by Michael R. Sohigian
ACCIDENT Two cases pending before the
California Supreme Court will address
liability insurance coverage for accidental
consequences of intentional acts
t may seem like a truism that liability insurance only covers accidents. But it’s not always true. In certain nonac-
I cidental circumstances, including alleged assaults and batteries committed in self-defense, California’s courts have
consistently held that insurers are duty bound to defend policyholders. Two cases now before the California Supreme
Court, Delgado v. Interinsurance Exchange and Jafari v. EMC Insurance Companies, raise a related issue: When
a liability policy covers injury arising from an “occurrence,” which is deﬁned as an “accident,” does the insurer
have a duty to defend an action for assault if the complaint alleges the insured was acting under an unreasonable and
negligent belief that he or she was acting in self-defense?1 The outcome may alter decades-old authority concerning cov-
erage for unexpected and unintended damages of intentional acts.
Much litigation over the issue has been and continues to be waged. In fact, after the supreme court granted the insur-
ers’ petitions for review in Delgado and Jafari, the Second District Court of Appeal handed down two decisions address-
ing insurers’ duty to defend claims for alleged intentional acts. In one, the court of appeal continued to apply a strict stan-
dard to intentional acts of a sexual nature and held that the insurer was not obligated to defend the insured against such
claims.2 In the other, more recent decision, the court distinguished an alleged intentional act from its accidental conse-
quences, and held the insurer was obligated to defend a suit for consequential damages.3
The standard commercial (formerly comprehensive)4 general liability (CGL) policy provides coverage for “damages
because of bodily injury or property damage…caused by an occurrence.” The term “occurrence” is often deﬁned as “an
accident, including continuous or repeated exposure to substantially the same general harmful conditions.” The policy
Michael R. Sohigian, a sole practitioner in Los Angeles, specializes in civil litigation with an emphasis on real estate, employment, pro-
bate, insurance coverage, and public licensing.
20 Los Angeles Lawyer November 2008
Los Angeles Lawyer November 2008 21
also typically provides an exclusion of coverage for “bodily injury or dant duty bound to defend its insured, the Mullen court stated, “It
property damage neither expected nor intended by the insured.”5 is now settled that injuries resulting from acts committed by an
Additionally, Insurance Code Section 533 provides that “[a]n insured in self-defense are not ‘intended’ or ‘expected’ within the mean-
insurer is not liable for a loss caused by the wilful act of the insured; ing of those terms as customarily used in an exclusionary clause.”17
but he is not exonerated by the negligence of the insured, or of the The Delgado court also cited David Kleis, Inc. v. Superior Court,
insured’s agents or others.” This deceptively simple statute is followed in which the court of appeal observed, “If the insured mistakenly
by more than 40 pages of annotations. Indeed, the alleged commis- believed that he had a right to defend himself, or was mistaken with
sion of an intentional act is probably the most common ground for regard to the extent with which he could use force, the act would not
an insurer’s denial of tender or reservation of rights, and policy- be intentional and coverage would exist” because “the focus [is
holders and insurers have been ﬁghting over it for at least 50 years.6 placed] upon the mental state of the insured when undertaking a course
Gray v. Zurich Insurance Company is the seminal case in which of conduct.”18 The Delgado court also relied upon Grain Dealers
the supreme court recognized that “the carrier must defend a suit which Mutual Insurance Company v. Marino, in which the court held an
potentially seeks damages within the coverage of the policy.”7 Dr. insurer obligated to defend claims for acts that were allegedly inten-
Vernon Gray, the insured, tendered to Zurich, his insurer, a lawsuit tional and stated, in pertinent part, that “[i]f an insured acted in self-
that had been ﬁled against him for assault arising out of a road-rage defense, although he intended the act, he acted by chance and with-
altercation between him and another driver.8 Gray advised Zurich that out a preconceived design to inﬂict injury just as though he were acting
