Occurrence Must be an Accident

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Beverly Weathersby appealed the trial court’s order awarding summary disposition under MCR 2.116(C)(10) to plaintiff, Meemic Insurance Company (Meemic), and denying its insured, defendant Randal S. Ritchie, personal liability coverage under his homeowner’s insurance policy.

In Meemic Insurance Company v. Randal S. Ritchie, and Beverly Weathersby, No. 358929, Court of Appeals of Michigan (October 20, 2022) the Court of Appeals was asked to resolve the issue of coverage for a claimed assault under a homeowners policy.
FACTUAL BACKGROUND

The case arose out of an unfortunate encounter between two strangers, whose stories of the incident vastly differ. As Weathersby tells it, while making a home visit in rural Coldwater as part of her job as a social worker, she became lost and her GPS erroneously sent her to Ritchie’s house. She pulled her car into Ritchie’s driveway and approached the home. Then, according to Weathersby, Ritchie came out of his house, approached her, and aggressively confronted her while pointing a gun directly at her at close range. He questioned her regarding why she was on his property and told her to leave. Fearing for her life, Weathersby returned to her car and drove away. He testified in his deposition that he approached Weathersby cautiously, helped her locate the proper address, and kept his handgun on his side and pointing toward the ground at all times with his finger off of the trigger. He explained that there was no confrontation at all.

Weathersby brought a civil action against Ritchie, asserting that Ritchie committed the intentional tort of assault. She also claimed that Ritchie was negligent in an apparent effort to dip into Ritchie’s insurance since is always intentional.

She sought damages for the emotional distress and injury she sustained as a result of Ritchie’s conduct. At the time of the incident, Ritchie was insured under a homeowner’s policy issued by Meemic. The trial court denied coverage, ruling that Ritchie’s act was not an “occurrence.”
LEGAL ANALYSIS

The interpretation of an insurance contract is a question of law that is reviewed de novo. An insurance policy is an agreement between parties that a court interprets much the same as any other contract to best effectuate the intent of the parties and the clear, unambiguous language of the policy. The terms of a contract must be enforced as written where there is no ambiguity.
COVERAGE FOR AN “OCCURRENCE”

The main issue in the appeal was whether Ritchie’s alleged acts constituted an “occurrence” under Meemic’s policy, which would trigger an obligation to indemnify and defend Ritchie. To analyze the question, the Court of Appeal needed to turn to the language of the policy.

Meemic was obligated to provide coverage and defend against Weathersby’s lawsuit only if an “occurrence” took place. The Meemic policy defines an “occurrence” as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions, resulting in bodily injury, personal injury, or property damage during the term of the policy.” Thus, the pertinent question is whether Ritchie’s act of pointing a gun at Weathersby and aggressively confronting her could constitute an “accident” that would fall within the definition of an “occurrence.”

Michigan courts have adopted the common meaning of “accident” as an undesigned contingency, a casualty, a happening by chance, something out of the usual course of things, unusual, fortuitous, not anticipated, and not naturally to be expected.

If both the act and the consequences were intended by the insured, the act does not constitute an accident. On the other hand, if the act was intended by the insured, but the consequences were not, the act does constitute an accident, unless the intended act created a direct risk of harm from which the consequences should reasonably have been expected by the insured.

The record contained no evidence from which a court could conclude that Ritchie accidentally pointed his handgun at Weathersby.  On the basis of the record, Weathersby’s alleged emotional injury manifestly resulted from Ritchie’s alleged intentional act of pointing his gun at her.

Weathersby alleged in her complaint that Ritchie aggressively confronted her and pointed a handgun at her at close range without any provocation. Ritchie’s alleged act of pointing his gun at Weathersby intentionally created a direct risk of mortal fear and emotional injury. Therefore, Ritchie reasonably should have expected the consequences of his act because of the risk of harm he created. Therefore, the Court of Appeal concluded that the incident was not an “occurrence” triggering coverage, and Meemic had no duty to indemnify or defend Ritchie.
EXCLUSION FROM COVERAGE

Meemic also contends that it is entitled to summary disposition under MCR 2.116(C)(10) on the basis of a policy exclusion. For that exclusion to apply, an “occurrence” was required to trigger the policy. Since the incident was not an “occurrence” as defined by the policy because a reasonable person in Ritchie’s position should have expected that such conduct would cause an unarmed, nonthreatening stranger severe emotional distress.
THE EFFECT OF THE NEGLIGENCE CLAIM

Weathersby cannot avoid the policy provisions regarding the intentional nature of Ritchie’s conduct by relying upon her pleadings that characterize his conduct as negligent use, or misuse, of a firearm. Whether Weathersby describes Ritchie’s conduct as an assault or negligent conduct, she is suing Ritchie for damages for emotional injury resulting from Ritchie’s intentional acts. In light of the intentional nature of Ritchie’s alleged conduct underlying Weathersby’s claims, the Court of Appeal agreed that Meemic was not obligated to defend and indemnify Ritchie, regardless of whether Weathersby pleaded negligence, assault, or both. The intentional act underlying Weathersby’s claims and the alleged injury were the same under both theories.

The Court of Appeal’s conclusion did not change even if it accepted Ritchie’s version of events as that which is most favorable to Weathersby. Ritchie testified in his deposition that he approached Weathersby cautiously, helped her locate her client’s address, and kept his handgun at his side pointing toward the ground at all times with his finger off the trigger. Under his version of the encounter, coverage would still not be available.

If the finder of fact believed Ritchie’s version, Ritchie (and Meemic) could not be liable for her damages because the lack of proximate cause would defeat her negligence claim. If the finder of fact believed Weathersby’s account, Ritchie would have committed an intentional act that was not covered under the Meemic policy. Thus, no matter whose account is believed, Weathersby cannot conceivably recover under the policy, so the Court of Appeal concluded that Meemic had no duty to defend or indemnify Ritchie.
ZALMA OPINION

Insurance, by definition, only applies to contingent or unknown events. Pointing a gun at a stranger to force removal from one’s property and causing fear of instant death and emotional distress, cannot be contingent, unknown, accidental nor an occurrence. No one can obtain defense or indemnity if there is no occurrence. The Court of Appeal found that ever element of Weathersby’s claim was the intentional conduct of Richie and the attempt to tap into the coverage by alleging negligence did not work because to prove negligence Weathersby still needed to prove Ritchie pointed a gun at her and threatened her life.

(c) 2022 Barry Zalma & ClaimSchool, Inc.

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business. He is available at http://www.zalma.com and [email protected] and receive videos limited to subscribers of Excellence in Claims Handling at locals.com https://zalmaoninsurance.locals.com/subscribe.Subscribe to Excellence in Claims Handling at https://barryzalma.substack.com/welcome.
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