Don’t take your guns to town, son
On the evening of October 24, 2013, the son of Maria Olivares (Son) was at a bar owned by Aztec Marketing, Inc. While at the bar, Son was involved in a fight with another patron (Patron); others present broke up the fight, and a bar employee ordered Patron to leave. As he was leaving, Patron was overheard saying, “I’ll be back. You’ll regret it.” Patron went to his car and retrieved a gun; he then returned to the bar, where he fired a shot in the air. A bar employee called the police, but Patron shot Son before the police arrived. Son later died.
In January 2017, Olivares filed a wrongful death action against Aztec and one of its employees, asserting claims for negligent security and dram shop liability. At the time of the shooting, Aztec was insured by Scottsdale Insurance Company; the policy included commercial general liability and liquor liability coverage. With respect to bodily injury coverage, the pertinent part of the commercial general liability coverage form stated, “We will pay those sums that the insured becomes legally obligated to pay as damages because of ‘bodily injury’ … to which this insurance applies.” The policy defined “bodily injury” as “bodily injury, sickness or disease sustained by a person, including death resulting from any of these at any time.”
In relevant part, the liquor liability coverage form stated: We will pay those sums that the insured becomes legally obligated to pay as damages because of “injury” to which this insurance applies if liability for such “injury” is imposed on the insured by reason of the selling, serving or furnishing of any alcoholic beverage.
The policy defined “injury” as “damages because of ‘bodily injury’ … including damages for care, loss of services or loss of support.” The policy’s limit for commercial general liability and liquor liability was $1 million.
The policy contained an Assault and/or Battery Limited Liability Coverage Form, which limited coverage for assault and battery, although those terms were not defined in the policy. In pertinent parts, the assault/battery coverage form stated:
This endorsement modifies insurance provided under the following:
COMMERCIAL GENERAL LIABILITY COVERAGE PART
LIQUOR LIABILITY COVERAGE PART
Except as provided by this coverage form, this policy does not apply to “injury,” “bodily injury,” … arising from:
1. Assault and/or Battery committed by:
a. Any insured;
b. Any employee of any insured; or
c. Any other person; or
2. The failure to suppress or prevent Assault and/or Battery by any person in 1. above; or
3. The selling, serving or furnishing of alcoholic beverages which results in Assault and/or Battery; or
4. The negligent:
Reporting to the proper authorities, or failure to so report; or
of a person for whom any insured is or ever was legally responsible and whose conduct would be excluded by paragraphs 1. and 2. above.
We will have no duty to defend any “suit” against you seeking “damages” on account of any such injury unless coverage is provided by this Coverage Form.
The coverage provided is described below:
For the premium shown below, we agree to afford coverage with respect to Assault and/or Battery Liability only as indicated on this Coverage Form and subject to the liability limits and provisions as set forth in this Coverage Form.
LIMITS OF LIABILITY COVERAGE
$25,000 Each Event Assault and/or
$50,000 Aggregate Battery Liability
$ INCLUDED TOTAL PREMIUM…
- COVERAGE – ASSAULT AND/OR BATTERY LIABILITY
We will pay on your behalf all sums which you shall become legally obligated to pay as “damages” because of “injury,” “bodily injury,” … to any person arising out of Assault and/or Battery that takes place during the policy period.
- LIMITS OF LIABILITY
Regardless of the number of insureds under this policy, our liability is limited as follows:
The limit of liability stated in this coverage form as applicable to each Event is the most we will pay for all “damages” arising out of “injury,” “bodily injury,” … because of assault and/or battery, regardless of the number of insureds, persons injured, claims made or suits brought or persons or organizations making claims or bringing suits. The limit of liability stated above as Aggregate, subject to the above provision regarding each Event, is the total limit of our liability under this coverage for all “damages” in any policy period.
In February 2018, Olivares, Aztec, and Scottsdale entered into a settlement agreement that fully released Aztec and its employee from the underlying action while reserving the issue of coverage limits to be litigated between Olivares and Scottsdale. Pursuant to the agreement, a $1 million judgment was entered against Aztec with the understanding that the judgment would be satisfied from the policy only. Scottsdale paid Olivares $25,000 pursuant to the assault/battery coverage form, but Olivares contended that the shooting was covered by the full $1 million policy limit, and not the $25,000 limit of the assault/battery coverage form.
Scottsdale filed a declaratory judgment action seeking a determination that the assault/battery coverage form applied and limited coverage for Son’s shooting death to $25,000. Thereafter, Scottsdale moved for summary judgment setting out 22 uncontroverted facts. In response, Olivares admitted the facts set forth in Scottsdale’s motion; she did not allege any additional facts. Scottsdale then filed a reply that did not assert any additional facts; no sur-reply was filed.
At oral argument, Scottsdale asserted that, pursuant to the undisputed facts set forth in its motion, the assault/battery coverage form unambiguously limited coverage for Son’s death to $25,000. Olivares argued that the terms “assault” and “battery” were ambiguous and therefore must be interpreted in favor of coverage. She further argued that, even if the terms were not ambiguous, Scottsdale’s uncontroverted facts failed to establish, as a matter of law, that the assault/battery coverage form applied.
On May 20, 2019, the court granted Scottsdale’s motion for summary judgment. The court found that the terms “assault,” “battery,” and “assault and/or battery” have commonly understood definitions and are not ambiguous.
Olivares filed a motion for a new trial. The court did not rule on Olivares’s motion; thus, it was deemed overruled. Olivares appealed.
Olivares raised two points on appeal. She first claimed that the motion court erred in granting summary judgment because Scottsdale failed to establish that its assault/battery coverage form applied as a matter of law in that (1) the terms “assault,” “battery,” and “assault and/or battery,” which are not defined in the policy, were ambiguous and thus should be interpreted in favor of coverage; and (2) the uncontroverted facts failed to establish that Son’s death arose out of an “assault,” “battery,” or “assault and/or battery” as those terms were defined by the court.
The court stated that it found nothing duplicitous or difficult to understand about the term “battery” in Scottsdale’s assault/battery coverage form. The court agreed with the motion court that the average layperson would reasonably understand the term “battery” to include a shooting.
Olivares’s second point ignored admissions she made in her responses to Scottsdale’s motion for summaryjudgment. Her statements were in Scottsdale’s statement of uncontroverted material facts and were admitted to by Olivares in her response. Olivares admitted that Patron got into a fight that others had to break up; he made threatening comments as he left the bar; he retrieved a gun and returned to the bar; he shot the gun in the air, and then he shot and killed Son. The court found these admitted facts sufficient to demonstrate that Patron engaged in unlawful conduct.
Finding that there were no genuine issues of material fact and that Scottsdale was entitled to judgment as a matter of law, the appellate court affirmed the motion court’s award of summary judgment to Scottsdale.
Scottsdale Insurance Company v. Olivares—Missouri Court of Appeals, Western District—No. WD 83178—September 29, 2020.