contends that the liability policy covers her judgment against Oxnard because it only excludes a battery defined as “physical contact.” She argues that “physical contact” requires direct body-to-body contact, and because her negligence suit arose from an incident involving no direct body-to-body contact, the “Assault or Battery” exclusion cannot apply. For their part, Busby's minor children contend that the trial court lacked jurisdiction to declare their rights and obligations under the Insurer's policy because no actual controversy existed between them and Insurer. They claim that no controversy actually existed because they had never pursued their NIED cause of action in the underlying action after the ruling on Oxnard's demurrer.

DISCUSSION

1. Standard of Review

“We determine de novo whether a triable issue of material fact exists and whether the moving party was entitled to summary judgment as a matter of law.” (Faust v. California Portland Cement Co. (2007) 150 Cal.App.4th 864, 877, 58 Cal.Rptr.3d 729.) “Absent a factual dispute as to the meaning of the policy language, which we do not have here, the interpretation, construction and application of an insurance contract is strictly an issue of law.” (Century Transit Systems, Inc. v. American Empire Surplus Lines Ins. Co. (1996) 42 Cal.App.4th 121, 125, 49 Cal.Rptr.2d 567 (Century Transit ).)

2. The “Assault or Battery” Exclusion Bars Coverage

a. Analysis of the Exclusionary Language

The exclusion at issue, in relevant parts, provides the following. “This insurance does not apply to: [¶] Any claim, demand or ‘suit’ based on ‘assault’ or ‘battery’, or out of any act or omission in connection with the prevention or suppression of any ‘assault’ or ‘battery’, including the use of reasonable force to protect persons or property, whether caused by ... an insured ... [or] patrons.... Further, no coverage is provided for any claim, demand or suit in which the underlying operative facts constitute ‘assault’ or ‘battery’. [¶] This exclusion applies to all ‘bodily injury’ ... arising out of ‘assault’ or ‘battery’ ... including but not limited to ‘assault’ or ‘battery’ arising out of or caused in whole or in part by negligence.... [ ³] [¶] ‘Assault’ means the threat or use of force on another that causes that person to have apprehension of imminent harmful or offensive conduct, whether or not the threat or use of force is alleged to be negligent, intentional or criminal in nature.[ ⁴] [¶] ‘Battery’ means negligent or intentional physical contact with another without consent that results in physical or emotional injury.”

Apart from the endorsement's inclusive language, the tort of battery generally is not limited to direct body-to-body contact. In fact, the commentary to the Restatement Second of Torts clearly states that the “[m]eaning of ‘contact with another's person’ ” does not require that one “should bring any part of his own body in contact with another's person.... [One] is liable [for battery] in this Section if [one] throws a substance, such as water, upon the other.” (Rest.2d Torts § 18, com. c.) Consistent with the Restatement, in Century Transit, supra, 42 Cal.App.4th 121, 49 Cal.Rptr.2d 567, the court effectively applied that rule. The insured's employee had struck demonstrators with a flashlight while acting in the scope of employment, and the court still applied the “Assault or Battery” exclusion even though no direct body-to-body contact occurred. (Id. at p. 130, 49 Cal.Rptr.2d 567.)

b. The Exclusion Is Not Ambiguous

We have no trouble concluding that the exclusion at issue is free from ambiguity. The following principles govern our interpretation of the term “physical contact.” “Insurance policies are contracts and, therefore, are governed in the first instance by the rules of construction applicable to contracts. Under statutory rules of contract interpretation, the mutual intention of the parties at the time the contract is formed governs its interpretation. [Citation.] Such intent is to be inferred, if possible, solely from the written provisions of the contract. [Citation.] The ‘clear and explicit’ meaning of these provisions, interpreted in their ‘ordinary and popular sense,’ controls judicial interpretation unless ‘used by the parties in a technical sense, or unless a special meaning is given to them by usage.’ [Ci...