Grange Insurance Association v. Elizabeth Roberts ( 2013 )

LOJr, j" Or APPEALS DA'
STATE OFWASBiNGTO::
20|i»MAR-6 AH 9^ 23
IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
GRANGE INSURANCE ASSOCIATION, NO. 69356-5-
a Washington corporation,
DIVISION ONE
Respondent,
v.
ELIZABETH and WESLEY ROBERTS, ORDER GRANTING NONPARTIES'
husband and wife, and the marital MOTIONS TO PUBLISH OPINION
community composed thereof;
Appellants,
Nonparties William R. Hickman, Geoffrey Bedell, and Susanna Sharp have filed
motions to publish opinion filed October 28, 2013. Appellants have filed a response
supporting publication; the respondent has filed a response objecting to publication.
The court has determined that the motions should be granted; therefore, it is
ORDERED that the nonparties' motions to publish opinion are granted.
DATED this (j?^* day of March 2014.
.•--r n c ft ? YE &*s- ° •-^ '• i
W3 OCT 28 W*01
IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
GRANGE INSURANCE ASSOCIATION, NO. 69356-5-
a Washington corporation,
DIVISION ONE
Respondent,
v.
ELIZABETH and WESLEY ROBERTS, UNPUBLISHED OPINION
husband and wife, and the marital
community composed thereof; FILED: October 28, 2013
Appellants,
Lau, J. — An insurer's duty to defend arises "if the insurance policy conceivably
covers the allegations in the complaint, whereas the duty to indemnify exists only if the
policy actually covers the insured's liability." Woo v. Fireman's Fund Ins. Co., 161
Wash. 2d 43, 53, 164 P.3d 454 (2007) (emphasis omitted). Grange Insurance Association
issued an insurance policy to Jane and Wes Roberts.1 The policy imposes on Grange a
duty to defend its insureds but excludes intentional conduct from the duty to defend.
Rebecca Brandis sued Roberts, alleging various torts stemming from Roberts's
intentional conduct. The trial court ruled in a declaratory judgment action that Grange
1We refer to Jane and Wes collectively as "Roberts."
69356-5-1/2
owed Roberts no duty to defend against the Brandis complaint. Because Roberts's
insurance policy provides no conceivable coverage for the allegations in the Brandis
complaint, the trial court properly granted declaratory judgment in Grange's favor.
FACTS
This coverage dispute began with litigation between siblings. That Trust and
Estate Dispute Resolution Act (TEDRA) lawsuit involved sisters Rebecca Brandis,
Suella Hershaw, Myra Converse, and Myrna Seifert2 against their sister, Jane Roberts,
and her husband, Wes. Brandis sought to set aside transfers of real and personal
property their now deceased mother, Elizabeth, made to Roberts. The Brandis
complaint also sought damages alleging that Roberts obtained the property transfers by
engaging in fraudulent acts, exerting undue influence over their mother, "actively
interfer[ing]" with their mother, and making false statements and "bad mouth[ing]" them.
The complaint also alleged that Roberts's conduct resulted in the loss of an expected
inheritance, loss of a parent-child relationship, and emotional distress/outrage.
Regarding interference and outrage, the complaint alleged:
Jane isolated Elizabeth from her longtime friends and family. Jane actively
interfered with the relationship between Elizabeth and her family and friends,
including her other children. Jane made false statements about and
"badmouthed" those other parties in order to so intentionally interfere with their
relationships. Jane's behavior towards the other family members, including
making false accusations regarding prior child abuse claims, went beyond the
bounds of decency, atrocious, and intolerable. The family and friends
experienced extreme emotional distress as a result of Jane's interference with
their relationships with Elizabeth, which were adversely affected.
We refer to these sisters collectively as "Brandis."
69356-5-1/3
The complaint's request for relief sought, among other things, "a judgment for damages
based on [Roberts's] tortious interference with expected inheritance," "a judgment for
damages based on [Roberts's] tortious interference with the parent/child relationship,"
and "a judgment for damages based on outrage caused by [Roberts's] outrageous
conduct which proximately caused severe emotional distress."
Roberts's Grange policy provisions provide coverage—subject to certain
exclusions—for bodily injury and property damage liability (coverage H) and personal
and advertising injury liability (coverage I). Coverage H provides in relevant part:
COVERAGE H - BODILY INJURY AND PROPERTY DAMAGE LIABILITY
1. Insuring Agreement
a. We will pay those sums that an insured becomes legally obligated to pay as
damages because of bodily injury or property damage to which this
insurance applies. We will have the right and duty to defend an insured
against any suit seeking those damages.
However, we will have no duty to defend an insured against any
suit seeking damages for bodily injury or property damage to which this
insurance does not apply.
b. This insurance applies to bodily injury and property damage only if:
(1) The bodily injury or property damage is caused by an occurrence ....
2. Exclusions
This insurance does not apply to:
a. Expected Or Intended Injury
Bodily injury or property damage expected or intended from the standpoint
of an insured. . . .
SECTION V - DEFINITIONS
2. Bodily injury means bodily injury, sickness or disease sustained by a person,
and includes death resulting from any of these at any time.
17. Occurrence means an accident, including continuous or repeated exposure
to substantially the same general harmful conditions.
69356-5-1/4
Coverage I provides in relevant part:
COVERAGE I - PERSONAL AND ADVERTISING INJURY LIABILITY
1. Insuring Agreement
a. We will pay those sums that an insured becomes legally obligated to pay
as damages because of personal and advertising injury to which this
insurance applies. We will have the right and duty to defend an insured
against any suit seeking those damages.
However, we will have no duty to defend an insured against any suit
seeking damages for personal and advertising injury to which this insurance
does not apply.
2. Exclusions
This insurance does not apply to personal and advertising injury:
a. Knowing Violation Of Rights Of Another
Caused by or at the direction of an insured with the knowledge that the act
would violate the rights of another and would inflict personal and
advertising injury.
b. Material Published With Knowledge Of Falsity
Arising out of oral or written publication of material, if done by or at the
direction of an insured with knowledge of its falsity.
SECTION V- DEFINITIONS
18. Personal and advertising injury means injury, including consequential bodily
injury, arising out of one or more of the following offenses:
d. Oral or written publication, in any manner, of material that slanders or
libels a person or organization or disparages a person's or organization's
goods, products, or services.
e. Oral or written publication, in any manner, of material that violates a
person's right of privacy.
In June 2010, Roberts tendered defense of the Brandis lawsuit to Grange.
Grange accepted the tender under a full reservation of rights and retained defense
attorney Tom Heller to represent Roberts. Grange informed Roberts that their policy
may not provide coverage and asserted its right to "file a declaratory judgment action
-4-
69356-5-1/5
asking a court of law to determine that Grange has no duty to defend the potential
lawsuit and/or to pay any judgment or settlement of the claims being asserted."
In September 2010, Grange filed an action for declaratory relief seeking a
determination of its duty to defend and indemnify Roberts in the underlying action. The
complaint alleged that Grange had no duty to defend or indemnify Roberts because no
"occurrence" happened as defined under the insurance policy, some or all of Brandis's
claims alleged no "bodily injury" or "property damage" within the policy's coverage, and
exclusions applied to those claims falling under "bodily injury," "property damage," or
"personal and advertising injury." Summonses were sent to Roberts and each of the
Brandis plaintiffs in the underlying suit.3
In June 2011, Roberts filed an answer, affirmative defenses, and a counterclaim
alleging bad faith by Grange. The counterclaim alleged, "By filing the Coverage Action,
Grange has breached its fiduciary duties to [Roberts] and committed the tort of
insurance bad faith. For Grange to prevail in the Coverage Action, Grange will
necessarily be required to allege facts that, if proved true, would be detrimental to
[Roberts's] defense in the Underlying Tort Action." Roberts argued, "By seeking to
prevail in the Coverage Action, Grange will effectively be helping Jane's siblings to
prove their case against her in the Underlying Tort Action."
