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Lark v. Western Heritage Insurance Co.

United States District Court, W.D. Virginia. Roanoke Division

October 31, 2014

DERRICK L. LARK, Plaintiff,
v.
WESTERN HERITAGE INSURANCE CO., et al., Defendant, and ANTUAN E. JONES, Plaintiff,
v.
WESTERN HERITAGE INSURANCE CO., et al., Defendant.

MEMORANDUM OPINION

GLEN E. CONRAD, Chief District Judge.

This declaratory judgment action asks the court to determine the amount of insurance coverage available in connection with two tort lawsuits filed by plaintiffs Derrick Lark and Antuan Jones after each was allegedly assaulted outside a restaurant operated by Peck Investments, LLC ("Peck Investments"). The matter is presently before the court on the motion for summary judgment filed by defendant Western Heritage Insurance Company ("Western Heritage"). For the following reasons, that motion will be granted in part and denied in part.

Factual and Procedural Background

The following facts are either undisputed, or, where disputed, are presented in the light most favorable to the plaintiffs. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986) (stating that all evidence must be construed in the light most favorable to the party opposing summary judgment).

I. The Insurance Policy:

At issue in this case is an insurance policy issued by Western Heritage to Tammy Peck, c/o Redford & Peck Enterprises (now Peck Investments), d/b/a Schooners for the contract period of December 22, 2009 to December 22, 2010 ("the policy"). See Insurance Policy, Answer Ex. 2, Docket No. 4-2. The policy provides commercial general liability insurance coverage for Schooners, a restaurant operated by Peck Investments in Roanoke County, Virginia.

Under the terms of the policy, Western Heritage agrees to "pay those sums that the insured becomes legally obligated to pay as damages because of bodily injury'... to which this insurance applies." Answer Ex. 2 at 50. The policy further provides that "[t]his insurance applies to bodily injury'... only if the bodily injury'... is caused by an occurrence' that takes place in the coverage territory.'" Id . An "occurrence, " in turn, is defined as "an accident, including continuous or repeated exposure to substantially the same general harmful conditions." Id. at 63. The policy excludes from coverage any "bodily injury'... [that is] expected or intended from the standpoint of the insured." Id. at 51. This exclusion, however, "does not apply to bodily injury' resulting from the use of reasonable force to protect persons or property." Id . The general policy insures Peck Investments up to $1, 000, 000 per occurrence, or $2, 000, 000 in the aggregate. Id. at 46.

A number of add-on endorsements "change[] the policy." See, e.g., id. at 79. Two endorsements are relevant here. First, an "Assault or Battery Exclusion" Endorsement explicitly excludes from coverage any

"bodily injury"... or medical expense arising out of assault or battery or out of any act or omission in connection with the prevention or suppression of such acts, including failure to warn, train or supervise, whether caused by or at the instigation or direction of the insured, his employees, patrons or any other person.

Id. A separate "Assault and/or Battery Limited Liability Coverage" Endorsement, however, provides that Western Heritage will pay "all sums [that the insured] become[s] legally obligated to pay as damages' because of... bodily injury'... to any person arising out of an Assault and/or Battery." Id. at 87. Coverage under this endorsement is limited to $100, 000 per "Event" and $300, 000 in the aggregate. Id . An "Event" is defined as "an act or series of acts based on or arising out of the same assault and/or battery." Id. at 88.

The policy also provides that Western Heritage has "the right and duty to defend the insured against any suit' seeking [] damages." Id. at 50. Western Heritage has "no duty to defend the insured against any suit' seeking damages for bodily injury'... to which [the policy] does not apply, " however. Id . The assault and battery endorsement similarly provides that Western Heritage

will have the right and duty to defend any suit against [the insured]... [but] shall not be obligated to pay any claim or judgment or to defend any suit after the applicable Limit of Liability shown in [the endorsement] has been exhausted... [Western Heritage] will have no duty to defend the insured against any suit seeking damages' to which this insurance does not apply.

Id. at 87. The assault and battery endorsement explicitly limits Western Heritage's liability to "damages, " meaning "a monetary judgment, award, or settlement, " but "not includ[ing] criminal restitution." Id. at 88.

II. Procedural History:

In December 2012, Derrick Lark and Antuan Jones filed separate tort lawsuits in the Roanoke County Circuit Court ("the underlying actions"), naming Peck Investments and several individual Schooners employees as defendants (collectively, the "Peck Defendants"). In their respective complaints, Lark and Jones each allege that they were assaulted by Schooners employees outside the restaurant on December 4, 2010, resulting in serious bodily injuries. See Jones Complaint, Answer Ex. 1, Docket No. 4-1; Lark Complaint, Answer Ex. 3, Docket No. 4-3. In ...


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