he had acted in self-defense, after the plaintiff left his vehicle, intentionally, although negligently, and injured someone.”19
approached Gray’s car, and jerked open the door. Zurich denied ten- About four months after the Second District issued its opinion in
der on the ground that the complaint alleged an intentional tort. Delgado, a different division of the same court published Jafari. The
The court held Zurich was obligated to defend Gray and to pay plaintiff in Jafari was an individual doing business as an auto repair
the judgment awarded against him in the suit Gray tried and lost at shop.20 The plaintiff was sued for damages because his employee
his own expense. The opinion rested on a number of legal and fac- allegedly struck a customer.21 The employee admitted he did so but
tual grounds. Among them were the court’s ﬁnding that Zurich’s pol- contended his action was in self-defense because he feared for his per-
icy failed clearly to deﬁne the application to the duty to defend of the sonal safety and his life.22
exclusion of coverage “for bodily injury or property damages caused The plaintiff was insured under a garage operations liability pol-
intentionally by or at the direction of the insured,” particularly in view icy that provided coverage for “damages because of bodily injury or
of coverage language promising to “pay on behalf of the insured all property damage…caused by an accident and resulting from garage
sums which the insured shall become legally obligated to pay as operations.”23 The policy did not deﬁne “accident.”24 The trial court
damages because of bodily injury or property damage.”9 granted the insurer’s summary judgment motion on the grounds that
In support of its legal analysis, the Gray court cited multiple there was no coverage and thus no duty to defend.25 The court of
cases for the proposition that an act that may be “intentional” or “will- appeal concluded, based on existing case law, that allegedly intentional
ful” in legal terms does not necessarily fall outside insurance cover- conduct in self-defense can be deemed accidental within the cover-
age.10 The court observed that Gray “might have been able to show age provision of the policy because the defensive conduct was pro-
that in physically defending himself, even if he exceeded the reason- voked by the unexpected and unintended acts of a third party.26
able bounds of self-defense, he did not commit willful and intended The court of appeal therefore reversed summary judgment for the
injury, but engaged only in nonintentional tortious conduct.”11 In the insurer.27
42 years since Gray was decided, courts have repeatedly cited it for As in Delgado, the court in Jafari cited Gray and Mullen. The Jafari
the proposition that CGL coverage may be available for intentional court also cited Lowell v. Maryland Casualty Company, in which the
acts committed under circumstances of self-defense.12 California Supreme Court repeated its statement in Gray that “even
if the insured’s conduct may traditionally be classiﬁed as an ‘inten-
Delgado and Jafari tional’ or ‘wilful’ tort, many cases have held that such conduct falls
The Delgado case currently pending before the supreme court arises within the indemniﬁcation coverage.”28
out of allegations somewhat similar to those in Gray. Delgado is an Interestingly, however, the Jafari court appeared to rest its hold-
insurance bad faith action under Insurance Code Section 11580. In ing mostly on cases the insurance company had relied on—cases in
the underlying action Delgado sued Reid, who was insured by the Auto which no duty to defend or indemnify was found because the con-
Club, for damages allegedly resulting from an assault and battery that, duct at issue was intentional. For example, the Jafari court cited and
Delgado alleged, Reid had committed, albeit unreasonably, in self- analyzed Merced Mutual Insurance Company v. Mendez,29 in which
defense. Reid tendered Delgado’s suit to the Auto Club, which the court of appeal affirmed summary judgment on the ground that
rejected it on the grounds that there was no “occurrence” but rather the insurance company had no duty to defend or indemnify its pol-
an intentional, unprovoked attack that was not an accident and thus icyholder, Mendez, against allegations of intentional and negligent
was excluded under the terms of his policy and Section 533. Reid and assault and battery and intentional and negligent inﬂiction of emo-
Delgado stipulated to judgment for Delgado on his claim for negli- tional distress stemming from acts of oral copulation and attempted
