Woo v. Fireman's Fund Ins. Co.

• Decision Date: 13 June 2005
• Docket Number: No. 53123-9-I.,53123-9-I.
• Citation: 114 P.3d 681,128 Wn. App. 95,128 Wash. App. 95
• Parties: Robert C. WOO, D.D.S. and Anne M. Woo, husband and wife; and the marital community composed thereof, Respondents, v. FIREMAN'S FUND INSURANCE COMPANY, a California corporation; National Surety Corporation, an Illinois corporation; Depositors Insurance Company, an Iowa corporation, Appellants. The Pacific Underwriters Corporation, a Washington corporation, Defendant Below.
• Court: Washington Court of Appeals

114 P.3d 681

128 Wn. App. 95

128 Wash. App. 95

Robert C. WOO, D.D.S. and Anne M. Woo, husband and wife; and the marital community composed thereof, Respondents, v. FIREMAN'S FUND INSURANCE COMPANY, a California corporation; National Surety Corporation, an Illinois corporation; Depositors Insurance Company, an Iowa corporation, Appellants.

The Pacific Underwriters Corporation, a Washington corporation, Defendant Below.

No. 53123-9-I.

Court of Appeals of Washington, Division 1.

June 13, 2005.

Reconsideration Denied August 9, 2005.

Michael B. King, Michael H. Runyan, Emilia L. Sweeney, Lane Powell PC, Seattle, Counsel for Appellants.

Charles K. Wiggins, Cheryl A. Dickerhoof, Wiggins & Masters PLLC, Bainbridge Island, Richard A. Bergh, Law Office of Andrew Bergh, Seattle, Richard B. Kilpatrick, Bellevue, Counsel for Respondents.

KENNEDY, J.

¶ 1 While his patient, also an employee, was under anesthesia for a dental procedure, a dentist played a practical joke by putting false teeth shaped like boar tusks into her mouth and taking pictures. After his insurer declined to defend him, the dentist settled his employee's lawsuit and sued his insurance company for coverage, for expenses incurred in his defense, for damages for bad faith and violations of the Consumer Protection Act, and for attorney fees and costs. Following the trial court's summary judgment order concluding that the insurer breached its duty to defend, a jury returned a verdict for the dentist. The insurer appeals. Because the complaint unambiguously alleged damages resulting only from intentional acts not required by or consisting of a legitimate part of the properly rendered dental procedure, the insurance company had no duty to defend the claim, and the verdict must be vacated and the case dismissed.

FACTS

¶ 2 This insurance dispute arises from a lawsuit filed by surgical assistant Tina Alberts against her former employer, oral surgeon Dr. Robert Woo. According to her complaint, during the five years of her employment, Dr. Woo learned of her interest in pot-bellied pigs and her pet pig, Walter. He began to make offensive comments to her about pigs and then showed her pictures of his boar hunting trip and a skinned pig hanging on a hook and made comments like, "[T]here is how Walter will look." During the last six months of her employment, Alberts began to complain about Dr. Woo's treatment of staff and to demand overtime pay.

¶ 3 When Alberts chipped a baby tooth that had never been replaced by a permanent tooth, Dr. Woo agreed to remove the chipped tooth and another tooth for her. According to usual procedure, a co-worker took an impression of Alberts' teeth and temporary false teeth known as "flippers" were created for Alberts to wear until the teeth were replaced by permanent implants. But Dr. Woo ordered additional flippers designed in the shape of boar tusks. While Alberts was under general anesthesia, Alberts' oxygen mask was removed, the boar tusks were placed into her mouth and photographs were taken showing Alberts' eyes and mouth pried open and the tusks protruding from her mouth. The boar tusks were then removed and the procedure was completed. Other staff members later gave Alberts the boar tusks and the pictures. After their presentation, Alberts assisted Dr. Woo in a procedure, during which he mentioned the boar tusks and said that she had a trophy to take home. Alberts left the office that day and never returned.

¶ 4 Alberts' complaint listed the following causes of action: assault, outrage, battery, invasion of privacy, false light, public disclosure of private facts, non-payment of overtime wages, retaliation, medical negligence, lack of informed consent, and negligent infliction of emotional distress. Her husband claimed outrage, loss of consortium, and negligent infliction of emotional distress, and her mother claimed outrage, and negligent infliction of emotional distress.

