State Farm Fire v. Nokes
| Decision Date | 02 March 2011 |
| Docket Number | No. 2:08–CV–312 PPS.,2:08–CV–312 PPS. |
| Citation | 776 F.Supp.2d 845 |
| Parties | STATE FARM FIRE AND CASUALTY COMPANY, Plaintiff,v.Donald E. NOKES, Jr., Patricia Ann Nokes, Steven Davis, Brandon Phelps, Nathan Evans, State of Indiana, Porter County Department of Family and Children, Starke County Department of Family and Children, Janet Carlson, Jade Palin, and Kathleen Hannon, Defendants. |
| Court | U.S. District Court — Northern District of Indiana |
OPINION TEXT STARTS HERE
John H. Halstead, Querrey & Harrow, Merrillville, IN, for Plaintiff.Jere L. Humphrey, Wyland Humphrey Wagner Gifford & Clevenger LLP, Plymouth, IN, Elizabeth A. Flynn, Braje Nelson & Janes LLP, Michigan City, IN, Anna Marie Hearn, Law Office of Anna M. Hearn, Valparaiso, IN, for Defendants.
Nathan Evans claims in a state court complaint that he was sexually abused while in the custody of his foster parents, Donald and Patricia Nokes. In this insurance coverage dispute, brought by way of a declaratory judgment, State Farm says that it has no duty to defend or indemnify the Nokes or anyone else involved in Evans' state court case. State Farm now seeks summary judgment [DE 100]. Because Evans' is an insured under the policy issued by State Farm, and the policy explicitly excludes coverage for injuries to an insured, State Farm's Motion for Summary Judgment is GRANTED.
The following facts are undisputed. Since 1975, Defendants Donald and Patricia Nokes have been licensed foster parents in the State of Indiana. [DE 105–1 at 42.] Defendant Evans was the Nokes' foster child from 1996 to 2002, living with the Nokes about three-fourths of the time over that five and a half year period. (Evans sometimes stayed with his mother on weekends). [DE 102–11 at 30–15–31:11; DE 105–2 at 27:20–28:20.] Evans lived with the Nokes from the age of nine to fifteen, [DE 102–11 at 9:15], and he struggled with mental health issues during that period, [DE 102–11 at 27:25–28:5; 29:7–15]. Defendant Steven Davis also lived with the Nokes as a foster child for over five years, and Defendant Brandon Phelps was the Nokes' foster child for about a year. [DE 102–11 at 10:6–11:5, 20:22–24.] As foster parents, the Nokes were responsible for the daily care of the children, which included feeding, clothing, sheltering, supervising, and disciplining them. [DE 101 at 4.] The Nokes were also responsible for taking their foster children to school, counseling, and doctor visits. [ Id.] Each of the foster children shared a room with another child where they kept their clothes, toys, and personal belongings. [ Id.]
Throughout the period relevant to this suit, the Nokes had a homeowner's insurance policy with State Farm which provided that State Farm would pay for claims “brought against an insured for damages because of bodily injury ... caused by an occurrence.” [ Id. at 5.] Importantly, the policy excluded coverage for “bodily injury to ... any insured.” [ Id. at 6.] An insured is defined as “you [the Nokes] and, if residents of your household, any other person under the age of 21 who is in the care of a person described above.” [ Id. at 5.] It also excludes bodily injury “which is either expected or intended by an insured.” [ Id. at 6.]
Evans filed a complaint in Indiana's Porter Superior Court alleging that he was sexually molested by Phelps and physically abused by Davis while they were all foster children living with Mr. and Mrs. Nokes. [DE 102–1.] Evans, Phelps, and Davis were all under 21 years of age at the time Evans was allegedly abused. [DE 101 at 3.] The state court complaint alleges that the Nokes, Phelps, Davis, Porter County Department of Family and Children, Starke County Department of Family and Children, the State of Indiana, and Porter County employees Janet Carlson, Jade Palin, and Kathleen Hannon violated Evans' civil rights under 42 U.S.C. § 1983, and that the negligence of many of these defendants (all but the alleged abusers, Phelps and Davis) caused the abuse. [DE 102–1.] This was not the first time one of the Nokes' foster children was accused of sexual abuse; State Farm had defended a previous lawsuit against the Nokes brought by a visitor to their home who claimed to have also been the victim of sexual abuse at the hands of one of the foster kids. [DE 105–11.]
