Liberty Mutual Fire Insurance v. Kenneth Harris

NOT RECOMMENDED FOR FULL TEXT PUBLICATION
File Name: 13a0133n.06
No. 11-5548
FILED
Feb 05, 2013
UNITED STATES COURT OF APPEALS DEBORAH S. HUNT, Clerk
FOR THE SIXTH CIRCUIT
LIBERTY MUTUAL FIRE INSURANCE )
COMPANY, )
)
Plaintiff-Appellee, )
) On Appeal From the United States
v. ) District Court for the Western
) District of Kentucky
KENNETH R. HARRIS and )
KATHRYN L. HARRIS, )
)
Defendants, )
)
and )
)
RODGER BUNKER, )
)
Defendant-Appellant. )
______________________________________________________________________________
Before: MARTIN and DAUGHTREY, Circuit Judges; MALONEY, District Judge.*
PER CURIAM. Liberty Mutual Fire Insurance Company filed a declaratory judgment action
in the United States District Court for the Western District of Kentucky. The action comes to federal
court under the diversity statute. The Harrises reside in Kentucky, Rodger Bunker resides in
Arizona, and Liberty Mutual is a Wisconsin corporation with its principle place of business in
Delaware. Liberty Mutual sought a declaration that the homeowner’s policy it issued to Kenneth and
Kathryn Harris did not cover a physical altercation between Kenneth Harris (“Harris”) and Bunker.
*
The Honorable Paul L. Maloney, Chief United States District Judge, United States District
Court for the Western District of Michigan, sitting by designation.
Bunker opposed the motion and sought a continuance. The underlying altercation occurred in
September 2006 in Scottsdale, Arizona. At the time of the incident, Harris was 73 years old and
Bunker was 61 years old. Harris was subsequently prosecuted and convicted of two counts of
aggravated assault.
In addition to the criminal action, Harris was also subject to a civil action in the Arizona
courts, which ultimately led to this lawsuit. Bunker sued Harris in the Arizona courts over the
altercation. The Harrises notified Liberty Mutual about the lawsuit. Liberty Mutual declined to
provide coverage. Because Harris did not respond to Bunker’s motion for summary judgment,
Harris was found liable for negligence, assault, battery, and intentional infliction of emotional
distress. A trial on the damages resulted in a judgment in Bunker’s favor for approximately
$500,000.
Bunker filed several suits attempting to collect the judgment, including a garnishment
proceeding in the Arizona courts against Liberty Mutual and an action in the Kentucky courts to
register the Arizona judgment and secure a judgment lien against Harris’s assets in Kentucky. Harris
and Bunker entered into an agreement in which, in part, Harris assigned to Bunker any rights and
claims Harris had against Liberty Mutual.
Liberty Mutual then initiated this lawsuit in federal court. Liberty Mutual filed, and
prevailed, on a motion for declaratory judgment. The district court denied Bunker’s request for a
continuance. Bunker filed this appeal.
The district court carefully analyzed the language of the homeowner’s policy and Kentucky
law. The district court relied on an opinion of the Kentucky Supreme Court, Cincinnati Insurance
Co. v. Motorists Mutual Insurance Co., 306 S.W.3d 69, 73 (Ky. 2010), in which the Court concluded
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that a commercial general liability policy did not provide coverage for faulty workmanship. The
policy defined the word “occurrence” as “an accident, including continuous or repeated exposure
to substantially the same general harmful conditions.” Because the policy did not define the word
“accident,” the Kentucky Supreme Court gave that word its plain and ordinary meaning. The
Kentucky Supreme Court held that, inherent in the plain meaning of the word “accident” is the
doctrine of fortuity, which consists of two central aspects: intent and control. Id. at 74. The district
court correctly noted that the word “occurrence” in the homeowner’s policy was the same as the
definition of “occurrence” in the policy in Cincinnati Insurance. Following Cincinnati Insurance,
the district court gave the word “accident” its plain and ordinary meaning, and applied the doctrine
of fortuity. The district court held that the underlying altercation or incident between Harris and
Bunker was not an occurrence, as that term is defined under the homeowner’s policy. The district
court noted that no party had argued that Harris lost control of his own body during the altercation
when Bunker was injured.
In this situation, Harris’s intent, or lack of intent, to cause injury during the underlying
altercation does not determine whether the policy provides coverage. The policy language on which
Bunker relies falls under the portion of the policy excluding from coverage any bodily injury that is
expected or intended by an insured. Where a policy does not initially provide coverage, a court need
not consider the application of an exclusion. Cincinnati Ins., 306 S.W.3d at 78 n.35. Furthermore,
the authority on which Bunker relies, James Graham Brown Found., Inc. v. St. Paul Fire & Marine
Ins. Co., 814 S.W.2d 273, 275 (Ky. 1991), involved an insurance policy that included, in the
definition of “occurrence,” the expectations or intentions of the insured. On the basis of the different
definitions of “occurrence,” in Cincinnati Insurance, the Kentucky Supreme Court distinguished the
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insurance policy then before the Court from the insurance policy before the Court in James Graham
Brown. Cincinnati Ins., 306 S.W.3d at 78. Because of the “materially different definition of
occurrence,” the Court found the holding in James Graham Brown “of, at most, limited value in
determining” whether there was an “occurrence.” Id. (emphasis in original). The same conclusion
applies here.
The district court did not err in granting Liberty Mutual’s motion for declaratory judgment
after finding that the homeowner’s policy did not provide coverage for the underlying altercation
between Harris and Bunker. Bunker’s claim that the Federal Rules of Civil Procedure do not
authorize a motion for declaratory judgment does not require this Court to reverse the district court.
Such a claim puts form over substance. As explained above, we find no error in the resolution of
questions of law by the district court. Similarly, we conclude that the district court did not err in
resolving the questions of fact. Assuming, for the sake of argument only, that Liberty Mutual
attached inadmissible exhibits to its motion, the district court did not clearly rely on any inadmissible
exhibit in its resolution of the motion. Without dispute, a physical altercation, a fight, occurred
between Harris and Bunker. The record contains no assertion by any party, and no evidence to
support such an assertion, that Harris did not or could not control his actions during the altercation.
Applying these facts to the language of the policy, under Kentucky law, we conclude that there was
no occurrence that triggered coverage.
AFFIRMED.
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