¶ 5 At the time of the incident, Dr. Woo held insurance policies issued by Fireman's Fund¹ for dental professional liability, employment practices liability, and general liability. The dental professional liability portion of the policy provided coverage for damages "that result from rendering or failing to render dental services." The policy defined "dental services" as "all services which are performed in the practice of the dentistry profession as defined in the business and professional codes of the state where you are licensed." Clerk's Papers at 162. Washington law provides:

A person practices dentistry, within the meaning of this chapter, who (1) represents himself as being able to diagnose, treat, remove stains and concretions from teeth, operate or prescribe for any disease, pain, injury, deficiency, deformity, or physical condition of the human teeth, alveolar process, gums, or jaw, or (2) offers or undertakes by any means or methods to diagnose, treat, remove stains or concretions from teeth, operate or prescribe for any disease, pain, injury, deficiency, deformity, or physical condition of the same, or take impressions of the teeth or jaw, or (3) owns, maintains or operates an office for the practice of dentistry, or (4) engages in any of the practices included in the curricula of recognized and approved dental schools or colleges, or (5) professes to the public by any method to furnish, supply, construct, reproduce, or repair any prosthetic denture, bridge, appliance, or other structure to be worn in the human mouth.

....

The practice of dentistry includes the performance of any dental or oral and maxillofacial surgery. "Oral and maxillofacial surgery" means the specialty of dentistry that includes the diagnosis and surgical and adjunctive treatment of diseases, injuries, and defects of the hard and soft tissues of the oral and maxillofacial region.

RCW 18.32.020.

¶ 6 The employment practices liability portion of the policy provided coverage for "damages as a result of sexual harassment, discrimination, or wrongful discharge that arise out of a wrongful employment practice." Clerk's Papers at 154. The policy defined "wrongful discharge" as "the unfair or unjust termination of an employment relationship which: breaches an implied agreement to continue employment; or inflicts emotional distress upon the employee, defames the employee, invades the employee's privacy, or is the result of fraud," and defined "wrongful employment practice" as "any negligent act, error, omission or breach of duty committed in the course of: relations with employees; interviewing, hiring or refusing to hire anyone who applies for employment; or decisions to hire, promote, discipline or fire employees." Clerk's Papers at 166.

¶ 7 The general liability portion of the policy provided coverage for claims of "bodily injury ... caused by an occurrence" during the policy period and in the coverage territory, and "personal injury caused by an offense arising out of your business[.]" Clerk's Papers at 74.

¶ 8 The policy included the following definitions:

1. Accident means a fortuitous circumstance, event or happening that takes place and is neither expected nor intended from the standpoint of the insured.

. . . .

4. Bodily injury means bodily injury, sickness or disease sustained by a person, including death resulting from any of these at any time.

. . . .

12. Occurrence means ... [a]n accident, including continuous or repeated exposure to substantially the same general harmful conditions.

13. Offense means a fortuitous, inadvertent or mistaken business activity giving rise to advertising injury or personal injury neither expected nor intended from the standpoint of the insured.

. . . .

17. Personal injury means injury, other than bodily injury, arising out of one or more of the following offenses:

a. False arrest, detention or imprisonment;

b. Malicious prosecution;

c. The actual wrongful eviction from, actual wrongful entry into, or actual invasion of the right of private occupancy of a room, dwelling or premises that a person legally occupies;

d. Oral or written publication of material that slanders or libels a person or organization; or

e. Oral or written publication of material that violates a person's right of privacy.

. . . .

27. Your business means the trade, profession or occupation in which you are engaged and which is shown on the declarations page.

Clerk's Papers at 85, 87-89.

¶ 9 Following Fireman's Fund's decision not to defend him, Dr. Woo settled with Alberts and then filed suit against his insurers seeking declaratory relief and damages, alleging a bad faith breach of the duty to defend and violations of the Consumer Protection Act. The trial court granted partial summary judgment to Dr. Woo, holding that Fireman's Fund breached its duty to defend under the coverage for professional liability, employment practices liability, and "business" or general liability. After a trial on Dr. Woo's claims of bad faith and violations of the Consumer Protection Act, a jury returned a verdict in favor of Dr. Woo, and the trial court entered judgment against Fireman's Fund including damages under the jury verdict, costs of the Alberts' settlement and Dr. Woo's defense, damages under the Consumer Protection Act, prejudgment interest and attorney fees and costs.

ANALYSIS

¶ 10 Fireman's Fund contends that the trial court erred in granting summary judgment to Woo regarding the duty to defend. This court reviews a summary judgment order de novo, performing the same inquiry as the trial court. Kruse v. Hemp, 121 Wash.2d 715, 853 P.2d 1373 (1993). The court must consider the facts submitted and all reasonable inferences from those facts in the light most favorable to the nonmoving party. Wilson v. Steinbach, 98 Wash.2d 434, 437, 656 P.2d 1030 (1982). Summary judgment is proper if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Kruse, 121 Wash.2d at 722,853 P.2d 1373; CR 56(c).

¶ 11 An insurer's duty to...