Artful Pleading Allowed To Trigger Liability Coverage

In Erie Insurance Exchange v. Moore, No. 20 WAP 2018 (Pa. April 22, 2020)(Op. by Dougherty, J.)(Dissenting Op. by Mundy, J.), the Court allowed artful pleading of negligence by a Plaintiff in a shooting case to trigger a carrier’s duty to defend the matter.

In this case, the liability carrier sought a declaration that it did not have to defend or indemnify the estate of Harold McCutcheon Jr., who was the alleged shooter in an underlying tragic string of events involving a murder-suicide and injuries to a third person.

With regards to the previous decisions by the lower courts in this matter, a three-judge Superior Court panel had reversed a Washington County trial judge’s decision and had unanimously ruled that, because the injured third person alleged in the Complaint filed in the underlying matter that the shooting was "accidental," the events fit the definition of “occurrence” in the homeowner’s policy that the alleged shooter had with the liability carrier. 

The language in the policy at issue defined an 'occurrence' as “an accident including continuous or repeated exposure to the same general harmful conditions.”

According to the Opinion, the injured Plaintiff alleged in his Complaint that the alleged shooter had left a note outlining his intention to kill his ex-wife and then commit suicide. 

The Plaintiff further alleged that, after the alleged shooter allegedly shot his ex-wife at her house, there was a knock at the front door. The Plaintiff was that person who was knocking on the door.

The Opinion also notes that the Plaintiff had been dating the ex-wife in the time leading up to the incident.

The ex-husband, who was the alleged shooter, pulled the Plaintiff into the house where a fight ensued during which the Plaintiff was shot in the face by the ex-husband. The alleged shooter then shot himself.

In his lawsuit against the shooter, the Plaintiff alleged that the alleged shooter had "negligently, carelessly, and recklessly caused the weapon to be fired." 

Justice Kevin Dougherty, writing for the majority, compared the allegations in the Plaintiff’s Complaint against the policy language and rejected Erie’s contention that McCutcheon’s conduct was deliberate and therefore not covered by the policy. As such, the Court’s ruling resulted in a finding that the carrier had a duty to defend the claims against the alleged shooter and, therefore, possibly a duty to indemnify the Plaintiff for his injuries from this shooting event.

Justice Dougherty wrote, “Contrary to Erie’s view, this surprise encounter with [the Plaintiff] was not part of the insured’s other intentional conduct for purposes of insurance coverage, and in fact, [the Plaintiff] does not seek damages for a fistfight or shoving match,” 

Justice Dougherty also wrote that “[The Plaintiff’s] lawsuit seeks damages for being shot by the insured. Had the policy’s exclusion expressly stated coverage would not apply to incidents involving firearms, or during the commission of a crime, then perhaps there would be no duty to defend the underlying claims by [the Plaintiff]. But the policy does not say this. Instead, it excludes from coverage bodily injury ‘expected or intended’ by the insured, and to the extent this language is ambiguous in the presently alleged factual context, it must be construed in favor of coverage.”

Dougherty was joined by Justices Max Baer, Christine Donohue and David Wecht.

The three Justices on the Supreme Court that could not agree with the Majority’s decision included Chief Justice Thomas Saylor, Justice Debra Todd, and Justice Sallie Updyke Mundy.

In her Dissenting Opinion, Justice Mundy, joined by Chief Justice Saylor and Justice Todd, contended that “the discharge of a weapon during a physical altercation initiated by the insured, while the insured is holding a firearm, is the type of harm specifically excluded under the policy.”

“In my view, artful pleadings cannot form the basis of imposing a duty to defend,” Mundy said. “As the discharge of the firearm under the circumstances alleged in the [Plaintiff’s] complaint does not carry with it the degree of fortuity or unexpectedness necessary to constitute an accidental occurrence, I cannot agree Erie is obligated to afford coverage under the terms of the insurance policies.”

Anyone wishing to review the Majority Opinion in this case may click this LINK.

The Dissenting Opinion can be viewed HERE.

Source: Article - “Deeply Split High Court Says Insurer Must Cover Accidental Shooting During Murder-Suicide” by Zack Needles of the Pennsylvania Law Weekly (April 23, 2020)