In its September 16, 2013 decision in Mount Vernon Fire Insurance Corp. v. Oxnard Hospitality Enterprise, Inc., the California Court of Appeal (Second Appellate District, Division Three) held that the battery exclusion in an insurance liability policy applied to a case where there was no “body-to-body” contact.
Oxnard owned a nightclub. Roberta Busby worked as a dancer at the nightclub. Busby was seriously injured when a person threw a glass full of a flammable liquid on her and set her on fire. Busby sued Oxnard for negligence.
Oxnard sought coverage from Mount Vernon Fire Insurance Corp., Oxnard’s liability insurer. Mount Vernon’s policy excluded coverage for battery which the policy defined as “negligent or intentional wrongful physical contact with another without consent that results in physical or emotional injury.” Based on the exclusion, Mount Vernon refused to cover Busby’s claim against Oxnard.
Busby’s lawsuit against Oxnard was resolved by a $10 million stipulated judgment against Oxnard. Oxnard assigned all of its rights against Mount Vernon to Busby.
Mount Vernon sought a judgment declaring that it had no duty under the policy to pay any damages that were awarded against Oxnard in Busby’s lawsuit. Busby argued that the battery exclusion required actual “body-to-body” physical contact; and since that did not occur, the exclusion did not apply and there was coverage under the policy. Mount Vernon argued otherwise. The insurer argued that “physical contact means the union or junction of things that have a material existence, or the touching of material things” and does not mean “body-to-body” contact. The trial court ruled in favor of Mount Vernon.
The Court of Appeal affirmed the trial court’s ruling. The court concluded that the battery exclusion “is free from ambiguity.” The court observed, “Had her assailant struck Busby with a closed fist, there could be no argument that such a striking was not a ‘battery’ under Oxnard’s policy. Could the answer be any different if that fist contained a glass container that was used to strike Busby? Certainly no reasonable person would make such an argument. How, then, could or should the result be any different if the glass container were filled, as in this case, with a flammable substance used to set Busby afire? … Neither Oxnard, nor its assignee Busby, could have had reasonable expectations to the contrary.”
A copy of the Court of Appeal’s opinion is available at www.courts.ca.gov