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Hanover Ins. v. Crocker
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Decision: 1997 ME 19
Docket: WAS-96-214
Argued November 4, 1996
Decided February 4, 1997





	[¶1]  Hanover Insurance Co. appeals from the summary judgment
entered in the Superior Court (Washington County, Marden J.) in favor of
Ngoclien Thi Crocker and Mary Crocker on Hanover's complaint requesting
a declaration that Hanover has no obligation to defend or indemnify
Ngoclien in connection with a civil action brought by Mary against Ngoclien. 
On appeal, Hanover contends that it has no duty to defend or indemnify
because 1) the allegations against Ngoclien do not constitute an
"occurrence" under the insurance policy, 2) the policy's exclusion for
injuries expected or intended from the standpoint of the insured applies to
the injuries Mary alleges that she suffered, and 3) there is a strong public
policy disfavoring insurance coverage for injuries resulting from sexual
abuse.  We conclude that Hanover has a duty to defend Ngoclien.  Because a
determination of whether a duty to indemnify exists would be premature,
however, we modify the judgment and affirm the judgment as modified.{1}
	[¶2]  Hanover issued a homeowner's policy to Thomas Crocker for the
period between June 30, 1975, and June 30, 1978.  Mary is the daughter of
Thomas and Ngoclien and has filed a complaint in the Superior Court
against Thomas and Ngoclien alleging that Thomas engaged in repeated
sexual activity with her beginning in 1976 when she was five years old. 
Mary Crocker v. Thomas Crocker and Ngoclien Thi Crocker, CV-94-78.{2}  As
against Ngoclien, the complaint alleges that after seeing one instance of
sexual abuse, she negligently failed to take positive steps to assure that
Thomas had no further opportunity to abuse Mary.
	[¶3]  Ngoclien requested Hanover to defend and indemnify her with
respect to Mary's civil action.{3}  After denying Ngoclien's request, Hanover
filed the complaint in this action for a declaratory judgment that Hanover
has no obligation to defend or indemnify Ngoclien. The court denied
Hanover's motion for a summary judgment and granted a summary judgment
for Mary and Ngoclien, see M.R. Civ. P. 56,  both on the duty to defend and
the duty to indemnify.  This appeal followed.
	[¶4]  In cases involving the construction of the language of an
insurance contract, the meaning of unambiguous language is a question of
law.  Globe Indem. Co. v. Jordan, 634 A.2d 1279, 1282 (Me. 1993).  Hanover
contends that the court erred in determining that the policy's requirement
of an occurrence was satisfied by the allegations against Ngoclien.  The
liability portion of the Hanover policy in Section II, Coverage E, "Personal
Liability," states:
This Company agrees to pay on behalf of the Insured all sums
which the Insured shall become legally obligated to pay as
damages because of bodily injury or property damage, to which
this insurance applies, caused by an occurrence.

The policy defines "occurrence" as:

[A]n accident, including injurious exposure to conditions, which
results, during the policy term, in bodily injury or property

	[¶5]  Hanover contends that the policy's requirement of an
"occurrence," as the requisite trigger of coverage, denotes a concept of
"accident" that is not present in the alleged conduct of Ngoclien.  Hanover
contends that there is nothing accidental about Ngoclien's conduct or
Mary's ensuing injuries.  Hanover argues that Ngoclien's knowledge that
sexual abuse was occurring was so certain to result in injury that an intent to
injure is implied as a matter of law, and therefore, her conduct cannot be
considered "accidental."  Hanover also urges this Court to follow Mutual of
Enumclaw v. Wilcox, 843 P.2d 154 (Idaho 1992).  In Wilcox, the court
focused on the actions that caused the injury from the perspective of the
intentional tortfeasor in determining whether the requirement of an
accident was met.  We are not persuaded by Hanover's contentions and
conclude that the complaint alleges an "occurrence" as defined by the
policy.   The complaint alleges "negligent" conduct by Ngoclien in that she
had knowledge that the abuse had occurred and negligently failed to protect
Mary from any further abuse.  The general rule is that injuries resulting from
negligent conduct are considered "accidental" and not "expected or
intended" and that those injuries are therefore caused by an occurrence
within the language of a homeowner's policy.  See Worcester Ins. Co. v.
South Acres Day School, 558 N.E.2d 958, 964 (Mass. 1990).  We agree with
the general rule.  The negligent conduct of Ngoclien alleged in Mary's
complaint falls within the meaning of an accident, and accordingly is an
occurrence within the language of Hanover's policy.