3 In January 2011, attorney Heller requested that Grange delay its declaratory
judgment action so that a planned motion for summary judgment in the underlying
action could be heard. Grange agreed and delayed prosecution of its declaratory
judgment action until after the underlying motion for summary judgment was heard.
69356-5-1/6
Grange moved for summary judgment, requesting a ruling that it had no duty to
defend Roberts in the underlying action. Roberts filed an opposition and a cross motion
to stay. The basis for the motion to stay was the same as that asserted in Roberts's
counterclaim: "Any attempt by Grange to offer proof that Jane possessed the intent
required to invoke the exclusions at issue would work directly against [Roberts's] efforts
to avoid liability in the underlying action, and would therefore constitute bad faith."
The court granted Grange's summary judgment motion in July 2011:
[The court] DECLARES that the claims being made against defendants [Jane]
and "John Doe" Roberts in the underlying action of Brandis, et. al. v. Elizabeth
Roberts, et. al., Snohomish County Cause No. 08-4-00999-3 do not trigger
coverage under Grange's Policy No. FP01010054 and, thus, that Grange has no
duty to indemnify, or to continue providing a defense to Roberts for the claims
being made in the underlying [case]. Consequently, Grange may cease
providing a defense to Roberts.
The court's order did not specifically address Roberts's counterclaim. The parties agree
that by considering and ruling on the summary judgment motion, the trial court implicitly
denied Roberts's cross motion to stay.
Shortly after the court determined Grange had no duty to defend, Roberts
tendered defense to a second insurer, Unigard Insurance Company. Unigard defended
under a reservation of rights for a period of time, but is no longer providing coverage.
More than a year after the trial court granted Grange's summary judgment
motion, Roberts asserted that the July 2011 order was not a final order because the bad
faith counterclaim was never formally dismissed. Grange filed a motion for clarification
of the court's summary judgment order. Grange argued that the court effectively
dismissed Roberts's counterclaim when it denied the motion to stay and it was only a
-6-
69356-5-1/7
"ministerial error that the [summary judgment] order did not so state." Report of
Proceedings (RP) (Sept. 21, 2012) at 5. Grange moved the court to amend its prior
summary judgment order to indicate it was a final order dismissing Roberts's
counterclaim. In September 2012, the court denied Grange's motion for clarification
and formally dismissed Roberts's counterclaim "w/prejudice [and] this is the final order
of the court."
ANALYSIS4
Standard of Review
We review a summary judgment order de novo, performing the same inquiry as
the trial court and considering facts and reasonable inferences in the light most
favorable to the nonmoving party. Jones v. Allstate Ins. Co., 146 Wash. 2d 291, 300, 45
4 Grange contends that collateral estoppel bars this appeal because Unigard
subsequently obtained the same order as did Grange and Roberts failed to appeal that
order. The details of the Unigard claim are not in the record on appeal. The parties
conveyed only limited information to the trial court regarding the Unigard litigation. See
Clerk's Papers (CP) at 368-69 (Roberts's declaration stating that Unigard defended
under a reservation of rights and brought a summary judgment motion against them in
June 2012); CP at 376 (in its motion for clarification, Grange informed the trial court that
Roberts, in response to Unigard's motion for summary judgment, asserted that the
Grange litigation was not complete because Roberts's counterclaim against Grange had
not been dismissed); RP (Sept. 21, 2012) at 3 (during oral argument on motion for
clarification, trial court was advised that Unigard was no longer providing coverage).
Collateral estoppel, also known as issue preclusion, bars relitigation of issues of
ultimate fact that have been determined by a final judgment in actions involving the
same parties. State v. Williams, 132 Wash. 2d 248, 253-54, 937 P.2d 1052 (1997).
Collateral estoppel must not be applied to work an injustice. "The question is always
whether the party to be estopped had a full and fair opportunity to litigate the issue."
State Farm Mut. Auto. Ins. Co. v. Avery, 114 Wash. App. 299, 304, 57 P.3d 300 (2002).
On this limited record, we cannot determine that Roberts had a full and fair opportunity
to litigate the coverage issue in the Unigard case.
69356-5-1/8
P.3d 1068 (2002). Summary judgment is proper if no genuine issue of material fact
remains and the moving party is entitled to judgment as a matter of law. CR 56(c).
Similarly, the construction of an insurance contract is a question of law. State
Farm Gen. Ins. Co. v. Emerson, 102 Wash. 2d 477, 480, 687 P.2d 1139 (1984); Bordeaux,
Inc. v. Am. Safety Ins. Co., 145 Wash. App. 687, 694, 186 P.3d 1188 (2008). Courts
construe insurance policies as contracts. Austl. Unlimited, Inc. v. Hartford Cas. Ins. Co.,
147 Wash. App. 758, 765, 198 P.3d 514 (2008). We consider the policy as a whole and
give it a "'fair, reasonable, and sensible construction as would be given to the contract
by the average person purchasing insurance.'" Weyerhaeuser Co. v. Commercial
Union Ins. Co., 142 Wash. 2d 654, 666, 15 P.3d 115 (2000) (quoting Am. Nat'l Fire Ins. Co.
v. B&L Trucking & Constr. Co., 134 Wash. 2d 413, 427-28, 951 P.2d 250 (1998)). "[I]f the
policy language is clear and unambiguous, the court must enforce it as written and may
not modify it or create ambiguity where none exists." Austl. Unlimited, 147 Wash. App. at
765-66. A policy is ambiguous only if its provisions are susceptible to two different
interpretations, both of which are reasonable. Allstate Ins. Co. v. Peaslev, 131 Wash. 2d
420, 424, 932 P.2d 1244 (1997). We resolve ambiguity in favor of the insured. Moeller
v. Farmer's Ins. Co. of Wash., 173 Wash. 2d 264, 272, 267 P.3d 998 (2011). When
interpreting insurance policies, we are bound by the definitions provided in the policy.
Austl. Unlimited, 147 Wash. App. at 766.
Duty to Defend
In Washington, "'[t]he duty to defend is different from and broader than the duty
to indemnify.'" Edmonson v. Popchoi, 172 Wash. 2d 272, 282, 256 P.3d 1223 (2011)
-8-
69356-5-1/9
(quoting Am. Best Food, Inc. v. Alea London, Ltd., 168 Wash. 2d 398, 404, 229 P.3d 693
(2010)). In Woo v. Fireman's Fund Insurance Co., 161 Wash. 2d 43, 164 P.3d 454 (2007),
our Supreme Court summarized the law governing an insurer's duty to defend:
The duty to defend "arises at the time an action is first brought, and is based on
the potential for liability." Truck Ins. Exch. v. VanPort Homes, Inc., 147Wn.2d
751, 760, 58 P.3d 276 (2002) (emphasis added). An insurer has a duty to
defend 'when a complaint against the insured, construed liberally, alleges facts
which could, if proven, impose liability upon the insured within the policy's
coverage.'" Id (quoting Unigard Ins. Co. v. Leven, 97 Wash. App. 417, 425, 983
P.2d 1155 (1999)). An insurer is not relieved of its duty to defend unless the
claim alleged in the complaint is "clearly not covered by the policy." ]d. (citing
Kirk v.Mt. Airy Ins. Co., 134 Wash. 2d 558, 561, 951 P.2d 1124 (1998)). Moreover,
if a complaint is ambiguous, a court will construe it liberally in favor of "triggering
the insurer's duty to defend." Id. (citing R.A. Hanson Co. v. Aetna Ins. Co., 26
Wash. App. 290, 295, 612 P.2d 456 (1980)). In contrast, the duty to indemnify
"hinges on the insured's actual liability to the claimant and actual coverage under
the policy." Havden fv. Mut. of Enumclaw Ins. Co.], 141 Wn.2d [55,] 64[, 1 P.3d
1167 (2000)] (emphasis added). In sum, the duty to defend is triggered ifthe
insurance policy conceivably covers the allegations in the complaint, whereas the
duty to indemnify exists only if the policy actually covers the insured's liability.