gence, with a covenant not to execute and an assignment of Reid’s oral copulation.30
claims against the Auto Club for failure to defend.13 In Jafari, the court noted the Mendez court’s rejection of “the notion
The trial court sustained the Auto Club’s demurrer to Delgado’s it was enough for the injury to have been unintended to be deemed
subsequent bad faith action,14 but the Second District Court of an ‘accident’ within the meaning of the insuring clause,” and approv-
Appeal reversed.15 The court cited no fewer than seven cases to sup- ingly quoted language from Mendez:
port its conclusion that the facts alleged in the underlying action against “In terms of fortuity and/or foreseeability, both ‘the means as
Reid presented the possibility of coverage under the policy.16 Those well as the result must be unforeseen, involuntary, unexpected
cases included Gray and Mullen v. Glens Falls Insurance Company. and unusual.’ We agree coverage is not always precluded
Mullen was a coverage action arising from a suit against Mullen for merely because the insured acted intentionally and the victim
alleged injuries that resulted from a ﬁght that the court viewed as hav- was injured. An accident, however, is never present when the
ing been started—for all Mullen’s insurer could have known—by the insured performs a deliberate act unless some additional,
plaintiff, whom Mullen struck in self-defense. In holding the defen- unexpected, independent, and unforeseen happening occurs that
22 Los Angeles Lawyer November 2008
produces the damage. Clearly, where the insured acted delib- The Jafari court concluded that “properly viewed, even deliber-
erately with the intent to cause injury, the conduct would not ate acts of self-defense in response to unexpected, unforeseen and unin-
be deemed an accident. Moreover, where the insured intended tended events by the third party are ‘accidents’ and give rise to the
all of the acts that resulted in the victim’s injury, the event may potential for liability under the policy, and hence the obligation to pro-
not be deemed an ‘accident’ merely because the insured did vide a defense.”38
not intend to cause injury. Conversely, an ‘accident’ exists when On August 3, 2007, the supreme court granted review of Delgado
any aspect in the causal series of events leading to the injury and did the same for Jafari on November 12, 2007, but deferred con-
or damage was unintended by the insured and a matter of for- sideration of the case pending the outcome of Delgado. The parties
tuity.”31 (and amici) have fully briefed the Delgado case, but as of November
The Jafari court also distinguished Quan v. Truck Insurance 2008, oral argument had not been scheduled.
Exchange,32 another case involving allegations that the insured com-
mitted sexual assault and rape, for the same reasons it found Mendez The Wright Concerns
inapposite: “Because the sexual assault was deliberate, the Quan Court Meanwhile, the courts of appeal continue to consider cases involv-
concluded there was no ‘accident’ within the meaning of the policy ing allegedly intentional acts and policyholders’ claims that their
and thus no coverage.”33 It quoted language from Quan rejecting the insurance companies owe duties to defend or indemnify. In March
possibility that the insurer might be held liable for physical injuries 2008, the court of appeal issued its opinion in Lyons v. Fire Insurance
caused by “accidentally” touching, kissing, embracing, or having sex Exchange.39 The court cited Mendez and Quan in echoing the hold-
with the claimant and emphasized a part of that language: “nor is there ings of those cases that allegations of false imprisonment in the con-
any additional ‘happening’ to combine with these necessarily delib- text of sexual assault raised no potential of coverage under the CGL
erate acts so as to produce an ‘accident’ giving rise to bodily injury.”34 policy the defendant had issued to the plaintiff—a former Major
Thus the Jafari court found “the deﬁnitions provided in [Mendez League Baseball player known to his teammates as “Psycho.” The
and Quan] [did] not foreclose the possibility acts in self-defense can claims therefore triggered no duty to defend.40
be an ‘accident’ and thus fall within the coverage provision of the pol- Lyons ﬁts into a long line of cases rejecting a defense or indem-
icy.” Indeed, the court read those opinions to “support the ﬁnding nity against claims of sexual molestation.41 But in cases involving less
