Expert Advocacy

New Court of Appeal Case: Horseplay Around Pool an “Accident” Under Homeowners’ Insurance

On Friday, the California Court of Appeals denied State Farm Insurance’s Petition for Writ of Mandate seeking to have the trial court issue judgment in favor of the insurance company. At issue in the case, titled State Farm Fire and Casualty Co. v. Superior Court, was whether the trial court erred in ruling that State Farm owed a duty to defend its’ insured from a lawsuit for personal injuries where its’ insured threw the victim into a pool, landing on an exposed step.

An insurance company’s duty to defend it’s insured is extremely broad. It is broader than the duty to pay a covered loss. The duty to defend applies to any claim that could possibly involve a covered loss.

In this case, the insureds’ 21 year-old son, who lived with the insureds, argued with another young man, Mr. Wright, at a party. When Wright went outside, the son grabbed Wright and picked him up and threw him into the shallow end of the swimming pool. Wright landed on the pool’s concrete step which was above the water line. As a result of this action, Wright fractured his right clavicle and was hospitalized for four days. The son apologized immediately to Wright and claimed that he was just horse-playing.

The son was later arrested for the incident and pled nolo contender to misdemeanor battery.

Wright then sued the son seeking compensation for his injuries. The claim was tendered to the parents’ homeowners’ insurance policy with State Farm. The policy covered “damages because of bodily injury…caused by an occurrence” with an “occurrence” being defined as “an accident…which results in a. bodily injury; or b. property damage.”

State Farm denied a defense to the parents on several grounds, including:

The claim against you does not meet the insuring agreement in the policy, as the actions do not arise out of an accident. Also, the policy specifically excludes damages which are either expected or intended by the insured or the result of willful and malicious conduct.” In short, State Farm treated the son’s actions as a willful assault rather than mere horseplay.

The Court of Appeals upheld the trial court’s ruling that State Farm acted improperly when they denied the parents with a defense to Wright’s claims. The Court found that under the stipulated facts, an “accident” did occur which would give rise to the duty to defend. The Court held that although the son intentionally picked up Wright and threw him at the pool, the son did not intend or expect the consequence (that Wright would land on a step). Therefore, the duty to defend existed because Wright’s injury was neither expected nor intended by the son, nor was it the result of a malicious act by the insured.