"There are two exceptions to the rule that the duty to defend must be
determined only from the complaint, and both the exceptions favor the insured."
Truck Ins., 147 Wash. 2d at 761. First, if it is not clear from the face of the
complaint that the policy provides coverage, but coverage could exist, the insurer
must investigate and give the insured the benefit of the doubt that the insurer has
a duty to defend. Id. Notice pleading rules, which require only a short and plain
statement of the claim showing that the pleader is entitled to relief, impose a
significant burden on the insurer to determine ifthere are any facts in the
pleadings that could conceivably give rise to a duty to defend. Hanson, 26 Wn.
App. at 294. Second, ifthe allegations in the complaint "'"conflict with facts
known to or readily ascertainable by the insurer,"'" or if "'"the allegations ... are
ambiguous or inadequate,"'" facts outside the complaint may be considered.
Truck Ins., 147 Wash. 2d at 761 (quoting Atl. Mut. Ins. Co. v. Roffe, Inc., 73 Wn.
App. 858, 862, 872 P.2d 536 (1994) (quoting E-Z Loader Boat Trailers, Inc. v.
Travelers Indem. Co., 106 Wash. 2d 901, 908, 726 P.2d 439 (1986))). The insurer
may not rely on facts extrinsic to the complaint to deny the duty to defend—it
may do so only to trigger the duty. jd.
.... Although the insurer must bear the expense of defending the
insured, by doing so under a reservation of rights and seeking a declaratory
69356-5-1/10
judgment, the insurer avoids breaching its duty to defend and incurring the
potentially greater expense of defending itself from a claim of breach. k±
Woo, 161 Wash. 2d at 52-54 (footnote omitted). In sum, "'if there is any reasonable
interpretation of the facts or the law that could result in coverage, the insurer must
defend.'" Edmonson, 172 Wash. 2d at 282 (quoting Alea, 168 Wash. 2d at 405). Once an
event triggers the duty to defend, insurers may not desert policyholders while awaiting
an indemnity determination. Alea, 168 Wash. 2d at 405. The obligation encompasses any
claim that might be covered under any permissible construction of the policy. Baugh
Constr. Co. v. Mission Ins. Co., 836 F.2d 1164, 1168 (9th Cir. 1988) (applying
Washington law); Travelers Ins. v. N. Seattle Christian & Missionary Alliance, 32 Wn.
App. 836, 839-40, 650 P.2d 250 (1982).
Policy Coverage
Roberts argues, "The Brandis complaint triggers [Grange's] duty to defend
because it alleges defamation, outrage, tortious interference with expected inheritance
and tortious interference with a parent/child relationship, all of which claims are
potentially covered by the policy." Appellant's Br. at 16 (formatting omitted). Under the
principles in Woo and the authority it cites, Grange's duty to defend triggered ifthe
Brandis complaint, construed liberally, alleged facts that could, if proven, impose liability
upon Roberts within the policy's coverage. Woo, 161 Wash. 2d at 52-53. Relief is
unavailable to Grange unless the claim alleged in the complaint is clearly not covered
by the policy. Woo, 161 Wash. 2d at 53. The parties do not dispute that the policy
expressly excludes coverage for intentional acts.
-10-
69356-5-1/11
Outrage
Roberts contends that the outrage allegation falls within Grange's policy
coverage for bodily injury and property damage. This question depends on whether
Brandis's alleged injuries constitute an "occurrence" under the terms of the policy.
Under the policy, an "occurrence" means an accident, including exposure to conditions
which results in (a) bodily injury or (b) property damage.
Brandis alleged bodily injury in the form of outrage. To establish a claim for the
tort of outrage—also known as intentional infliction of emotional distress—the plaintiff
must show that (1) he or she suffered severe emotional distress; (2) the emotional
distress was inflicted intentionally or recklessly, but not negligently;5 (3) the conduct
complained of was outrageous and extreme; and (4) he or she personally was the
subject of the outrageous conduct. Janaszak v. State, 173 Wash. App. 703, 736, 297
P.3d 723 (2013). The defendant's conduct must be "'so outrageous in character, and
so extreme in degree, as to go beyond all possible bounds of decency, and to be
regarded as atrocious, and utterly intolerable in a civilized community.'" Reid v. Pierce
5 Conduct is reckless when a person "knows of and disregards a substantial risk
that a wrongful act may occur and his or her disregard of such substantial risk is a gross
deviation from conduct that a reasonable man would exercise in the same situation."
RCW9A.08.010(1)(c).
Negligent infliction of emotional distress is a limited, judicially created cause of
action that allows a family member to recover for "foreseeable" intangible injuries
caused by viewing a physically injured loved one shortly after a traumatic accident.
Colbert v. Moomba Sports, Inc., 163 Wash. 2d 43, 49, 176 P.3d 497 (2008). No party
argues that Brandis alleged negligent infliction of emotional distress in the underlying
complaint.
-11-
69356-5-1/12
County, 136 Wash. 2d 195, 202, 961 P.2d 333 (1998) (emphasis omitted) (quoting
Grimsby v.Samson, 85 Wash. 2d 52, 59, 530 P.2d 291 (1975)).
Relying on Woo, Roberts argues that even if her conduct was intentional, it is
conceivable that her conduct resulted in unintended injuries to Brandis. In Woo, the
insured dentist inserted boar tusks into his patient's mouth while she was under
anesthesia and took humiliating photographs of the prank. The dentist's staff gave the
photographs to the patient. Woo, 161 Wash. 2d at 63-64. The patient sued the dentist,
alleging bodily injury resulting from both negligent and intentional conduct. Woo, 161
Wash. 2d at 63. The dentist's insurer argued that his general liability policy excluded
coverage for the boar tusk prank because that conduct was clearly "intentional." Woo,
161 Wash. 2d at 63. The relevant policy language provided defense coverage for bodily
injury caused by an "occurrence," which was defined as "[a]n accident, including
continuous or repeated exposure to substantially the same general harmful conditions."
Woo, 161 Wash. 2d at 63 (alteration in original). The policy also defined "accident" as a
"'fortuitous circumstance, event or happening that takes place and is neither expected
nor intended from the standpoint of the insured.'" Woo, 161 Wash. 2d at 63.
Our Supreme Court construed the unique policy language at issue to hold that
the plaintiff's complaint alleged claims that were conceivably covered by the dentist's
policy. Woo, 161 Wash. 2d at 64-65. The court's analysis depended heavily on the
policy's definition of "accident:"
Woo's policy covers bodily injury that is caused by an "accident," which is
defined as a "fortuitous circumstance, event or happening that takes place and is
neither expected nor intended from the standpoint of the insured." NSW at
-12-
69356-5-1/13
000043 (emphasis added). The Court of Appeals limited its analysis of the bodily
injury coverage to whether Alberts' complaint alleged exclusively intentional
conduct. However, based on the language of Woo's policy, he had to have
"expected or intended" the specific "event or happening" alleged in the complaint.
Thus, he would have to have intended not only the "event or happening" of
photographing her with the boar tusk flippers in her mouth but also the "event or
happening" that Alberts would sustain the specific injuries she alleged in her
complaint. Although Woo's conduct was likely intentional, it is conceivable that
Woo did not intend that conduct to result in Alberts' injuries.
Moreover, Woo's policy covers "continuous or repeated exposure to
substantially the same general harmful conditions." NSW at 000045. Woo's
"taunts" and the practical joke could have been part of Woo's "continuous or
repeated" efforts to cultivate a "friendly working environment" in the office. NSW
at 000045; Br. of Resp'ts at 4-5.
Woo, 161 Wash. 2d at 64 (emphasis added in part).