[that] acts in self-defense can be an ‘accident’ where the third party’s prurient facts, claims for damages that are unintentional and unex-
actions provoking the self-defense response were the unforeseen and pected consequences of an intentional act are held to trigger the
unexpected element in the causal chain of events making the insured’s insurer’s duty to defend.42
acts in self-defense unplanned and involuntary. Under these courts’ For example, State Farm Fire and Casualty Company v. Superior
deﬁnitions,” the court reasoned, “it is the unexpectedness of the Court (Wright) arose from the tender of an action against State
third party’s actions which creates the ‘accident’ within the meaning Farm’s insured for personal injuries the plaintiff suffered when the
of the coverage clause.”35 insured threw him into a swimming pool, and he landed on the
In Jafari, the court understood the Gray decision as a statement pool’s cement step and broke his collarbone.43 State Farm rejected ten-
that courts must take the broad view of any incident raising the der on the grounds that the plaintiff’s injuries were not caused by an
question of self-defense when determining whether there has been an “occurrence” or “accident” as the policy deﬁned those terms.44 The
unexpected and unintended force, or happening, in the causal chain insured settled the underlying action and assigned all rights under his
of events creating the “accident.” Therefore, according to Jafari, policy to the plaintiff.45
“the third party’s actions prompting an insured to act in self-defense At the trial of the plaintiff’s action against State Farm, the court
are part of the causal chain of events leading to potential injury. In found the insured did not intend to injure the plaintiff but rather sim-
the usual case the third party’s actions which prompt the need to pro- ply wanted to get him wet. As recounted by the appellate court, “the
tect self or others will be the unintended, unexpected, unplanned and trial court recited the rule that when an injury is an unexpected or
unforeseen event constituting the ‘accident.’”36 Further, the court unintended consequence of the insured’s conduct, it may be charac-
stated: terized as an accident for which coverage exists.”46 Because the
The provoking party’s actions are an integral part of the over- injury was neither expected nor intended, the trial court ruled State
all incident. The insured’s response in self-defense often will be Farm owed a duty to defend its insured against the allegations of the
intentional when the insured fears serious bodily harm or underlying action.47
death. Other times the insured could be acting purely reﬂex- The Wright court started its analysis by noting the meaning of the
ively in responding to the third party’s real or perceived threat. term “accident” in insurance law is not settled.48 The court reviewed
In this sense, the insured’s acts in self-defense are involuntary, a number of cases, including Quan, and arrived at the conclusion that
not wrongful, and triggered by the unexpected and unforeseen “an accident can exist when either the cause is unintended or the effect
threat presented by the provoking third party.37 is unanticipated.” The court cited with approval the Mendez deﬁn-
Los Angeles Lawyer November 2008 23
ition of “accident” that Jafari, too, had policies would be illusory.55 37 Cal. App. 4th 1035, 1048 (1995); Delgado v.
Interinsurance Exch., 152 Cal. App. 4th 671, 684
emphasized, requiring an unintended and The analyses in Wright and Jafari seem
(2007); Jafari v. EMC Ins. Cos., 155 Cal. App. 4th 885,
fortuitous aspect in the causal series of events intuitively correct. They are also consistent 888 (2007).
leading to the injury or damage.49 with the test the California Supreme Court 13 Delgado, 152 Cal. App. 4th at 676-77.
14 Id. at 678-79.
The court described a series of illustrative applied in Montrose Chemical Corporation
15 Id. at 676.
paradigms. In one, a batter hits a baseball dur- v. Superior Court.56 In holding the plaintiff
16 Id. at 681-86.
ing a game with the intention of hitting a had established facts triggering the insurer’s 17 Mullen, 73 Cal. App. 3d at 170.
home run but, because of his stance and the duty to defend it against claims arising from 18 David Kleis, Inc. v. Superior Court, 37 Cal. App. 4th
angle of contact between bat and ball, sends alleged discharges of toxic chemicals from the 1035, 1048 (1995).
it through a window in foul territory instead. plaintiff’s manufacturing plant, the court 19 Grain Dealers Mut. Ins. Co. v. Marino, 200 Cal. App.
