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Trustgard Insurance Co. v. Johnson

United States District Court, Third Circuit

June 12, 2013

DANIEL JAMES JOHNSON, et al., Defendants.


CYNTHIA M. RUFE, District Judge.

Plaintiff Trustgard Insurance Company ("Trustgard") seeks a declaration that pursuant to an insurance policy issued to Defendants J. Michael and Kim Johnson, it does not have a duty to defend or indemnify its named insured, Defendant Daniel James Johnson, [1] in an underlying civil action filed against him by Defendant Chester Heights Camp Meeting Association ("Chester Heights"), which arises out of an October 15, 2011 fire. Before the Court are cross-motions for summary judgment filed by Trustgard and Chester Heights.


On the evening of October 15, 2011, Defendant Johnson, who at the time was a twenty-two year old student living with his parents, and several friends, including Defendant Elizabeth S. Hegadorn, were celebrating a friend's birthday at the home of Defendant John Markham Kasper; they sat outdoors around a small fire drinking beer and talking.[3] At about 11:30 p.m., Defendants Johnson, Kasper, and Hegadorn decided to explore the grounds of Chester Heights, a non-profit corporation, whose property consists of several acres with cottages and a Tabernacle, both of which are used by members of the Association for religious activities.[4]

When they arrived on the grounds, Johnson, Kasper, and Hegadorn entered several cottages, which were unlit.[5] In at least one of the cottages, Johnson took a candle and used it to find his way around.[6] Johnson also admits to taking an American flag from one of cottages, lighting it on fire with his lighter, and waiving it around in an effort to make an interesting image for Kasper to capture with his camera.[7] Before leaving the area by the cottages they had entered, Johnson lit a pile of leaves on fire while Kasper took additional pictures.[8]

Once this leaf fire had "mostly died down, " Johnson, Kasper, and Hegadorn walked closer to the Tabernacle. Johnson lit another pile of leaves on fire; the pile was approximately 20 feet from the Tabernacle, and at their height the flames of the fire were three to five feet tall.[9] Johnson, Kasper, and Hegadorn remained on the grounds for about twenty more minutes, before leaving.[10] When the three friends decided to leave, Johnson observed that the fire by the Tabernacle "appeared to be safely dwindling out - there were only a couple of tiny flames (a few inches high) left, " and when he took "one last look" before they left, Johnson "saw [the fire] dissipating, and felt that it was safe to leave."[11] He did nothing, however, to extinguish the fire.[12]

Johnson, Kasper, and Hegadorn left the grounds, stopped for food at a local convenience store, and then returned to Kasper's house, where Johnson spent the night on the couch.[13] Johnson awoke around 11:30 a.m. the following morning and left Kasper's house for his parent's house shortly thereafter.[14] A few hours after returning to his parent's house, Johnson was reading the local news on the internet when he came across an article about a fire on the Chester Heights grounds.[15] He immediately informed his parents what he had done, contacted an attorney the following day, and voluntarily surrendered to authorities a few days later.[16]

A. Criminal Charges

Johnson was interviewed by police and thereafter submitted a written statement dated October 24, 2011.[17] On November 30, 2011, a criminal complaint was filed in the Delaware County Court of Common Pleas charging Johnson with: Burglary;[18] Criminal Trespass;[19] Criminal Mischief;[20] Institutional Vandalism;[21] Reckless Burning;[22] Failure to Control/Report Dangerous Fire;[23] Theft by Unlawful Taking;[24] Arson;[25] Recklessly Endangering Another Person;[26] Public/Private Mutilation of a Flag;[27] and Disorderly Conduct.[28] On July 2, 2012, upon motion by the Delaware County District Attorney, the court admitted Johnson into the Accelerated Rehabilitative Disposition (ARD) first offender program.[29] All charges, with the exception of one trespassing charge, were withdrawn "by stipulation between counsel, " "but shall be reinstated in the event defendant is removed from the ARD program."[30]

B. Underlying Civil Action

On January 18, 2012, Chester Heights filed a civil complaint against Defendants Johnson, Kapser, and Hegadorn in the Delaware County, Pennsylvania Court of Common Pleas asserting claims of negligence (the "Underlying Action").[31] The underlying complaint alleges that on October 15, 2011, Johnson "entered the Camp Meeting Grounds after dark without permission."[32] It further alleges that while on camp grounds he "removed a candle and began lighting fires with a lighter, and then "lit leaves on fire in or near the Tabernacle building."[33] "[T]he embers from the fire at or near the Tabernacle Building caused the Tabernacle to ignite and burn" resulting in a total loss, and "[t]he fire in the Tabernacle then caused fire damage to three nearby cottages."[34] Although the initial complaint in the Underlying Action described Johnson's behavior as "reckless, " the amended complaint does not include this qualification.[35]

C. The Insurance Policy at Issue

Plaintiff Trustgard provided counsel to represent Johnson in the Underlying Action and thereafter, filed this declaratory judgment action pursuant to 28 U.S.C. ยง 2201, seeking a declaration that it does not have a duty to defend or indemnify Johnson in the Underlying Action. The insurance policy, # TH9915710, is a homeowner's policy with an effective policy period from August 22, 2011 to August 22, 2012.[36] Johnson is included as an insured under the Policy. The Policy provides, inter alia, that Trustgard

will pay all sums, up to our limit of liability shown on the Declarations Page for this coverage, arising out of any one loss for which an insured person becomes legally obligated to pay as damages because of bodily injury or property damage, caused by an occurrence covered by this policy. If a claim is made or suit is brought against the insured person for damages because of bodily injury or property damage ...

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