	[¶6]  Hanover also contends that liability for Mary's injuries is
excluded pursuant to the additional policy term excluding personal liability
coverage for injuries "either expected or intended from the standpoint of
the insured."{4}  Hanover contends that Ngoclien knew that her husband was
abusing Mary but failed to take action to assure that such sexual activity
cease.  Hanover argues that injuries resulting from a failure to protect a
child from further abuse are certainly expected within the meaning of the
exclusion.  We disagree.
	[¶7]  The policy exclusion is limited and excludes coverage only for
bodily injury or property damage that is either expected or intended from
the standpoint of "the insured."  See Perrault v. Maine Bonding & Casualty
Co., 568 A.2d 1100, 1101 (Me. 1990) ("any injury produced by a criminal
act of sexual abuse against a child is 'injury-expected or intended by the
insured' within the meaning of the homeowner's exclusion").  Mary does
not allege that Ngoclien acted intentionally, but only negligently.  Because
injury from negligent acts are considered accidental, Worcester Ins. Co. v.
South Acres Day School, 558 N.E.2d at 964, such injury is not injury
expected or intended from the standpoint of Ngoclien, one of the insureds
covered pursuant to Hanover's policy.
	[¶8]  Our conclusion is consistent with the majority of other
jurisdictions that have held that provisions excluding from coverage injuries
intentionally caused by "the insured" refer to a definite, specific insured,
who is directly involved in the occurrence that causes the injury.  Western
Casualty & Surety Co. v. Aponaug Mfg. Co., 197 F.2d 673, 674 (5th Cir. 1952)
(use of "the" insured would not affect coverage of other insureds); Arsenon
v. National Auto. and Casualty Ins. Co., 286 P.2d 816, 818 (Cal. 1955) (use of
"the" insured in exclusion clause did not preclude recovery of other
insureds); Pawtucket Mut. Ins. Co. v. Lebrecht, 190 A.2d 420, 423 (N.H.
1963) (use of "the" and "an" insured in same policy indicates an intent to
cover different situations; "the" insured refers to definite, specific insured
who is seeking coverage); Uniguard Mut. Ins. Co. v. Argonaut Ins. Co., 579
P.2d 1015, 1019 (Wash. Ct. App. 1978) (coverage and exclusion defined in
terms of "the" insured create separate obligations to several insureds).  The
"the insured" language in this policy differs from the "an insured" exclusion
language present in other policies.  Such "an insured" language in an
exclusion clause is equated with "any insured" and means that the conduct
of any insured that is excluded from coverage bars coverage for each insured
under the policy.  See Johnson v. Allstate Ins. Co., et al., 1997 ME 3 at ¶ 7
and cases cited therein.  Such is not the case with the policy providing
coverage to Ngoclien.
	[¶9]  Hanover finally contends that requiring it to provide coverage for
injury resulting from sexual abuse contravenes the strong public policy
articulated in Perrault v. Maine Bonding & Casualty Co., 568 A.2d 1100 (Me.
1990).  Hanover argues that allowing coverage to the non-perpetrator who
fails to prevent the abuse would allow homeowners' coverage for child
molestation claims through a back door.  We disagree.  Public policy does
not prohibit insurance coverage for an insured whose negligence
contributed to an injury from sexual abuse.  Perrault makes clear that
indemnifying a child abuser for his own criminal conduct is against public
policy.  In Perrault, we disallowed homeowners' coverage for the
perpetrator of child sexual abuse noting that
[H]omeowner's coverage for criminal sexual abuse of children is
undoubtedly outside the contemplation of the parties to the
insurance contract; indeed, "'[t]he average person purchasing
homeowner's insurance would cringe at the very suggestion that
[the person] was paying for such coverage.  And certainly [the
person] would not want to share that type of risk with other
homeowner's policyholders.'"

568 A.2d at 1102.  (citation omitted).  In Perrault the perpetrator himself
was seeking coverage for an intentional act.{5}  In this case, the complaint
against Ngoclien alleges negligent conduct by Ngoclien.  By its own terms,
the language of Hanover's policy provides coverage for that unintentional
conduct.  Public policy prohibiting coverage for intentional sexual abuse does
not override the language of this insurance contract.
		 The judgment is:
						Judgment modified to reflect Hanover's
						duty to defend only.  As redefined,
						judgment affirmed.

Attorney for plaintiff:

Martica S. Douglas, Esq. (orally)
Douglas, Whiting, Denham & Rodgers
P O Box 7108
Portland, ME 04112

Attorneys for defendants:

Joyce Mykleby, Esq. 
P O Box 151
Machias, ME 04654
(for Ngoclien Crocker)

John P. Foster, Esq.(orally)
71 Water Street
Eastport, ME 04611
(for Mary Crocker)

Rebecca Irving, Esq.
38 Broadway
Machias, ME 04654
(co-counsel for Mary Crocker)
FOOTNOTES******************************** {1} The Superior Court concluded that Hanover had a duty to defend and to indemnify Ngoclien. Although we agree with the court's conclusion with respect to the duty to defend, we vacate the portion of the judgment declaring that Hanover has a duty to indemnify Ngoclien. An insurer may not litigate its duty to indemnify until the liability of the insured has been determined. See State Mut. Ins. Co. v. Bragg, 589 A.2d 35, 36 (Me. 1991). The duty to defend is broader than the duty to indemnify, and an insurer may have to defend before it is clear whether a duty to indemnify exists. Id. {2} A judgment for Mary has been entered in the Superior Court by stipulation in the amount of $200,000 against Thomas only. {3} Hanover does not dispute that Ngoclien is insured pursuant to the policy. Cf. Johnson v. Allstate Ins. Co., et al., 1997 ME 3. {4} Exclusion (f) provides that the policy does not apply: (f) [T]o bodily injury or property damage which is either expected or intended from the standpoint of the insured. {5} "The complaint alleged intentional acts . . . [t]here is no implied negligence . . . in any of these claims as pleaded." Perrault v. Maine Bonding & Casualty Co., 568 A.2d at 1102.