Valero v. Fla. Ins. Guar. Ass'n Inc.

• Decision Date: 26 May 2011
• Docket Number: 4D09–1335.,Nos. 4D09–1151,s. 4D09–1151
• Citation: 59 So.3d 1166
• Parties: Verushka VALERO, individually and as parent and natural guardian of D.R., a minor, Alberto Mila and Karelli Mila, Appellants,v.FLORIDA INSURANCE GUARANTY ASSOCIATION, INC., a non-profit Florida corporation, Humberto Ramirez and Shyla Ramirez, Appellees.
• Court: Florida District Court of Appeals

59 So.3d 1166

Verushka VALERO, individually and as parent and natural guardian of D.R., a minor, Alberto Mila and Karelli Mila, Appellants,

v.FLORIDA INSURANCE GUARANTY ASSOCIATION, INC., a non-profit Florida corporation, Humberto Ramirez and Shyla Ramirez, Appellees.

Nos. 4D09–1151

4D09–1335.

District Court of Appeal of Florida, Fourth District.

March 2, 2011.Rehearing Denied May 26, 2011.

Roy D. Wasson of Wasson & Associates, Chartered, and Howard J. Weitzner of Greenberg & Stone, P.A., Miami, for appellant Verushka Valero.Perry M. Adair of Becker & Poliakoff, P.A., Coral Gables, for appellants Alberto Mila and Karelli Mila.Charles W. Rice, Robert Dugan and Jennifer A. Golden of Buckner, Shifrin, Rice & Etter, P.A., Miami, for appellee Florida Guaranty Insurance Association.No appearance for appellees Humberto Ramirez and Shyla Ramirez.GERBER, J.

The insurer filed a declaratory judgment action alleging that it had no obligation to provide a defense or coverage for its insureds on a negligent supervision action arising out of sexual molestation. The insurer relied on the sexual molestation exclusion in the insureds' homeowners' policies to deny coverage. The circuit court granted the insurer's motion for summary judgment on that argument. We affirm.

The exclusion at issue provided that coverage did not apply to “bodily injury ... [a]rising out of sexual molestation....” In its motion for summary judgment, the insurer acknowledged there was no Florida case addressing whether a sexual molestation exclusion applied to a negligent supervision action arising out of sexual molestation. However, the insurer argued that because the negligent supervision action arose out of sexual molestation, the sexual molestation exclusion should exclude coverage regardless of the legal theory by which the alleged victim was pursuing the underlying action.

The alleged victim and the insureds, in their responses to the motion for summary judgment, argued that the sexual molestation exclusion was inapplicable because the alleged victim's underlying action was based on the insureds' negligent supervision of the alleged perpetrator, and not on sexual molestation by the insureds. The alleged victim further argued that if the insurer intended to exclude coverage for negligent supervision, then it should have expressly stated such an exclusion in the policy. The insureds further argued that it was unclear from the exclusion's language whether coverage for sexual molestation is excluded when committed by any person or only by the insured. That ambiguity, according to the insureds, had to be resolved against the insurer and in favor of coverage.

In its order granting the motion for summary judgment, the circuit court reasoned:

[T]he language excluding coverage for sexual molestation is clear and unambiguous. Any insured would be on notice the insuring agreement will not insure against acts of sexual molestation.... [W]hat homeowner could possibly expect to be insured for something as egregious as child molestation[?]

In further support of its decision, the circuit court cited other states' supreme court decisions which rejected insureds' attempts to raise negligent supervision actions to avoid sexual molestation exclusions. According to the circuit court, “All concluded the act leading to damages was sexual molestation—and it really did not matter how it was pled.”

This appeal followed. “Our review of an order granting summary judgment is de novo, as is the interpretation of an insurance contract and the determination of whether the law requires the insurer to provide coverage.” Am. Strategic Ins. Co. v. Lucas–Solomon, 927 So.2d 184, 186 (Fla. 2d DCA 2006) (citations omitted).

We agree with the circuit court that the language excluding coverage for sexual molestation is clear and unambiguous. However, we reach that conclusion based on a finding slightly different from that which the circuit court made. See Dade Cnty. Sch. Bd. v. Radio Station WQBA, 731 So.2d 638, 644 (Fla.1999) (“[I]f a trial court reaches the right result, but for the wrong reasons, it will be upheld if there is any basis which would support the judgment in the record.”).

The policy at issue contains a list of twelve enumerated exclusions stating that coverage did not apply to bodily injury:

a. Which is expected or intended by the insured;

b. Arising out of or in connection with a business engaged in by an insured ...;

c. Arising out of the rental ... of any part of any premises by an insured ...;

d. Arising out of the rendering of or failure to render professional services;

e. Arising out of a premises ... that is not an insured location;

f. Arising out of ... ownership ... of motor vehicles ...;

g. Arising out of ... ownership ... of an excluded watercraft ...;

h. Arising out of ... ownership ... of an aircraft ...;

i. Caused ... by war ...;

j. Which arises out of the transmission of a communicable disease by an insured;

k. Arising out of sexual molestation, corporal punishment or physical or mental abuse; or

l. Arising out of the use [or] sale ... by any person of a Controlled Substance....

(emphasis added; internal quotation marks omitted).

As emphasized above, exclusions a., b., c., and j. all expressly limit those exclusions based on some action taken by an insured. However, exclusion k., which is at issue here, contains no such express limitation. Thus, we conclude the plain meaning of exclusion k. is that the exclusion applies to bodily injury arising out of sexual molestation “by any person.” See U.S. Fire Ins. Co. v. J.S.U.B., Inc., 979 So.2d 871, 883 (Fla.2007) (“[W]e apply well-established principles of insurance contract interpretation, reading the policy both in accord with its plain language ... and as a whole, endeavoring to give every provision its full meaning and operative effect.”) (internal citation and quotations omitted).

The insureds argued in the circuit court that exclusion k. is ambiguous because exclusion l. expressly states that it applies to bodily injury “[a]rising out of the use [or] sale ... by any person of a Controlled Substance” (emphasis added), whereas exclusion k. does not expressly refer to sexual molestation “by any person.” However, reading all twelve exclusions together, we believe that the insurer's use of the phrase “by any person” in exclusion l. is merely superfluous and does not create an ambiguity in exclusion k. or in exclusions d. through i., which also do not use the phrase “by any person.” For example, exclusion i. states that coverage does not apply to bodily injury “[c]aused ... by war.” It would make no sense for that exclusion to apply only if war was caused “by an insured.”

In practical terms, assuming...