Safeco Ins. Co. of Am. v. White

Decision Date04 August 2009
Docket NumberNo. 2008-0403.,No. 2008-0304.,2008-0304.,2008-0403.
Citation122 Ohio St.3d 562,913 N.E.2d 426,2009 Ohio 3718
PartiesSAFECO INSURANCE COMPANY OF AMERICA, Appellant, v. WHITE et al.; Federal Insurance Company et al., Appellees.
CourtOhio Supreme Court

Jenks, Pyper & Oxley Co., L.P.A., P. Christian Nordstrom, and Scott G. Oxley, Dayton, for appellant.

Gallagher Sharp, Jay Clinton Rice, and Richard C.O. Rezie, Cleveland, for appellees.

Murray & Murray Co., L.P.A., Dennis E. Murray Sr., and James L. Murray, Sandusky, urging affirmance for amici curiae, Vincent Joseph Bilgen and Gloria Louis.



{¶ 1} Safeco Insurance Company of America ("Safeco") appeals from a decision declaring that Safeco is obliged to defend and indemnify its insureds, Lance and Diane White ("the Whites"), in connection with a negligence action filed against them after their 17-year-old son, Benjamin, attacked another child.

{¶ 2} The First District Court of Appeals certified this case pursuant to Section 3(B)(4), Article IV of the Ohio Constitution and App.R. 25, concluding that its judgment conflicts with judgments from other courts of appeals on two questions of law.

{¶ 3} First, the court of appeals certified a conflict with the Fifth District Court of Appeals decision in Torres v. Gentry, Ashland App. No. 06 COA 038, 2007-Ohio-4781, 2007 WL 2702457, on the following issue: "When an insurance policy defines an `occurrence' as an `accident' that results in bodily injury, does an `occurrence' include injuries that result from an intentional act when the insured[s] seeking coverage are claimed to have been negligent in relation to that intentional act?" Second, the court certified a conflict with the Third District Court of Appeals decision in United Ohio Ins. Co. v. Metzger (Feb. 8, 1999), Putnam App. No. 12-98-1, 1999 WL 84201, on the following issue: "When an insurance policy excludes an injury `which is expected or intended by [an or any] insured * * *'; injuries `arising out of an illegal act committed by or at the direction of an insured'; or `any injury caused by a violation of penal law or ordinance committed by or with the knowledge or consent of any insured,' do the exclusions become ambiguous when read in conjunction with a `Severability of Insurance' condition, in light of the announced expectation by policyholders that their negligence will be covered?" We accepted Safeco's discretionary appeal on the same issues and consolidated the cases. 117 Ohio St.3d 1457, 2008-Ohio-1635, 884 N.E.2d 67.

{¶ 4} For the following reasons, we answer the first certified question in the affirmative, holding that the negligent acts of the Whites are "occurrences" under the language of the Safeco policies at issue. However, we decline to address the second question, which pertains to potential ambiguities in the policy exclusions, because we find the exclusions to be inapplicable in these circumstances. Accordingly, we affirm the judgment of the court of appeals and hold that the Whites are entitled to coverage under the Safeco policies.


{¶ 5} In July 2003, 17-year-old Benjamin White attacked and repeatedly stabbed Casey Hilmer, the 13-year-old daughter of Steve and Megen Hilmer, as she was jogging in their neighborhood. Her injuries were not fatal. Benjamin, who lived with his parents, the Whites, at the time of the attack, pleaded guilty to attempted murder and felonious assault. The trial court convicted him and sentenced him to an aggregate term of ten years in prison.

{¶ 6} After Benjamin was convicted, the Hilmers sued Benjamin and the Whites on multiple claims, including battery against Benjamin and negligent supervision, negligent entrustment, and negligent infliction of emotional distress against the Whites. The matter proceeded to a jury trial.

{¶ 7} The jury made several findings relevant to our review. First, the jury found that Benjamin had committed a battery, an intentional tort, against Casey Hilmer and that his intentional acts had also caused Steve Hilmer to suffer emotional distress. Second, the jury found that the Whites had been negligent in their supervision of Benjamin, and that this negligence had also injured Casey Hilmer and caused Steve Hilmer to suffer emotional distress. Third, the jury found that the Hilmers were owed $6,500,000 in compensatory damages for these combined torts. Fourth, the jury found that Benjamin was 30 percent responsible for the Hilmers' injuries and that the Whites were 70 percent responsible. The jury also awarded the Hilmers $3,500,000 in punitive damages against Benjamin.