In Woo, the insurance policy's plain language required that Woo intend not only
the event or happening that caused the injury, but also the injuries that resulted. Here,
the definition of "occurrence" includes "accident." In contrast to the policy in Woo, the
term "accident" is not defined in Grange's policy. We thus look to the common law
definition. Safeco Ins. Co. of Am. v. Butler, 118 Wash. 2d 383, 401, 823 P.2d 499 (1992).
For purposes of liability insurance,
"an accident is never present when a deliberate act is performed unless some
additional unexpected, independent and unforeseen happening occurs which
produces or brings about the result of injury or death. The means as well as the
result must be unforeseen, involuntary, unexpected and unusual."
Butler, 118Wn.2dat401 (Quoting Detweiler v. J.C. Pennev Cas. Ins. Co., 110Wn.2d
99, 104, 751 P.2d 282 (1988)). An act is deliberate when it is "done with awareness of
the implications or consequences of the act." Nationwide Ins. Co. v. Havles, Inc., 136
Wash. App. 531, 538, 150 P.3d 589 (2007).
-13-
69356-5-1/14
Where an insured acts intentionally but claims that the result was unintended, the
incident is not an accident if the insured knew or should have known facts from which a
prudent person would have concluded that the harm was reasonably foreseeable. State
Farm Fire & Cas. Co. v. Parrella. 134 Wash. App. 536, 540, 141 P.3d 643 (2006). Stated
another way, "[w]e define an outcome as accidental only if both the means and the
result were 'unforeseen, involuntary, unexpected and unusual.'" Allstate Ins. Co. v.
Bauer, 96 Wash. App. 11, 16, 977 P.2d 617 (1999) (guoting Grange Ins. Co. v. Brosseau.
113 Wash. 2d 91, 96, 776 P.2d 123 (1989)). "[PJursuant to the common sense definition,
'accident' is not a subjective term. Thus, the perspective of the insured as opposed to
the tortfeasor is not a relevant inquiry. Either an incident is an accident or it is not."
Roller v. Stonewall Ins. Co., 115 Wash. 2d 679, 685, 801 P.2d 207 (1990), overruled on
other grounds by Butzberger v. Foster, 151 Wash. 2d 396, 89 P.3d 689 (2004).
Under the common law definition of "accident," a reasonably foreseeable harm
resulting from deliberate conduct is not an "accident" and, thus, not an "occurrence"
under the Grange policy language at issue. While Brandis could prove outrage by
showing "reckless" conduct, the complaint's factual allegations, broadly construed,
allege intentional conduct by Roberts. Even accepting Roberts's argument that she
could have acted recklessly without intending the result, the complaint clearly alleged
deliberate actions by Roberts. As defined above, to be reckless is to know of and
disregard a substantial risk of harm. Roberts's actions could foreseeably result in the
plaintiffs' severe mental distress. There is no coverage for Roberts's alleged conduct
under the Grange policy's clear and explicit language because the conduct does not
-14-
69356-5-1/15
constitute an "occurrence" within the meaning of the policy. The trial court properly
determined that the Grange policy triggered no duty to defend the outrage claim.
An alternative ground also exists to affirm the trial court on this issue. We note
that Washington courts consistently interpret "bodily injury" provisions in insurance
policies to include claims for physical injury but exclude claims for purely nonphysical or
emotional harm unrelated to a physical injury. Although neither party briefed this issue,
"an appellate court may sustain a trial court on any correct ground, even though that
ground was not considered by the trial court." Nast v. Michels, 107 Wash. 2d 300, 308,
730 P.2d 54 (1986). Accordingly, this case can be decided as a matter of law based on
whether the term "damages because of bodily injury" in Roberts's policy includes
damages for emotional distress unrelated to physical injury. See Daley v. Allstate Ins.
Co., 135 Wash. 2d 777, 958 P.2d 990 (1998).
Cases in Washington and other jurisdictions recognize that damages for bodily
injury include damages for emotional distress if that distress arises as a result of a
physical injury. See Thompson v. Grange Ins. Ass'n, 34 Wash. App. 151, 161, 660 P.2d
307 (1983) (damages for loss of consortium allowed where a spouse suffers bodily
injury and can no longer perform spousal functions); Michael Sean Quinn & L. Kimberly
Steele, Insurance Coverage Opinions, 36 S. Tex. L. Rev. 479, 527 (1995) (mental
anguish as a consequence of bodily injury is covered).
Here, the record contains no evidence or allegation of physical injury. Instead,
Brandis alleged purely emotional injuries due to Roberts's statements and actions.
Grange has a duty to defend Roberts against claims asserting "damages because of
-15-
69356-5-1/16
bodily injury." As noted above, Grange's policy defines "bodily injury" as "bodily injury,
sickness or disease sustained by a person, and includes death resulting from any of
these at any time." In Daley, our Supreme Court construed similar policy language in
an underinsured motorist (UIM) policy defining "bodily injury" as "bodily injury, sickness,
disease or death." Daley, 135 Wash. 2d at 784. The court noted, "The clear majority of
states, including Washington, have held that the term 'bodily injury' does not include
damages for purely emotional injuries." Daley, 135 Wash. 2d at 784-85 (footnote omitted).
The court discussed its previous cases interpreting "bodily injury" in the insurance
context:
Washington follows the majority of jurisdictions which find that the term
"bodily injury" does not encompass recovery for purely emotional injuries. In E-Z
Loader [Boat Trailers, Inc. v. Travelers Indemnity Co.. 106 Wash. 2d 901, 726 P.2d
439 (1986)], this court considered whether an insured could recover for sex and
age discrimination pursuant to a claim for wrongful discharge under her
employer's comprehensive general liability policy which allowed recovery for
"bodily injury." E-Z Loader, 106 Wash.2d at 903-06. The term "bodily injury" was
defined in the general liability policy, similar to the present case, as "bodily injury,
sickness or disease . .. ." Id. at 904. The court concluded that the employee
coverage contemplated actual bodily injury, sickness or disease resulting in
physical impairment, as contrasted to mental impairment, ]d at 908. The court
reasoned that the terms "sickness" and "disease" were modified by the word
"bodily" and therefore, "[m]ental anguish and illness, and emotional distress are
not covered by the express terms of the . . . policy." Id. The court declined to
stretch the policy to the point to where it would cover such problems.
Daley. 135 Wash. 2d at 786.6
The court also cited with approval our decision in Northwest Farm Bureau
Insurance Co. v. Roberts. 52 Wash. App. 888, 765 P.2d 328 (1988):
6The Daley court concluded the term "bodily" modifies the other terms in the
definition of bodily injury. Daley, 135 Wash. 2d at 787.
-16-
69356-5-1/17
Division One of the Court of Appeals has followed E-Z Loader finding that,
similar to the argument made in the present case, an insured's homeowners
policy which allowed damages for "bodily injury" did not encompass an insured's
claim for negligent infliction of emotional distress. Northwest Farm Bureau fins.
Co. v. Roberts], 52 Wn. App. [888.1 891T.785 P.2d 328 (1988)]. Like the policy at
issue here, the homeowners policy in Northwest Farm Bureau defined "bodily
injury" as "physical harm, sickness or disease . ..." Id Thus, courts in
Washington and elsewhere have found that coverage for "bodily injury" does not
include claims for purely emotional distress and we find that the present case
does not warrant a different result.
Daley, 135 Wash. 2d at 787.
Here, Roberts's policy defines "bodily injury" in terms substantially similar to the
definition of bodily injury discussed in Daley and the cases Daley cites. Those
authorities construe such policy language to exclude emotional harm from coverage.
Because the outrage claim alleges emotional harm, the Grange policy triggers no duty
to defend under the bodily injury provisions.
Tortious Interference Claims
Roberts contends the complaint alleged "two untested theories of tort recovery:
(1) Tortious interference with expected inheritance and (2) tortious interference with the
relationship between an adult child and parent." Appellant's Br. at 25. Roberts argues,
"It is unknown whether or not the innovative tortious interference torts claimed by
Brandis will, if recognized in Washington, require proof of intention to cause the
consequential harm, or just proof of the intention to undertake the harmful act, or simply
proof of reckless disregard or even merely negligence." Appellant's Br. at 26-27. Citing
the rule that any uncertainty favors defense of the insured, Roberts contends that
-17-
69356-5-1/18
"where the tort claimed is new to Washington, and could include elements that would be
covered by the Policy, the Insurer must provide coverage." Appellant's Br. at 27.