In another, an intentionally speeding driver recited a “test for ‘expected’ damage[:] 3d 1083, 1088 (1988) (internal quotations omitted).
20 Jafari v. EMC Ins. Cos., 155 Cal. App. 4th 885, 888
negligently hits another car. Both are acci- whether the insured knew or believed its con-
dents, according to Wright. In the baseball duct was substantially certain or highly likely 21 Id. at 889.
paradigm, one of the aspects in the causal to result in that kind of damage.”57 22 Id. at 889-91.
series of events—too much force at an inad- Nobody ever threw someone in a swim- 23 Id. at 889.
24 Id. at 890, 891.
vertent angle—was unintended by the batter ming pool, or punched a threatening person
25 Id. at 891.
and thus fortuitous. The second paradigm in the nose, because he or she had insurance. 26 Id. at 894.
was chosen from the Mendez opinion, in But insurance ought to cover people for the 27 Id. at 902.
which the court explained that “the act consequences of things they do that, due to 28 Lowell v. Maryland Cas. Co., 65 Cal. 2d 298, 301-
directly responsible for the injury—hitting unforeseen factors (including an unprovoked 02 (1966).
29 Merced Mut. Ins. Co. v. Mendez, 213 Cal. App. 3d
the other car—was not intended by the dri- attack), cause damage to others. That is cer-
ver and was fortuitous. Accordingly, the tainly what a policyholder would reasonably 41 (1989).
30 Id. at 44.
occurrence resulting in injury would be expect.58 31 Jafari, 155 Cal. App. 4th at 898-99 (quoting Mendez,
deemed an accident.”50 In line with these expectations, three courts 213 Cal. App. 3d at 50) (emphasis in original) (citations
The Wright court likened the plaintiff’s in the state’s largest appellate district have in omitted)).
claim to the paradigms. State Farm’s insured the last year alone found the potential for cov- 32 Quan v. Truck Ins. Exch., 67 Cal. App. 4th 583
deliberately picked up Wright and threw him erage in nominally intentional acts. There (1998).
33 Jafari, 155 Cal. App. 4th at 899.
into the pool, but he did not intend or expect are plainly good reasons to provide such cov- 34 Id. (citing Quan, 67 Cal. App. 4th at 601) (empha-
the consequence that Wright would land on erage. The supreme court will have the last sis in original).
a step and be injured. “[T]he act directly word, of course. It could decide to reject 35 Id. at 899.
responsible for [the plaintiff’s] injury, throw- some 50 years of precedent, or it could fol- 36 Id. at 900.
ing too softly so as to miss the water, was an low the reasoning of Jafari and the concerns
unforeseen or undesigned happening or con- expressed in Wright. ■ 39 Lyons v. Fire Ins. Exch., 161 Cal. App. 4th 880
sequence and was thus fortuitous,” the court (2008).
concluded.51 “The event here was an accident 1 Delgado v. Interinsurance Exch., 152 Cal. App. 4th 40 Id. at 889-90.
because not all of the acts, the manner in 671 (2007) (review granted); Jafari v. EMC Ins. Cos., 41 See J.C. Penney Cas. Ins. Co. v. M.K., 52 Cal. 3d
which they were done, and the objective 155 Cal. App. 4th 885 (2007) (review granted). 1009 (1991); Coit Drapery Cleaners, Inc. v. Sequoia Ins.
2 Lyons v. Fire Ins. Exch., 161 Cal. App. 4th 880
accomplished transpired exactly as Lint [the Co., 14 Cal. App. 4th 1595 (1993); Merced Mut. Ins.
