State Farm Fire & Cas. Co. v. Muth

• Decision Date: 11 May 1973
• Docket Number: No. 38783,38783
• Parties: , 190 Neb. 272 STATE FARM FIRE & CASUALTY COMPANY, a corporation, Appellant, Cross-Appellee, v. William J. MUTH et al., Appellees, Cross-Appellants.
• Court: Nebraska Supreme Court

Page 364

207 N.W.2d 364

190 Neb. 248, 190 Neb. 272

STATE FARM FIRE & CASUALTY COMPANY, a corporation, Appellant, Cross-Appellee, v. William J. MUTH et al., Appellees, Cross-Appellants.

No. 38783.

Supreme Court of Nebraska.

May 11, 1973.

As Corrected May 21, 1973.

Syllabus by the Court

1. The findings of the trial court in an action where a jury has been waived have the effect of a verdict of a jury and will not be set aside unless clearly wrong.

2. An injury is either expected or intended within the meaning of an exclusion in a policy of liability insurance reading as follows: 'This policy does not apply to bodily injury or property damage which is either expected or intended from the standpoint of the insured,' if the insured acted with specific intent to cause harm to a third party.

3. A judgment creditor of an insured under a policy of liability insurance is entitled to an award of attorney's fee under section 44--359, R.S.Supp., 1972, where the insurer brings an action for declaratory judgment to determine coverage under the policy and the judgment creditor prevails.

Fraser, Stryker, Marshall & Veach, Omaha, for appellant.

Matthews, Kelley, Cannon & Carpenter, Burbridge, Burbridge & Parsonage, Omaha, for appellees.

Heard before WHITE, C.J., and SPENCER, BOSLAUGH, SMITH, McCOWN, NEWTON, and CLINTON, JJ.

CLINTON, Justice.

This action is one for a declaratory judgment between the insurer, the insured, and the judgment creditor of the insured. It presents the question of the construction of an exclusion in a policy of liability insurance and the applicability of the exclusion to the facts as found by the trial court.

The language of the exclusion is as follows: 'This policy does not apply . . . to bodily injury or property damage which is either expected or intended from the standpoint of the insured.' The pertinent insuring clause in the homeowner's policy involved in this case is as follows: '. . . to pay on behalf of the insured, all sums which the insured shall become legally obligated to pay as damages decause of bodily injury or property damage, to which this insurance applies, caused by an occurrence.'

We now set forth the pertinent facts. The defendant Allen Muth, a minor, was an insured under the homeowner's policy of his parents, William J. Muth and Naomi R. Muth, by virtue of being a resident of their hosehold. On September 2, 1970, Allen fired a B-B gun from a slowly moving automobile and the pellet struck James B. Brailey, Jr., in an eye, causing loss of sight in that eye. James recovered a judgment in a tort action against Allen. The State Farm Fire & Casualty Company, plaintiff and appellant herein, defended the tort action under a reservation of rights agreement. The ground of the reservation was that there was no coverage under the policy because under the facts the exclusion which we have previously set forth applied.

The trial judge in this case found that when Allen caused the gun to discharge in the direction of James he did not intend nor expect to do bodily injury to James, that Allen was negligent, and that the exclusion was not applicable.

Allen testified he pointed the gun 'at his feet' without taking careful aim and that his intention was to 'scare somebody.' He was not a close acquaintance of James. He knew who James was because they had been in one class session together after the start of the school term. There had been no conflict between them. The evidence discloses that the act of Allen was a spontaneous one. There was conflicting evidence from which the court could have found Allen aimed at James and intended to hit him. We interpret the court's finding to mean it accepted Allen's version of the facts.

The appellant argues that if Allen 'should have expected that his act . . . involved the risk of injury to Brailey, then it follows that the incident was not one within the coverage of the policy.' On this point, during cross-examination of Allen counsel drew from him the concession that if one points a gun in the general direction of a person, even though aim is not taken, there is a risk of hitting somebody. The cross-examination continued as follows: 'Q. And that's what we mean by taking the risk of hitting somebody if you don't aim; right? A. Yes. Q. You understand that, don't you? A. Yea. Q. And you understood that when you pointed the gun out that car window at that young boy, didn't you? A. I didn't think it would hit him or hurt him, because--Q. I am not asking you that; I am asking you, if you don't aim, and you aim a gun out a window, and there's person over there, you could possibly hit him? A. You could possibly hit him. Q. And that's the risk that you were willing to take, wasn't it? . . . Isn't that right? A. I suppose.' On redirect examination Allen testified that he did not think he was taking a chance of hitting James.

Language in liability policies excluding from coverage injury intentionally caused by the insured are common, but we have been cited no case, nor have we found any, interpreting the precise policy language we have here. The language usually found is: 'injury . . . caused intentionally by or at the direction of the insured.'

In accordance with the usual rule that the judgment of the trial court in an action where a jury has been waived has the effect of a verdict of a jury and will not be set aside unless clearly wrong, we feel ourselves bound by the findings of the trial judge that Allen did not intend to injure James. Belek v. Travelers Ind. Co., 187 Neb. 470, 191 N.W.2d 819. While we might ourselves have come to a different conclusion than did the trial judge, we cannot say his findings were clearly wrong.

Accordingly, we believe the pertinent inquiry is whether the language 'bodily injury . . . which is either expected or intended from the standpoint of the insured,' means something other than 'injury intentionally caused,' and thus is there substance to the appellant's argument that coverage is excluded if Allen 'should have expected that his act . . . involved the risk of injury'?

The term 'expected' when used in association with 'intended' carries the connotation of a high degree of certainty or probability and seems to be used to practically equate with 'intended,' because one expects the consequences of what one intends. See Webster's Third New International Dictionary (Unabr. Ed., 1968), pp. 799, 1175. It does not seem to us designed to substantially enlarge the exclusion.

We hold on the basis of the authorities which we hereinafter cite that, under the language of the exclusion in question, an injury is either expected or intended if the insured acted with the specific intent to cause harm to a third party. It seems to us to be immaterial whether the injury which results was specifically intended, i.e., the exclusion would apply even though the injury is different from that intended or anticipated. We find it difficult to precisely delineate the scope of the rule and recognize that there will be difficulties in applying the rule in concrete cases. For that reason we cite and discuss the following cases which we believe illustrate the intendment of the rule.

In State Farm Mutual Auto. Ins. Co. v. Worthington, 405 F.2d 683, the Eighth Circuit had occasion to consider a factual situation similar to what we have here and a policy exclusion which read: 'This policy does not apply: * * * to bodily injury * * * caused intentionally by or at the direction of the insured;'. The court held that the language did not exclude coverage where the gun was fired intentionally with the purpose of frightening, but where there was no intention to shoot a person. We do not, however, intend to adopt the holding in that case insofar as it may lend support to the proposition that the exclusion does not apply where one person is shot at with the intent to harm, but a bystander is injured. That question is not before us here.

A somewhat similar case on the facts is Lumbermen's Mut. Ins. Co. v. Blackburn (Okl.), 477 P.2d 62. The language of the exclusion there was the same as in the case just cited. The trial court found that the insured intentionally threw the rock which caused the plaintiff's injury, but did so without the intent of causing injury. The court on appeal held the exclusion did not apply. We do not, however, adopt the holding in that case insofar as it appears...