Grange responds that although no Washington case has yet recognized the tort
of interference with expected inheritance, the tort is a logical extension of Washington's
already-recognized cause of action for tortious interference with an economic
relationship. That tort requires a showing of intentional conduct. Grange cites as
authority the jurisdictions that have adopted the tort of interference with expected
inheritance. Those cases hold this tort is equivalent to a claim for tortious interference
with an economic relationship. Grange claims the same logic applies to a minor child's
claim of tortious interference with a parent-child relationship, a tort requiring intentional
conduct. According to Grange, requiring a claimant to establish intentional conduct in
the context of an adult child's interference claim is a logical extension of Washington's
rule applicable to a minor child's claim.
Roberts "concede[s] that the overwhelming majority, and perhaps all, jurisdictions
which have considered the two tortious interference claims (inheritance, adult
child/parental relationship) require an intentional act." Appellant's Reply Br. at 8-9.
Nevertheless, Roberts claims, "Unless and until a published Washington case sets forth
the elements of the untested interference claims, the elements of those claims remain
uncertain" and "uncertainty with respect to coverage must be resolved in favor of the
insureds." Appellant's Reply Br. at 9.
-18-
69356-5-1/19
Interference with Expected Inheritance
No Washington case has adopted the tort of interference with expected
inheritance, although other jurisdictions have recognized this tort or extended the tort of
interference with a business expectancy to include inheritance expectancy. Washington
recognizes the tort of interference with a business or economic expectancy, which
consists of five elements: (1) existence of a valid contractual relationship or business
expectancy, (2) defendants had knowledge of that relationship, (3) intentional
interference inducing or causing a breach or termination of the relationship or
expectancy, (4) defendants interfered for an improper purpose or used improper means,
and (5) resultant damage. Leingang v. Pierce County Med. Bureau, Inc., 131 Wn.2d
133,157, 930 P.2d 288 (1997); See also 6A Washington Pattern Jury Instruction:
Civil 352.02, at 477 (6th ed. 2012). Particularly important here, the tort requires
intentional interference.
Multiple jurisdictions have adopted tortious interference with an expected
inheritance and have uniformly held that the tort is equivalent to tortious interference
with an economic relationship. See Lindberg v. U.S., 164 F.3d 1312, 1319 (10th Cir.
1999) ("The elements of the tort [of intentional interference with inheritance] are quite
uniform across jurisdictions that have recognized it."); Allen v. Hall, 328 Or. 276, 282,
974 P.2d 199 (1999) ("Ultimately, an expectancy of inheritance is an interest that fits by
logical extension within the concept underlying the tort of intentional interference with
prospective economic advantage and, absent some legitimate reason for excluding it,
may be deemed to be covered by that theory of recovery."); Sonja A. Soehnel, Liability
-19-
69356-5-1/20
in Damages for Interference with Expected Inheritance or Gift. 22 A.L.R. 4th 1229, § 3
(1983 & Supp. 2013) (summarizing cases).
Further, the Restatement (Second) of Torts describes "Intentional Interference
with Inheritance or Gift" and lists cases in jurisdictions that recognize this tort. See
Restatement (Second) of Torts § 774B (1979). The Restatement and those
jurisdictions recognizing the tort agree that this is only an intentional tort and that it
"does not purport to cover liability for negligence ...." Restatement (Second) of
Torts § 774B cmt. a; Allen, 328 Or. at 282-85; Harmon v. Harmon, 404 A.2d 1020,
1024-25 (Me. 1979); Peffer v. Bennett, 523 F.2d 1323, 1325 (10th Cir. 1975); Allen v.
Levbourne, 190 So. 2d 825, 828-29 (Fla. App. 1966). No jurisdiction has adopted a tort
of negligent interference with an inheritance. See Cardenas v. Schober, 783 A.2d 317,
324n.2(Pa. Super. 2001).
Roberts agrees that Grange's policy excludes defense coverage for intentional
torts but contends that because Washington has not yet recognized tortious interference
with expected inheritance, we cannot be sure what its elements would be. Roberts
claims that given this "uncertainty," Grange cannot rely on out-of-state authority to
refuse a defense. Appellant's Br. at 27.
Our Supreme Court has rejected the argument that an insurer may refuse to
defend based on its own interpretation of Washington case law. In Woo, the insurer
relied on a formal written legal opinion by attorney Stephen G. Skinner, who advised
that the insurer had no duty to defend based on two Washington Court of Appeals
cases. Woo, 161 Wash. 2d at 60. Skinner's opinion acknowledged, however, that neither
-20-
69356-5-1/21
case was entirely on point and that a reviewing court might conclude they apply only in
other contexts. Woo, 161 Wash. 2d at 60. Our Supreme Court disapproved of the
insurer's reliance on this "equivocal" legal advice:
[The insurer's] reliance on Skinner's equivocal advice regarding the
application of [the Court of Appeals cases] to this case flatly contradicts one of
the most basic tenets of the duty to defend. The duty to defend arises based on
the insured's potential for liability and whether allegations in the complaint could
conceivably impose liability on the insured. Truck Ins., 147 Wash. 2d at 760. An
insurer is relieved of its duty to defend only if the claim alleged in the complaint is
"clearly not covered by the policy." Id Moreover, an ambiguous complaint must
be construed liberally in favor of triggering the duty to defend.
[The insurer] is essentially arguing that an insurer may rely on its own
interpretation of case law to determine that its policy does not cover the
allegations in the complaint and, as a result, it has no duty to defend the insured.
However, the duty to defend requires an insurer to give the insured the benefit of
the doubt when determining whether the insurance policy covers the allegations
in the complaint. Here, [the insurer] did the opposite—it relied on an equivocal
interpretation of case law to give itself the benefit of the doubt rather than its
insured.
Woo. 161 Wn.2dat60.
In Alea, our Supreme Court considered out-of-state authority when determining
whether an insurer had a duty to defend. There, the insurance policy excluded "assault
and battery" from the insurer's duty to defend. Alea, 168 Wash. 2d at 406. The issue was
whether postassault negligence by the insured's employees gave rise to a duty to
defend. Alea, 168 Wash. 2d at 407. Because Washington courts had not yet considered
this factual scenario, the court turned to out-of-state authority. Alea, 168 Wash. 2d at 407-
08. The court recognized that "[m]any states have found a preassault/postassault
distinction in analyzing 'assault and battery' exclusions." Alea, 168 Wash. 2d at 407. After
analyzing the out-of-state authority, the court recognized a "pattern of holding an insurer
-21-
69356-5-1/22
to a duty to defend in the case of postassault negligence . . . ." Alea, 168 Wash. 2d at 408.
As to its reliance on out-of-state cases, the court reasoned:
[The insurer] contends that persuasive out-of-state precedent should not
trump binding in-state law. We agree. However, as the Court of Appeals noted,
Washington courts have yet to consider the factual scenario before us today.
Evaluation of out-of-state cases was appropriate in deciding which rule to apply.
The lack of any Washington case directly on point and a recognized distinction
between preassault and postassault negligence in other states presented a legal
uncertainty with regard to [the insurer's] duty. Because any uncertainty works in
favor of providing a defense to an insured, [the insurer's] duty to defend arose
when [the underlying plaintiff] brought suit against [the insured].
Alea. 168Wn.2dat408.
