COURT OF APPEALS DECISION DATED AND FILED April 15, 2008 David R. Schanker Clerk of Court of Appeals |
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This opinion is subject to further editing. If published, the official version will appear in the bound volume of the Official Reports. A party may file with the Supreme Court a petition to review an adverse decision by the Court of Appeals. See Wis. Stat. § 808.10 and Rule 809.62. |
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APPEAL
from a judgment of the circuit court for
Before
¶1 PER CURIAM. Steven VerHaagh[1] appeals a judgment declaring Penn America Insurance Company’s commercial general liability policy (“CGL”) provided no coverage for damages arising from a bar fight. VerHaagh argues: (1) the policy in its entirety is contextually ambiguous; (2) the declaration page is ambiguous and illusory; (3) the endorsement page is ambiguous and illusory; and (4) the assault and battery exclusion is ambiguous. We disagree and affirm.
¶2 VerHaagh sought damages resulting from a physical altercation between Scott VerHaagh and two other patrons at The Korner Bar in DePere, which resulted in Scott sustaining a fatal injury. Various defendants were named in a wrongful death suit, including the two patrons involved in the altercation, the bartender, and Edward Farah as the owner of The Korner Bar. Penn America issued a CGL policy to “Edward Farah dba Korner Bar.” Farah tendered to Penn America a copy of the complaint, after which Penn America filed a motion to intervene, bifurcate and stay liability proceedings pending resolution of coverage issues. Penn America subsequently filed a motion for summary judgment, requesting dismissal on the grounds the policy contained an assault and battery exclusion, which precluded a duty to defend or indemnify any defendants in the action. The circuit court granted summary judgment dismissing Penn America and VerHaagh now appeals.
¶3 We review summary judgment decisions de novo and follow the
same methodology as the trial court. See
Brownelli v. McCaughtry, 182
¶4 A provision that is unambiguous in itself may be ambiguous in
the context of the entire policy.
¶5 We turn first to whether the assault and battery exclusion is susceptible to more than one reasonable interpretation. The circuit court concluded the policy language in the assault and battery exclusion was unambiguous. The assault and battery exclusion provides:
ASSAULT AND BATTERY EXCLUSION
This endorsement modifies insurance provided under the following:
COMMERCIAL GENERAL LIABILITY COVERAGE PART COVERAGE A - BODILY INJURY AND PROPERTY DAMAGE LIABILITY COVERAGE B - PERSONAL AND ADVERTISING INJURY LIABILITY COVERAGE C - MEDICAL PAYMENTS COMMERCIAL PROFESSIONAL LIABILITY COVERAGE PART
In consideration of the premium charged it is hereby understood and agreed that this policy will not provide coverage, meaning indemnification or defense costs for damages alleged or claimed for:
“Bodily Injury”, “Property Damage”, “Personal and Advertising Injury”, “Medical Payments or any other damages resulting from assault and battery or physical altercations that occur in, on, near or away from the insured’s premises;
1) Whether or not caused by, at the instigation of, or with the direct or indirect involvement of the insured, the insured’s employees, patrons or other persons in, on, near or away from insured’s premises, or
2) Whether or not caused by or arising out of the insured’s failure to properly supervise or keep the insured’s premises in a safe condition, or
3) Whether or not caused by or arising out of any insured’s act or omission in connection with the prevention or suppression of the assault and battery or physical altercation, including, but not limited to, negligent hiring, training and/or supervision.
4) Whether or not caused by or arising out of negligent, reckless, or wanton conduct by the insured, the insured’s employees, patrons or other persons.