As a result of Evans' suit, State Farm brought this declaratory judgment action against all parties named in the state court complaint. [DE 30.] State Farm seeks a judgment declaring that, pursuant to the Nokes' State Farm homeowner's insurance policy, it owes no duty to defend or indemnify the Nokes or any other insured, and no duty to any other defendant, relating to Evans' state court complaint. The Nokes, Evans, and Davis (which for simplicity's sake I will refer to collectively as “Defendants”) filed separate responses to the motion, claiming that the Nokes' State Farm policy provides coverage for Evans' injuries, and, in any event, State Farm waived or is estopped from denying coverage.1
Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a).
Insurance contracts are subject to the same rules of construction as other contracts. Eli Lilly & Co. v. Home Ins. Co., 482 N.E.2d 467, 470 (Ind.1985). As a result, the interpretation of insurance contracts is primarily a question of law for the court. Wagner v. Yates, 912 N.E.2d 805, 808 (Ind.2009). When interpreting an insurance policy, the court's goal is to determine the parties' intent as manifested in the insurance contract. Burkett v. Am. Family Ins. Grp., 737 N.E.2d 447, 452 (Ind.App.2000). The court will give the language of the insurance policy its plain and ordinary meaning if it is clear and unambiguous. Id. A provision is ambiguous if it is susceptible to more than one reasonable interpretation. Am. Family Ins. v. Globe Am. Cas. Co., 774 N.E.2d 932, 935 (Ind.App.2002). But the mere fact that the parties disagree as to the interpretation of the policy language does not create an ambiguity. Id.
The State Farm policy that was sold to Mr. and Mrs. Nokes specifically excludes coverage for “bodily injury to you or any insured.” [DE 101 at 6]. So if Evans is an “insured” under the policy, the injuries he asserts in his state court complaint plainly are not covered. The policy defines an insured as “you [the Nokes] and, if residents of your house, ... any other person under the age of 21 who is in the care of a person described above.” [ Id. at 5.] The parties agree that Evans was under the age of 21 at the time of his alleged injuries. Thus, the issues here are whether Evans was a “resident” of the Nokes' house and whether he was “in the care” of the Nokes at the time of his injuries.
I first address whether Evans was a resident of the Nokes' home. For starters, the term “resident” in insurance contracts is unambiguous. Indiana Farmers Mutual Ins. Co. v. Imel, 817 N.E.2d 299, 304 (Ind.App.2004). While “resident” has no fixed or precise meaning in law, courts in Indiana look to whether an individual has “maintained a ‘fixed abode’ in the household for some continuous amount of time.” Allstate Ins. Co. v. Shockley, 793 F.Supp. 852, 856–57 (S.D.Ind.1991) (quoting Allstate Ins. Co. v. Neumann, 435 N.E.2d 591, 593 (Ind.App.1982)). In making this determination, I must look to: (1) whether the claimant maintained a physical presence in the insured's home, (2) whether he had the subjective intent to reside there, and (3) the nature of his access to the insured's home and its contents. Imel, 817 N.E.2d at 304. I must analyze these factors by taking into account the totality of the circumstances. Allstate Ins. Co. v. Lawrence, 2010 WL 4386780, at *4 (S.D.Ind. Oct. 27, 2010) (citing Alexander v. Erie Ins. Exchange, 982 F.2d 1153, 1158–59 (7th Cir.1993) (applying Indiana law)). Notably, a resident “need not be a permanent member of the household, and in fact can be the resident of another household at the same time, but must be more than a transient.” Shockley, 793 F.Supp. at 856; see also Neumann, 435 N.E.2d at 593 ().
Here, Evans resided with the Nokes during the relevant period. Evans was the Nokes' foster child for five and a half years, living with the Nokes about three-fourths of the time during that period. He had a bedroom at the Nokes' house where he kept his clothes, toys, and personal belongings. As foster parents, the Nokes performed general parenting duties, including feeding, clothing, sheltering, supervising, and disciplining Evans, and they were responsible for taking him to school and counseling and doctor visits. In fact, Evans—who lived with the Nokes from ages nine to fifteen and had documented mental health issues—was totally dependent on the Nokes' care. See Shockley, 793 F.Supp. at 857 (); Imel, 817 N.E.2d at 305 (). This demonstrates that the parties intended Evans to reside with the Nokes. Shockley, 793 F.Supp. at 857. Based on the above, Evans clearly maintained a physical presence in the Nokes' house, as Evans and the Nokes intended, and he had sufficient access to the house to demonstrate his residency.
The Defendants arguments to the contrary are unpersuasive. First, that Evans did not reside with the Nokes throughout the entire five and a half year period, sometimes staying with his biological mother on weekends, is of no matter—the above conditions sufficiently demonstrate that...
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