The court also analyzed several cases cited by the insurer and "disagree[d] that
any causal connection whatsoever between an assault or battery and subsequent
negligence would suffice to render the resultant injuries 'clearly not covered.'" Alea, 168
Wash. 2d at 408-09. The court concluded:
[The insurer's] interpretation of Washington lawfails to persuade us that
its interpretation of the contract is correct. We find persuasive precedent from
other states that have found claims that the insured acted negligently after an
excluded event are covered. Further, a balanced analysis of the case law should
have revealed at least a legal ambiguity as to the application of an "assault and
battery" clause with regard to postassault negligence at the time [the insured]
sought the protection of its insurer, and ambiguities in insurance policies are
resolved in favor of the insured. Because such ambiguity is to be resolved in
favor of the insured, we hold that [the insurer's] policy afforded coverage for
postassault negligence to the extent it caused or enhanced [the underlying
plaintiff's] injuries.
Alea, 168 Wash. 2d at 410-11 (citations omitted).
Under Alea, when Washington authority is silent regarding a particular claim or
cause of action, courts may consider persuasive authority when determining an
insurer's duty to defend. Alea did not end its duty to defend analysis when faced with a
-22-
69356-5-1/23
novel tort claim. The court analyzed persuasive authority, discerned a trend, and
imposed a duty to defend based on the existence of that trend and the lack of any
Washington guidance. Alea held that the persuasive authority conflicted with the
insurer's position, creating a legal uncertainty that triggered the duty. The court so held
because the persuasive authority on which the insured relied showed that coverage
could be triggered ifWashington followed the trend established by the other
jurisdictions. We are unpersuaded by Roberts's argument that the duty to defend
triggers whenever a claimant alleges a novel tort theory.
Unlike in Alea, here, the persuasive authority supports the insurer's denial of the
duty to defend. Roberts cites no authority to the contrary and concedes that "the
overwhelming majority, and perhaps all, jurisdictions" recognizing this tort require an
intentional act. Appellant's Reply Br. at 8. No legal uncertainty or ambiguity exists that
requires construction in favor of the insured. To prevail on the interference claim,
Brandis must prove intentional, not accidental, conduct. Further, Brandis made no
allegation that Jane accidentally committed the tort. Brandis alleged that harm resulted
from Jane's acts of "fraud, undue influence, and tortious interference." Read liberally in
the context of the entire complaint, these allegations involve intentional or deliberate
conduct. Because the Grange policy excludes intentional conduct, the trial court
properly concluded that no duty to defend Roberts extends to Grange.
Tortious Interference with Parent-Child Relationship
Alea also controls the resolution of this claim. While no Washington Supreme
Court case precisely recognizes a cause of action for malicious interference with family
-23-
69356-5-1/24
relations,7 we have dealt with a minor child's claim in Waller v. State, 64 Wash. App. 318,
338, 824 P.2d 1225 (1992). There, we identified a "trend in the law" that began with our
decision in Strode v. Gleason, 9 Wash. App. 13, 510 P.2d 250 (1973). The elements of a
claim for tortious interference with a parent-child relationship are (1) the existence of a
family relationship, (2) a wrongful interference with the relationship by a third person,
(3) an intention on the part of the third person that such wrongful interference results in
a loss of affection or family association, (4) a causal connection between the third
parties' conduct and the loss of affection, and (5) that such conduct resulted in
damages. Waller, 64 Wash. App. at 338 (citing Strode. 9 Wash. App. at 14-15. The intent
element cannot be met by merely showing reckless conduct. Instead, as we explained
in Waller, intent in the context of an alienation of affections claim requires the plaintiff to
prove "malice—that is, an intent that [the plaintiff] lose the affection of his or her family.
Waller. 64 Wash. App. at 339.
Roberts claims that Washington has not yet recognized a cause of action for
tortious interference with a parent-child relationship in the context of an adult child and
argues without citation to authority that such "[u]ntested torts should trigger a duty to
defend." Appellant's Reply Br. at 8 (boldface omitted). In addition to our discussion
above, we note that Roberts provides no argument or citation to authority explaining
why Washington would apply a different standard when the tort is committed against an
adult child. To the contrary, our courts have refused to distinguish between adult and
7 In Tvner v. State Department of Social and Health Services. 141 Wash. 2d 68, 1
P.3d 1148 (2000), our Supreme Court permitted a parent to sue the state for damage to
the parent-child relationship.
-24-
69356-5-1/25
minor children when analyzing other torts. See Ueland v. Reynolds Metals Co., 103
Wash. 2d 131, 132, 139-40, 691 P.2d 190 (1984) (holding that children have a separate
cause of action for loss of parental consortium when a parent is injured through the
negligence of another and refusing to limit recovery for loss of parental consortium to
minor children dependent on the parent); Kramer v. Portland-Seattle Auto Freight, Inc.,
43 Wash. 2d 386, 397, 261 P.2d 692 (1953) (allowing a child in wrongful death action to
recover for loss of parental consortium beyond the period of minority).
The tort of interference with a parent-child relationship cannot be committed
accidentally or negligently. Further, as discussed above, Brandis did not allege
accidental conduct. Brandis claimed that Jane "actively interfered" and "intentionally
interfere^]" with their relationships. These allegations encompass deliberate,
intentional action.8 The trial court properly concluded that no duty to defend Roberts
against such allegations extended to Grange.
8As persuasive authority, see Drake v. Mutual of Enumclaw Insurance Co., 167
Or. App. 475, 1 P.3d 1065 (2000), which addressed facts remarkably similar to those in
the present case. In Drake, the insureds (husband and wife) were sued by the wife's
sister, who alleged that the insureds exerted undue influence over the wife's mother
such that the mother disinherited the sister. Drake, 167 Or. App. at 477. The insurer,
Mutual of Enumclaw, rejected the insured's tender of defense. Drake, 167 Or. App. at
477. The insureds sued for a judgment, declaring that Mutual had a duty to defend
them, and Mutual moved for summary judgment, arguing that the insureds' claims
"alleged only intentional conduct and, therefore, did not allege an 'occurrence' under the
policies." Drake, 167 Or. App. at 477. The trial and appellate courts agreed with
Mutual. In affirming, the Oregon Court of Appeals invoked the rule of inferred intent:
Thus, even if it were theoretically possible to commit the civil wrongs of undue
influence, breach of fiduciary duty, and interference with economic relations
without intending to injure another person, allegations concerning the manner in
which those wrongs were committed by plaintiffs may require the inference that
harm was intended. . . .
-25-
69356-5-1/26
Defamation
Roberts argues that Brandis's defamation allegation9 falls within Grange's policy
coverage for personal and advertising injury. Grange contends that the "knowing
violation of rights of another" and "material published with knowledge of falsity" policy
exclusions apply. Resp't's Br. at 17 (capitalization omitted).
Defamation is concerned with compensating the injured party for damage to
reputation. Eastwood v. Cascade Broad. Co., 106 Wash. 2d 466, 471, 722 P.2d 1295
(1986). A defamation plaintiff must show four essential elements: (1) falsity, (2) an
unprivileged communication, (3) fault, and (4) damages. Demopolis v. Peoples Nat-
Bank of Wash., 59 Wash. App. 105, 108, 796 P.2d 426 (1990). "The burden of proof on
the element of fault depends on the nature of the defamed party." Demopolis, 59 Wn.
App. at 108 n.1. When the defamed party is a public figure or public official, he or she
must show that the defamatory statement was made with actual malice—that is, made
with "actual knowledge of its falsity or with reckless disregard for its truth or falsity."
Herron v. KING Broad. Co., 112 Wash. 2d 762, 775, 776 P.2d 98 (1989). If the defamed
The claim for undue influence makes clear that plaintiffs intended to injure
[the sister]."
Drake, 167 Or. App. at 482.
9We question whether Brandis's complaint adequately states a claim for
defamation. While Brandis alleges that Jane made "false statements" and "false
accusations" and "badmouthed" them, Brandis's request for relief mentions no
defamation claim and requests no judgment for damages based on such a claim. See
Ralph v. State Dep't of Natural Res., 171 Wash. App. 262, 266, 286 P.3d 992 (2012),
review granted, 176 Wash. 2d 1023 (2013) ("The nature of a claim for relief is determined
by the facts alleged in the complaint and as adduced thereunder, and by the relief
reguested.'" (emphasis added) (quoting Silver Surprize, Inc. v. Sunshine Mining Co., 74
Wash. 2d 519, 522, 445 P.2d 334 (1968)).