(2008). Co. v. Mendez, 213 Cal. App. 3d 41 (1989); Horace
policyholder] intended.”52 3 State Farm Fire & Cas. Co. v. Superior Court
Mann Ins. Co. v. Barbara B., 61 Cal. App. 4th 158
The Wright court distinguished many of (Wright), 164 Cal. App. 4th 317 (2008). (1998); Quan v. Truck Ins. Exch., 67 Cal. App. 4th 583
4 Compare Bank of the West v. Superior Court, 2 Cal.
the cases on which State Farm relied as involv- (1998); Northland Ins. Co. v. Briones, 81 Cal. App. 4th
ing sexual harassment or sexual assault, or 4th 1254, 1258 (1992) (construing advertising injury 796 (2000).
coverage under “[c]omprehensive general liability 42 State Farm Fire & Cas. Co. v. Superior Court
claims in which “the insured intended all of
insurance policies”), with Buss v. Superior Court, 16 (Wright), 164 Cal. App. 4th 317 (2008).
the acts in the causal chain, including the Cal. 4th 35, 39 (1997) (resolving “issues relating to 43 Id. at 321.
injury.”53 And it rejected “State Farm’s argu- standard commercial general liability insurance poli- 44 Id. at 321-22.
ment that we should apply ‘fortuity’ solely to cies, which were formerly called comprehensive general 45 Id. at 322.
the act causing the injury without reference liability insurance policies”). 46 Id. at 323 (citing Interinsurance Exch. v. Flores, 45
5 See DIMUGNO & GLAD, CALIFORNIA INSURANCE LAW
to the injury, [because it] would result in no Cal. App. 4th 661, 669 (1996)).
HANDBOOK 1095-98 (2008). 47 Id.
coverage at all.”54 6 See Gray v. Zurich Ins. Co., 65 Cal. 2d 263, 273 n.12 48 Id. at 325 (citing Hogan v. Midland Nat’l Ins. Co.,
The court observed: (1966) (string cite of cases “recogniz[ing] that an act 3 Cal. 3d 553, 559 (1970)).
In State Farm’s analysis, there could which under the traditional terminology of the law of 49 Id. at 328 (citing Merced Mut. Ins. Co. v. Mendez,
never be a covered event because all torts is denominated ‘intentional’ or ‘wilful’ does not 213 Cal. App. 3d 41, 50 (1989)).
necessarily fall outside insurance coverage,” leading 50 Id. (citing Mendez, 213 Cal. App. 3d at 50).
batters deliberately seek to hit base-
with Firco, Inc. v. Fireman’s Fund Ins. Co., 173 Cal. 51 Id. at 329 (emphasis in original) (citations omit-
balls and therefore engage in inten- App. 2d 524 (1959)). ted).
tional acts, regardless of whether the 7 Id. at 275. 52 Id. (emphasis in original).
property damage, namely, breaking 8 Id. at 267. 53 Id.
9 Id. at 266-67.
windows, was intended. Likewise, 54 Id. at 330.
10 Id. at 273 n.12. 55 Id.
there would never be a covered occur-
11 Id. at 277. 56 Montrose Chem. Corp. v. Superior Court, 6 Cal. 4th
rence when an injury is occasioned 12 See, e.g., Lowell v. Maryland Cas. Co., 65 Cal. 2d
by a negligent driver, who obeys the 298, 301-02 (1966); Mullen v. Glens Falls Ins. Co., 73 57 Id. at 304-05.
laws of the road, nevertheless miscal- Cal. App. 3d 163, 171 (1977); Clemmer v. Hartford 58 See Bank of the West v. Superior Court, 2 Cal. 4th
culates a lane change and hits another Ins. Co., 22 Cal. 3d 865, 887 (1978); Grain Dealers 1254, 1264-65 (1992) (Ambiguous policy provisions
car. Under State Farm’s analysis all Mut. Ins. Co. v. Marino, 200 Cal. App. 3d 1083, should be interpreted to protect the insured’s objectively
1088 (1988); Jacobs v. Fire Ins. Exch., 36 Cal. App. 4th reasonable expectations.).
accident-based automobile insurance
1258, 1269 (1995); David Kleis, Inc. v. Superior Court,
24 Los Angeles Lawyer November 2008