United States District Court, E.D. Pennsylvania
AUSTIN MCHUGH UNITED STATES DISTRICT JUDGE
a declaratory judgment action brought by an insurance company
against its insured, a bar, and the plaintiffs in an
underlying wrongful death action, arising out of a stabbing
incident that occurred near the bar. Nautilus Insurance
Company seeks a declaration that it does not have a duty to
defend or indemnify Owen's Café because of a
policy exclusion for bodily injury that arises from an
assault, battery, or physical altercation. Both Owen's
Café and plaintiffs in the underlying case seek to
characterize the complaint in that action so as to avoid the
exclusion, primarily relying on QBE Insurance Corporation
v. M & S Landis Corp., 915 A.2d 1222, 1224 (Pa.
Super. 2007). But because the policy exclusion here is much
broader than the exclusion in Landis, I am compelled
to grant Judgment on the Pleadings in favor of Nautilus.
the death of Thomas C. Ewing, his parents brought a
wrongful death and survival action in the Philadelphia Court
of Common Pleas against Defendants Owen's Café and
Shawn Szrankowski [hereinafter “Owen's”]. The
underlying complaint, pleads that Mr. Ewing was stabbed to
death by one Angelo Maldonado on August 7, 2015. (Pl.'s
Ex. 3-22, ECF No. 1-2 .) The chain of events began when Ewing
and other patrons took a bottle from behind the bar,
ostensibly without paying for it. In response, Owen's
employees directed Maldonado, a regular customer of the bar,
to confront the patrons who had taken the bottle. Shortly
after leaving the bar, Ewing was confronted by Maldonado, and
he stabbed Ewing multiple times. The complaint asserts that
the incident “resulted solely from the
negligence” of Owen's employees, in that they were
aware of Maldonado's violent history and had served him
alcohol despite his being both visibly intoxicated and a
minor, rendering it entirely foreseeable that he would
confront the other patrons in a manner that would result in
severe injuries or death. The Ewings' complaint was
skillfully crafted to make Owen's negligent conduct in
bringing about their son's death the focus of the
presented the claim to Nautilus Insurance Company, which
proceeded to defend Owen's against the underlying action
under a reservation of rights. Nautilus now moves for
Judgment on the Pleadings on the basis of the assault and
battery exclusion mentioned above.
Controlling Legal Standard
proper construction of an insurance policy is resolved as a
matter of law in a declaratory judgment action, ”
QBE Ins. Corp. v. Walters, 148 A.3d 785, 787 (Pa.
Super. 2016), particularly where the existence of coverage is
not the subject of dispute in the underlying state court
action, Homesite Ins. Co. v. Neary, 2017 WL 5172294,
at *3 (E.D. Pa. 2017). A motion for judgment on the pleadings
is properly granted in a contract case, if the moving party
clearly establishes that it is entitled to judgment as a
matter of law. DiCarlo v. St. Mary Hosp., 530 F.3d
255, 259 (3d Cir. 2008). I must view the facts presented in
the pleadings and the inferences to be drawn therefrom in the
light most favorable to Defendants, as the non-moving party,
and grant the motion only if Defendants would not be entitled
to relief under any set of facts that could be proved
consistent with the allegations made in the complaint.
Oxford Assocs. v. Waste Sys. Auth. of E. Montgomery
Cty., 271 F.3d 140, 144 (3d Cir. 2001) (citing Green
v. Fund Asset Mgmt., L.P., 245 F.3d 214, 220 (3d Cir.
terms of the insurance policy and the allegations in the
underlying third party complaint are determinative. J.H.
France Refractories Co. v. Allstate Ins. Co., 534 Pa.
29, 43, 626 A.2d 502, 510 (1993). The insurer is required to
accept all of the allegations contained in that complaint as
true and provide a defense if the possibility exists that the
alleged injury could be covered. Selective Way Ins. Co.
v. Hosp. Grp. Servs., Inc., 119 A.3d 1035, 1046 (Pa.
Super. 2015) (en banc). Where the insurer relies on
a policy exclusion as the basis for denying coverage, it has
the burden of proving the exclusion applies, with such
exclusions being strictly construed against the insurer and
in favor of the insured. See Swarner v. Mutual Ben.
Group, 72 A.3d 641, 645 (Pa. Super. 2013).
the claim clearly falls with the policy's definition of
“bodily injury, ” Nautilus argues that an
exclusion for injuries arising out of an assault, battery, or
physical altercation applies. The exclusion states,
Regardless of culpability or intent of any person, this
insurance does not apply to ‘bodily injury',
‘property damage', ‘personal and advertising
injury' or medical payments arising out of any (1) actual
or alleged assault or battery; (2) physical altercation; or
(3) [a]ny act or omission in connection with the prevention
or suppression of such acts, including the alleged failure to
provide adequate security.
and Battery Exclusion, Pl.'s Ex. 59, ECF No. 1-2. The
exclusion applies regardless of whether such damages are
caused by any “insured, employee, patron, or any other
person, ” and so long as the damages occurred at any
“premises owned or occupied by any insured.”
Id. It specifically excludes from coverage both the
obligation to indemnify and the obligation to defend.
read, the underlying complaint falls within the language of
this exclusion. Notwithstanding skillful pleading by
Ewing's counsel as to the role played by Owen's in
causing this tragedy, by any objective measure the injuries
leading to Ewing's death at least in part arose out of an
assault, battery, or physical altercation. It strains
credulity to assert otherwise, when the complaint expressly
states that “Ewing was confronted by a visibly
intoxicated Angelo Maldonado who stabbed him multiple times
resulting in his death.” (Ewing Compl. ¶ 26,
Pl.'s Ex. 8, ECF No. 1-2.)
assert that the policy is ambiguous because of Nautilus's
failure to include a definition of ‘assault,'
‘battery,' ‘physical altercation,' or
‘arise out of' in the policy. But those terms have
both common meaning and legal definition. When challenged at
oral argument to identify what further clarification would be
necessary for a policyholder to comprehend the scope and
applicability of the exclusion, defense counsel could only
reply that “assault” and “battery”
are legal terms of art. Yet to the extent that they are, such
terms are defined by Pennsylvania law. Recently, my colleague
Judge Savage applied Pennsylvania definitions of
“Trafficking, ” “Rape, ” and
“Simple Assault” in determining the applicability
of this same exclusion to claims that a motel's employee
allowed unlawful conduct to take place on its premises.
Nautilus Ins. Co. v. Motel Mgmt. Servs., Inc., d/b/a
Neshaminy Inn & E.B., 2018 WL 2363594, at *4-6 (E.D.
Pa. 2018). See also Markel Int'l Ins. Co. v. 2421
Salam, Inc., 2009 WL 1220557, at *6 (E.D. Pa. 2009)
(citing Essex Ins. Co. v. Starlight Mgmt. Co., 198
Fed.Appx. 179, 183 (3d Cir.2006) for the proposition that the
terms “assault” and “arising out of,
” which were not defined in the policy, were
unambiguous because Pennsylvania law provides a definition),
report and recommendation adopted, 2009 WL 1203341
(E.D. Pa. Apr. 30, 2009); Liberty Surplus Ins. Corp. v.
McFaddens at Ballpark LLC, 116 F.Supp.3d 447, 458 (E.D.
Pa. 2015) ...