-26-
69356-5-1/27
party is a private figure, only negligence need be shown. Demopolis, 59 Wash. App. at
108 n.1. In the defamation context, negligence means that the defendant "'knew or, in
the exercise of reasonable care, should have known that the statement was false or
would create a false impression in some material respect.'" Maison de France, Ltd. v.
Mais Qui!, Inc., 126 Wash. App. 34, 44, 108 P.3d 787 (2005) (quoting Vern Sims Ford,
Inc. v. Hagel, 42 Wash. App. 675, 680, 713 P.2d 736 (1986)).
As discussed above, the complaint alleges:
Jane actively interfered with the relationship between Elizabeth and her family
and friends, including her other children. Jane made false statements about and
"badmouthed" those other parties in order to so intentionally interfere with their
relationships. Jane's behavior towards the other family members, including
making false accusations regarding prior child abuse claims, went beyond the
bounds of decency, atrocious, and intolerable.
Roberts first contends that Grange's "Knowing Violation of Rights of Another" exclusion
does not apply. That provision excludes personal and advertising injury "[c]aused by or
at the direction of an insured with the knowledge that the act would violate the rights of
another and would inflict personal and advertising injury." Roberts argues,
The exclusion does not apply. The underlying Complaint does not allege
that Mrs. Roberts knew both that her alleged defamation would violate the rights
of another arid would slander Brandis. At most, the Complaint urges that Mrs.
Roberts "actively" and "intentionally" interfered with relationships by
"badmouthing" the underlying plaintiffs. Grange casually applies the Brandis
allegation of intentionality to the slander, but the Complaint itself only references
the intentionality with respect to the charge of interference with relationships.
Appellant's Br. at 19 (citations omitted); see also Appellant's Reply Br. at 10. Roberts
thus contends that because the complaint does not allege Jane acted intentionally in
-27-
69356-5-1/28
making false statements and "badmouthing" the other parties, the defamation claim,
construed liberally, conceivably alleges negligent rather than intentional conduct.
For similar reasons, Roberts also contends that Grange's exclusion for "Material
Published With Knowledge Of Falsity" does not apply. That provision excludes personal
and advertising injury "[ajrising out of oral or written publication of material, ifdone by or
at the direction of an insured with knowledge of its falsity." Roberts argues that the
complaint fails to allege that she knew her alleged statements were false. Thus, a
negligence standard applies.
The complaint, read liberally in its entire context, alleges intentional and
deliberate conduct. As to the defamation claim, the complaint alleges that Roberts
made false statements about the other parties that went beyond the bounds of decency
"in order to so intentionally interfere with their relationships." The complaint states no
prima facie claim of negligence and solely refers to intentional, deliberate conduct. To
state a claim for negligence, the underlying complaint must allege facts that support a
conclusion that the conduct was negligent. See McLeod v. Grant County Sch. Dist. No.
128, 42Wn.2d 316, 319, 255 P.2d 360 (1953) ("In order to state a cause of action for
negligence, it is necessary to allege facts which would warrant a finding that the
defendant has committed an unintentional breach of a legal duty, and that such breach
was a proximate cause of the harm."). The complaint states no such facts. Read in
context, the complaint alleges only intentional torts and, thus, Roberts's knowledge of
the falsity of her statements may be implied. See Marooles v. Hubbart, 111 Wash. 2d 195,
-28-
69356-5-1/29
215, 760 P.2d 324 (1988) ("evidence of hostility or spite is clearly relevant" in
determining whether defamation defendant acted with knowledge of falsity).
Further, the allegation of intent and calculation to injure ("in order to so
intentionally interfere") implies that regardless of whether Roberts knew her statements
were false, she made the statements knowing that Brandis's rights would be violated
and that personal and advertising injury would occur. The complaint alleged more than
merely false statements. It alleged that Roberts made false statements for a specific
tortious purpose. Relevant here, the policy defines personal and advertising injury as
"injury . . . arising out of. .. [o]ral or written publication, in any manner, of material that
slanders or libels a person .. . ."10 The complaint clearly alleges that the injury arising
out of Roberts's false statements was intentional interference in Brandis's family
relationships. Read in context, the complaint alleges conduct indicating that Roberts
intended and knew that her statements would cause interference in Brandis's personal
relationships (thus violating Brandis's rights). Under the policy's plain language, this
interference injury is "personal and advertising injury" because it arose from a statement
that allegedly slandered Brandis, i.e., "tend[ed] to injure the reputation of a person
referred to in it." Black's Law Dictionary 449 (8th ed. 1999). Under the facts alleged,
Roberts intended the statements to injure Brandis's reputation with respect to their
mother and intended the damaged reputation to result in relationship injury. Grange's
10 Black's Law Dictionary defines "slander" as "[a] defamatory assertion
expressed in . . . speech." Black's Law Dictionary 1421 (8th ed. 1999). It defines
"defamatory statement" as "[a] statement that tends to injure the reputation of a person
referred to in it." Black's Law Dictionary 449 (8th ed. 1999).
-29-
69356-5-1/30
policy excludes such conduct from the duty to defend.11 The trial court properly granted
summary judgment on the defamation claim.
Separate Versus Community Liability
In her reply brief, Roberts contends for the first time that Grange's policy applies
separately to each insured. Roberts contends Grange owes Roberts a defense
because the complaint alleges tortious conduct committed by only Jane Roberts, and
which benefited her own separate property.
An appellate court "may refuse to review any claim of error which was not raised
in the trial court." RAP 2.5(a); Roberson v. Perez. 156 Wash. 2d 33, 39, 123 P.3d 844
11 Woo, discussed above, does not require a different result. There, regarding
the policy's general liability provision for bodily injury, the dentist argued that the
plaintiff's complaint "should be construed liberally in his favor as triggering a duty to
defend because the complaint alleged both intentional and negligent conduct resulting
in bodily injury." Woo. 161 Wash. 2d at 63. The complaint alleged conduct that was "likely
intentional" but also alleged three negligent causes of action. Woo. 161 Wash. 2d at 64.
The court relied heavily on the specific bodily injury policy exclusion language requiring
that the dentist intend both the event or happening of photographing the plaintiff with
boar tusk flippers but also the injuries that resulted, and concluded that under the facts
alleged, it was conceivable that the dentist did not intend his conduct to result in the
plaintiff's injuries. Woo. 161 Wash. 2d at 64.
Regarding the insurance policy's "[e]mployment practices liability provision," Woo
claimed that Fireman's had a duty to defend because the plaintiff's complaint could
"reasonably be read to include allegations of negligent acts that led to an involuntary or
constructive discharge." Woo, 161 Wash. 2d at 61. The court disagreed, concluding that
the facts alleged did not meet the definition of wrongful discharge under the insurance
policy. Thus, "Fireman's had no duty to defend under [the dentist's] employment
practices liability provision because [the plaintiff's] complaint clearly did not allege
actions that met the definition of wrongful discharge under the policy." Woo, 161 Wash. 2d
at 62.
Unlike in Woo, here, the complaint contains no negligent causes of action and
cannot reasonably be interpreted to include allegations of negligent acts. Our
determination is heavily dependent on the precise wording of the policy, as was the
determination in Woo (interpreting different policy language). On these facts, Grange
owes no duty to defend.
-30-
69356-5-1/31
(2005). Further, we do not consider issues argued for the first time in the reply brief. In
re Marriage of Sacco, 114Wn.2d 1, 5, 784 P.2d 1266(1990). The reply brief is limited
to a response to the issues in the responding brief. To address issues argued for the
first time in a reply brief is unfair to the respondent and inconsistent with the rules on
appeal. RAP 10.3(c); State v. Hudson. 124 Wash. 2d 107, 120, 874 P.2d 160 (1994). We
therefore decline to consider this argument.