{¶ 8} At the time of the attack, the Whites had four insurance policies: a homeowner's policy and a separate umbrella policy, both issued by Safeco, a second homeowner's policy issued by appellee Pacific Indemnity Company ("Pacific"), and an umbrella policy issued by appellee Federal Insurance Company ("Federal"). When the Hilmers filed suit, the Whites sought a defense and indemnification from each carrier. Pacific and Federal agreed to defend them, but Safeco refused. All, however, expressly denied any obligation to indemnify the Whites.

{¶ 9} During the pendency of the suit, Safeco filed the instant action, seeking a declaratory judgment that it has no obligation to defend or indemnify the Whites in relation to claims arising out of their son's intentional act. The trial court consolidated Safeco's declaratory-judgment action with the Hilmers' action, and the insurance companies and the Whites filed motions for summary judgment on the issue of coverage under the policies. Following the jury's verdict, however, Pacific and Federal withdrew their motions for summary judgment, agreed to indemnify the Whites under the terms of their policies, and claimed that Safeco should share in the cost. Safeco continued to aver that the Whites were not entitled to coverage under its policies.

{¶ 10} The trial court granted summary judgment in favor of the Whites, entering a declaratory judgment that Safeco was required to defend and indemnify the Whites in connection with the underlying action. Federal and Pacific subsequently settled with the Hilmers on behalf of the Whites and asked the court to order Safeco to reimburse Federal and Pacific for Safeco's share of the Whites' attorney fees and the settlement.

{¶ 11} On appeal, the First District Court of Appeals affirmed the trial court, holding that the Whites' negligence constituted an "occurrence" pursuant to language in the Safeco policies, even though it related "to the failure to prevent intentional conduct." Safeco Ins. Co. of Am. v. Federal Ins. Co., Hamilton App. No. C-070074, 2007-Ohio-7068, 2007 WL 4553690, ¶ 19. The appellate court further held that a severability clause in the Safeco policies created an ambiguity with respect to the application of an exclusion for injuries caused by the intentional act of another insured and that this ambiguity must be read in favor of coverage for the Whites. Id. at ¶ 26.


{¶ 12} Safeco contends that its policies do not provide coverage for the Whites' negligence for two reasons: (1) the injury in this case resulted from an intentional act by Benjamin, an insured under the policies, and therefore the act was not an "occurrence," which both policies define as an "accident," and (2) the policies explicitly exclude coverage for the intentional acts of an insured, and the severability clause in both policies does not render the language in the exclusionary clauses ambiguous.

{¶ 13} Federal and Pacific argue that Safeco's policies provide coverage because the Whites' acts were accidental and thus constitute an "occurrence" under the policies. Moreover, they contend that the exclusionary language in the Safeco policies is ambiguous because of a severability clause that provides that the insurance applies separately to each insured.

{¶ 14} Before we address these arguments, we review the relevant provisions in the Safeco policies and our caselaw on the general principles applicable when interpreting insurance policies.

A. The Safeco insurance policies

{¶ 15} The homeowner's policy issued by Safeco expressly names Lance and Diane White as insureds, and the definition of "insured" contained in the policy includes their son, Benjamin. This policy provides coverage when "a claim is made or a suit is brought against an insured for damages because of bodily injury or property damage caused by an occurrence to which this coverage applies." According to the policy, "`[o]ccurrence' means an accident" (emphasis added) that results in bodily injury or property damage. The policy expressly excludes coverage for bodily injury or property damage that "is expected or intended by an insured or which is the foreseeable result of an act or omission intended by an insured." Moreover, the contract excludes coverage for injuries "arising out of any illegal act committed by or at the direction of an insured."

{¶ 16} The umbrella policy issued by Safeco expressly names Lance White as the insured, and the definition of "insured" includes both Diane and Benjamin. The contract provides coverage for "personal injury or property damage caused by an occurrence," and "occurrence" is defined as "an accident" that results in personal injury or property damage. The umbrella policy excludes coverage for "[a]ny injury caused by a violation of a penal law or ordinance committed by or with the knowledge or consent of any insured," as well as for "[a]ny act or damage which is expected or intended by any insured." In addition, both policies contain a severability clause that states, "This insurance applies separately to each insured."

{¶ 17} As we stated in Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216, 2003-Ohio-5849, 797 N.E.2d 1256, our task when interpreting an insurance policy is to "examine the insurance contract as a whole and presume that the intent of the parties is reflected in the language used in the policy." Id. ...

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