¶6 We conclude the assault and battery exclusion is not
susceptible to more than one reasonable meaning and, in fact, VerHaagh does not
suggest an alternative meaning. The
provision is unambiguous on its face: there is no coverage for “bodily injury”
damages “resulting from assault and battery or physical altercations that occur
in, on, near or away from the insured’s premises. The exclusion focuses on the incident or
injury that gives rise to the claim, not the plaintiff’s theory of
liability. Thus, if the damages incurred
by a third party resulted from the underlying assault and battery, the
exclusion applies. See Berg v. Schultz, 190
¶7 VerHaagh insists the assault and battery exclusion is
illusory. According to VerHaagh, the
policy builds up false expectations because “The policy purports to cover all liability, and then by
exclusion denies potential liability,
including negligence.” Penn America
responds that the policy does not bar coverage, but in fact provides coverage
for third-party liability claims that do not arise out of assault and battery.[2] As examples, Penn America cites unsafe
conditions on the premises, such as the tavern owner’s failure to remove ice
and snow from the walkway, or a customer who is injured as a result of an
employee’s negligent stacking of barstools.
VerHaagh does not reply to this argument and therefore the issue is
deemed conceded. See Charolais Breeding Ranches, Ltd. v. FPC Secs. Corp., 90
¶8 VerHaagh also contends the policy is contextually ambiguous when read in its entirety because “As a tavern owner, Mr. Farah reasonably expected that the claimed exclusions would be clearly and expressly set forth on the Declarations Page.” VerHaagh insists Penn America created an ambiguous and illusory policy by failing to set forth the assault and battery exclusion on the declarations page, but rather “deviously placing” the exclusion eighty-nine pages into the policy.
¶9 We disagree. The first declarations page states in bold print and capital letters that forms and endorsements complete the policy. Moreover, the first declarations page states in bold print and capital letters, just below the list of coverages:
FORM(S) AND
ENDORSEMENT(S) MADE A PART[ ] OF THIS POLICY AT THE TIME OF ISSUE
SEE FORM S901
¶10 The next page of the policy contains the endorsement page labeled “S901.” On the endorsement page is a list of forms, including “S2005 (05/02).” The “Assault and Battery” exclusion form is labeled “S2005 (05/02).” The top of the form is plainly and conspicuously labeled in bold print and capital letters: “ASSAULT AND BATTERY EXCLUSION.” We conclude the circuit court properly determined the policy was not contextually ambiguous.
¶11 VerHaagh also claims the endorsement page is ambiguous because
it “does not supply any feasible information on any exclusions/endorsements to
the Policy other than listing a section of letters and numbers without any
other information….” However, we held in
Ruenger
v. Soodsma, 2005 WI App 79, ¶22, 281
We reject Ruenger’s argument that the failure to identify the UIM endorsement by name next to its number and to specify where in the policy it can be found, together with length of the policy, create contextual ambiguity. A reasonable insured would understand that he or she had to look through the policy to find the pages that addressed each of the types of coverage listed on the … declarations page.
Moreover, in Berg,
the insurance policy included an “assault and battery” exclusion by
endorsement. Berg, 190
¶12 Although organizationally complex, the organization and other relevant provisions of the Penn America policy do not create an objectively reasonable alternative meaning so as to render it contextually ambiguous. There is nothing in the policy that contradicts the provisions in the assault and battery exclusion. Rather, the insured is reminded throughout the policy to read the entire policy. The policy also repeatedly provides that the general grant of coverage may be limited by the exclusions and other provisions within the policy and, further, that the policy is made up of forms and endorsements. These notifications are sufficient to alert a reasonable insured that the declarations are but one part of the whole policy. By reading the entire policy, a reasonable insured finds the endorsements, including the assault and battery exclusion, which is clearly labeled: “ASSAULT AND BATTERY EXCLUSION.” The exclusion was properly applied by the circuit court in this case to preclude a duty to defend or indemnify.
By the Court.—Judgment affirmed.
This opinion will not be published. See Wis. Stat. Rule 809.23(1)(b)5 (2005-06).
[1] Appellants are collectively referred to as “Steven VerHaagh” or “VerHaagh.”
[2] Penn
America also argues that VerHaagh lacks standing to raise the issue because he
is not the insured under the policy.
VerHaagh does not reply to the standing issue. Counsel for Penn America’s insured informed
this court that his client was not participating in the appeal and would not be
filing a brief. On September 4, 2007, we
issued an order that this appeal would be taken under submission without briefs
from the insured. However, we need not
reach the standing issue because we conclude VerHaagh fails on the merits. See Gross v. Hoffman, 227