Dismissal of Counterclaim
Roberts contends the court erred in dismissing the bad faith counterclaim. As
discussed above, over a year after the trial court granted summary judgment in
Grange's favor, it entered an order formally dismissing Roberts's bad faith counterclaim.
The court dismissed the counterclaim after a hearing on Grange's motion to clarify the
summary judgment order. At the hearing, Grange requested that the court enter an
order nunc pro tunc dismissing Roberts's counterclaim as of July 22, 2011, when
Grange's summary judgment motion was granted and Roberts's motion to stay—based
on the same grounds as the counterclaim—was implicitly denied. Roberts opposed
Grange's motion, arguing that the request for a nunc pro tunc order was simply a gambit
to deny Roberts the opportunity to appeal. When the court asked Roberts's counsel,
"On what basis can your claim of bad faith go forward," counsel responded,
I am not prepared to argue whether there is a basis or not, but I will assume for
the purposes of this argument that the counterclaim cannot go forward. The
question is whether or not the Court has dismissed the counterclaim or not. I
could enter into an agreed order today that the counterclaim is dismissed, and I
would have no problem doing that. What I have a problem with is the suggested
language in Grange's order which seems to provide for a retroactive dismissal of
-31-
69356-5-1/32
the counterclaim and, therefore, the entire case with finality which is an attempt
to preclude my clients from appealing the order on summary judgment.
The fact is that an appeal lies when a final judgment has been entered.
Final judgment has not been entered, and, therefore, I would ask that your court
deny their form of the order. And I would be happy to work with counsel on an
agreed order on the counterclaim as of today's date.
RP (Sept. 21, 2012) at 4-5.
Counsel and the court then engaged in the following discussion:
[COUNSEL]: The prejudice is the loss of the right to appeal.
. . . Grange could have and should have, perhaps, asked the Court to
dismiss the counterclaim. It did not. The counterclaim simply wasn't dismissed.
There's nothing in this record indicating that it was, in fact, dismissed except for a
logical and legal conclusion that because the summary judgment was granted,
therefore, logically, and by necessity, the counterclaim could not stand. But that
is not a logical - -
THE COURT: Isn't that form over substance, though? Isn't that just
putting form over substance, something that even CR 1 guides us not to do.
[COUNSEL]: Of course not. I don't believe so.
THE COURT: Nothing exists in the counterclaim.
[COUNSEL]: And you can so find right now.
THE COURT: It didn't exist as of July of 2011.
[COUNSEL]: But the Court did not find that as of July 2011.
THE COURT: I found it by implication. I found it by application.
THE COURT: I am not prepared to enter an order nunc pro tunc
amending a July order.
I think we would - - I'm prepared to take her up on her offer that the matter
is dismissed. The counterclaim. Or else I can sign an order denying the
clarification and leave this thing open. Frankly, I think they're going to be hard-
pressed to convince the Court of Appeals that they have any appellate rights on
a claim that hasn't existed by operation of law.
RP (Sept. 21, 2012) at 7-9. Counsel indicated she would be "happy if the Court formally
dismissed the counterclaim." RP (Sept. 21, 2012) at 9. The court then entered an order
formally dismissing the counterclaim.
-32-
69356-5-1/33
On appeal, Roberts claims that because the trial court's dismissal order
articulates no basis for its decision, "[t]he inference is that the trial court concluded that
a counterclaim for bad faith could not proceed where the Insurer prevailed in the
coverage action." Appellant's Br. at 30.
The record indicates Roberts never presented argument or evidence to the trial
court regarding why the counterclaim had merit or should not be dismissed. See CP
281-85 (Roberts's response to Grange's motion for clarification). The September 21,
2012 hearing transcript clearly shows that the issue raised at the hearing was whether
the counterclaim was formally dismissed for appeal purposes. Even when prompted by
the court, Roberts gave no basis for allowing the bad faith counterclaim to go forward.
Roberts's counsel clearly asked the court to formally dismiss the counterclaim so that
Roberts could appeal the summary judgment order. The court noted it could either
dismiss the counterclaim or leave it open, to which counsel responded, "I'd [be] happy if
the Court formally dismissed the counterclaim." RP (Sept. 21, 2012) at 9. Roberts did
not ask the court to leave the matter open, consider the counterclaim's merits, or
address it other than to dismiss it. Roberts also failed to refute Grange's argument that
when the court denied the motion to stay, it "implicitly found that the factual basis for the
counterclaim wasn't true." RP (Sept. 21, 2012) at 8.
We "may refuse to review any claim of error which was not raised in the trial
court." RAP 2.5(a); Roberson, 156 Wash. 2d at 39. Roberts raised none of her appellate
arguments at the trial court's dismissal hearing, and we can decline to consider them on
appeal. Roberts also specifically asked the court to formally dismiss the counterclaim
-33-
69356-5-1/34
rather than keep the claim open. Under the invited error doctrine, a party may not set
up an error at trial and then complain of it on appeal. In re Pers. Restraint of
Thompson, 141 Wash. 2d 712, 723, 10 P.3d 380 (2000). The doctrine applies when a
party takes affirmative and voluntary action that induces the trial court to take an action
that party later challenges on appeal. Thompson, 141 Wash. 2d at 723-24. Roberts
cannot complain that the trial court dismissed the counterclaim for the "wrong reason"
when she (1) affirmatively asked the court to dismiss the claim rather than keep it open
and (2) failed to argue the merits of the claim when prompted by the court.12 We
decline to address the counterclaim's merits.
Attorney Fees and Costs
Roberts request an award of attorney fees and costs on appeal, citing RAP 18.1
and Olympic Steamship Co. v. Centennial Insurance Co., 117 Wash. 2d 37, 52-53, 811
12 Roberts cites Lavigne v. Chase, Haskell, Haves, & Kalamon, P.S., 112 Wn.
App. 677, 50 P.3d 306 (2002), to argue that she did not "set up" an error. There, the
respondent argued that the appellant invited dismissal when it conceded to the trial
court that an adverse evidentiary ruling "eviscerated" its case and that summary
judgment was appropriate. Lavigne, 112 Wash. App. at 681. We held that the invited
error doctrine did not apply in those circumstances:
The doctrine does not apply here because [appellant] did not "set up" an
error. When the verbatim of the summary judgment hearing is viewed in context,
it is apparent [appellant] felt compelled by the trial court's negative evidentiary
ruling to go along with resolution by summary judgment. [Appellant] did not
concede the merits of its case, and the trial court agreed on that point. It would
be unfair to characterize [appellant's] counsel's exasperated comment that the
trial court's evidentiary ruling "eviscerated" [appellant's] case as constituting a
waiver of the merits of their case.
Lavigne, 112 Wash. App. at 682.
The facts here are different. Roberts clearly asked the court to dismiss the
counterclaim so she could appeal the summary judgment ruling. Roberts affirmatively
chose not to present the counterclaim's merits and declined the trial court's offer to keep
the matter open. This constitutes invited error.
-34-
69356-5-1/35
P.2d 673 (1991). Olympic Steamship provides that an insured successfully suing an
insurer to obtain coverage may also recover reasonable attorney fees necessarily
incurred in the endeavor. See McRory v. N. Ins. Co. of New York, 138 Wash. 2d 550, 980
P.2d 736 (1999) (quoting Olympic Steamship, 117 Wash. 2d at 52-53). Given our
disposition, we deny Roberts's request for appellate attorney fees and costs.
CONCLUSION
Because the Brandis complaint, construed liberally, alleges no claims
conceivably covered by the insurance policy Grange issued to Roberts, Grange had no
duty to defend Roberts in the underlying action. We affirm summary judgment
dismissal and deny Roberts attorney fees and costs on appeal.
WE CONCUR:
^cke^.
-35-