Prosser v. Leuck, 95-0688

• Decision Date: 06 September 1995
• Docket Number: No. 95-0688,95-0688
• Citation: 539 N.W.2d 466,196 Wis.2d 780
• Parties: Robert PROSSER, Plaintiff-Appellant, v. Richard A. LEUCK and Cedarburg Mutual Insurance Company, Defendants-Respondents. d
• Court: Wisconsin Court of Appeals

Page 466

539 N.W.2d 466

196 Wis.2d 780

Robert PROSSER, Plaintiff-Appellant, v. Richard A. LEUCK and Cedarburg Mutual Insurance Company,

Defendants-Respondents. ^d

No. 95-0688.

Court of Appeals of Wisconsin.

Submitted on Briefs July 31, 1995.

Opinion Released Sept. 6, 1995.

Opinion Filed Sept. 6, 1995.

For the plaintiff-appellant the cause was submitted on the briefs of Michael J. Neitzke of Novitzke, Gust & Sempf of Amery.

For the defendants-respondents the cause was submitted on the brief of H. Ben Levy of Levy & Levy, S.C. of Cedarburg.

Before CANE, P.J., and LaROCQUE and MYSE, JJ.

MYSE, Judge.

Robert Prosser appeals a judgment dismissing his complaint against Richard A. Leuck and Leuck's insurer, Cedarburg Mutual Insurance Company. Prosser sought damages resulting from a fire in his warehouse which thirteen-year-old Leuck caused while trespassing and engaging in horseplay in the warehouse. Prosser contends that the trial court erred when it dismissed his complaint following a jury verdict based upon the principles of fortuity, concluding that no reasonable person would anticipate insurance coverage for Leuck's acts. Because we conclude that the principles of fortuity do not preclude Prosser's recovery from Cedarburg, we reverse the judgment and direct judgment be entered for Prosser based upon the jury verdict.

Prosser owned a warehouse in Turtle Lake, Wisconsin. Leuck and two other minors entered the warehouse by climbing onto the roof and pushing open a window. The juveniles intentionally broke into the building without Prosser's consent and intentionally damaged various items of personal property located within the warehouse. Leuck and Allen H., one of the minors, found a gasoline can, a cigarette lighter and a small plastic bottle in the warehouse. After filling the bottle with gasoline, they poured a couple of drops of gasoline the approximate size of a quarter on the concrete window sill of the upper floor and ignited them. While the gasoline was burning on the window sill, Allen sprinkled more gasoline onto the fire causing the flames to rise. When the flames rose, they burned his hand causing him to drop the then burning bottle at Leuck's feet. Leuck then kicked the burning bottle down a hole in the floor to the first floor. The fire quickly spread and caused extensive damage to the warehouse and its contents.

Leuck was an insured under his parents' homeowner's policy with Cedarburg. Prosser filed suit against Leuck and Cedarburg, and Cedarburg argued that the intentional act exclusion within the policy barred coverage. The trial court refused to grant summary judgment to Cedarburg based upon the intentional act exclusion contained within the policy. The trial court then entered an order to bifurcate the proceedings between the coverage issue and the liability and damages issues.

The jury found that Leuck did not intend to cause damage to the warehouse by means of fire. Following the jury verdict, the trial court concluded that based upon principles of fortuity Cedarburg was entitled to judgment notwithstanding the verdict and dismissed Prosser's complaint against Cedarburg.

The single issue presented for resolution is whether the principles of fortuity preclude Prosser from recovering from Cedarburg, Leuck's insurer.

[T]he "principle of fortuitousness" ... is, that insurance covers fortuitous losses and that losses are not fortuitous if the damage is intentionally caused by the insured. Even where the insurance policy contains no language expressly stating the principle of fortuitousness, courts read this principle into the insurance policy to further specific public policy objectives including ... (4) maintaining coverage of a scope consistent with the reasonable expectations of the contracting parties on matters as to which no intention or expectation was expressed. Keeton, Insurance Law, sec. 5.3(a), p. 279 (1971).

Hagen v. Gulrud, 151 Wis.2d 1, 4, 442 N.W.2d 570, 572 (Ct.App.1989) (citing Hedtcke v. Sentry Ins. Co., 109 Wis.2d 461, 483-84, 326 N.W.2d 727, 738 (1982)).

The application of a legal standard to a set of facts is a question of law which we determine without deference to the trial court. Kimberly-Clark Corp. v. LIRC, 138 Wis.2d 58, 66, 405 N.W.2d 684, 688 (Ct.App.1987).

Cedarburg argues that the principles of fortuity enunciated in K.A.G. v. Stanford, 148 Wis.2d 158, 434 N.W.2d 790 (Ct.App.1988), and Hagen compel the trial court's conclusion that no reasonable insured would expect insurance coverage for damages resulting from a thirteen year old's horseplay. We disagree. In both K.A.G. and Hagen, we dealt with principles of fortuity based upon sexual assaults committed by the insured. In K.A.G., we concluded that the intentional act exclusion in the policy applied because the intentional act of sexual assault was of a nature that the intent to harm could be inferred as a matter of law without regard to the actual subjective beliefs in the mind of the insured at the time he committed the acts. ¹ Id. at 164, 434 N.W.2d at 793. However, we also noted that the trial court's analysis, that coverage should be denied because no reasonable person would expect coverage for damages resulting from the defendant's intentional sexual misconduct, was based upon sound legal principles and presented a viable alternative analysis. Id. at 165-66, 434 N.W.2d at 793.

In Hagen, we adopted that same analysis holding that insurance coverage for injuries arising out of a nonconsensual sexual assault was not within the reasonable expectations of the contracting parties. Id. at 7, 442 N.W.2d at 573. We concluded that because there was no coverage as a matter of law, the jury's finding that the defendant had not intentionally caused injuries to the plaintiff was irrelevant. Id. Because it is good public policy to deter sexual assaults, we did "not want to remove any deterrence that the threat of a money judgment provides." Id.

The principles of fortuity were also applied in Ramharter v. Secura Ins., 159 Wis.2d 352, 463 N.W.2d 877 (Ct.App.1990). In that case, the plaintiff claimed damages...